hi

What about an IMF&ECB joint action in sustaining these fragile european countries by huge lending offers ?It’s been demonstrated in the previous phase of the crisis in western europe and the US, thanks to Gordon Brown, that a strong public guarantee limits the market impact and thus eases the resolution of the financial problem in all its dimensions, including the actual need to spend acutal money in aid.

Libor coninues its southward journey as TED narrows and shares in banknote companies soar. Bernanke has broken with tradition and declared his defacto support for Obama and the necessity for huge stimulus. Perhaps there is a movement afoot to nationalize the equity markets – meanwhile over at Merrill, newly appointed Peter Kraus will be collecting as much as $25 million in severance after 7 weeks on the job… nice LIBOR TED Spread

Money is debt, and its printing out of thin air.

@ AllI’ve only got a minute to check in here, so can’t do justice to the Professor’s post above. I have hoped that Eastern European growth would cushion the EU in the coming years, but perhaps I was over-optimistic.Rich H/Miss America will be guest-blogging for me on the London Banker page on Friday, so be sure to check in then and give him some support and encouragement. As many long term commenters here will appreciate, Rich was has a tremendous talent for reading the cash flows of the investment industry and translating that into market timing. He understands the implications of the liquidity facilities being innovated by the Fed and Paulson, and his perspective on how events will play out will be well worth the read.I will be back the following Friday, with many adventures and some new perspective to share.

Satyajit Das points out an erroneous assumption that the hedge funds hedged their CDS exposure. They neededto get the upfront premium to pad their earnings fromtheir pessimal investment returns. Hedge funds have substantial cds exposure and it is not hedged. If they can’t pay, the counterparty pays!A Warning Sign From LehmanCDS Settlement Offers Window Into More Banking ProblemsOctober 20, 2008(CBS) CBS News Investigative Unit’s Kim Lengle wrote this story for CBSNews.com.Worries are mounting that some banks and hedge funds that sold credit default swaps (CDS) on Lehman Brothers’ debt might not have enough cash to make the big payouts they promised.The settlement date is tomorrow, Tuesday, October 21 which means that a transfer of cash must be completed. That’s when CDS, which guarantee to compensate trading partners for losses on Lehman bonds, need to be paid out.Credit analysts predict some firms could take a huge financial hit amounting to billions of dollars in combined losses.“I believe it was a tragic error for the Fed to allow Lehman to go under,” Weil, Gotshal & Manges Senior Partner Harvey Miller told CBS News. Miller who is currently overseeing the Lehman Brothers bankruptcy added, “It’s not a contained situation.”The concern is whether the paying side of the swap will be able to make their payments. Swap sellers are required to make up the difference on the price of the debt if a company goes bankrupt. Because the price of the Lehman debt was set at 8.625 cents, it means Some of the biggest players on Wall Street will now have to pay 91-cents-on-the-dollar for those contracts, if they can afford to.If the sellers of the swaps can’t afford to pay up, the counterparty who bought the so-called protection will be forced to take the losses as well.Outstanding Lehman Brothers’ CDS have an estimated value of $400 billion.No one knows just how many CDS have been traded or whose balance sheet they are on because the market for these swaps is unregulated. The International Swaps and Derivatives Association recently estimated the market at $54.6 trillion. But since there is no central clearinghouse, trade volume can’t be tracked and publicly posted.The Depository Trust and Clearing Corporation (DTCC) put out a press release last week saying that worries about Lehman swaps are overblown. DTCC, which runs its own voluntary trade registry, says outstanding CDS only total $6 billion.“That’s the sunny side of the street,” said Satyajit Das, a former derivatives trader and author of Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives.Das says the $6 billion figure assumes that all of the sellers took out additional investments to effectively cancel out the risk they had with Lehman but believes this is not the case, particularly with hedge funds.The CDS market doesn’t require financial firms to keep capital in reserve in case they have to pay off their bets.Das says he thinks there will be some problems tomorrow in terms of the payout but says this is the first sign of just how deep the CDS problem could run. “This is a test for the market, but there will be a lot more to come,” said Das.By Kim Lengle© MMVIII, CBS Interactive Inc. All Rights Reserved.

Art Cashin’s Tuesday outlook: break out or break down?

Screw Hungary!! The US economy has fallen off a cliff! My 3rd qtr GDP est now stands at -4.52% with data through September!!!The Chicago Fed National Activity Index was −2.57 in September, down from −1.61 in August. Most of the index’s decline in September was driven by the steep drop in industrial production, as reflected in the contribution of the production and income category of indicators. However, all four broad categories of indicators made negative contributions to the index in September.

any word on the Lehman CDS settlements?

SINK WHAT PIG!! GOIN GREEN BABY! DOW CLOSE 9278 TODAY!!

I’m Hungarian. I do not think you have to ignore (like JimmyTheBanker) what’s happening in Hungary. Hungary is a small country (10 million), but in the middle of Europe.You remember the Great Depression? The first failed bank was Creditanstalt located in Austria. Some Austrian banks have subsidiaries in Hungary. If one of them will fail then I’m sure the domino effect will start. And not only in Eastern Europe, Austria will follow etc…So, this is a dangerous situation for all of us.

However the people in Hungary are relaxed. Business as usual today. 99% percent can not imagine a default of the country.

just like Iceland but with far more serious consequences – the post above is exactly right, this is a dangerous situation for all of us.

Nouriel,I’m not an expert, but I think, what we need is the same what ECB have got from the FED: the swap line. We need a swap line to ECB EUR/HUF. Perhaps more then 5 mrd EUR as of today. It is not really a huge number for a country. If the eurozone, Japan, Switzerland, GB) get’s it from the FED, then we should get it from the ECB.I’m not sure our problem is much bigger than Western Europe has. What would Switzerland do without a USD swap line? They would be in a same danger as we are.How do you see?

I do not really like the comparison with Iceland.1. Non of the Hungarian banks ever invested in any US assets2. We have 65% of debt (GDP), Iceland have much more. I do not know the exact figures, but most of them is in our currency (forint HUF).So, we are in a much better shape as Iceland was.Hungary will not default in a short term, I’m sure.

10:46 a.m.[C] Goldman Sachs tells clients to sell Citigroup10:46 a.m.[C] Goldman puts Citi on “conviction sell” list

If we create swap lines for all currencies and countries for U.S. dollars, wouldn’t we suck up all foreign currencies and eliminate all talk of baskets of currencies or regional currencies. We would have only one, in the form of U.S. dollar domination. The neocons would be proud.

@ John Ryskamp (previous thread): Now we are shifting from idiotic “bailout” schemes to equally idiotic “stimulus” schemes. The decline of the Baltic Dry points to a catastrophic decline in economic activity, which no stimulus package on earth will turn aside…”The proof is in the pudding…er, the shipping.

What is a “PPT?” Is it a company, or corporation, or a multinational thingy? Does it pay good money to its employees? If so, how to apply for a job?

This reminds me of a never ending Monopoly Game, It’s time to reset the board and start over, however the central bankers and top players don’t want to stop playing. So they keep printing out more monopoly money to hand out to all the losers in hopes that new money will keep the game going. This is going to get more ridiculous by the day, to keep this game going the world will have to create another board much larger than the individual boards that we have now. To keep the Fiat money system going on a world scale the board builders will need digital units of value instead of paper. They will need to outlaw private ownership of Gold and destroy the currency value of other metals. World tax system, world police, Digital credits only please. A million points of light, do you see another option?

I wonder if one solution for Hungary could be to accelerate its accession to the euro. The fiscal effort would be balanced by a reduction in interest rates.

On Bloomberg site. Argentina to nationalize all private pensions in order to stave off default on debt. Argentine stock market down 8%.

And it will help the EEM economies as well, given the origin of the products in those stores.Some may argue, however, that what the American public really needs is a lesson in frugality and personal financial responsibility. Another piece of plastic to replace their tapped out credit cards might not be the best tonic

Guest, I couldn’t agree more! US citizens have lived well beyond their means for a decase now and all that supply of credit is now gone. That is what politicians fail to realize, personal balance sheets should be dowgraded to BBB in the US and no bank is going to just give away money anymore. Japan showed us that you can lower rates to 0%, but you still can’t force bnaks to lend nor people to borrow…

Furthermore, some of these banks have now turned around and said that they may use Paulson’s cash injection to go on a buying spree and look for takeovers. Doesn’t sound to me like these banks were quite as desperate (financially) as the Gov’t made out. Looks a lot more like they gamed the system, so they could swallow up their competition. Why is the taxpayer funding something like this???PeteCA

Just wait till the shoe drops on business loansGlobe and Mailby DEREK DeCLOETOctober 21, 2008Henry Paulson said it with the confidence of … well, of a man who used to run Goldman Sachs. His scheme to pump a quarter of a trillion dollars into America’s banks “is an investment, not an expenditure, and there is no reason to expect this program will cost taxpayers anything.”This goes to show what an Alice-in-Wonderland place the market has become. Private investors, whose sole reason for owning stocks is to make money, have been losing it like it’s 1931 again. The U.S. government, whose sole reason for buying bank shares is not to make money but to make credit easier, could break even, or even turn a small profit. Or so the Treasury Secretary says.If nothing else, it proves the man has learned from his earlier mistakes. No more labelling it a “bailout” and getting the Joe Six-Packs riled up. Let’s focus on the positives, shall we? This is now a potential money-maker, or at the very least, not a money-loser. It’s smart messaging.Why isn’t the stock market buying what Mr. Paulson … continue reading

Off topic but thought its funny:http://gawker.com/5063337/the-secret-pleasures-of-dr-doom

why not just create swap lines all over the planet?

PPT!PPT!PPT!PPT!

Nobody speaks about a well known conspiracy theory, about the world currency.These swap lines pointing to this direction.

Cut payroll taxes = money in wage earner’s wallets at their next paycheck

NOuriel has lost his mind. EVERYTHING in his opinion has the risk of leading to “serious financial contagion.” As if finance isn’t already contaminated. Why is he simply advocating that governments bankrupt themselves in order to pay off theft? Hungary is an example of PURE CORRUPTION. It is corrupt from top to bottom. And now he is prescribing austerity+bailout. This is simply privatizing gains and socializing losses.All the nonsense he has put forward to “stabilize” the “financial system” hasn’t done a thing. Why not? Because ECONOMIC ACTIVITY IS DECLINING. Why can’t this little technorobot keep his eyes on the facts? Nothing he has suggested has done, or will do, anything to increase economic activity. Nothing. Not in the long term, not in the short term–never. He is simply a Goldman mole. Disgusting.Now comes this: are we also supposed to bail out the mutual funds industry, because if we don’t, it poses a “systemic risk?” Nouriel is junk, garbage. When everything is systemic risk, then nothing is systemic risk.Oh and by the way, Baltic Dry is still a disaster area.Oct. 21 (Bloomberg) — The Federal Reserve will provide up to $540 billion in loans to help relieve pressure on money- market mutual funds beset by redemptions.“Short-term debt markets have been under considerable strain in recent weeks” as it got tougher for funds to meet withdrawal requests, the Fed said in a statement in Washington. About $500 billion has flowed out of prime money-market funds since August, a Fed official said.The initiative is the third government effort to aid money- market funds, which in stable times are a key source of financing for banks and companies. The exodus of investors, sparked by losses from the aftermath of the Lehman Brothers Holdings Inc. bankruptcy, contributed to the freezing of credit that threatens to tip the economy into a prolonged recession.“The problem was much worse than we thought,” Jim Bianco, president of Chicago-based Bianco Research LLC, said in a Bloomberg Television interview. Policy makers are trying to prevent “Great Depression II” by stemming the financial industry’s contraction, he said.JPMorgan Chase & Co. will run five special units that will buy up to $600 billion of certificates of deposit, bank notes and commercial paper with a remaining maturity of 90 days or less. The Fed will provide up to $540 billion, with the remaining $60 billion coming from commercial paper issued by the five units to the money-market funds selling their assets, central bank officials told reporters on a conference call.Backstop ProgramThe new program is called the Money Market Investor Funding Facility, and officials said it’s intended as a backstop for money-market mutual funds to use as needed to meet redemptions.Today’s action shows that two programs set up last month by the Fed and U.S. Treasury to help money-market funds haven’t stabilized the industry. A Fed official told reporters today that the funds don’t have much of a liquidity buffer remaining.Last month, the Fed agreed to give emergency loans to banks so they can buy commercial paper from money-market funds. There was $122.8 billion of such loans outstanding as of Oct. 15. The Treasury separately used a $50 billion emergency pool to offer money funds guarantees against losses.“In terms of the redemptions money-market funds are seeing, and hedge funds as well, any of these moves by the Fed are going to help,” Mike Holland, chairman and founder of Holland & Co. LLC in New York, said in an interview with Bloomberg Television. He predicted redemptions will ease.

Any idea how to make money from the misery of Eastern european countries like Hungary? Any short plays? or is it too late?

This is what I see between the elections and next summer:Treasury auctions have few foreign biddersFed prints money to buy treasuriesInflation in fungible commodities, as creditor countries divest from dollars, and are willing to exchange dollars for essentials.Dollar selloff gains steam. Gold, oil etc price rises as US interest rates also rise.Foreign and domestic dollar holders try to get anything of value for their dollarsHyperinflationDollar run and crash. US bank runs, bank holidays, oil shortages and rationing, etc.This makes me sad. Please tell me how it is flawed.

wow, so Fed prints money to buy treasuries because no one else will?

Rally underway!

“ECONOMIC ACTIVITY IS DECLINING”That I believe. But it will not be visible in the official GDP numbers;-)

“I believe it was a tragic error for the Fed to allow Lehman to go under,”Oh, and we should toss this bomb directly on the masses rather than allowing these folks to eat their own mistake? Sorry, but this is a painful lesson to these folks that they should never again contemplate such bad practices!

= greater government debt, which means print more money, that or dump the debt in the laps of our future generations (though the later won’t work because the interest on this debt has to be paid and there will be less and less people willing or able to chance it; the same outcome could be said for printing more money).

This is a contrarian (sp?) signal that the worst is yet to come when “business as usual” consensus is prevalent on the street.

“There can be no more iniquitous alliance than to have the politicians at the service of the bankers, unless perhaps it is to have the military at the service of the bankers too.”London Banker’s Jeffersonian words over the weekend still ring in my ears like a rifle shot in the middle of the night.As Americans, the danger we face is far more critical than financial collapse. Here, said Hamilton, the people rule. But after the years of stealing, cheating, war making, currency corruption and lying, all that the people have been able to manage lately is to shut down the switchboards “where the people rule.”What could be more graphic than undistinguished congressmen, acting tough, pretending to understand taxpayer rage, and all the while demonstrating total ignorance of the economic problems?Using banker talking points, these “representatives” of the people hurried past jammed phone lines to catch their flights in one of the weakest, most cowardly chapters in American history.Meanwhile, with his bosses carting away America’s treasure, the scholarly Benjamin Bernanke labeled corrupt thieving private companies that brought the world’s biggest economy to crisis…companies that are “systemically critical.”Bernanke’s bosses, we all know by now, aren’t congressmen or presidents. The spectacular performance of Henry Paulson, the bosses’ main spokesman, would make Pierpont Morgan look like a phone bank volunteer. Paulson, Goldman’s most famous star for all times, was a vision in action…here on the talk circuit, there brow-beating the banking committee, here romancing Nancy Pelosi, there dragging Bush to public announcement after announcement (perhaps writing his speeches and telling him where to stand).Unfortunately, the private interests that brought us this dazzling taxpayer robbery are interested in more than estates, yachts, jets and Dubai skyscrapers and personal pleasure (how about that “relationship” inquiry now involving IMF’s Strauss-Khan?).No, these master string pullers traffic in power: power to pick winners and losers, power to leverage corporations and foreign governments…power to grant or deny a nuclear power plant, a hydroelectric project, war materials, agricultural projects for thousands of acres, matching cheap labor to exploited resources around the planet. True, there’s money to be made in almost every project but added muscle from the IMF, the World Bank and the U.S. State Department turn credit into more than just money…it turns credit into world political power.But credit isn’t enough.Only a superpower such as the U.S., with a stockpile of tactical nuclear weapons, battle ready carrier groups and the best equipped army in the world can give the string pulling financiers the political power they need.Now, as financiers scramble to save their ill-gotten bacon, the options for them to use U.S. military power as carrot and stick leverage are dropping fast. There are two reasons for this: One, the neo-con foreign policy they promoted has isolated the U.S. from the world’s power centers as never before. Two, the American middle class is signaling its intentions finally to move beyond complaining and phone calling about destruction of its earnings — and its strongest anger is directed toward corporate government…banker crooks, plutocrat billionaires, toady congressmen, and war for profit.It holds, no less, the fate of the world in its hands.

Let’s not confuse socialism with what is in reality facism. Every use of the word socialism in the MSM and by policital campaigns has been misapplied. Facism is the enemy in the U.S. and globally. At least in socialism you have in theory wider distribution via statism, facism is a consolidation of distribution to a few via corporatism.

Paulson just did a victory lap through the NYSE to a thunderous applause from the traders (well maybe not thunderous) – reminded me of W declaring victory in Iraq almost 4 years ago to the day.

They,…they….they…who are they?

Charts say this market explodes green in 15 minutes….

BOOOOMMMM PPT IN EARLY TODAY, NO MELTDOWN ONMY WATCH!

Things that make you go hmmmm…Kirk Kerkorian looks like the Grinchhttp://www.marketwatch.com/

WOw-Dow up 180 points from its low!

Dow only down 40 points now. This is crazy to watch. Too bad our economy isn’t as exciting as stocks on a daily basis.

In 1998, in “Bailout Mania,” Jeffrey M. Herbener of City Grove College wrote:At last, the world has a lender-of-last-resort, a menacing Fed for the world, and its name is the IMF…{A]s Ludwig von Mises showed, the interest-rate driven boom must end in bust since the newly created money cannot be confined to the credit markets. Instead, it will be spent again and again to buy consumer goods. Interest rates will eventually be pushed up again, and capital values and stock markets will collapse. The boom comes to an end.{John Maynard] Keynes recognized that the extent and duration of the artificial capital accumulation during the boom depends on the international monetary regime. The U.S., home to the world’s reserve currency, is able to extend its booms further and for longer periods than any other country by “exporting” its monetary inflation…This is precisely what has happened. Consider the paradoxical movement of the stock market and the GDP. The meteoric rise in the stock market, up about 28 percent per year for the six years of the boom, has resulted from the twin causes of low interest rates and high earnings.The relatively anemic increases in GDP, about 2.5 percent per year during the same six years, coincides with an overseas boom in investment and production. This overseas boom does not count in the U.S.’s GDP. The U.S. economy dwarfs that of its foreign partners, so this transfer of production will lower our growth rate but greatly increase growth in smaller economies.On the 1996 list of developing countries that received the largest amount of foreign, private investment, Indonesia, Malaysia, and Thailand rank third, fifth, and sixth. The regions of East and Southeast Asia received nearly half of the $243.8 billion in foreign, private investment.China, now called the next economic miracle, has been far and away the largest recipient of foreign, private investment since 1992. It received $52 billion of these investment funds in 1996. To the extent that these capital projects are fueled by central-bank inflation, they are part of the “exported” boom. (If China escapes financial collapse, it will be due to its pace of privatization.)To continue their domestic booms, adjunct countries must refrain from conducting an “independent” monetary policy. They must coordinate their own central-bank monetary inflation with the Fed’s. If instead their central banks pile domestic monetary inflation on top of the “imported” dollar inflation, domestic price inflation will rapidly follow, since they cannot “export” their own monetary inflation.If they try to delay or deny the decline in their currencies’ purchasing powers by linking or pegging their currencies to the dollar, then instead of smooth, gradual decline they will face swift and massive devaluation. Devaluation, like its domestic counterpart price inflation, pushes interest rates up, causing capital values and stock markets to crash.Evidence that this process was in full swing in Thailand was obvious in 1997. Its central bank had been inflating the baht at higher rates than Fed inflation of the dollar. Flush with funds, Thai banks extended loans to riskier and riskier projects ending up with speculative indebtedness in the expanding real estate bubble.Thailand’s central bank responded to the advent of devaluation in typical fashion by abruptly halting its monetary inflation and, in an act of desperation, increasing its demand for the baht by using its dollar reserves to purchase the baht in international currency markets. Neither of these measures could overcome the force of the previous monetary inflation.The upward spike of interest rates from the decline in the baht’s purchasing power and the reversal of central bank monetary inflation and credit expansion caused the real estate and stock markets in Thailand to crash. The Thai stock market fell 45 percent since the beginning of 1997. Suddenly the growing and profitable banks of yesterday were bankrupt as the value of their collateral collapsed and the number of bad loans soared.Far from poor entrepreneurial judgment or lack of vigorous regulatory oversight, bankruptcy is an inevitable part of a central-bank-induced business cycle. It is the downward counterpart to the artificial expansion of bank loans and capital values of the boom. From the S&L debacle of the 1980s, to the continuing banking problems of Japan in the 1990s, to the current problems in Southeast Asia, the pattern is the same.The Thai experience has been repeated with other Southeast Asian currencies. The Malaysian ringgit, Indonesian rupiah, Philippine peso, Singapore dollar, and Korean won all fell to speculative reassessment. Their currencies, stock markets, and banking systems collapsed. Malaysia’s market fell 48 percent, Indonesia’s fell 30 percent, Phillippines’s 45 percent, Singapore’s 33 percent, and South Korea’s 24 percent. (China is up 40 percent since the beginning of 1997.)The nature of the international dollar-reserve system explains another aspect of the Asian currency debacle. What the U.S. government must avoid, if it wants to avert a similar financial debacle, is a repatriation of dollars held abroad…Any significant disgorging of these holdings would set in motion price inflation in America and the resulting upward spike of interest rates would result in a stock market crash, bankruptcy, and liquidation, quickly bringing our boom to an end.Of these enormous and increasing foreign holdings, tens of billions of dollars are in the hands of the central banks of the Asian Tigers. Thailand spent about two billion dollars of its reserves to defend the baht before being dissuaded from this policy and convinced to let the baht float.What convinced them was an IMF bailout of $17 billion. As with Mexico’s $50 billion bailout in 1995, the IMF arranged to compensate Thailand, and now the other Asian Tigers, so that defending the currency peg became unnecessary. For its part, Indonesia enjoyed a $23 billion gift from the IMF following its currency debacle.More bailouts are planned. The IMF recently announced (1997) that its 181 members will increase its capital base by $285 billion, a 45 percent increase, to be the international lender-of-last-resort to bail out countries bankrupted by their own folly and greed. By increasing the incentive to inflate money and credit, this new role for the IMF will result in more frequent and severe international debacles…The real lesson of the Asian currency crisis is this: only God can perform miracles. Central banks and the IMF merely produce inflation, business cycles, and financial crises.http://mises.org/freemarket_detail.aspx?control=98

Stocks are downInterest rates are downGold is downOil is downHome prices are downCommodities are downEmployment is downThis does look as deflation, doesn’t it?

Guest on 2008-10-21 11:56:40It is not nice. But it is not unusual all around the world.But you know the story behind?Microsoft (Ballmer) came to Budapest to make presser on the Hungarian government for renewing a software license of Windows in some public segments. And there are always guys who do not like if the own government is blackmailed or there is a corruption behind.

Anonymous, as a Hungarian I do not recommend shorting the Hungarian market. I’m also a short seller, but I’m making my money on other markets like shorting the DAX.

“they” are simply “they”They are not to be named.[evil hollow laughter]

AHHHH GREEN!!

Too many dominos all falling at once-Iceland, Korea, Argentina, Hungary-to be followed by larger dominos until it all falls apart.

Probably the US taxpayer picked up the tab via the Feds new TPBOFL program or ” Taxpayer BENd Over For Lehman”

Seconded. Are there any indications who might replace Paulson, if indeed he would be replaced?

the play by play Guest, stocks going green guy is really, truly annoying and dilutes the content here. GO AWAY! if you have something meaningful to say please do, otherwise, please please please go away. look at a chart of a daily market it goes up and down. shall we all become guest who type look the market is going up or gee look the market is going down. please spare us !

The Charmed Lives of the Crony Capitalists: How the Banksters are Making a Killing Off the Bailout By PAM MARTENS | October 17/20, 2008 CounterPunchIn 1897, when 8-year old Virginia O’Hanlon posed her Santa Claus query to the New York Sun, she received a heart-warming editorial response reassuring her that “He exists as certainly as love and generosity and devotion exist…”Today, we hand our 8 year olds a $13 trillion national debt while our Congress hands Wall Street banksters the national purse without so much as a hearing to determine the cause of the debt collapse. Worse still, the money is doled out to the very same individuals who leveraged their institutions to casino status.Americans are correctly outraged at the spectacle of U.S. crony capitalism crashing stock and bond markets around the globe while simultaneously watching the poster boys of crony capitalism on Monday, October 13, 2008 march up the granite steps of the United States Treasury building in their Armani shoes and heist a fresh $125 Billion of taxpayer dough in broad daylight.The U.S. Treasury Secretary, Henry Paulson’s, $700 billion bailout plan to buy up distressed mortgage assets has spun off its own $250 billion subsidiary plan (skipping that pesky detail called taxation with representation) to inject $125 billion in equity capital into 9 of the biggest commercial and investment banks in the country. Another $125 billion may possibly go to smaller regional banks and thrifts, assuming they will sign on to the deal.And what will taxpayers get for their investment in these financial firms whose stock prices are getting hammered as the public recoils in revulsion at what they have done to our financial system? The taxpayers, who were not invited to send their own legal representative to the negotiating table, will receive a paltry 5% dividend, exactly half of what Warren Buffett received for his recent investment in General Electric, a company that actually makes something real, like jet engines and light bulbs.Now we learn from the U.S. Treasury web site that it has hired the law firm of Simpson, Thacher & Bartlett to represent our taxpayer interests going forward at a cost to us of $300,000 for six months work. But we’re not allowed to know their hourly wages; that information has been blacked out on the Treasury’s contract. Curiously, the Treasury has named in its contract the specific lawyers it wants to work for us. Two of those are Lee A. Meyerson and David Eisenberg. Mr. Meyerson has been a central player in facilitating the bank consolidations that have led to the present train wreck, including building JPMorgan Chase from the body parts of Chemical Bank, Chase Manhattan and Bank One.Mr. Eisenberg has played a central role in the proliferation of the credit derivatives blowing up on the books of the Frankenbanks created by Mr. Meyerson. Here’s what the Simpson, Thacher & Bartlett web site says about its relationships and Mr. Eisenberg’s work (see link):…This is an unconscionable conflict of interest given that JPMorgan Chase is receiving $25 billion of taxpayer funds under this bailout and that the program is very likely to be buying the very toxic waste for which Mr. Eisenberg wrote legal opinions and assisted in proliferating.What most Americans do not understand, because mainstream media rarely explains it, is the incestuous relationship between the U.S. Treasury and this small band of financial marauders who busted the entire financial system with insane levels of leveraged derivative bets… FOR THE REST OF THE STORY:http://www.counterpunch.org/martens10172008.html

Capone, Capone. Indulge me. I love Stocksgoingreen, and I miss Stocks-to-the-Moon. He captures the action and it’s part of the day’s history, isn’t it? Soooooooo. Tell him you’re sorry. Hmmm? For me?

Add me (anonymous guest #84928429) to the list of people who would miss SGG in his absence. Levity is a good thing these days, and frequently in short supply…I think he also highlights the absurdity of these markets these days. Seemingly no amount of bad news can deter these stock markets… it’s silliness.

And at least Stocks… identifies who he/she/it is (well sort of) and besides when/if Obama wins we’ll all be singing “cum by ya”, whether we want to or not.

I heard Jamie Dimon from JP Morgan. Can you belive that BS?

3 years ago,I was with a group of stock holders of a certain company.We researched “naked shorting (counterfeiting of shares)” of said company by brokerage houses with the DTCC’s (settler of the trades)blessings.Even though there was no outstanding shares on the market,the brokers sold all authorized shares on a single day.When we wrote Anne Nazereth of the SEC enforcement,she blew us off as whiners.The DTCC is an arm of the Federal Reserve and as such can authorize naked shorting (counterfeiting of shares) to settle trades at the DTCC.This is why long term positions should have stock certificates in your name with you in possession of those certificates.If you buy stocks using Etrade,Ameritrade,…the shares are in their name not yours.The DTCC can print shares as easy as the FED and print money.

I also heard robert reich and tim Geithner of the FED

WOW! I don’t know if you folks notice but the second after SGG said he/she was “taking my buyers with me” The Dow sold of over 200 points!

The aggregate value of US Fed and Treasury programs is approaching the $3T mark including the brand new $600bn program announced just today to further backstop money markets. That is not to say the $3T number is an expense but it is an indication of just how far behind the curve Hank and Ben were and just how lucrative these programs will be for Hank’s friends. At the very least it should help to replace some of the easy money the ibanks had become accustomed to not to mention the potential for shenanigans.

John Corzine will be the leading candidate if Obama wins

ETrade is toast-halted after-hours

Robert Rubin, aka Goldman Sachs/Citigroup, was an “advisor” to Hilliary Clinton and after her demise marched straight into Obama’s camp without missing a beat. Here’s hoping Obama is only superficially listening to him and will discard him after his election to the oval office. I don’t think Obama would dare return him to the Treasury given the nation’s sentiment against Goldman Sachs. But…

The US model is alive and well! When rules get in the way, waive them!Double dipping, anyone?The United Nations, with a headquarters staff of approximately 15,500, is apparently relying on a battalion of retirees to fill important vacancies. The cost of keeping codgers on its payroll to do jobs that full time employees apparently cannot handle has soared from $33 million in 2004-2005 to $50 million in 2006-2007.In the process, the world organization appears to have been violating its own limits on how much retirees are allowed to earn after they take a U.N. pension, and how long they can be kept on the job. Those rules were seemingly designed to prevent double-dipping by former workers, or the filling of jobs that might otherwise go to full-time staff.But one small group of pensioners, 135 people in all, appear to have done far, far better than anyone else in breaking through the post-retirement salary ceiling. That group, consisting of higher-level professional and administrative employees, and representing little more than 10 percent of the total number surveyed, pulled in $11.4 million, or more than 20 percent of the amount spent on the growing post-retirement work force, according to an internal U.N. study on the group.

4:37 p.m. U.K. likely in recession, Bank of England’s King says

4:43 p.m. [AAPL] Apple late traded shares halted last trade at $93.32

any news on Lehman CDS settlements?

Completely corrupted, no big surprise.Lets call it United Nothing!

I heard it could be as late as tomorrow AM – between that and Apple it should be another interesting day

Does anyone have an idea of a safer currency to start accumulating if the dollar devalues? Swiss Franc, Euro, British Pound?

shortage? at the rate Fed is printing it there should not be any. I think this guy must be joking.

errr fed = treasury

The short answer to your question is Gold.There is no “safe” currency in this environment, but if the USD deflates, gold will rise. Other countries will certainly start running their printing presses to keep their currency at relative weakness to the USD, so even currencies that you might be told are “safe” are at risk in a hyperinflation environment.However, no one can print Gold. I like it over any other commodity just for the simple fact that it has a long, long history as the flight-to-safety repository of wealth, and when doubt flies all around, people will (many very reluctantly) put their money in this useless metal.–Brian

Ha ha!!! The next thing Nouriel will be saying is that we need to bail out China because, if we don’t, it will present a “systemic risk.” Look:Professor Glyn Davis, who runs an exporting business called University of Melbourne (he and his staff teach 11,000 foreign fee-paying students), was in China last week visiting his main market.Usually, he says, when students return to China with their Melbourne degrees, it’s just a matter of choosing which job to take. The cost of the degree is more than covered by the salary premium they command; the investment is always worthwhile and the demand for places is therefore always strong.Last week Professor Davis found that most of the graduates he had sent back in July were still looking for jobs. The few who were now employed had found that their salary premium had shrunk dramatically.The Melbourne University vice-chancellor, and convenor of the 2020 Summit a few months ago, had another indicator to share with a small group over lunch at Austrade yesterday: he just received his first letter from parents – in Singapore as it happens – asking to defer their child’s tuition fees because the father has just lost his job in the financial sector. He agreed, but expects to get many more of these letters.The optimism of the 2020 Summit over that weekend in April seems a long time ago now. With its focus on creativity, governance, indigenous issues and sustainability, it already feels like part of a lost Australian era.The final report from the economic stream chaired by former Westpac CEO David Morgan, entitled ‘Future of the Australian Economy’, opened with these words: “Big challenges confront the Australian economy – among them the reality of ongoing economic change and competition, the aging of our population, climate change, and the continued projected expansion of China and India. We must be ready, and we must devise ways to grasp the opportunities presented in a way that reinforces our national values of opportunity and fairness.”Now, just six months later, we must devise ways to survive the decline of China and India, and none more than the convenor of the summit, and Australia’s largest exporter of education to Asia.Andy Xie, the Shanghai-based economist who used to work for Morgan Stanley, said at a conference in Dubai recently that China is actually in crisis: “Forty percent of its GDP is generated by exports. Now, for the first time ever, exports are grinding to a halt. In addition, the real estate bubble has burst. These two sectors were responsible for more than half the annual growth in our GDP.”On Monday the Chinese government reported that GDP growth had slowed from 11 per cent to 9 per cent, its slowest growth for five years. Sherman Chan, an analyst with Moody’s in Sydney, told the Los Angeles Times yesterday that if growth in China dips below 8 per cent, the conditions would be equivalent to a recession.A consumer products analyst based in China, Michael Dunne, said: “China will not compensate for falls in the rest of the world. It’s not going to be the saviour.”Yesterday I discussed the fall in the Baltic Dry Index of shipping rates caused by the refusal of banks to produce letters of credit, which is causing shipping to grind to a halt.A trade adviser based in Sydney, Sri Annaswamy, wrote to me last night to correct me, explaining that it’s not that shipping is being affected by the credit crisis – it’s that banks don’t want to open or honour letters of credit “that they know would ultimately be defaulted upon due to the Chinese buyer’s refusal/inability to accept the shipment (that’s the core of the problem)”.In other words, the problem with shipping, as he sees it, is not an extension of the counter-party risk issues that are crushing the credit markets – it’s caused by a more fundamental concern about the future of the Chinese economy.By the way, Sri kindly forwarded to me an email he had sent to his clients yesterday explaining why the decline in the Baltic Dry Index points to a global recession, and is perhaps the best economic indicator that includes China. It is worth republishing in full:“The Baltic Dry is a composite index of shipping freight rates across 20 odd major dry bulk carrying routes and covers all three types of ships – Capesizes, Supramaxes and Panamaxes. The index is dominated by the large capesizes (150,000 tonnes plus) ships which operate on both time charter and voyage charter basis and typically carry raw materials for steel manufacturers (iron ore and coking coal mostly) who in turn make steel for automobile manufacturers as well as building and construction companies.“As the supply capacity is very difficult to adjust up and down (large capesizes cannot be created or destroyed without at least a few years time), it gives an accurate indicator of the forward-looking volume demand for iron ore and coal from manufacturers. Hence, it serves as a very reliable forward indicator of the level of global manufacturing activity.“For example, if steel makers are buying more iron ore, it means their projected demand from car companies and builders is looking very strong and vice versa.“China obviously is the biggest iron-ore and coal demand driver and Brazil and Australia are the biggest iron-ore supply drivers.“Because it is not distorted by financial market considerations and impacted mainly by volume shipped, it is a very robust indicator of the level of global trade and economic activity (in my opinion).“Hence it points to a serious global recession, now, in my view.”

I’ve also played the game (version 2) with Arthur, George, Paul, and Alan (big family!). I don’t get it — I just can’t seem to win no matter who I’m playing against!

The problem is not the settling of swaps. The problem is that, as I have said for two years now, ECONOMIC ACTIVITY IS DECLINING.There is only one thing which will increase economic activity: banning housing evictions.And look! Now even Paulson is on Rose saying that he has to prevent millions of home foreclosures!!But that is not what I want, and they know it. Just read my wonderful, insightful book, The Eminent Domain Revolt. What genius wrote that tome?!?These fascist clods, and their little fascist potted plant lawyers, know perfectly well that, in scrutiny regime terms, the demand is for an elevation in the level of scrutiny for housing. And what elevation, you ask? Just check out page 15 of my book. I offer these scummy dogs SIX new levels of scrutiny for housing, in addition to intermediate and strict.We are currently fighting a struggle, and it is ALL about page 15 of that book. I even offer them a teeny weeny increase in the level of scrutiny for housing above minimum scrutiny. It is, direct scrutiny, which says that policy with regard to housing must “articulately facilite a frequent government purpose.” That is just a tiny bit more protection that current Lindsey v. Normet minimum scrutiny, which says that policy with regard to housing must “rationally relate to a legitimate government purpose.”Will the political system even grant the SLIGHTEST elevation of scrutiny for housing? Hell no–even at the same time they are all saying they want to prevent home foreclosures.Why not? Because1. it would mean that the government has to show RESULTS for its policies; and2. it would enlarge the number of FACTS relevant to determining whether a housing eviction should go forward.Together, these things mean decreased power in the political system over housing, particularly MONEY.So remember, this current debacle is occurring because of ONE THING: the American political system’s resistance to even SLIGHTLY increasing individually enforceable rights in housing.Our little Mussolinis are perfectly aware that ALL the facts demand this higher level and that there are NO facts in support of maintaining housing at minimum scrutiny.This is the reason I say that economic activity will never increase as long as the level of scrutiny is not increased for housing. Until this issue is resolved in FAVOR of raising the level of scrutiny for housing, deals simply will not get done. For the obvious reason that parties to ANY contract relating to ANY fact relating to HOUSING, cannot know their contractual rights and duties. Would you sign anything, knowing that this conflict exists? In lieu of actual deals, the political system is trying corporate fascism. It failed for Mussolini, Franco and Hitler, and it will fail for Brown Brothers Harriman (hello George, you darling love monster you!).So this is the inner, true story of the current crisis. As I have said before, it is not a financial or economic crisis. It is a rights crisis.Stayed tuned kiddies!

Stop it already with this ridiculous idea. You can ban housing evictions.No one in the US would pay their mortgage, and the economy would be destroyed in 15 minutes.Talk about moral hazard. Think about it. If no one could be evicted, would anyone pay? NOAll banks would go bankrupt. All financial institutions would be obliterated. Every credit card and ATM would stop, and the entire world would be without any financial instrument instantly. Like, within 15 minutes of the announcement.Total chaos, riots, and probably global destruction as society totally collapses with runs on food, water…Come on man. Stop posting about what is suicide for the human race. Yes, we are in for a deep depression and an uncertain future, but anything is better than what you’re proposing.

I agree with you and comment:Leadership should govern by example and be held ultimately accountable – not by word, but in deed.As with the CPI which has be progressively changed over presidential periods to avoid the scrutiny and thus the judgment of political leadership “deed”, so has most, if not all, such oversight mechanisms and so much so, that frog sitting in the pan in the water on the fire, doesn’t realize that it is dead.Now, the bureaucracies have gone along with these changes; cpi, housing, etc., and should also be held accountable; not just the political ‘godhead” – which I totally agree with @ PeteCA, must be the object of the pointed finger of “j’accuse”.But, we the people, are also accountable because we put the morons in office (because we believe their promises to us that we would get something too) and we put up with the lying cheating bureaucracy and their abuse of office; so we are also responsible and subject to accountability.Therefore, what is happening is a systemic socio-economic shift (collapse / change / breakdown) where we must place blame correctly on “leadership”.Yes, this is a “leadership” crisis, for all the stated reasons and no amount of “fix” will get this donkey to remain in the race.

Everyone on cue stop paying your debts and watch how quickly the bankers will be destroyed.

Personal observation about GOLD.Back in Feb. I bought some gold coins in San Diego for $20 above spot price.Three week ago from the same dealer. I put order to buy some gold coins for $60 above spot price.Today, I went to get delivery of my Am. Eagle, and for curiosity I asked what is spread today, the dealer told me it is $100.I just would say woooooo!

I second Mark

True. But in February 2008 they published an alert about the coming economic shocks to the U.S. in September 2008:According to LEAP/E2020, the end of the third quarter of 2008 will be marked by a new tipping point in the unfolding of the global systemic crisis. At that time indeed, the cumulated impact of the various sequences of the crisis (see table below) will reach its maximum strength and affect decisively the very heart of the systems concerned, on the frontline of which the United States, epicentre of the current crisis. In the United States, this new tipping point will translate into a collapse of the real economy, final socio-economic stage of the serial bursting of the housing and financial bubbles (1) and of the pursuance of the US dollar fall. The collapse of US real economy means the virtual freeze of the American economic machinery: private and public bankruptcies in large numbers, companies and public services closing down massively (2),…

The Sheriff of Cook County Illinois (that’s Chicago) has announced a couple weeks ago that he would not enforce any evictions for mortgage defaults.We’re still here in Chicago.Your pontificating is rather dumb-looking. Ryskamp is talking about reality. Are we really going to throw a large percentage of America out of their homes? Will stability prevail while it happens and afterwards? That would be more like “suicide for the human race”.The human race is not the banks. Duh.

Which ones of us were missing this guy? Can we send him back again? I am remembering now why we appreciated his eviction from here.John,Really, for Christ’s Sake! Stop with you beloved tome. I have not read it (nor do I have any intent to) but if it is as full of the diarrhea of the keys you spew here, it must be a real page turner.Your arguments are ill formed and pre-suppose that anyone here knows what the hell you reference for legal cases. Your terminology seems to be unique to you which translates to: If we can’t follow your argument, you are just a guy who writes for his own ego. Sorry pal. I’m thus far not impressed with anything other than the fact that you somehow managed to get a book into print.I suspect it was self-financed or done by some tiny publisher who was anxious to get anything out there.Write so you can be understood or go back to whence you came and don’t bother to return.

I am in San Diego also. Today I went to LA and sold 95 gold eagles and 4 10oz gold bars. They had no stock till I sold them mine at $50 over spot, so they can sell around $90 over spot. To bad I didn’t know you wanted some. Hopefully I will be right this time and the dollar will continue to strengthen, at least temporarily. Unfortunately I got lost in the noise, and did not listen to those who said the dollar was on steroids!hlowe

Medic, your apparent attempt at critique, while unnecessary, is weak. Low enough already, your blasphemy puts what remains to the torch. Why is it that non-believers in the Creator of the Universe can find no other words to support their failing ideas than to invoke the name of that Creator?

Let me see if I got this right.A) Using threats of financial collapse and martial law, George Bush pushes through an $850 billion or more bill that gives Paulson a blank check.B) 70% of the American people oppose the legislation.C) Paulson can’t decide how he wants to spend the money, but selects a favored few banks including his former investment bank.D) Now Paulson hires PricewaterhouseCoopers and Ernst & Young to manage the deals, but guess what, the basic elements of the deals are shrouded in secrecy.http://bailoutsleuth.com/E) Today another $450 billion discount window opened.It’s one thing to intellectually understand what is happening to our country, but its a completely different to watch it unfold. We are so screwed.

Perhaps, the same “solutions” do not apply to “this bigger economy” because the IMF/World Bank is a vehicle for moving capital from the United States and other industrialized nations to underdeveloped nations, the very ones over which Marxists have always had the greater control. Says G. Edward Griffin, “They looked forward to the day we would pay their bills. It has come to pass.” The hidden agenda behind the IMF/World Bank is world socialism. Its current managing director, Dominique Strauss-Kahn, is a Socialist/Communist. President of the World Bank is Robert Zoellick, former managing director of Goldman Sachs and a signatore of a letter drafted by the Project for a New American Century to President Clinton calling for “removing Saddam [Hussein]‘s regime from power.”The IMF/World Bank is patterned after the Federal Reserve System that allows American banks to create money out of nothing without paying the penalty of having their currencies devalued by other banks. Says Griffin, “It was the establishment of a world bank which would create a common fiat money for all nations and then require them to inflate together.” The IMF promotes monetary cooperation between nations by maintaining fixed exchange rates between their currencies. The World Bank makes loans. As PeterJB reports, graft runs as high as 60 percent.The IMF is funded on a quota basis by its member nations: the greatest share comes from the industrialized nations such as Great Britain, Japan, France and Germany, with the US contributing the most.One of the routine operations at the IMF is to exchange worthless currencies for dollars so the weaker countries can pay their international bills, often owed to investment bankers such as Goldman Sachs. This is supposed to cover “cash-flow” problems. According to Griffin, “It is a kind of international FDIC which rushes money to a country that has gone bankrupt so it can avoid devaluing its currency. The transactions are seldom paid back.”Harry Dexter White was America’s chief technical expert and the dominant force at the Bretton Woods Conference that established the IMF/World Bank. He eventually became the first Executive Director for the U.S. at the IMF. White was simultaneously a member of the Council on Foreign Relations (CFR) and a member of a Communist espionage ring in Washington while he served as Assistant Secretary of the Treasury (See David Rees, “Harry Dexter White: A Study in Paradox,” 1973; and Whittaker Chambers, “Witness,” 1952).The goal of the IMF/World Bank as seen by co-authors White and Lord John Maynard Keynes is to create a world currency, a world central bank, and a mechanism to control the economies of all nations…the United States eventually is to be reduced to just one part of the collective whole.

The Sheriff refused to enforce evictions of RENTERS whose property was forclosed because the LANDLORD defaulted, and his primary disagreement was in cases where the renters had not recieved notice, or in some cases short notice of the eviction. He agreed to enforce evictions provided that there was better tenant notification.Neither blanket eviction or blanket ban of evictions is practical.

WEDNESDAY, OCTOBER 22, 2008|SUDDEN DEBTFood And DrugsTwo charts from our “less commonly publicized economic data” Dept.· Americans receiving food stamp assistance rose to a record 29.05 million persons in July 2008 (latest data available). That’s 9% more than a year ago – and that’s before the credit crisis started hitting in earnest.· People are starting to cut back on drugs – the prescription kind. According to a NY Times article, the number of filled prescriptions has dropped for the first time in at least a decade.No more comments needed… Ok, just one: don’t bet on permagrowth in the medical services sector, either – ageing baby boomer effects notwithstanding.http://suddendebt.blogspot.com/

yup,pension funds,its “amazing” the thing is not discussed in the US,wonder will bushie,BB and Hanks taps into US pension funds (they havent tap into that rite??!!)well i take it back its not amazing, nothing amazes me anymore

The US already spent the social security trust fund and the FDIC fund. The states will tap the pension funds.

“Don’t you think that the scenario of either Obama or MaCain ruling the World is mindboggling frightening?”Why is it more frightening than Clinton, GWB, Gordon Brown, Sarkozy, Putin being in charge?None of these puppets rule the world. They just work for the banks. As does the mainstream media. And the military.

Alessandrodo you stock prayers??

Emerging Market Bonds, Currencies Drop on Argentina ConcernOur friends just purchased a pied-à-terre in Buenos Aires’ recovering market. Wonder what this will do to the AR Peso.

<font color=”red”>Isn’t the issue of “money being debt” merely philosophical?It is not like the money printed by the Treasury HAS to be paid back to the Treasury.

I found this Paul Solman interview on PBS last night with Nassim Taleb and mathematician Benoit Mandelbrot to be one of the most disturbing things I’ve run into in the past 12 months (old hat to some here, I’m sure):http://www.pbs.org/newshour/rss/redir/http://www-tc.pbs.org/newshour/rss/media/2008/10/21/20081021_solman.mp3SWK

question is it better to know armageddon awaits the us or to be among the masses and part of the group / herd standing around going “oh my this is terrible.” “gee, i hope this bill fixes it.” i don’t know about you, but very few folks want to believe or hear the truth. outside of here, it is a somewhat lonely place knowing what is coming ultimately hyperinflationary depression when noone else believes or knows. maybe they can’t handle it. the hardest part is now that we are essentially proven correct since the market already crashed, the same people who ignored the 500 million warnings still do not want to hear about NOR acknowledge that you were right ! this reality has been VERY difficult to deal with personally where I work where I warned until i was blue in the face and $40 to $50 million + in losses later – they still don’t believe and they come nowhere near saying Gee this guy was right and asking what maybe next? i guess they have it all figured out OR just maybe they were not meant to have that money after all…

Roubini to guest host CNBC America today October 22, 2008 — for your information if you go to cnbc.com they offer a 7 day free trial for their cnbcplus live streaming service

Don not forget to include highway maintenance taxes (Congress slipped the gasoline tax into the general fund the same way it did the social security fund).

hey, it is not any more corrupted than Washington.Washigton may be more accountable, though (perhaps).

Mayor Bloomberg: Economic crisis already costing New York $1.5 billion in lost taxeshttp://www.nydailynews.com/money/2008/10/21/2008-10-21_mayor_bloomberg_economic_crisis_already_.htmlyet in other newsIRS clears way for tax dollars to help new stadiums, arenashttp://www.nydailynews.com/money/2008/10/21/2008-10-21_irs_clears_way_for_tax_dollars_to_help_n.html

If you missed it they will have lots of video clips on their site that they put up 60 to 90 minutes later. It’s great as the permabulls face off with superbear Roubini

It was a weird interview. These guys are the first I am aware that have called it the “worst economic event since the American Revolution.” Yet they really only had a gut (black swan) feeling to fall back on. The fact that these guys are well known, no, make that famous individuals that would not be prone to rash statements gives me pause.The crux of their argument seems to be “unknown” intricate relationships control by a relatively few large banks. So rather than stabilize our credit problem, they feel the Paulson bailouts are exacerbating the problems through unintended sneak paths in the economic system. MBS -> CDO -> Hedge Fund -> Fire Sale -> Asset Deflation -> Bank Credit?They did not say this, but they would probably agree that the dry shipment letter-of-credit squeeze is one of those sneak paths. And they feel that these types of problems will seep throughout the system, even to the point where Kroger cannot get its inventory shipped across country.

Dear Professor:We all just saw you on CNBC. Throughing Pearls at the Swine! They are anesthesized! Excellent parting comment!The failure of economic policy has been an exercise in market fundamentalism. Pragmatic Skepticism would haveallowed us to navigate this economy!

Question to this site IT specialists:Is there away to add a sequence number for every next comment submitted?This would make it much easier to go to the latest comment (provided you remember the last one you read).

And here is a link to Art Cashin’s comments this AM on CNBC – for traders his is a voice of wisdom:Art Cashin Oct 22

A problem (a huge mass of foreign currency denominated loans) has built up over a long period. We want to solve it quickly, and without a loss to the borrowers, the banks, the taxpayers. It’s not possible.Even if loans are redenominated (it takes time…), the liability side will still be there with the self-reinforcing cycle: buy euro – repay debt – forint weakens – buy more euro at higher prices – repay more debt (not renewed) – …

Notice the beautiful triangles forming in the charts? These generally break out with a continuation of the primary trend which is down.They are also classic wave 4 of Elliot wave theory.A,B,C,D and E of a contracting triangle.It looks like we are currently (9 AM Central time) approaching point D SP500 @ approx. 890.If correctly read,we will bounce off 890 approach 940 (point E) on Thursday or Friday.Breaking down and out of the triangle to a wave 5 low under 800 on the SP500.This will also be a signal for trades to reenter the market long for a month or two.

Things are changing so fast none of us can keep up. In addition to the freight problems the fx markets are in disarray with many em currencies falling off a cliff. Imagine making a contract in which you wanted to hedge your fx exposure now.It looks like the Asian crisis of 10 yrs ago when Bahtulism spread through the region bringing what were considered well-to-do countries to their knees. Only it seems to have gone global.

what happens to people that own an etrade account?

looks like morning panic is over.

NEW THREAD

Some hatred of Mr. Ryskamp! He may be touching some sensitive nerves …

The dealer I use will received some from the mint next week.hlowe

The control bankers have over the world has always been absolute but only now in crisis can we see it in the open.

Hi Martin,Nice to see you back and posting again!The blog has changed a bit since you were last here, but I’m all ears for anything you have to say.–Brian

Well, then I might be in that 1%.I think the game is over for Hungary. The country has lived well above it’s possibilities. To much money has been borrowed and spent not on investments but daily pleasures.My guess is that Mr. Roubini has been invited by the Hungarian PM to give his advice. I can’t say that the Hungarian PM is a gentleman, because after Mr. Roubini has left, the PM has attributed such comments to Mr. Roubini, that he has never made. Mr. Gyurcsány says that Mr. Roubini blames the opposition for the current Hungarian financial crisis. Who can trust a man who says: “We lied in the morning, we lied in the evening and also at night.”Listen to Mr. Gyurcsány (translated) on this link:http://www.youtube.com/watch?v=cZGbz00n8-QThe words of PM Ferenc Gyurcsány:”There is not much choice. There is not, because we have screwed up. Not just a little, big time. No country in Europe has screwed up as much as we have.It can be explained. We have obviously lied for the past one and a half, two years. It was perfectly clear that what we were saying was not true. We are beyond the country’s possibilities to such an extent that we could not conceive earlier that a joint government of the Socialists and the liberals would ever do. And in the meantime we did not actually do anything for four years. Nothing! You cannot mention any significant government measures that we can be proudof, apart from the fact that in the end we managed to get governance out of the shit. Nothing! If we have to give an account to the country of what we have done in four years, what are we going to say?”

How to prevent a financial crisis in Hungary that would lead to serious financial contagion in Emerging Europe?My point of view is: Hungary should drop out from the EMS2 and floating the forint. The country is to far away to join the euro currency area. The early floating prevents a potential currency crisis with its ugly outcome. The central bank dont have to fight againts it and can keep the interest rates down. A real devaluation of the forint should stimulat the exporting industries (Hungary is a typical “workbench” for the developed european countries)