First!

the latest from Miss Americahttp://www.rgemonitor.com/globalmacro-monitor/255439/alt_energy_chapter_2__net_meteringEnjoy.

Hayes:You called it! Wow!……125 points in 20 minutes! I’ve seen better though…..a few months ago, I saw the dow go up 400 points in 5 minutes! What a great free market!

Have you been ZIRPed? Then fight! Your weapon is the Internet.SAVERS ARE BRITAIN’S NEW UNDERCLASS by Ross Clark (The Spectator UK)We are divided into two nations once more, says Ross Clark. Reckless borrowers are helped by government bail-outs, while those who have sacrificed to save are abandoned…The financial crisis…has opened up a new crack in society. The real social and political battle in Britain is no longer between rich and poor, between flat cap and top hat; it is between financial roundheads and financial cavaliers. In the former camp we have savers, homeowners who have foregone holidays to reduce their mortgages, conservative businessmen, people who rent because they were unable or unwilling to borrow large sums at the height of the property boom. In the latter camp we have overmortgaged homeowners, buy-to-let investors, bankers who still have a job, estate agents, most large retailers, property developers and, it would seem, the Socialist Worker.But the…debate does not do justice to the hard feelings between those left frothing by every bank bail-out, every reduction in interest rates, and those who squeal for more help, blaming miserly savers for worsening the recession…[T]he recession of 2009 is the first to be played out in the age of the internet. You didn’t have to dig far this week to sense that the Roundheads are becoming mutinous. With the announcement of the second big bank bail-out, there were demands for the boards of the big banks to be jailed and calls for a mass go-slow on the nation’s motorways to protest at the public debts being run up in the name of stimulating the economy. Meanwhile, no billions could be enough for the property companies and other businesses which were simultaneously responding to the bail-out by releasing statements to the effect that it was ‘good as far as it goes’.Broadly, the Roundheads’ position is this: that it is a fundamental rule of capitalism that while risk pays rewards, those who get it wrong should pay for their errors. The government and the Bank of England, however, seem intent on saving the reckless and punishing the prudent. The government lifted not a finger to discourage the build-up of debt during the good times, yet now tries all it can to re-inflate the bubble. If a government is going to be laissez-faire on the way up, it should be laissez-faire on the way down, too. House prices and share prices should be allowed to fall to a sensible level, and the prudent rewarded through the opportunity of picking up cheap homes and shares. Any attempt to bail anyone out will just encourage reckless behaviour and lead to another speculative boom. As for deflation, so what if cash appreciates in value? It probably won’t anyway: the government is following a hugely inflationary policy which is likely, sooner or later, to provoke hyperinflation.The Cavaliers’ position is this: yes, of course, it is terribly unfortunate that banks and other businesses are having to be bailed out and that taxpayers and savers are going to have to foot the bill, but the economic crisis is too serious to start trying to apportion blame. After a collapse of the banking system, the worst thing that could happen is general deflation. That would ruin businesses and individuals and lead to another Great Depression which would suit nobody. All serious people are Keynesians now: we must all hold our noses and pump money into the economy. Savers must grin and bear it. In any case, saving is a bit of an anti-social activity: in the longer run no country becomes rich by squirrelling money away… Risk-takers are heroes who need encouragement, even if they did get it a bit wrong this time around…But when, in October, the banking bail-outs began and the Bank of England followed the US Federal Reserve by slashing interest rates, a horrible prospect began to enter the heads of those who, either through wisdom or laziness, had managed to keep their money in cash through the boom years: is the government going to try to help bail out borrowers by stealing from savers? Suddenly, the boot was on the other foot: were the Cavaliers going to come out on top after all?Since then, the government has done all it can to justify the Roundheads’ fears. Virtually every week comes a new initiative to bail out homeowners in some way — homebuyers struggling with £400,000 mortgages can now apply for a two-year holiday on the repayments, underwritten by taxpayers. Interest rates have continued to plummet to the point at which many savings accounts now pay less than 1 per cent in interest. The next move, the Chancellor has acknowledged, may be to indulge in ‘quantitative easing’ — that’s printing money, to you and me — a move previously associated with Mugabe’s Zimbabwe. While homeowners and shareholders continue to nurse losses, savers now are also haemorrhaging wealth — with inflation still running at 4 per cent, there is a negative real interest rate of 3 per cent on most savings accounts.Sensing an opening in what had been a taut political consensus over the banking crisis, the Conservatives finally broke free and proposed that taxes be cut on savings accounts. To judge by an often quoted statistic — that there are seven savers for every borrower… Cameron’s initiative has chimed with a huge constituency and may well be the leading factor in his recovery to double-digit poll leads.As for the borrowers, they have gained a new hero in the shape of Times columnist Anatole Kaletsky, who two days after Cameron’s initiative penned a piece with the title ‘Punish savers and make them spend money’. ‘The next logical step, although it might be politically controversial,’ he wrote, ‘would be to do the opposite of what the Tories suggest. Instead of reducing taxes on interest payments, the government could tax all bank deposits and other risk-free savings …the result would be more consumption and physical investment, less unemployment and faster recovery from the slump.’The piece provoked an international uproar, not merely accusing Kaletsky of wanting to steal from the prudent to give to the feckless, but threatening a nuclear response. The blogs came alive with aggrieved savers threatening to withdraw their life savings and bury the money in the garden: you try to tax our savings, in other words, and we’ll bring down the banks, Northern Rock-style, by queueing up round the corner for our money…As for me, I’m with the Roundheads. I don’t care what my house is worth — it is still the same house whatever. I can take my shattered share portfolio on the chin: it was my silly fault for buying the things. But if the government starts trying to erode my cash pile in order to try to bail out the sharp-suited spivs and tarty blondes who only 18 months ago were smugly boasting about the fortunes amassed on the back of what has turned out to be empires of debt, then I am going to fight tooth and claw. If this financial crisis does end with revolution I am going to be there with the savers, lobbing Molotov cocktails at the chancers who got us into this mess. I think I can guess, from their previous behavioural responses, which side is going to run out of petrol and bottles first.http://www.spectator.co.uk/the-magazine/features/3300136/savers-are-britains-new-underclass.thtml

I am soooo sick to death of all this over-simplification of “savers” and “chancers” I could scream!!People think they can just jump into the equation in the middle of it and ignore the true beginning.Never mind how wages have been stagnant or declining for decades, I was just SO IMPRUDENT to have lost my employment through no fault of my own so long ago!!!!!! The only reason I could need help is because I was SO IMPRUDENT.!@#$%^&*()_+!@#$%^&*( !!!!

@ Cahill – I always seem to be posting replies to the last thread as it ends, and have managed to do same today. Wanted you not to miss this reply I made to you there:Greenspan knew what he was doing and he did it anyway. I propose that after he’s dead we dig him up once a year and shoot his carcass as a national holiday! Sheesh! How can we be so blind as we are being??????By Mother of God! on 2009-02-04 06:45:07MOG,You and I don’t see eye to eye on a lot, but that Greenspan idea was one of the finest I have ever heard! I love it!By Cahill on 2009-02-04 17:08:34my reply:And I’m only HALF joking about it, Cahill – and we can add the Cheney and the Kissinger and some others to the holiday. It would be a good reminder to us to keep teaching every new generation about the mistakes humans made in the past and the consequences of those actions.On the flip side of this idea is this: People who have “D’oh!” moments should be held up as heroes – their photos oughta be put on the front pages and they should be honored on teevee and given free tacos or something.I’m telling you, Homer Simpson is smarter than most people. Homer is at least capable of having “D’oh!” moments, when he suddenly realizes how very wrong he has been getting it. We modern humans feel embarrassed and ashamed to have anyone know we have been getting it wrong, and that’s backwards to what we need. Having “D’oh!” moments is a wonderful thing for people. Having the big “D’oh!” moment should be cause for celebration and honour. Having the big “D’oh!” moment makes us safer and happier!It’s the dog doo-doo we don’t see that we step in.”D’oh!”

Whatever Geithner has in mind to protect the bank shareholders and bondholders is theft from the taxpayer. Geithner was the Head of the New York Fedbefore coming to Treasury. He is representing the shareholders of the Fed not the Taxpayer. The bankstook too much risk and failed! We cannot pay “CASH FOR TRASH” nor can we practice “VOODO ECONOMICS”.We must do what is best for the citizens and taxpayers.http://tpmcafe.talkingpointsmemo.com/2009/02/05/are_we_going_to_buy_the_bezzle/Congressman Brad Miller states!……Goldman Sachs economists estimated a couple of weeks ago that losses from all debt—residential mortgages, credit cards, car loans, commercial real estate, business loans—was now $2.1 trillion, and only $1 trillion of that had been written down by the financial institutions holding the debt. “Loss recognition by US financial institutions still has a long way to go,” a Goldman economist said.Not surprisingly, Nouriel Roubini is less optimistic still. Dr. Doom estimates that losses for U.S. financial institutions could reach $3.6 trillion, about half of that losses to banks and broker dealers. “If that’s true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion,” Roubini said. “This is a systemic banking crisis.”So who can we believe? Financial institutions’ own valuations of their assets? Standard & Poor’s computers? The price actually paid for an identical asset in a single recent transaction? Goldman Sachs’ economists? Dr. Doom?Some prominent economists appear to put more faith in Roubini’s analysis than in financial institutions’ valuations. Joseph Stiglitz, a Nobel laureate in economics, calls the rumored plan to buy such assets swapping “cash for trash.” Paul Krugman, also a Nobel laureate, calls the plan “Wall Street voodoo”- “the belief that by performing elaborate financial rituals we can keep dead banks walking.” ….

From John Browne post today:Citi and Bank of America, two of the three most important money market banks are technically insolvent. Yet, each has received $45 billion in TARP funds.These two banks have total exposure of some $78 trillion to derivatives. Most importantly, they have almost $6 trillion of exposure to highly toxic Credit Default Swaps. Even JP Morgan has more than $9 trillion of exposure to these assets.The Government TARP and stimulus packages now add up to some $3 trillion. Already, they have caused political consternation and pose serious challenges to America’s credit rating and ability to extend further its towering debts, without crowding out viable corporate borrowing. What will happen when all of the private bank liabilities get thrown on top?The money center banks render the TARP and, indeed, the total financing ability of the U.S. Government almost insignificant. In short, they have become too big to bail out.It appears that America and the world are staring into the face of financial collapse, depression and eventual hyperinflation. Little wonder that, despite the growing evidence of recession, gold is rising in price.

Even the CNBC talking heads are in revolt! Dylan Ratigangiving his case for Nationalization.http://www.thedailybeast.com/blogs-and-stories/2009-02-05/nationalization-now/

You’re nothing but a mugger. There are two sides in this heist, and you’re on the one that wants to take other people’s money and put it in their pockets.

The Group of Thirty – take a look at its membership – including a host of bankstershttp://www.group30.org/members.htmMy favorite is its Chairman Jacob Frenkel – who has been Vice Chair of AIG since 2004 …

It isn’t new for savers to be shafted.From Elaine:The government in 1933 took severe measures, unilaterally, without debate or Congressional approval, in order to kill the value of the currency, not protect it. This was viewed, back then, as astonishing and horrible by people who saved money. People who were relabeled as ‘hoarders’ rather than ’savers.’ The basis of all banking is savings. When the banks make too many loans and these go bankrupt in concert, as all bubbles do, the banks have to pay off the dead loans and their capital declines. They need more savings.When the banks are bankrupt, there is no point in supporting the currency so the need to reduce debts becomes all-important. Devaluing and debasing the currency and then letting people pay debts with fake money, is the ideal solution. For borrowers, that is, not savers. Savers are simply cheated. Cheated savers hide wealth when this happens. Instead of parking it in banks, they hide it in tins like the example I gave, earlier. Banks need to be recapitalized and to do that, they have to charge a sufficient interest to attract savings. But the government needs cheap lending so it can pay for a depression so it wants ZIRP. To recapitalize the banks, confiscating gold and handing it over to bankrupt banks is the ideal way for dealing with savers.Excerpted from here:http://emsnews2.wordpress.com/2009/02/04/1933-terrorizing-people-into-handing-over-gold/

“Revolution Insurance”Check out this clip of Lawrence Lindsey interview on The Daily Show. The best bit starts about 5 minutes in. Stewart does a fine job of rebutting Lindsey’s more nonsensical ideas.Very interesting to see revolution openly mentioned on a mainstream show.http://www.thedailyshow.com/video/index.jhtml?videoId=217029&title=lawrence-lindsey

thanks for cheering me up!

The Group of Thirty is nothing more than a non-governmental body that acts as the government. It is a banker pool from which the elite draw to control world finance.Long before Barack Obama won the Democrat Primary contest, the Group of Thirty included Geithner, the future treasury secretary; Volcker, future senior economic advisor to the White House in a position to be newly-created; Summers, the future director of the powerful White House National Economic Council; and bailout media-economist Krugman, the future Nobel prize winner and guru apologist for explosive-government spending for the incoming Obama Administraton. (Coincidental?)In a May 26, 2008 article entitled “Fed’s Geithner Says World Economy Is Coping With U.S. Slowdown,” Bloomberg referred to this Group of Thirty at its Jerusalem hosted event as the G-30, “a private group mainly of current and former central bankers…”In a related article on May 26, “Group of 30: the Conclave of Financial ‘Geniuses’ Meet,” Elaine Meinel Supkis, writes: “The US is leaderless right now. But the international ruling elites, the international brain pool, the international noogies who paw all over each other at Davos or Paris or New York, these guys will slog onwards without any US leadership. They are what they are: the Real Rulers…http://elainemeinelsupkis.typepad.com/ezmoneymatters/2008/05/group-of-30-the.htmlAs you, Hayes, earlier pointed out: The Group of Thrity includes “Volker, Krugman, Geithner, Trichet and Summers. Other members include a cross section of Central bankers, politicians and Goldman, JP Morgan types.”The Chairman… Dr. Jacob A. Frenkel…on May 3, 2004, was appointed Vice Chairman of American International Group (a position he still holds) and Chairman of AIG’s Global Economic Strategies Group. Prior to AIG Dr. Frenkel served as Chairman of Merrill Lynch International Inc. and as Chairman of Merrill Lynch’s Global Financial institutions and Sovereign Advisory Groups.”Gentlemen: Hold on tight to your wallets!

It takes a man of strong resolve, they say, to be president of the United States. Mr. Obama will have to confront parents of the young men sent to die in Afghanistan. And he’s already had to have a dreaded conversation this week with Tom Daschle. For it was Daschle’s efforts that just possibly were one of the key reasons why Obama won the presidency.Even though pulling Daschle’s nomination was probably the suggestion of Emanuel and Axelrod, the president would have had to make the phone call personally. For it was Daschle who very early on threw his support to Obama. It was Daschle who tirelessly pressed his very close friends in the U.S. Senate to refrain from giving Hillary Clinton an early endorsement as the campaigns began the first primaries.And it was Tom Daschle, with arguably the best Democratic Rolodex in town, who continuously struggled to keep super delegates from committing to Hillary as the tight race wound through the last primaries.Yes, Mr. Obama met the resolve test with Daschle when it came to protecting the higher purposes of his administration. Of course, you can’t expect that resolve to meet the tax cheating massive conflict of interest problems of the Tim Geithner nomination. Hey, do you want to be president or not? If the answer is yes, then you’d better learn that this country is run by the money monopoly, not your presidency.

Oh, and someone else agrees with Stewart’s idea that stimulus should go directly to the masses:”In an economy where 72% of GDP is the engine of success that sector has to be catered too. As unemployment rises income stops and as house prices fall asset depreciation takes place. At the same time 10% inflation eats away at buying power. These are the people who need help, not Wall Street and the bankers. The stimulus of $850 billion should go to the public to spend and to pay down overdue bills. In fact a lot more than $850 billion is needed, probably 10 or 15 times that amount. This could get America back on its feet. The dollar would fall 40% or 50% against other currencies but so what. It is going to fall anyway with all the trillions of dollars being injected into the financial sector. In this process we could get rid of the Fed and the income tax.”http://www.theinternationalforecaster.com/International_Forecaster_Weekly/Acts_Of_Insanity_Are_What_Destroyed_The_Economy

“Actually, the depression was cured when, after WWII, our industrial might was intact. The industrial capacity of everyone else was decimated to one degree or another. The world had to turn to us because we were the ones still standing.”… and the new deal kept the masses fed and busy and gave them enough hope to avoid a revolution so there was still an economy to recover after WWII

if you have money in a bank account then you have been speculating

And McCain showed himself as much more knowledgeable and committed. If we only had him and Joe the plumber in charge this whole mess would be fixed by now.

Anything that isn’t “gimmee more cheap labor and social hierarchy” is Kryptonite to right-conservatives. Their fantastical denials about the New Deal that’s made them seeth for decades make me laugh.(And I ain’t a democrat, either.)

BAC goes from a high today of 4.85 to a low of 3.77 and after the terrible unemployment report goes back up to 4.85; I guess Timmy is going to guarantee them another 50-100 billion soon.

And speaking of actually jumping into what is the middle of the equation and kidding ourselves we’re at the beginning of the whole thing…“This way to the museyroom. Mind yor hats goan in!” (JJ FW p8)I drew some passionate heat as soon as I arrived in this forum for “daring” to say that we human-chimpy bears of little brain are not to blame for our mistakes and we should blame god…but it is quite obvious that we did not create ourselves, we did not choose it to be the case that we humans are all working with limited intelligence, we did not say to Mother Nature ‘Hey don’t bother rebuilding our brains from the ground up…just slap a layer of cortex over those reptile remnants we’re still outgrowing and away we go!’ No, we didn’t create ourselves. We would not have chosen to have limited intelligence, limited wits, with which to make our way through this situation we fell into that we call living our life. We are not the beginning of the equation so to speak, we’re in the middle of it.My friends, I really think the place we have to start is with forgiving ourselves, so we can fall back in love with ourselves and with life. I think we’re stuck in a poverty of horizons, mostly, and maybe mostly because of mis-placed guilt – ‘cause we’re forgetting the beginning of the equation. I think we should be giving the blame for our mistakes to whatever you think it is created us, because I think freeing ourselves from guilt that isn’t really ours would enable us to learn from our mistakes like never before and it would empower us to make the kind of progress we must make.Trust me just once, on this – God and Mother Nature have very broad shoulders. They can bear the burden of carrying their own guilt quite nicely, thanks. Give them the guilt and love them with all your heart anyway, because they gave us everything, everything, everything we have – including the knowledge/awareness of our own existence.I seriously think that God’s scientific name is Existence (when asked he said my name is I AM (not I am this-or-that) and I AM = IS = Existence…as in existence existing eternally and nothing left out) …I think “Creator” is a Rascal, an infinitely loving Rascal, and the original sin is God’s because it was a sin to create – a sin against the perfect infinity to create our imperfect finity from it and that the reason “he” did create was because god was a great treasure but he was unknown and he wanted to be known (and we are like ‘him’ and that’s why so much of our lives is about our desire to be known, understood) but the sticky bit is that the only way to create was by using the alchemy of opposites (rainy days are here because we wouldn’t know what “sunny day” is without anything to compare/contrast it to, evil is here so good can be recognized or we wouldn’t know good – everything is recognized through its opposite) and I believe maybe we are so significant we were given a huge universe to live in and we are quite simply awash in the highest pitch of lovegift though we hide it from ourselves (to make the game of life exciting, I guess) ……like life love god existence is the opposites plus the marriage of the opposites, the particulars plus the universal plus the marriage of the particulars with the universal…that our whole job and purpose is to be happy…that playing and winning the game of life means stop rejecting bits we don’t like and start accepting everything in life just IS and then doing all we can to minimize the bad and maximize the good that all just IS…that it isn’t our right to be happy it is our DUTY…to pursue our maximum happiness with our every nerve and our every second…that life is for placing your own best happiness front and center on the stage of your life in the spotlight…and that the instant you start forgiving and loving yourself this exquisitely and tending consciously to your happiness it becomes beyond obvious to you that living in a world with all smiles coming at you down the street and no frowns is your first goal in life…and it’s not then possible to be selfish in a bad, myopic way anymore and people with this extraordinary devotion to their own best happiness…caused by this shift in perspective…will actively work to get themselves a world of happy people to live in where we do what is sustainable and just…we could return to our sense…tie the boat of our own good sense back up to the wharf of reality…realize, internalize, the inescapable truth of our brotherhood including our economic brotherhood by perfect devotion to our own best happiness…which won’t fail us even if/when brother is begging for a kick in the pants……what I’m struggling to say is it might be crucial to get guilt out of our way – it is paralyzing us – to reach back into our innocence – I think it has sustenance to give us – go back and get “a beginner’s mind” – to TRULY center our devotion on our own best happiness IS to realize how inextricable it is from the happiness of the people who are our environment…and that’s the entire globe today in this modern world of highspeed communication and transportation. I am a-feared, My Dear Eggons, that we will never become rational while we’re carrying around the guilt for the entire sorry his-story of humanity’s tragicomedic foibles and follies.Ya know, I just might change my mind and have me a headstone after all someday, just so I can have this carved on it:Your mistakes are not as important as you think.OMG! Did I just say all that out loud? I can’t bear to look back at that thoughtburst I just typed – did I just commit social suicide again? (she said from a puddle of Finnegan giggles)Lots of fun at Finnegans Wake!Love soft fun at the waking of the finnegans!Life is a constantly startling miracle…and yup…relax – you’re SOAKING in it!Be bright! Be happy to each other!Tell the rich they can safely come down from their dangerous heights and we will forgive them and be happy to them when they see the light!Let’s all be Global Emperors of our own happiness!Let’s have the daffodil revolution of “humid nature is feeling itself freely at ease with the alfresco”!I swear we can do this thing – we bears of little brain can still do this thing!Let’s leave guilt in the dustbin and set ourselves to cleaning up the mess we’ve made by our dangerous partying with the idea of allowing unlimited fortunes, overpayunderpay. There are empty sour yogurt cups lying all about the living room and the drapes are torn and the trash needs to go out – and we just might be coming back to this mess if we leave it a mess. After all, we incarnated once…what’s so unlikely we do it again?*********** your little hen loves you all **********“Lead, kindly fowl! They always did: ask the ages. What bird has done yesterday man may do next year, be it fly, be it moult, be it hatch, be it agreement in the nest. For her socioscientific sense is sound as a bell, sir, her volucrine automutativeness right on normalcy: she knows, she just feels she was kind of born to lay and love eggs (trust her to propagate the species and hoosh her fluffballs safe through din and danger!)From James Joyce, Finnegans Wake (p112)Ok. Now I’ll get out of the way for the rest of today. I have responsibilities to go meet, so see yiz all later. Cheers!

does that include Zunes?

The point being??? Since Dec of last year the market has been in an “internal battle” to discount the effects of the proposed Obama stimulus plan. It sure looks like the outcome isn’t very positive at this stage, if we believe what the market is telling us right now. In other words, the dread forces of global asset deflation are vastly overpowering all the attempts by countries and central banks to reverse the process. This is not a statement about money supplies … but rather the depreciation of asset values. It looks like the process has a lot further to go.PeteCA

Actually, I thought of it more as “Give us your dollars and we’ll make them worth Change.”

n,every time you inhale you are speculating.

Elvis Has Left the MountainBy THOMAS L. FRIEDMANIn its own unpredictable way, the Davos World Economic Forum usually serves as a crude barometer of the latest mood or mania on the world stage. This year did not disappoint. What has struck me is the quiet urgency that infused so many panel discussions and private conversations here between investors, politicians and social activists. To put it crudely: everyone is looking for the guy — the guy who can tell you exactly what ails the world’s financial system, exactly how we get out of this mess and exactly what you should be doing to protect your savings.But here’s what’s really scary: the guy isn’t here. He’s left the building. Elvis has left the mountain. Get used to it.What do I mean? First, if it is not apparent to you yet, it will be soon: there is no magic bullet for this economic crisis, no magic bailout package, no magic stimulus. We have woven such a tangled financial mess with subprime mortgages wrapped in complex bonds and derivatives, pumped up with leverage, and then globalized to the far corners of the earth that, much as we want to think this will soon be over, that is highly unlikely.We are going to have to learn to live with a lot more uncertainty for a lot longer than our generation has ever experienced. We keep pouring money into the dark banking hole of this crisis, desperately hoping that we will hear it hit bottom and start to pile up. But so far, as hard as we listen, we can’t hear a thing. And so we keep pouring …A broker friend told me it reminded him of when he was a teenager and his doctor first diagnosed him as unable to digest wheat products. He said to the doctor, “Well, just give me a pill.” And the doctor told him: there is no pill. “You mean I’m just going to have to live with this?” he asked. That’s us. There is no pill — not for this mess.The fact that there is no single pill doesn’t mean there’s nothing to be done. We need a stimulus big enough to create more jobs. We need to remove toxic assets from bank balance sheets. We need the Treasury to close the insolvent banks, merge the weak ones and strengthen the healthy few. And we need to do each one right. But even then, the turnaround will be neither quick nor painless. Indeed, the whispers here were that what has been an exclusively economic crisis up to now may soon morph into a domino of political crises — as happened in Iceland, where the bankruptcy of the banks toppled the government on Monday.(Davos humor: What is the capital of Iceland? Answer: $25.)Second, we’re going to have to get used to a loss of trust. All those rock-solid people and institutions that we trusted with our money, our pensions and our kids’ piggybank savings — like Citigroup, Merrill Lynch, Bank of America — do not seem trustworthy anymore. Never before in my adult life have I looked around at every bank in my town and said, “I’m not sure I wouldn’t prefer to put my paycheck in a mattress.”The Bernard Madoff scandal, of course, has only reinforced that loss of trust. His degree of betrayal — his alleged willingness to embezzle the life savings of people whom he had known his whole life — is so coldhearted that it charts new territory in human behavior. He’s on his way to becoming an adjective. Money managers are already being asked prove to prospective new clients that their internal safeguards are “Madoff proof.”I’ve written a lot about the Indian outsourcing community, so I knew B. Ramalinga Raju, the Satyam chairman accused of embezzling $1 billion from his own company. What’s really sad is that I didn’t get to know him through his business but through an interest in his family’s charitable work. They created India’s first 911 emergency system in their home state and call centers in Indian villages, so young people there could get service jobs. Was all that a fake, too? Or was he just an embezzler with a good heart? Don’t know. When you can’t even trust a person’s charitable work, you’ve hit a new low.“We’re all going to have to learn to live with a lower level of trust in our lives,” an African banker friend said to me here. But the mind recoils at that, which may explain why so many people I talked to here are hoping that President Obama will turn out to be the guy.Like Harry Truman, Obama is definitely present at the creation of something. He is arriving on the scene “not after a war but after the same kind of shattering of institutions that a war does,” said Peter Schwartz, chairman of the Global Business Network. “His job is to restore confidence to these institutions that have been at the foundation of our economy.”That may be President Obama’s most important bailout task: to educate the country that there is no easy escape here, except taking our medicine, getting our fundamentals right again and working our way out of this, brick by brick, by getting back to making money — what was that old Smith Barney ad? — “the old-fashioned way” — by earning it.

I don’t agree with this. Another “tax”.

Q: If and when U.S. long term rates rise (10 to 30 yr.), will we experience another round of real estate devaluations?

In other words, that money belongs to you. It needs to be put into play so that you have a crack at getting it. And if you support a socialist government, your chances are very good at getting it. Not only do you want to make me spend it, you know where you want it spent — and you’ll be there, at the front of the gravy train.

What you’ve said does good: the chorus grows. And, then, the pressure:Stop CEO’s and their boards corrupting the economy.Stop the Federal Reserve from corrupting our money supply.Stop CEO’s from siphoning away our wealth.Stop Banks and Insurance companies gambling on deriatives and our pensions.Stop the SEC from supporting the Robber Barons.Stop Wall Street from becoming useless.Stop Usury fees on credit cards.Stop Bankers from creating debt on the shadow banking market.We have found the problem. It’s the Congress.

I don’t see it. A tax on trading – though a zero sum investment – only creates another pool of capital to be misallocated. As it will be if it were to get into the hands of the political/financial/30 something mutual fund sales/investment advisor community.The only solution I see is to disintermediate those intermediaries. We need real alternatives. Investments with measurable ROI. And we need to create them ourselves.Pitchforks & torches.

“We can survive and thrive in the collapse of both the US military empire, and its financial house of cards. Patriots of all political persuasions should welcome these collapses, encourage them, cheer them, and revel in them. Like the great lion with a painful but removable thorn in its paw, we the people will be far better after the military empire and financial fakery is expelled. Not corrected, not improved, just gone…“Like our shady financial dealings and our military empire, fear is vaporous, yet temporarily influential. A decade or two from now, we will certainly discover that the fear was real – but we will understand that it was the state’s own fear gone viral. We will recall how the state projected its own existential disaster on us, attempted to force we the people to own the state’s festering self-destruction, and when we resisted that toxic deal, ramped up the state’s only remaining asset – force – on the non-conformer.”What to do? A great religious leader known for challenging the state advised that we must become as little children. In our current American predicament, this might mean proceeding as any four or 14-year-old would. When the state is looking, stay alert and listen carefully not only for words, but for intent. When the state turns its back, stick out your tongue and do what you damn well please.” Karen Kwiatkowski in “The Coming Fascism”http://www.lewrockwell.com/kwiatkowski/kwiatkowski223.html

Well this would probably take more political courage than I expect exists. The key would be to somehow prevent misallocations through the guidance of the industry consortium. In this way the consortium could guide the investments in a way that benefits some overall set of goals, rather than any individual corporation or short term market forces.Think of it as a small business farm, feeding large businesses who want to get things done. The technology that is farmed is guided through the inputs of many, many stakeholders. Profit motive would only be one of the motivations. No financiers. No politicians. Rather Engineers. Thinkers. Futurists. Collaborative decisions made in the interest of everyone. Perhaps a nomination process to be a part of the decision team, based on some rather stringent rules. And no personal profit motive for anyone making the investment decisions.This idea does not necessarily require the trading tax to fund it, however the trading tax would most directly impact the undesirable behavior (trading for short term gain) to fund the desired long term behavior (investment for the future good).

backdating occurred for a decade…number chefshttp://news.therecord.com/News/article/482729

Tumult in the financial world.Bank of England slashes rates to lowest level ever: 1%http://sg.news.yahoo.com/afp/20090205/tts-britain-economy-bank-rate-forex-mone-cac1e9b.html

British interest rates remain at the lowest point since the bank was created in 1694 — 315 years ago.

European Central Bank keeps rates at 2% – ECB chief says that “zero interest rates at the moment I am speaking is not something that we would consider appropriate”http://sg.news.yahoo.com/afp/20090206/tts-ecb-eurozone-bank-rate-forex-c1b2fc3.htmlSwiss Re turns to Warren Buffett for helphttp://sg.news.yahoo.com/afp/20090205/tts-switzerland-insurance-company-earnin-c1b2fc3.html

The world’s biggest reinsurer Swiss Re turned to Wall Street sage Warren Buffett for fresh funds on Thursday after massive losses while Zurich Financial earnings plunged due to the global financial crisis .The insurance sector woes dealt another blow to Switzerland’s prized status as a major world financial centre, already under pressure after colossal losses and writedowns incurred by the country’s biggest banks, UBS and Credit Suisse.

http://www.marketwatch.com/news/story/treasury-unveil-comprehensive-financial-rescue/story.aspx?guid={6DA41B6B-24C0-4BA0-A94C-D979D66686B3}&dist=msr_6Possible components according to the story!1)change in mark to market accounting2)capital injections3)buying troubled assets4)insuring troubled assets5)FDIC mitigation proposal(feaux mods)22 billion6)foreclosure prevention Treasury 50 to 100 billion7)independent valuation board for mark to board!8)Treasury may ask for more capital(MO MONEY)9)Executive compensation restriction bone so wecan salivate and forget the other details.Geithner will announce this on Monday February 9Obviously they are being as diffuse as possible sowe can’t mount an attack. How could we even discussit? They have thrown the kitchen sink and the restof the appliances into a pot and we can only justask for Nationalization to protect the Taxpayer.

Does it matter what they call it at this point isn’t a non performing loan still a loss for the banks in terms of lost revenue?, what investor in their right mind would invest in banks just because they change the accounting rules. It would only allow banks to leverage up even more and they’re not interested in lending period because they know consumers can’t pay back so why doesn’t the government know this? That might have worked earlier on in the game but trust in the markets is not coming back simply because they allow banks to lie even more about their financial health, the truth is already out of the bag.

I’ve never in my life seen evil so up front center stage and so bold.

you should have your head examined.

Economists View debate on Mark to Market Barry Ritholtz on Mark to Market

Ponzi Definition = Take money from Peter and give to Paul.Hank Paulson’s Ponzi = Deceive and take money from tax-payer and give to Wall Street’s Bonus PoolGeithner’s Ponzi = probably same as PaulsonObama and Democrats Ponzi = Deceive and take $900B+ from tax-payer and give to (Disapear into many dubious government spendings)Tax-payer and voter = ultimate moron and loser. you are all too naive to think Obama can bring change. NO, WE CANT. Obama will be a ultimate failure.

China”Trade protectionism serves no purpose as it will only worsen and prolong the crisis,” said Chinese Premier Wen Jiabao. China is the world’s second-biggest exporter after Germany.Well, wait a minute: The U.S. Treasury Secretary Timothy Geithner says China manipulates its currency to keep it artificially low, making its exports cheaper. Plus, the U.S. accuses both China and Russia of dumping their steel.SpainSpanish Prime Minister Jose Luis Rodriguez Zapatero told his Chinese counterpart last week that both countries must reject the temptation of resorting to protectionism amid the global economic downturn.Well, wait a minute: Madrid is offering to pay immigrant workers all the unemployment benefits they are entitled to in a lump sum if they agree to leave Spain and go home, and don’t come back for three years. About 1,400 have taken up the offer.GermanyDo all these national stimulus and bailout packages constitute some sort of unfair government subsidy? German Chancellor Angela Merkel thinks so. “I am very wary of seeing subsidies injected into the U.S. auto industry,” she said. “That could lead to distortion and protectionism.Well, wait a minute:Germany’s government said Tuesday that the bank Hypo Real Estate Holding is too big to be allowed to fail. It’s already put 92 billion euros into the institution and is drawing up a new law that would allow the state to take over banks. It’s also in talks to help bailout individual companies like German tire maker Continental AG.JapanJapanese Prime Minister Taro Aso told the Davos gathering that his country would do its part: “We will resolutely fight protectionism.”Well, wait a minute: The Canadian auto workers have argued for years that Japanese car manufacturers have an unfair advantage because they keep out North American competitors while the American and Canadian markets are largely open.Brazil”Protectionism won’t solve the problem of the crisis. It’s not fair that, now that the rich countries are in crisis, they forget their talk about free trade,” Brazilian President Luiz Inacio Lula da Silva said last week.Well, wait a minute:Last week, the Brazilian government reversed a decision that would have placed restrictions on 60 per cent of the products imported from abroad, apparently due to criticism from its neighbours.Indonesia”Free trade agreements should be expanded,” said John A. Prasetio, chairman of the international co-operation committee of the Indonesian Chamber of Commerce and Industry. “This is important in these times when other countries are promoting protectionism and going against the rules of the World Trade Organization.”Well, wait a minute: Foreign pharmaceutical companies must establish manufacturing facilities in Indonesia if they want to distribute and sell drugs in the country.France”It’s extremely preoccupying that one of the first acts of the new Obama administration could be a measure that is clearly protectionist and a distortion of competition,” said Anne-Marie Idrac, the French trade minister.Well, wait a minute: The European Commission says France’s subsidies to its fruit and vegetable sector, amounting to over 330 million euros over the last decade, are against the EU rules. This week, the French government moved to help the country’s media industry by providing free newspaper subscriptions to teenagers on their 18th birthdays.IndiaKamal Nath, India’s minister of commerce, told the Davos gathering that protectionism “is a panic response” that will hurt developed as well as developing economies. He wondered how many North American auto jobs would be spared if parts companies can’t easily outsource to cheaper labour markets, like India.Well, wait a minute: India has raised tariffs on steel to protect local producers. Plus, one of the main reasons the World Trade Organization’s most recent Doha Round of talks collapsed was because India wanted to impose a special tariff to protect poor farmers in the event of a food import surge or price drop.I am confused as to what protectionism means?http://www.cbc.ca/money/story/2009/02/02/f-protectionism.html

McCain and Palin are probably better than Obama and Binder Combo. What a joke. American people made a huge mistake picking two sheeps.

@Mark & MOGJust read a good interview in the latest Seed magazine re: ecological economics. Tried to find an online link to the text unsuccessfully, so here are a few bits.Rethinking Growth:Herman Daly Applies A BiophysicalLens To The Economy And Finds That BiggerIsn’t Necessarily Better.Interview By Maywa MontenegroSEED: What underpins your optimism that people might eventually embrace a no-growth economy?Daly: We’re encouraged by a number of studies by economists and psychologists on happiness – almost all show that beyond a certain threshold, further increases in GDP really do not increase self-evaluated happiness. They do, of course, continue to increase environmental costs. That gives us some idea of what is enough.Whatever that amount is, it’s a lot less than the average per capita GDP of the United States. And this, of course, is a highly contentious point. People really don’t like to talk about limits to income. We’re now willing to talk about a minimum income, but we’re not quiet willing to talk about a maximum yet. Yet if the total amount of economic growth is limited then that should be on the agenda as well.SEED: What would you say is the just and proper range, the limit to inequality?Daly: If you look around at various institutions such as the government, the military, or universities, they have a factor of around 20 between the richest and the poorest. In US corporations it’s 500 or more. I think you could probably reward all real differences of contribution within a range of 25. But let’s just start with a factor of 100, get some experience, and work down.SEED: Do you think that in the future all economics will necessarily be ecological economics?Daly: That’s what I expect. I mean, we’re faced with two impossibilities. On the one hand, it’s politically impossible to stop growth. On the other hand, it’s biophysically impossible to continue it ad infinitum. So, which impossibility is fundamentally impossible? Well, you know, I’ll take my chances with trying to change politically impossible, because I don’t think I can change the biophysically impossible.

Just add a dab of lipstick. Instant credibility.Now go forth and Lead us not into Temptation.–Thx for the laugh

A small thought on protectionism…What about a carbon tax based on transportation of goods so that local products would be advantaged? Wouldn’t that benefit every locality? Perhaps some categories of goods could be exempt, such as unprocessed food products and raw materials.

Next up at the government bailout trough – Auto Parts Suppliers: Bloomberg on parts suppliers Three options:1) Fund automakers to accelerate payments to 10 day terms instead of 45 day terms. Lets see, what does that do to cash flow for the suppliers 30 days from now, since they are BANKRUPT NOW AND THERE IS NO DEMAND FOR AUTOMOBILES? hmm…2) Guarantee payments from automakers in the event the automaker fails, so they can get credit. Lets see, how do they repay the credit they get if they are BANKRUPT NOW AND THERE IS NO DEMAND FOR AUTOMOBILES?3) Force banks, through the TARP, to loan them money. Lets see, Lets see, how do they repay the credit they get if they are BANKRUPT NOW AND THERE IS NO DEMAND FOR AUTOMOBILES?I just don’t get it. We plan to throw billions at an industry for which there is no demand for their products. Then we throw billions at their suppliers when there is still no demand for their products.

Gross Says U.S. Must Spend to Avoid Mini Depression Feb. 5 (Bloomberg) — Bill Gross, co-chief investment officer of Pacific Investment Management Co., said the U.S. may slump into a “mini depression” unless policy makers spend trillions of dollars to spur growth … and is it true that Bill will audition for the next Batman flick??

Can you say Podcast?

Could it be that America’s people are suckers, i.e., chumps: people who are gullible and for whom it is easy to take advantage? The operative words here are globalization and protectionism.Has not the media made it a campaign to scorn “protectionism” in order to shield international corporations feasting on the deprived laborers of dictators to replace the living wages of home labor, in nations “emerging” on the backbone of America’s once vibrant system of free enterprise and free competition—a system whereby unknown men would be the entrepreneurs of tomorrow and whose ingenuity made the life of coming generations more agreeable, as Ludwig von Mises described it?The rise of the modern corporation, the global corporation such as Microsoft that participates in all the world’s important markets while moving production almost at will from one low wage country to another in order to minimize production cost in pursuit of monopoly powers, is creating a world climate whereby the rich get richer and the poor get poorer, according to Myron J. Gordon, Professor of Finance Emeritus at the University of Toronto University. It’s called Welfare-Corporate Capitalism.Says Gordon, “The internationalization of real and financial capital proceeds at a breathtaking pace, and the ability of national governments to manage their economies in the interest of their people declines correspondingly. The buzz words are globalization, downsizing and the end of work. The causal factor in all of these developments has been the rise of the modern corporation.”As for Market Socialism in China, the professor writes in “Welfare-Corporate Capitalism and Market Socialism: Economic Systems for The 21st Century?”: “What is going on in China may, as some claim, be nothing more than a transition to capitalism, so that within 25 years China will be a capitalist country that enjoys the blessing of the United States. It is also possible that China and some other countries will find market socialism an attractive long-run alternative to welfare-corporate capitalism.”I am not of Professor Gordon’s persuasion. But the question arises: Will the U.S.– with its downsizing; inflation swindles; out-sourcing of jobs, manufacturing base and patents; offshoring of corporate headquarters and profits; elimination of living wage and pension policy and postponement of Social Security; open borders and universities to lower-cost foreign job competition; loss of representative government and taxation of the people for benefit of the plutocrats and global corporations – will the U.S. remain the home of the American Dream that was all about individualism and the opportunity to achieve success without interference from others?Are not many of these former American values and achievements worth regaining and protectionism?

JapanJapanese Prime Minister Taro Aso told the Davos gathering that his country would do its part: “We will resolutely fight protectionism.”

I wanted to say “of course they will fight protectionism – they export more than they import”.

This global mess sure proves that it doesn’t matter what kind of government the people have. Those folks who control the cash register determine how the people will spend,save,invest,live and die. No place to run.

the chess pieces are really movinghttp://www.telegraph.co.uk/news/worldnews/asia/kyrgyzstan/4513296/US-troops-ordered-out-of-Kyrgyzstan-after-Russia-deal.htmlUS troops ordered out of Kyrgyzstan after Russia dealRussia has scored a major foreign policy victory after the United States was told to close its last military base in central Asia.Frantic Pentagon officials initially attempted to deny there were plans afoot to force the United States out of its last Central Asian outpost before issuing a plea to the Kyrgyz government to change its mind.”We very much appreciate the support the Kyrgyz have given us in the use of that base and we hope to continue using it,” Geoff Morell, a Pentagon spokesman, told reporters.But Mr Bakiyev, speaking after talks with Russian President Dmitry Medvedev in Moscow, sounded categorical in his decision.”Kyrgyzstan will close the US military base in Manas after Washington refused to negotiate better compensation,” he said.An eviction decree was presented to parliament, which will go through the formality of approving it in the next few days.The collapse of a deal with the Kyrgyz government to continue using Manas, an ex-Soviet base that has been used by US forces since late 2001, is both an embarrassment and a blow to the new administration of President Barack Obama.Gen David Petraeus, the US commander leading the military campaigns in both Afghanistan and Iraq, visited Bishkek last month with an offer to raise the annual rent the United States pays for Manas from £55 million to £104 million — nearly 7 percent of the Kyrgyz government’s annual budget.According to diplomats, the United States also offered to pay senior Kyrgyz officials substantial “bonuses”.But shortly after Gen Petraeus announced he had received assurances from the Kyrgyz government that Russia had no intention of forcing the United States out of Manas, Mr Medvedev arrived in Bishkek on a gazumping mission.

It dawned on me that with the scarcity of physical gold going on today (I can’t seem to get my hands cheaply enough on a lot of nice coin samples) what market will truly be there except for those that have it physically in hand – which again due to scarcity is likely a very small group of significant enough holders of it much less disbursed in disparate locales all over the globe? Will they barter with each other? Will a bank accept your gold coin for exactly what value and for what commission to have it assayed etc? After all why should they trust you that it’s indeed 99.9999% pure?And so if gold goes through the roof what does one exchange for it in the U.S. but eventually for dollars anyway? At least so far that’s still the preferred currency today.So all this business about gold being the ultimate ‘safe haven’ even moreso than U.S. Treasuries ultimately IMO becomes only a true safe haven if at some point (market timing being essential) one exchanges it at precisely the right moment when said dollar ceases to inflate -in effect many in the gold market must become superb optimal timers of return on investment. What are the odds of that I ask myself. Then if one is supposed fool-proof safe haven bought you then? Time I suppose but nonetheless you’re back to square one on the risk scale of exchange markets.My point is this: there IS no universal monetary-based safe haven during an economic collapse of what we’re experiencing. In effect what one person’s safe haven at any given point in such a calamity is another’s useless paper weight. For example, take food: depending on how much one has already stored away and the unique situation each of you may find yourselves it may be more valuable to someone that has it over gold itself. To wit, have you ever tried to feed a screaming hungry milk and formula infant a $50 dollar gold piece?So like the saying that ‘all politics are local’ IMO so too the value of gold is dependent at any given moment and place to someone else that wants it more than the person that values as the example, food above it. In short, if food is scarce and gold is relatively plentiful food will still be more valuable to many more individuals than gold, as also ammo and guns may be more valuable than gold, and so on. As such I just don’t see the universal desirability of this precious metal to represent this wonderful hedge against currency collapse in today’s global economy as it were and I certainly don’t see it necessarily ‘risk free’ either from a governmental seizure aspect should history repeat itself and the government confiscates it from the general population due to such extreme dire economic circumstances. Isn’t that what the government did during the Great Depression? Hmmmmmmmmmmmmm.So I guess I don’t get it over this flight to gold for ‘safety’ when ultimately most of those that own it for protection sooner or later exchange it anyway for some form of paper currency so they can continue to eat from currency-only accepting establishments – yes that old floating value paper medium which is commonly used to buy goods and services in most developed economies.Bottomline IMO, gold is overrated. It kinda reminds me of the Dutch tulip bulb frenzy in many ways but unfortunately discretionary income these days appears to be declining faster than what the Dutch experienced back then when they apparently had enough extra money laying around to blow on future beautiful flowers and assumably the ones that stayed the most beautiful the longest were much more valuable before they too turned into compost like all the rest.Hey OTH, maybe my thinking is wrong here. If I am someone please let me know how much of a killing they’re making owning gold right now too.AM

why?people deposited money in banks, the banks speculated with these deposits, the depositors were happy to take profits of this speculation, but not the losseswhy does my head need examination?

Wait a minute. India bans Chinese toys.http://www.huffingtonpost.com/2009/01/23/india-bans-chinese-toys-f_n_160503.htmlP1AQL.PS: After you’re a little pregnant with deflation, seeking protection is politically natural. Who said that economics had anything to do with it. Tell that to the 20M unemployed Chinese migrants who’ve gone back home.GOTTA PRINT PRINT PRINT

What you fail to see is that the USA will renege on its debt owed – that is, the USA Dollar becomes worthless – that is – due to the fact that the US Government is worthless (read: incompetent and vitally corrupt) and that which follows is the disintegration of the United States of America, that Constitutional Republic and an immediate return to feudalism.Once this happens, sometime around June (~) 2009, then the European Community collapses and so do all governments – (Your mileage will vary) – in terms of Global government recognition, and then no markets (international) exist anymore, for the time being.SOooo then – as markets don’t exist – we go into survival mode and revert to the basics: gold, food, water, and utilitarian things; Gold is innate to the human condition, that is to say, it is innate to Universal life; if only as a symbol of the Universal simplicity of current time and position:).”Your” World is collapsing – it is time for you to move on!Ho hum

I think the idea is to get them past the current lack of demand. People in this country cannot survive without an automobile. There will be demand in the future.And to those people saying GM et al. haven’t been making money because their cars have poor quality or labor or health care costs are too high, GM was sitting on over $20 billion until recently. It came from selling cars, poor quality or otherwise.

I read an article recently (sorry, can’t find it) that indicated a collapse in the purchase of expensive items like jewelry, a heavy user of gold, is putting downward pressure on this metal. I believe that this collapse was taking place in India. Anyway the point of the article was that jewelry accounted for 60% of the demand for gold, investors only 20% – and this is the reason the price of gold is tending to want to fall.Does this make any sense with what others here know about gold and the market forces surrounding its “value.”

“have you ever tried to feed a screaming hungry milk and formula infant a $50 dollar gold piece?”you are a moron. gold was trade medium before replaced by fiat paper. you use gold to buy milk. your statement is as moronic as feeding infant with $50 bill. what is that? moronic and pointless.

gold is still something that holds value and can be used as trade medium during global currency crisis. you dont know why “this flight to gold”, then you are moron.

This ‘cycle’ of State is attributed, but not verified, to A. Tytler, a scottish lawyer.Something to think about, nonetheless”From bondage to spiritual faith;From spiritual faith to great courage;From courage to liberty;From liberty to abundance;From abundance to complacency;From complacency to apathy;From apathy to dependence;From dependence back into bondage.”

http://www.bloomberg.com/apps/news?pid=20601087&sid=a4kNe4UbH6k8&refer=homeThere seems to be better visibility of the Bank Bailout Plan.1. The article seems to intimate that Geithner is going to “ring fence” the bad assets within the banks and provide a treasury guarantee.2. They will also do capital injections of preferred convertible to common stock.(bank CEO control)The devil will be in the details, but the convertible will be convertible to common years down the line andtherefore has no voting stock control. The guarantee of the bad assets seems to me to be worse than anything proposed, because now these troubled assetswill have the backing of the treasury and the taxpayerhas all the downside. These are toxic debts. Remember that there are equity tranches of CDOs mixed in that were rated AAA just because the bonds were insured byCredit Default Swaps sold by insolvents. The banks will have all the upside. They will have control, because the preferred shares have no voting rights and the convertibility will be way down the line inthe future.This is a bonanza for the banks! They now will attractprivate equity capital that is excited about influencing the lending of FDIC deposits without becoming a Bank Holding Company and relinquishingtheir non-regulated status. The Banks and the Private Equity Capital will game the system and eventuallybankrupt the FDIC=Treasury=taxpayers with their futurescams. The sovereign debt rating of the US will sufferfrom the guarantee. I just see tons of downside for the taxpayer.Why don’t we have the government take the good assetsand guarantee depositors and maintain a good bank forlending. Let the bank shareholders and bondholders have the bad assets and their respective banks.The nationalized good bank will lend and the bad bankshareholders and bondholders have to cross their fingers that all this Global Fiscal Stimulus willprovide great Global Aggregate Demand. I still thinkthat global wages have to be coordinated up just enough to stimulate consumption worldwide. The naturalwage driven demand is the key to a world recovery. Wecannot wean off debt without the equation being balanced by higher wages to pay for the assets produced. If global wages don’t go up just a bit thanthere will be excess inventory due to excess production and that is deflationary. The topic ofcoordinated global treaties to increase global wagesis so taboo, and it is the key to the whole situation.The financiers dread this idea, because higher wages would reduce the use of debt. Debt yields interest and power. The financial concerns would love a Worldneck deep in debt, because compound interest would eventually make them the owners of all assets. Themagic of compound interest is the key to World Domination.

Dear Hayes:Unless Turbo Timmy pops a surprise! The bank stocks will have an orgasm! Make sure you are watching Turbo Timmy Monday at 8 pm eastern on TV. Yen is down. Futures are up. Banks screwing the taxpayer rally coming up! Trading parameters are now assessed in hours! Watch for mark to market ambivalent statements all day. The news will screw with everybody’s head and will have us coming and going. Short term fun! Long term pathetic!at the same time

http://finance.yahoo.com/tech-ticker/article/169781/Peter-Schiff-Stimulus-Bill-Will-Lead-to-%22Unmitigated-Disaster%22?tickers=%5Edji,%5Egspc,QQQQ,SPY,DIA,TLT,UDNSchiff has taken a lot of heat of late, but IMO, he nails it here. You might disagree with his claims of impending hyperinflation, but it’s hard to argue with his point that the government’s actions thus far are only serving to exacerbate the fundamental flaws in our economy.

Ahhhh… This Is The Change We Can Believe In!The corrupt system has a “lock” on the populace. I will hang my hat on the Holy Spirit, whose chief attribute is TRUTH. These crooks are so corrupt they don’t know what truth is anymore.

Headlines:598,000 jobs shed in January Most since ’74. Job losses from Nov-Jan: 1.8 million. Unemployment rate: 7.6% Unemployed workers: 11.6 millionFlappers doing the Charleston all the rage.Man goes over Niagra in a barrel.W.C. Fields falls down stairs without spilling a drop of his drink.

the banks are soaring this morning

There’s hope that the 900 billion plan will be approved and that friend Timmy will propose a plan in which once more personal interests will be superior to taxpayer’s interests. In other words: bankers of all sorts can smile and be happy again. Life is sooo good.

No, Jeff Immelt, the C.E.O of General Electric said yesterday at a Wall Street Journal Executive Breakfast event in New York, that, “We’re at least to 1974-75″. He went on to say that, “Once you break through ’74-75, you don’t stop ’til you get to 1929″, he said. “Unlike the other downturns that I’ve been a part of, this one is faced with limited liquidity. If liquidity exists, it’s not coming back readily. That’s why the government’s role in this cycle is so gosh-darned important.”

Treasury to unveil new bank rescue plan Mondayhttp://www.marketwatch.com/news/story/Treasury-unveil-comprehensive-financial-rescue/story.aspx?guid=%7B6DA41B6B%2D24C0%2D4BA0%2DA94C%2DD979D66686B3%7D”Secretary Timothy Geithner will unveil the plan in a speech on how Treasury will employ the second half of a $700 billion bank bailout package as well as other new programs to ” add more money into wall street bonus pool to woo executives of financial market.

Schiff really nailed it for me too. One cannot refute the basics.It’s the antithesis of Nouriel Roubini! How ironic that NR goes on on with calls for government support barely acknowledging the concept of inflation thinking that somehow the Goldman Sachs boyz will figure it out!?!Meanwhile most every poster on this blog disagrees with NR!?!

Obi about to give a speech – for some reason the market typically sells off a bit while he is speaking – we’ll see if today is different with the Dow up 192

My struggle is how to pool the money so it can be marshalled for something too large for yours and my investments. You describe what are called angel investors. However they enter the market, like VCs, in hopes of cashing out on IPOs for the technology they breed. Therefore they are still just in the casino game in my view (though I am sure we could find counterexamples).There needs to be a pooling mechanism. How can you and I, as investors, pool our money, act like an angel investor for some good tech startup, and accept, say, a fixed 10% return because we don’t want the startup to have to rush an IPO so we can cash out? Could it be a community oriented capital pool? There needs to be a balancing act between returns, risk, and the common good, that does not try to solve the equation with just the first two variables as is done today. How?

“What you fail to see is that the USA will renege on its debt owed – that is, the USA Dollar becomes worthless……”Well not exactly true as I see it as well a possibility but not necessarily a given either. All I’m saying is that gold as a ‘flight to safety’ may work for some and not so well for others. Determining that difference will be the rub. It’s the touted universality of it being safe during economic collapse is what I question. In effect there may be better alternatives depending on one’s unique situation and locale.AM

Donaldson, Immelt, Tyson, Feldstein, etc.These are hardly evolutionary think outside the boxtypes! The financials are protected by this crew!I pledge allegiance to the ….. Goldman Sachs…and to the…..with penury and injustice for all!!!Let the party roll!

I hope you see the plan! The assets guaranteed by Treasuryand next is high risk gambling with FDIC insured funds.Even Goldman Sachs can do some propietary trading withFDIC insured funds in the near future. They are gamblersnot a bank holding company. The are money leveragers.The asset guarantee plan simply cannot be improved upon. What plan could better ensure that management “swings for the fences” on risk? Isn’t that what the Fed and Treasury want? A renaissance of risk taking, a return to the “damn the torpedoes” attitude that reigned during our golden era?Please, if you goal is to increase leverage, then align management comp and the balance sheet structure with that goal. That is exactly what Summers and Geithner are doing. We will pay the price, for sure, down the road. I can seeTim (Leona Helmsley)Geithner at the helm of the frigate called “Leverage Risk” and Summers saying “Clear sailingguarantees, let us pillage and plunder.”

http://prorev.com/2009/02/story-media-wont-touch.htmlFEBRUARY 5, 2009THE STORY THE MEDIA WON’T TOUCHSam Smith…the Review has been among the lonely voices raising the possibility that drug and mob money may have played a much larger role in the current fiscal crash than has been noted.It is clear the media doesn’t want to touch this matter. But they’ve had a setback with the testimony of financial investigator and Madoff whistleblower Harry Markopolos. Talking Points Memo notes: “Markopolos elaborated while being questioned by lawmakers, alleging Madoff ‘had a lot of dirty money’ from the Russian mafia and Latin American drug cartels.”And the Independent in Britain reports that “Amid persistent rumors that Russian mob money found its way into the Madoff Ponzi scheme, a panic button has been installed in the [Madoff] apartment, along with 24-hour surveillance, as much to protect him as to check he is not planning to flee. He wears a bullet-proof vest for trips to court.”It seems obvious that the parallel rise of the illegal drug trade and the use of hedge funds and other devices to hide the origin and movement of money deserves, at the very least, deep looking into. There seems a reasonable possibility that our current crisis was driven in some part by a need to launder large sums belonging to criminal groups.Why is the media so reluctant to consider this? Partly because it sounds too movie-like. But, as we have recently learned, Bernie Madoffs actually exist outside of Hollywood.Part is because the media traditionally takes its cue on covering crime from law enforcement, which may itself – as with other government bodies – be involved, incompetent or indifferent.Finally we have the little noted problem that in a hyper-corporatized media, a good scoop can ruin a career as fast as it can make one if the wrong people in power are angered by it.I have been alternately frustrated and fascinated by the money laundering story and the refusal of major media for the most part to even mention it. To the media, the drug trade is largely the result of minorities and undisciplined young white dudes. It makes the story so much easier.But when I started covering the Clinton story (note: he is referring to Mena, Arkansas, an epicenter of CIA drugs trade under the Clintons-Bushes) I found myself repeatedly stumbling into other aspects of the tale. Here are a few examples from the Review archives:(note: go read those examples. the “conspiracy theorists” are actually conspiracy researchers and conspiracy exposers more times than not)As one examined the story, it was clear even back then that there were major ties to other major scandals such as BCCI and the savings & loan crisis, forerunners of current mass fiscal manipulation gone awry. The state of Arkansas was laundering money in Grand Cayman, which had a population of 18,000, 570 commercial banks, one bank regulator and a bank secrecy law. Foreign investors helped to set up a bank in a small town near the major drug center at Mena. One secretary told told an IRS investigator that she was ordered to obtain numerous cashier’s checks, each in an amount just under $10,000, at various banks in Mena and surrounding communities, to avoid filing the federal currency transaction reports required for all bank transactions that exceed that limit. Bank tellers testified before a federal grand jury that in November 1982, a Mena airport employee carried a suitcase containing more than $70,000 into a bank. “The bank officer went down the teller lines handing out the stacks of $1,000 bills and got the cashier’s checks.”Mind you, most of this occurred more than a decade ago, yet, with a few exceptions like Roger Morris, Sally Denton and Ambrose Evans-Pritchard, reporters haven’t wanted to touch it and have spent their efforts instead creating a benign Clinton myth. Clinton was – like a typical prohibition era politician – a beneficiary and peripherally complicit at the very least through studied indifference, but in a sense he was really just part of the background. He was a window into the real story: how a huge part of the American economy – created by the crudely misnamed War on Drugs – operated in just one state.If the media had honestly followed the money back then, if they had asked obvious questions about the war on drugs, if they hadn’t fallen for the politicians’ lines on BCCI and the S&L scandal, if they had wondered why so much money was moving around without any visibility or regulation, we might have approached the end of 2008 in better shape.entire article at the link.

A tender moment at this conference! He is sitting at kneesof Dr Volcker and he is mini me.” Please teach me economicsPaul! All those people criticizing us are not economists of statute. Only you, Timmy and Larry have the experience.”That comment about “economists and people-who-think they are economist” is a “tell” of how he is being handled by the Group of 30. Obama is a smart constitutional lawyer andhe can think on his feet, but he can easily be bamboozled and hoodwinked by the “luminaries” around him. A lawyer has no training in economics beyond his corporate law class. He learns that corporation have rights as persons under the Constitution,and the now destroyed “prudent investor rule”.I know what lawyers are taught. It is only after you entersecurities practice that a lawyer gets a clue as to how the world works. I hope that he has some outside input fromheretics in the economics profession.

still calling you moronic. currently fiat paper is the trade medium. and lets say countries around the world print the fiat paper to worthless. you cant rely trade medium to trade, can you? what can you use then? you still have to trade for necessities. plus it is impossible to produce all necessities by oneself. you still need trade medium. precious metal will be next, it was used in the past, sure not alots of it = inefficient market. but better than none. what you want to resort to trading rice for apple, and apple for pig? calling you moron, and you dont believe it.

“….still calling you moronic.”And you sound like someone that own some gold and doesn’t want to hear anything contrary to it. Quite possibly you’re a bigger moron than me even. Time will indeed tell now won’t it?AM

JOHN WILLIAMS’ SHADOW GOVERNMENT STATISTICS – FLASH UPDATE – February 6, 2009 – January Jobs Loss Was 716,000 Net of Concurrent Seasonal Bias and Not the Officially Stated 598,000 Job Loss) – Alternate-Unemployment Rate Hits 18%Here is an eyeopener; if every officially unemployed individual was paid an equal salary from the proposed $900 billion stimulus bill, their salary would be $69,200 per unemployed individual!

money going directly to the people who pay taxes does not allow for pork… this disaster is the opportunity of a lifetime for our legislators, they have had a 700 billion and now a 900 billion bill to skim off of… if stimulus dollars go directly to individuals for relief, how can they skim? many sensible folks have argued for this – oh well… let them trade favors on the deck of the titanic with our monopoly tax dollars…

g,i’m reading your mail.

Earnings are collapsing.http://www.comstockfunds.com/index.cfm/act/newsletter.cfm/category/market%20commentary/menuitemid/29/MenuGroup/Home/NewsLetterID/1437/startrow/1.htm

CNBC just announced that the Aggregator bank will be 500 billion and there will be a stress test procedure that may trigger a change from preferred to common stock! Liesman was not too detailed! There will also be a Foreclosure MitigationPlan detailed days later. The announcement will be at noon!Neel Kashkari will play a role!

whether gold or fiat GREED exists in botha cow in India produces milk,butter, dung fertilizer and urine for bug repellent. Take away a farmers cow he must rely on buying fertilizers machines, bank loans etc…he now is MORE dependent whereas before he was self reliant and could grow his own food to survive. How many people are farmers in India. Is this corporate system creating more welfare? Why such a high suicide rate amongst farmers.How about the cow system in n. America do you feel safe about food security?

Hmph…MSM today reporter was talking about the job numbers and then said “on the bright side, for those who have a job, paychecks are going farther than ever.” Yes dear, that is called deflation.

And, the recession and depression is just now getting warmed up??”As the federal government looks for even more unique ways to transfer your tax money to various financial institutions, state jobless funds across the country are running low. According to the Wall Street Journal, unemployment filings have escalated so quickly in recent months that seven states have already emptied their unemployment-insurance trust funds… which were supposed to see them through recessionary periods!”http://www.minyanville.com/articles/C-Paulson-bac-tarp/index/a/21019/p/1Ho hum… down and down we go,in a spin,love that spin we are in,that old black magikcalled …?

Economy, Waves and Eternal Good.I was going to write and say that global economic and financial crisis are happeningcontinuously and will continue like that in foreseeable future but first I wanted to checkthe history of economic & financial crisis and went to Wikipedia. There I followed the links and found out thatsome economists already suggest economic waves. Read http://en.wikipedia.org/wiki/Kondratiev_waves.According to this idea, economic developments hit in cycles and each cycle has certain periods:spring (growth, innovation, low interests), summer (new social trends, new production means), fall (recession, high interests) and winter (depression). Although these may look dogmatic, I think it illustrates what happens practically.Personally, I think complex relations among human beings and between human beings and everything else (nature, economic and social activities) make everything unpredictable. It is the action and reaction rule that defines not just nature but everything related to humans (economic and social trends). So I don’t see many eternal laws in anything. That’s why I am a bit suspicious about Kondratiev waves but still find them useful.So what I want to say? I think nobody in this world knows what the optimum economic and financial system is. You can’t!I think what people should discover in each economic / social failure is its own ignorance. First of all, understand that in some cases, you can only find solution for today but for tomorrow, you have to wait and see…Today I have read about Toyota city. It is a place in Japan where Toyota, auto maker, has factories. The unemployment is skyrocketing. The high unemployment in Japan for last 20 years is not new. This nation that produces efficiently and sells most of the autos and electronic devices world uses is in serious economic trouble for the last 20 years. Just before 90s the Nikkei was around 40000 but today it is around 8000… There are millions of “working poor”. Some of these people have no shelter and the rest is living in terribly bad conditions. Can you imagine such thing in a country like Japan that is a sample to the whole world?So the question is; is there a fundamental mistake in our idea of “good economy”? I have a feeling that we are making a major mistake. What the whole world wants is to be like Japan but you see what happens when you become like Japan. So, could it be so that at the end of the road is a terrible awakening? Will we say: “Oh, we have been wrong all along…”. Will we discover that most of our formulas were terribly wrong?I know I am contradicting with myself when I say that there is no eternal answer to the good economy but I can’t stop thinking about setting global trends that will lead us, human beings, to rationally correct places at least.

Talking about “dick” – this is a great laugh (and thereby good for the health:-). Your mileage surely can’t vary?Ho hum

pjb,love.!!

well this whole world (or at least the western world) has been about one thing for a long time…that there is no absolute truth, but that truth is something personal…

blindman: you said (above) “‘ zen is what happens while you are busy making other plans.’”very deep – but true – it is the difference between automata and “civilization” or as Mark implied, real “democracy” – by all of us .Ho hum

w,yes, march 2001. c. powel ANNOUNCED gratitude to the taliban for their war on opium production in afganistan with an award of 20 some millions of dollars u.s.. then, of course, by fallthings changed. as you say.hmmmmmm.

g,he is, should be, is presented as, presents himself as, a black man in america.2008. if that does not inform him as to the nature of the people’s perspective, 2008,than he is nothing. not human, not animal, vegetable, or mineral.then he is a con. a shill. as with us all.. no where to run, no where to hide.let us not be dense.

The dollar is holding, but treasuries are risingGold has settled to 911 for the weekendWill foreign buyers pick up enough treasuries to avoid QE from the FED?What would the effect of QE be on treasury yields and the dollar?Are you really diversified if all your investments are dollar denominated?Are you ready?

Never again will I feel a moral responsibility to pay back a loan from a bank.

Unless the measure of new DEBT starts with a “T” , Geithner doesnt yet have enough money to make a dent in the bad “assets” loaded up on bank balance sheets. Which just goes to convince me that what you are looking at is an installment on what is to become a multi -TRILLION effort to save the US financial system.The people fo the US can wave bye bye to the standard of living they have thus far enjoyed and HELLO to third worldness.That will be the definition of being “saved”- that there is still something, anything left standing when this meltdown finally exhausts itself.

I have noticed a marked drop in quality postingseems the crazies have discovered this blog andare filling at least 70% of the comments withpersonal ravings….too bad.

The Kondratiev Wave theory is posted here about once a month. At first blush it looks really powerful. Then you realize the “wave” has been tweaked to match past events so it qualitative proprieties for future predictions are minimal except that we can expect cycles to continue as later generations forget the lessons of earlier generations.

I think you’re quite wrong actually, it’s just that the time for intellectual debate is over. Intellectual debate can only occur when the substrate or framework around the discussion has credibility unfortunately a lot of very smart people have been awakened to the fact that credibility of the system itself is severely compromised if not completely rigged. When we most recently discovered how rigged and corrupt the economy and political process was under the past years duress we started changing the tone of our posts accordingly. We’re not crazy for being pissed off at bankers ripping off tax payers on the eve of economic collapse, I would call it enlightened but certainly not crazy. Now is not the time to continue on with the same nonchalant rhetoric, their are thieves in our homes!

I agree. I believe that its now necessary to eliminate guest and anonymous posting

A Rationalization for Nationalization This is a repost from an FT article. IMO this is a very straightforward and rational way to support the financial system.All those wondering how to get out of this mess, I think this has the highest chance of success.What do you think?

“…because all economies have performance issues.” hee hee- thanks for that one!

I think there is a wave in american youth to no longer invest in US denominated assets (shares or banks, etc..)College is teaching them well to avoid dollars

Average Jane: I’m not thinking like you, I’m actually buying a home right now because its such a good deal and the interest rate was real cheap. I can swing the note because I’m ok financially and employment-wise. I’m setting myself up for retirement in about 12 years so I need a place to molder away in when I’m too old to move anymore.For you, its how you see your financial picture. If you’re uncertain, don’t buy and don’t fault yourself for it. I rented for decades to get to this point. My advice is to just make sure you can be financially comfortable no matter how or where you live. There will always be houses to buy if you want one and there will always be someone to loan you the dough when the time is right for you. Do what makes you feel good and let the world do what it does. Besides, later this year or next year, might be even better times to buy because, based on the comments on this blog, we’ll either be in utter economic collapse or the socialistical communists will have taken over and they’ll give you your dream home. Cheers!!

You mean Kyrgyzstan?

I like the analogous relationship (with life) with the Opera: Phantom of the Opera. The music of the night.Life is our lesson and we must learn by picking the cat up by the tail; we must confront ourselves.Life is our fate; fate is in analogy; scalular and the World is our stage, where “we” should read, “I”.We are so lucky to have infinite possibility subject only to circumstance. Circumstances constantly changing; as life is a dynamic; here, is the problem as nobody wants the circumstances to change and all deny the fact, that they do change, have changed, are changing! But they change anyway; too bad.Isn’t it marvelous that gold represents the end-effect in the minerals family; it is redundant and such is the role of royalty; where all men strive for royalty while they deny their then state of redundancy. Gold is the standard of Physics; where Cause has reached Effect and where Gold is for all to bear witness and where there is No part for the opines of men to play at whim and fancy.Intellect is Order; harmonious Order; not chaos, but men seek chaos to profit in order to become redundant; that is, to be come royalty; wealth never created royalty; only intellect through time. Then they reject the values of Gold; the Symbol of Synthesis through Syssion.The music of the night: the music of functional consciousness realized.Ho hum

“love”; You mean attachment, of course?Ho hum

And I also agree with the both of you on many of your points. (was unable to reply to several posts the other day- frustrating!)Much of the past, however, isn’t what it appears to be. 30 years ago the US was shifting from a creditor nation to a debtor nation. The momentum changed primarily due to it shifting from a net oil exporter to a net oil importer. This, plus the Vietnam debacle, was most responsible for the US being basically insolvent (and yanking the plug on what was left of the gold standard).As I’ve repeated ad nauseum, growth cannot continue indefinitely. Built-up savings would eventually be eroded as growth abated.The fundamentals are excellently made by Peter Schiff in this article:Peter Schiff: Stimulus Bill Will Lead to “Unmitigated Disaster”Mark

Great article (as usual) by Kwiatkowski!Mark

Thanks K!And this is my main point- destruction (through unsustainable mining of nature) of the environment WILL limit our growth. I recommend Collapse by Jared Diamond for more on collapses of civilizations.I spend a fair amount of time reading/studying farming-related issues. I know that we’re either at, about at, or past our maximum output. Dwindling fossil fuels will have a huge impact on food production. We will be forced to rely on more organic means of production (such as championed by the Rodale Institute and the Leopold Center to mention but a couple).And for MOG – Just because my belief that we have exceeded carrying capacity agrees with those wishing to control population sizes, do not confuse this as meaning that I agree with those people. My concern is with the earth’s capability to sustain us; if you don’t start with this premise then there can only be one fatal outcome.Mark

No one is disputing that there will be demand in the future. The question is: how much demand? How long before people are able to dig out from the mountain of debt they are under? And all the while the federal government is piling more debt on them in an attempt to create demand!Game over! Get used to it…Mark

OK folks, how do I go long on the Depression?Clearly these folks are wanting this to happen (though saying that they don’t), as that’s what their actions will produce!Mark

Love this first quote/bit from Willem Buiter:Increasingly, I find it helpful to analyse the crises afflicting the US and the UK as emerging market crises – perhaps they could be called submerging markets crises. (emphasis added)Mark

Stress the SCHEDULE? Ugh!Mark

Oh no, I feel put on the spot, I can’t remember what I’d said! LOL!My views on democracy is that it cannot survive population growth. True democracy cannot scale past something like 120 (or so) people; as such, in order to achieve true democracy we will have to split into really small groups.Mark

Of course it will cost Trillions. Prof alreday made it clear tha US has to recap banks with at least 1.4 T to kick start crazy lending again. I don’t think it will work. As I see it bondmarket will crash and sooner than later.

Why are you waiting for a rate cut?USD was buying CAD for $0.79 on Friday. $0.79 for a currency not encumbered by a trade or budget deficit (well, the idiots are now copying the US and are going to deficit spend) and, they have a fair amount of resources.Do you have residency up there?Mark

3 Months on and Professor might actually be professor bloom if he is still predicting the recession to end in 2009

Shrieks of Laughter (SOL) – er, how true”The most obvious indication that there are no terrorist cells [in America] is that not a single neocon has been assassinated. “Ho hum

what a load.

what a load

Here’s a glimpse:In times of crisis, Parisians take to scavengingFine as long as the system is still generating such “waste.”Mark

This is your last chance. If you don’t get in now you are gonna miss out. Not everyone has this opportunity but if you act now, much money is gonna be made. I am not going to tell you my secret formula but it works, I promise. Is this Madoff or Obama talking? Is this Paulson talking about TARP 1 or Obama talking about Stimulus? Does anyone actually understand what Obama is selling? Has anyone done any math? How can people support something they don’t understand based on the words of Politicos or their Shills? Does anyone understand the multiplier effect, how it is actually computed, where the numbers come from, which derivative of some estimated number is being used to bolster the hypothesis? What about the Lucas Critique, has it been factored into the analysis and if so how? All the people purveying the stimulus have been dead wrong so far yet they are the ones being relied upon to fix everything? Now Rush is in the act with some ill defined unquantifiable analysis which is becoming the mantra of the conservatives, is everyone just an idiot? Why anyone listens to Rush the junkie is beyond me especially since like most conservatives that which he rails against most, he is a purveyor of. If most Americans were honest they would admit their stupidity, admit they are sheep, admit they are relying on people who have not only been wrong the whole time about his mess but now are hoping for the best. Of course, Freud or Einstein would describe this behavior as fantasy or lunacy. My point, how can Americans be so passionate about something they don’t understand and which is being purveyed by those who have been wrong every step of the way (not to mention the purveyors been have lying to them their entire lives)? Madoff truly had the psyche of man figured out which is incredible as the scams have been going on for centuries. Most Americans are truly rats in a maze.

the portended recovery from the stimulus plan

The oldest tactic in the book to quite down dissension is to undermine its credibility by calling it crazy. Bush and the far right did this very successfully for a long time where any and all dissension to the war and or the administrations policies were either unpatriotic or radical/loony. People in favor of the status quo or who are benefiting from it will try anything to quite down dissension including trying to make you and I look like out of control fools. It’s important that we do maintain our composure so they’re tactics won’t work but even more important to stay vigilant in never letting the pseudo intellectual fake’s change the subject or undermine our cause.They are stealing from our family and friends and they want us to stay quite and be civil while they do it, but we’re not that stupid!!!!

It’s too fair, hence the banks will never go for it. They are happy with the plan they convinced Geithner to approve leaving them plenty of wiggle room and backdoor exits for escape if things don’t work out as planned. These huge institutions like BAC, Citi, Goldman, etc have planned ahead for domination in a global environment and could care less about the U.S. public. Ask yourself, why did BAC rally from a Thursday low of $3.80 to a Friday High of $6.50, almost 70%, in 2 days while the Dow rallied about 6%!!! Do you really think the banks are not happy with the new bailout even though the MSM will pretend to jabberjaw and criticize it knowing full well that the public has been duped again?

Check this out: http://www.nytimes.com/2009/02/06/world/asia/06japan.html?pagewanted=1&_r=1Before Obama starts spending the bailout money, he has to look at the Japanese experience. If they build roads just for building them then the economy will not grow…Also, the large amounts of cash spent by politicians will surely cause corruption. He has to think about this too.

The financiers have accomplished their mission. Surrepticious power is the ultimate power, because it is not evident and it is stealthy. How do you obtain complete power over the World? You induce a global crisis where the debt expansion will be geometric and the debt service will be geometric.Follow the money! Who benefits? The government debt has topay interest and the financiers are the middlemen! When the world is in a credit crisis, power flows to the financiers. They will be able to set the terms of administration of national budgets. The agenda is to extortthe governments into paying so much money in bailing outthe financial institutions that there will be no money leftfor anything but military defense. The “automatic stabilizers” of the post-world war II 1947 to 1980 periodwill be dismantled. We will become akin to China. Afascist state with no “automatic stabilizers”. Afterthe “orgy of fiscal expenditures and the embezzlement thatis already evident in the TARP 78 billion misallocation”,there will be a period of RESPONSIBILY. The HamiltonProject of Fiscal Responsibility directed by Peter Ortsag will be implemented. There will be proclamations “We nowneed to be responsible”. The banks will by then have absconded with all the money. We the taxpayers will thenhave to work until we are 85 to get Social Security(maybe).Medicare won’t be possible. We will be Chinese!!!The new song will be! ” I think we are turning Chinese”.Do you want to be Chinese???? Get involved in participatorydemocracy or lose your security!

A few excerpts from Doug Noland’s latest:”Despite today’s histrionic fixation on “deflation,” current dynamics have some similarities to the post-tech Bubble period. Granted, the collapse of Wall Street finance is of much greater scope and consequence than the bursting of the tech Bubble. Yet I would counter that The Burgeoning Bubble in Government Finance is poised to make the Mortgage Finance Bubble appear tiny in comparison.It is in this context that I fear that the Trillions of Government Finance spent to save the world from “deflation” will, in the end, require perpetual needs for Trillions more. There will be no kick-starting asset Bubbles or a return of private-sector Credit excess. Instead, it will be a case of throwing repeated doses of government-directed finance/purchasing power at the system. Temporary but fleeting economic boosts will then require only stronger doses of artificial stimulus.It is in this context that I fear that the Trillions of Government Finance spent to save the world from “deflation” will, in the end, require perpetual needs for Trillions more. There will be no kick-starting asset Bubbles or a return of private-sector Credit excess. Instead, it will be a case of throwing repeated doses of government-directed finance/purchasing power at the system. Temporary but fleeting economic boosts will then require only stronger doses of artificial stimulus.”http://www.prudentbear.com/index.php/commentary/creditbubblebulletin?art_id=10186

“so our American taxes pay for foreign industrial bases instead?”What are you talking about? The stimulus bill will not be financed by our tax dollars. What part of “huge current account deficit” you do not understand? It will have to be financed through borrowing from foreign countries (i.e., from someone else tax dollars). If we leave the “Buy American” clause in, those nasty foreigners will not buy our bonds, and there is going to be no stimulus. Wake up, we are at the mercy of foreigners, and this is the worst possible time to increase protectionism.

Recovery of what? To what?Recovery of the billions of dollars shoveled to banks? Of the billions lost in MBS? Of the jobs lost to China? Of the securitization of loans?To the way things used to be in 2005? To what?This is a myth. Nothing important is going to be recovered, and the old system is broken beyond recovery. We have to stop looking backward and look for a new way forward.

Jason,My pun on “recovery” was meant to be – the recovery of the credit junkie.It seems to me that is what Turbo Timmy’s plan is for a “recovery.”

A START OF A SOLUTION: TAKE ACTION!1000 LETTERS/E-MAILS FROM EACH OF US TO OUR GOVT AND RULING ELITES UNTIL THEY RESPOND:Go ahead and take the bailout money and write the laws that benefit you and put the taxpayer on the hook until he/she dies. Guess what I and 100 million other Americans are going to do:Stop paying the mortgage on the house, the car, the credit card and all other loans.Stop paying all taxes including those to the local, state and federal govt.Remove all funds from banks, credit unions and financial markets.Move out of the country if necessary to a country where the cost of living is 90% less than the U.S. YOU SEE, MY FAMILY AND I REALLY ONLY NEED FOOD, SHELTER AND FREDOM TO BE HAPPY IN LIFE. WE WILL NO LONGER BE ENSLAVED BY YOUR POLICIES AND PROPAGANDA. SO, AS THE HIT TV SHOW SINGS “BAD BOY, BAD BOY, WHATCHA GONNA DO”, YOU’VE GOT 30 DAYS TO INVOLVE THE PUBLIC IN COMING UP WITH A BETTER PLAN!

Opps – can’t seem to get the hyperlink to workAmerican Treasury bonds – Too much of a good thinghttp://www.economist.com/finance/displaystory.cfm?story_id=13062160

Is this an opinion or some privileged information?

Well, this is my opinion of course, but I think what the government & fed are (and have been) doing is far crazier than any rantings on this blog. The only thing more crazy than that would be for everyone to sit back quietly, patiently discussing the pros & cons of everything with identifying monikers over a drop of tea instead of becoming properly outraged and sickened at what is going on.

They already know were not going to pay them back, they’re real motive is to store up enough reserves so they can buy everything up after assets fall to nothing.

problem, he doesnt think. He just rollober infront of Democratic Socialist Party

thanks for your reply, it helps a lot, i was thinling that it may go even lower, I’ve learnt greed…i am on the fence because this is all i have, an imigrant too busy working to have a family, children, life, i saved so i can buy a studio on cash, not on credit, and finally to have a place to call home;I did get the canadian residency in 2007, which I couldn’t obtain in 10 years in US on work visa, still waiting – i am from e europe ; I had enough uncertaintyafter resisting temptation and saving my money in cash for 7 years, I’ve lost pretty much everything I’ve put on my roth ira on two legg mason star funds …stupid for me to do what americans do, me coming from an ex-commie country that don’t know much about “creative” finance, thought that I couldn’t possible figure out the “system” , well figure I should have trusted my gut, what a joke;to me everyhting was new and different here, but people not reading, unwilling to learn about the world surrounding them, that puzzled me, i thought that all these fake pop icons, tv, media, inuendo, were just advertising for fouls, but most of the people know better, couldn’t believe that it was a deliberate policy to keep you dumb, uninformed, out of touch, maneuvrable, pretty much same as the living hell communism that I know so well ;what a beautiful country america, what a chance and a wasted moment of grace, i feel sad that I cannot be optimistic when children in this country start crying when they get a book as a gift, people have to suffer, learn and fight hard every moment for their life and for their country, so pathetic, and yet so true!fed should be banned based on the law that JFK signed right before he went to meet his bulletthank you for your witty comments, i’ve learnt a lot from you, and i am happy that you exist

A,You could try $-averaging into CAD position. A certain % each month gets converted to CAD.I too have been considering picking up a few grand in CAD – as a hedge – but my gut says to wait ’till the USD starts to tank. My fantasy is something around $0.40 exchange rate but I will $-average as it becomes more and more favorable.

Read Wall Street Journal and there will be no more money given to Banks that exceeds the close to 350B that are the TARP remains. They havve to go to Congress and ask for moore

As that lazy song goes:Trailers for sale or rentTEETH … for 50 cents…da da dah dee da dahI ain’t got no cigarettes…See Mish: http://globaleconomicanalysis.blogspot.com/Ho hum

Nassim Nicholas Taleb is making ripples again. The brilliant author of The Black Swans has set up a petition on his Facebook page calling on the US government to force bankers to give back their bonuses. Taleb tells me that more than 800 people have signed up to the cause – a number that is growing daily. His co-conspirator is another great mind, the New York University economist Nouriel Rou-bini, which is nicely unpredictable as Taleb doesn’t rate economists. But Roubini is rather different as one of the few forecasters to have warned years ago that the world’s economy was heading for the buffers.The two have set up “J’accuse” on Facebook to urge President Obama’s government to make it mandatory for those bankers who have taken money from the bailout to give back their bonuses – all of them. Top of Taleb’s list for punishment is Robert Rubin, the former US Treasury Secretary who received more than $100m while working for Citigroup. This, says Taleb, should be paid back because of Rubin’s failure to understand the risks his bank was taking. For someone who urges us to accept we understand so little about the world around us, Taleb, a former derivatives trader, is very sure that he is right.http://www.independent.co.uk/news/business/comment/margareta-pagano/margareta-pagano-this-time-we-must-listen-to-the-black-swan-1603732.html

For all you guys and gals in America and Canada, staying in touch is important especially in the coming days. I was just alerted by a friend in the USA of “magicjack”.http://www.magicjack.com/7/index.aspThere are always infinite possibilities and opportunities and here is a sweet bit of applied technology that may save you money.You see, just because the government, bureaucracy, the financial industries, manufacturing, the federal reserve are imploding onto themselves, there is no need to despair, as life goes on and it is indeed exciting; just dance with the music.Disclaimer: This is not an advertisement and I have no financial interests in magicjack and nor does my friend.Your mileage may varyHo hum

Too late, it’s already started (which means that it started before Obama took office), not that this really matters…IMF Says Advanced Economies Already in DepressionMark

Isn’t that all backwards?If the USD tanks then the CAD will be worth MORE. You will have to use more USD to buy CAD!I’ve hit $0.77, $0.79 and $0.80. Greedy enough! The conundrum, however, is that the more the CAD is brought up the bigger the negative impact on exports, which then in turn places downward pressure on the Canadian economy. So, people, PLEASE don’t all go piling into CAD- LOL!Mark

I can see where the attitude of “screw them” comes in and one just takes advantage of the programming. I’m too morally inclined, however, to do such a thing. But really, sitting in a much better position when taking one’s own advice and then ridiculing those that didn’t listen, well, there’s some sense of justice in that…Mark

Allow the scientists and engineers to come up withenergy efficiency measures that will benefit allthe world’s population. Incentivize scientificbreakthroughs.You forgot to add:7) Make pigs fly.”Allow” scientists to… How about to defy physics?This fantasy land stuff is only going to lead us over the cliff. There is no free lunch. There is no free energy; and if there was (oil was insanely cheap for a LONG time), then that would only help promote growth. And in case you’ve missed it, growth isn’t sustainable.Mark

“Gold Disconnects from USDollarBy Jim WillieCB. EditorFebruary 07, 2009 “Hat Trick Letter” — The gold price has finally disconnected from its nemesis, the USDollar. This news should be read as the coming of spring after months of wintry torment, or as the sighting of land after 30 days adrift at sea in a derelict vessel. From 2002 to very early 2008, the gold price had risen from the massive speculative fervor that swept the United States and Europe, whose economies had been supplied largely by Asian factories. The mines from Latin America to South Africa to Australia greatly aided the process. The very paradoxical event of the USDollar rising this past autumn amidst truly horrendous news, one disaster after another, one major bank failure after another, one nationalization of a large financial institution after another, makes the disconnect all the sweeter for gold investors. That set the stage for a powerful gold price move. Imagine a notable rise in the buck, based upon broad negative news in August and October! “http://informationclearinghouse.info/article21934.htmHo hum

Yves shares her perspective on Sirota’s article David Sirota: Obama’s Team of Zombies

From a post at CR Ten Questions For Secretary Geithner ( Turbo Timmy )

Next week, Tim Geithner will have an opportunity to explain his plans for the financial system (Cash Room of the Treasury, Monday, 12:30pm), and defend these plans in front of the Senate Banking Committee (Tuesday, starting at 10am) and Senate Budget Committee (Wednesday, also from 10am).Here are the questions (in bold) we would ask him. And, just in case any of you are involved in preparing the Secretary’s briefing book, we also suggest some answers.1. Do you agree that, to restore trust in the financial system, it is essential that the Treasury (working with other relevant US authorities) take rapid steps to “once and for all” completely recapitalize the banking system?2. Would you also agree it is critical that you and your colleagues tell the unvarnished and unequivocal truth regarding the needs of the financial system and your plans to recapitalize banks, so that clarity regarding the policy framework can be restored and uncertainty diminished?3. Do you agree that a one-off, transparent assessment – with the methodology and results fully divulged in public – of the solvency and financial condition of all banks is required within three months so that we can precisely define and address the problem?- The only answer that should give any credibility to questions 1 and 2 is: yes…

pjb,hey, i didn’t write the song, i just found a question i thought i could answer.no prize money? ok.attachment and dependency based on natural, cultural, societal and technological circumstance as they intersect and impinges on the individual/s as they arrive , exist, become aware, conscious, of those fast changing circumstance/s.and it all becomes quite overwhelming as the pace accelerates.black magic. as the population accelerates, consumption etc…and then it stops. but the attachment and dependency linger on for a while.the next phase will test the world. new attachments but love will figure in too.i think the mind experiences bliss as love, centered in the heart and radiating from there to the head etc. and beyond..attachment is necessary to keep the parts from flying apart in different directions, individually and collectively.

>Ho diddly hum

Flawed model ‘blinded’ King to credit crisis

Former members of the monetary policy committee will this week call on Mervyn King to tear up the Bank of England’s complex mathematical model of the economy, as the Bank is accused of having exacerbated the recession by failing to cut interest rates fast enough when the credit crunch hit.As King prepares to issue the Bank’s latest economic forecasts this week, three former MPC members, Sushil Wadhwani, Willem Buiter and DeAnne Julius, have agreed to join an extraordinary experiment by number-crunchers at consultancy Fathom to build a rival to the Bank of England Quarterly Model (BEQM), its main forecasting model.…Using information gleaned from publicly available documents and Bank insiders, Fathom’s number-crunchers have constructed a replica of BEQM. It shows that the model actually stops working when interest rates hit zero – an increasingly pressing possibility – and fails to allow for the impact of a credit shortage on the economy.Fathom’s director, Danny Gabay, himself a former Bank economist, argues that interest rates would have been cut earlier and faster, and the recession might have been less severe, if Mervyn King and his colleagues had relied less rigidly on mathematical models, and taken more notice of what independent MPC member David Blanchflower has called “the economics of walking about”.Wadhwani said: “It is possible that they were complacent, in part because they had no easy way of using their model to show the effect of credit constraints. It’s very depressing.”…

(full article at http://www.guardian.co.uk/business/2009/feb/08/bank-of-england-governor)

I don’t know so much macroeconomics but I follow war and geopolitics very carefully….I also have a strong interest in military sciences…mostly WWII german army though.Yes, I follow Puplava and financialsense…Invasion of Iraq was one of many moves to secure future oil supplies. The fight for oil has begun long time ago.It is obvious that oil will decrease in the future and that is no secret. Two ways to tackle is either increase supply or decrease demand.It’s not possible to increase supply overnight so decreasing oil demand of certain countries is the only way…..especially those unfriendly to the US….Some possible ways:1) Start a depression.2) Let oil go to 200 by inflating all currencies.3) Make China/India go back to developing countries.4) Start WWIII.5) Con the world to buy US Treasuries.6) Scare people to make them move money from stocks to the bond market….I’m sure you can think of others.hero

How so?”Better cars” usually translates to “more expensive.”Like any big corporation, GM had to cater to shareholders. Profit NOW! It’s the system we’re in. But not for much longer…Mark

@ mark ..” case of the parasite killing the host.”m,in a case like this the host dies but is not dead. it just cannot produce that which the parasite requires.so the parasite will drop off the host, ( print money ) and attempt to live this way if possible. of course the parasite will search for a new unsuspecting or willing host (commensurate relationship). if it cannot be found then the parasite will perhaps shrivel and starve, or go into a dormant state while new hosts can develop. cyclic and seasonal activity.exhilarating is the feeling when a host is free of a parasite as long as no infecting agents have been transmitted and as long as the host has not been truly starved to death itself.hosts evolve with certain defense mechanism against certain parasites. if they do not they cease to exist as the natural and unnatural world are full of parasites. i think it is just a question of ecology and relative numbers regarding species ( recognizable entity units ) whether the term “parasite” is appropriate. it is a question of balance and as global imbalance of production reached it’s crescendo the financial system became imbalanced, gorged and parasitic. now it resists shriveling but must drop from the host by feeding off an imagined future host.triage of the parasite seems misguided while the host itself is going into shock.ecological balance is the goal. we need to have your perspective made available to those who claim to representthe host. ( the people ) .institutional identities are abstract and to varying degrees function as host or parasite ( are both ) depending on circumstance and balance. it is dangerous and i believe wrong to have their existence predicated on a corrupt and corruptible financial basis. the world does not and never will conform to mans financial imagination. it has its own.we need to conform to it and realize that. ecology economics.

where is the bear and short? i see, no one is going to bet against FED’s print press.

Roubini and Taleb start petition to have banksters pay back bonuses. Margareta Pagano: This time we must listen to the black swan (The Independent) A Rallying Cry to Claw Back Bonuses (NY Times) Make Bankers Accountable – A “J’accuse” by Roubini and Taleb

US Inflation Could Hit 200%: Dr. DoomIn the US, we have a totally new school, and it’s called the Zimbabwe school,” Faber said. “And it’s founded by one of the great leaders of this world, Mr Robert Mugabe, that has managed to totally impoverish his own country. And that is the monetary policy the US is pursuing.”The government’s increased intervention in the economy is likely to slow down economic growth because history shows that every time the private sector shrinks to make way for the government sector, the economy suffers, he said.Asked whether the US risked being faced with 200 percent inflation, Faber answered: “Well, not yet. Not yet. But I think eventually. If I look at government debt in the US, and debt in general, I think the only way they will not default physically on their debt is to inflate.”The Federal Reserve’s policy of printing money and the government’s intervention in the economy might undermine the US’s economic and political clout, Faber warned.”Well, I wrote two years ago a report entitled ‘Is America becoming a banana republic?’ And there are some features that characterize banana republics- totalitarian states, very strong government intervention into the economy, and the polarization of wealth,” he said.”And we have all these trends occurring in the US. We are not yet there. And in theory it could be reversed, but I doubt it will be,” Faber added.Because of these factors, US government and corporate bonds, including that of CNBC parent General Electric [GE 11.10 0.25 (+2.3%) ], should be downgraded, he said.”Yeh, I think GE should be a junk bond. But I also think the US government should be junk,” Faber said, adding: “I don’t pay much attention to rating agencies. The rating agencies havehttp://www.cnbc.com/id/29047443

Mark,Most of these suppliers are running on the same kind of business plan as many companies. They leveraged everything. Their equipment is on payments, their labor is borrowed, they borrow to buy their materials. They need pretty much full production runs to keep from going down. This business plan is not unique to the auto industry either. There was a feeling that it was bad business to have capital that wasn’t working… Which meant, wasn’t leveraged. But this meant lots of payments. Which was floated with lines of credit. But it still has to be repaid. So the prices always go up and the production lines always squeezed for higher and higher production.I knew that this business model wasn’t sustainable over the long run but it worked good for the last 20 years. Until the last few years when it has been a real drag. Lowering demand is killing most businesses. There is little room for a huge down turn and that is why layoffs have been so dramatic. I expect to see average earnings to be declining more rapidly than the media and many economists who really don’t understand the consequences of the modern business debt structure.TPTB know this and are looking at all the businesses in the industrial world and going, “Oh Shit!”. This debt pyramid is so huge and most seem to just be ignoring it.We do need the auto industry but I think it is going to go down because the underlying business model can’t work in a declining demand, which has to happen due to declining employment and a consumer that is generally over their heads in debt to start with. Not every one is, but enough to dramatically lower the demand, which is causing massive layoffs due to the highly leveraged business model which is lowering the demand some more.Vicious cycle that ends when?I don’t know that. But like all other things, there is an end of this trend also. It would seem logical to me that it won’t be until a lot of this leverage (debt) is unwound. The banksters don’t want that as that is their livelyhood. My pygmy brain just can’t see another way.

bears and shorts are no match for FED’s print press. look for waves of TARPs and STIMULUSs to crash bears and shorts.

f,”..chances of that happening?”it comes down to perspective and consciousness and our ability to communicate and educate ourselves and each other.and resistance when your lied to or cheated.things are collapsing, deflating, out of imbalance. it won’t stop till the laws of gravity, ecology etc. are satisfied..3 important things.1. host/ parasite characterization as it relates to perspectivelear jet to pedestrian.the natural tendency to assume that your current circumstance and perspective isreal and proper and sustainable is based on natures cycles as they compare orrelate to the frequency or cycles of the human body and mind.so. the passenger on the lear jet assumes the parasites on the ground are destroying the planetwith their automobiles. the auto operator sees it differently, blaming the “other” drivers and bicycleriders and walking pedestrians as “inefficient” obstacles to maximization of resource allocation.of course the bicyclist has his/her own life threatening problems but the walking pedestrian alsodespises the bicyclist as they follow absolutely no rules and frequently kill and otherwise slam intothose on foot. soo.perspective is the key. that being that your current circumstance is local and not systemically informedin relation to the larger perspective and ecology.2. vacation and depressionknown cure for manic depressives.conflict or stress due to accelerating environmental and psychological changesis threatening to the integrity of the body/mind and its ability to harmonize withits environment and ecology. frequently this results in mental bubble states.energetic mania and collapse into depression. over time patterns developand depression can become lasting or L shaped. one scientifically proven wayto reset the mind body depression condition is to change time zones. move, travel, vacation.the internal clock can be reset, alleviating the state, breaking the cycle.!3. what you say! ( the only really important part of this post.)

Peter,Where do you come up with a date of June?I don’t doubt that this is possible but a date?

http://radio.goldseek.com/Dylan Ratigan for Treasury sec. hec for President there’s actually hope in the world, listen to this interview of Dylan Ratigan about 2/3rds of the way through right down click and save as the mp3 file so you don’t have to listen to all the other stuff. Dylay Ratigan goes off on our banks their ceo’s and our congress. He basically calls the entire financial and political system corrupt, I never thought I’d see a cnbc talking head risk his own career for what is right!!! The man has integrity and courage. I thought he was just some slickster/con puppet like most of them but he’s willing to sacrifice his own status for the benefit of future generations. The tides are turning evil and greed are being exposed by more and more main stream people people who are educated and credible, it’s time for people to roll up their sleeves and boot these corrupt politicians and their bankster friends out of office. Next time I’d like to see that same speech on CNBC though instead of a gold bug website!

check out CR – apparently Geithner will delay his “financial plan” until Tuesday -http://www.calculatedriskblog.com/2009/02/summers-bank-bailout-announcement.html

create a cloud of smoke amid controversy of the stimulus bill then do the heist! You got to admit they’re smart crooks-professional.

http://news.yahoo.com/s/nm/20090208/bs_nm/us_usa_stimulus_3$827B or $819B or $780B or $790B or $827B or $900B. man, those democrat scumbag really want to spend USA into bankruptcy.

g,we were spent into bankrupcy while you were sleeping last decade.think about it.

blame the bankers rather – they should stop whining and let their own companies die a nice silent death. That’s were most of this money is going anyway.oh and besides that the other bunch of whiners are those at Pentagon. A group of chicken little’s who have managed the get a hold on the government money.

Guest(s), did you not read the entire article?? They’re bidding themselves out at the LOWEST WAGE.

Everyone is lined up for the free money that’s not backed up by industry or production. If the government wasn’t so badly in debt I could buy hard core deflation argument but whatever deflation we get will easily be turned into inflation given the government is broke. Our currency will have to give way soon and next will be an attempt to generate wealth through the military maybe take over another oil rich state ie. Iran

I would like to submit this for discussion.Debt-To-GDP Chart “Wrong,” US Debt Levels Fine It has a piece by Credit Suisse that implys that we can pay our debts because the servicing costs are within sustainable means due to relatively low borrowing costs.What do you think?Is Credit Suisse right and as such, we can even handle more debt?This is an important issue because if the economy isn’t overburdened by debt then the borrowing by the government is affordable and the prospect of inflation is higher than a continuation of deflation.This is a critical issue to investors as there are opposite scenarios of what to do with capital..Deflation or inflation?Which is it going to be?

It’s clear to me that Credit Suisse and UBS are part of the cabal that manufactured this crisis. In the past they have been proved to be untrustworthy. Also, it is in their financial interest to spin good times ahead.Credit Suisse is peddling pablum. That chart shows the building of kinetic energy that is forcing its way onto the international banking scene. This energy will continue to build until the credit bubble pops.Deflation or inflation? It’s probably a multi-variate combination. Like a summer’s severe thunderstorm, first the wind (credit insolvency), then the calm (what we see now), then the hail (inflation), then the rain (deflation).

here’s the solution to the nations financial woes:Cheney Dunk Tank Raises $800 Billion For Nationhttp://www.theonion.com/content/news/cheney_dunk_tank_raises_800

WASHINGTON—Organizers reported Sunday that the 44th White House Carnival was a rousing success, raising a record $800,000,066,845 for the federal government—$800 billion of which came from a dunk tank featuring former vice president Dick Cheney…. …”All right, you candy arms, let’s go,” Cheney shouted at the line of people, which consisted of Americans, non-Americans, out-of-work autoworkers, teachers, luminaries from the science community, gays, lesbians, military personnel, members of Congress, children, and the entire Arab-American population. “Hey [former British prime minister Tony] Blair. I see you back there. Think you’ll be able to stop crying long enough to throw the ball?”

psssstt… Mark..we already have(had) a One World Government..that govt is falling apart now…psssttt dont tell no-one…

Is it time to close the money hole?LINK

The problem with CS’s argument is that servicing cost isn’t everything. Interest rates do not remain low forever, and only way rates can remain low forever is that inflation remains low forever, which cannot be the case, since the only way the amount of debt can be funded is through monetisation of debt (ie printing press). Printing press = debasement of US$ = complete exit of foreign holders of US assets = higher rates and so on so forth. A more idiotic argument for higher debt I have never heard.

Agree Wolf,When and if the bond market collapses and interest rates adjust upwards, the dynamics of Credit Suisse’s argument are thrown out the window. This would crimp demand for debt even more and force savings up again. The risk here remains with the Asians as any further decline in consumption will accelerate the decline in Asian manufacturing economies, allowing US companies and investors to pick up great assets on the cheap as this credit crunch continues.

PROTECTIONISM IS A STUPID TERM TO USEIf we don’t due the same thing the rest of the world does [I guess you call it protectionism] and develop a domestic industral base, we won’t be paying the foreigners any payments back on their loans anyway. They need us to do the same thing they do or they’re shafted.Think about it, Japan and China would totally agree with me.

Philosophical Musings by an Existentialist Who Has Been Subjected to Nihilistic Meanderings of the Consumer KindReality Check #1: Our core work-population is aging, really aging. Faster than even illegal aliens can replace it with younger bodies at fast food joints. And hence because this core work population is getting older by we don’t produce like we used to. We’re really too damn tired to hoist that I-beam in the air as it were. Our energy levels have come down considerably.Reality Check #2: And since we don’t produce like we used to we don’t consume like we used to either: that is, saving first to make the entire purchase or saving enough to make a decent down-payment on an expensive item before charging the rest off on a credit card, home equity line, etc., instead of the opposite as we have been doing for the past 20 years or so. Therein lies the crux of all our current economic problems. In order to solve this problem we must become a nation of producers once again. But with an aging population and an educational system that pumps out more BS degrees in ‘Business’ rather than Engineering it doesn’t look like that is going to happen any time soon now does it?Reality Check #3: And where will we all go from here even after these post-mega-trillion stimulus plans? Well, we will have to lower our standard of living expectations a bit because we cannot afford to maintain the current one to begin with. We will also have to start saving again to carry us through until we become work-core producers – then we can start the whole borrowing cycle to riches all over again. In effect what I’m saying is that we can’t help ourselves when the opportunity is given to get something today instead of tomorrow. Of course today that isn’t so easy and we’re shocked by this change of events.Reality Check #4: I’ll let this graph tell you everything you need to know about the finer details of the entire picture as to where we’re heading and how fast we’ll get there. They say a picture says a thousand words. We may have to modernize this old adage into the 21st Century version of a graph says a million jobs.http://globaleconomicanalysis.blogspot.com/Reality Check #5: I think what we all need to come to grips with to maintain our sanity and to keep things in perspective is that having less stuff is sometimes more and having more stuff doesn’t equal a better life necessarily. Maybe what this whole ordeal is trying to teach us is that chasing the proverbial pot of gold ain’t what it’s cracked up to be if that’s all we pretty much focus on chasing in life. Greed is good but then again it’s not so good, is it?This all has happened for a damned good reason. It’s a big comet of a reality-check on our starry priorities and most importantly what we have sacrificed to keep them up there in the blue skies at all costs and all at once. A global life-lesson.AM

AM,here’s my take.RC#1 Older but smarter and more efficient. If it was only about lifting or digging you might be right but many older workers have a lot of tricks in their bags that younger ones don’t. Sure there is some drop off in physic when someone gets to 50-60 but I can dig more ditch than my 28 year old son because I have a good skill set and know how to pace myself.RC#2 true as we age we don’t consume as much. That is partly because we have a lot and some because we just don’t get the thrill. Having good quality lasts too.RC#3 agreeRC#4 I have a lot of empathy for the unemployed. I wish there was a decent answer. Maybe a 4 day work week. The US produces plenty of food, although organic would be healthier and more labor intensive, but we have plenty, we just need to get over this winner take all greedy monopoly game mentality.RC#5 A lot of this goes to our individualism and our survival instincts gone awry. We could easily do with less if we could ever learn to share and be responsible. Why do we all need crappy cheap lawn mowers when it would be more efficient for a group to have a really good commercial one? We all need our McMansion so we can show others how well we are doing, even if we have NO equity in it and owe $30k on our credit cards.. Our biggest enemy is ourselves. We are all about image and nothing about substance. IF we don’t grow up soon, we will tear down the entire place in anger that our insane personal greed caused us to go backwards and our ego couldn’t take it.

Exactly! I keep arguing with those believing that OWG (NWO) is a threat, stating that it can’t happen because it takes too much energy (too much to maintain the structure). But people are insistent that it’s still a threat. Many appear to be pushing this fear out of some sort of biblical rationalization.Mark

What more could I possibly add? Mark

Anybody here have any guess as to what would happen if most/all of the leading economic powers went into mega inflationary mode?It’s my understanding that inflation is meant to change your position vis a vis other countries’ currencies. If everyone does it doesn’t that cancel any “effectiveness” of inflating?Mark

This all has happened for a damned good reasonA,I quite agree with your underlying spiritual message in your sharing. Our world has lost its vision – as if material things were the only things. It is that quest to find the right balance and it reminds me of Christ’s saying, “Give to Caesar the things that are Caesars and to God the things that are Gods.”

anyone know if there is a petition to sign for people who aren’t members of the facebook thangee?

Geithner will guarantee 2009 Wall Street CEO Bonus Pool on monday like his predecessor Paulson. Hurray Wall Street. Bend over Washington and Main Street.

Ultimate Reality Check: All your reality check not gonna happen. USA is going down the drain under leadership of Obama, Democrasocialist controlled congress, FED, Geithner (mini Paulson). NO, WE CANT.

to pick asset with what? more printed dollar? USA companies are broke, that is why they are asking for TARP money. who gonna come up with money to buy what? Even USA is broke, the only last resort is print more public debt that foreigner starting to keep a long distance of or print more dollar. Idiotic.

take over oil rich state for oil? you mean to start an expensive military campaign for a state with cheap oil? are you a nut? do you want to drive USA or NATO economy into more debt. your comment is incredibly moronic.

In Florida, Despair and Foreclosures

Desperation has moved into this once-middle-class exurb of Fort Myers, where hammers used to pound. ts straight-ahead stare was hidden amid the chatter of 221 families waiting for free bread at Faith Lutheran Church on a recent Friday morning; and it appeared a block away a few days earlier, as laid-off construction workers in flannel shirts scavenged through trash bags at a home foreclosure, grabbing wires, CDs, anything that could be sold.“I knew it was coming,” said Gloria Chilson, 56, the former owner of the house, as she watched strangers pick through her belongings. “You take what you can; you try not to care.”Welcome to the American dream in high reverse. Lehigh Acres is one of countless sprawling exurbs that the housing boom drastically reshaped, and now the bust is testing whether the experience of shared struggle will pull people together or tear them apart.The changes in these mostly unincorporated areas outside cities like Charlotte, N.C., Las Vegas and Sacramento have been swift and vivid. Their best economic times have been immediately followed by their worst, as they have generally been the last to crest and the first to crash.In Lehigh Acres, homes are selling at 80 percent off their peak prices. Only two years after there were more jobs than people to work them, fast-food restaurants are laying people off or closing. Crime is up, school enrollment is down, and one in four residents received food stamps in December, nearly a fourfold increase since 2006.President Obama is scheduled to visit… Read More

The Obama Spin Machine is in full operation. The headline suggests this area outside of Ft Myers is a microcosm for the woes of America. e.g. once the stimulus is passed we’ll be on the road to prosperity…

…..a piece by Credit Suisse that implys that we can pay our debts because the servicing costs are within sustainable means due to relatively low borrowing costs.”This is exactly why we are in this situation, thus exactly the wrong conclusion and based on delusional thinking. Business, consumers, and governments all bought in to the idea that cash flow should be levered up to the hilt. So long as you have the cash flow, borrow and grow. Oops! Now we must learn (re-learn) that cash flow is not hard asset, and neither is “relatively low borrowing cost”. What tripe. This must have come from their marketing department.

SOBERING

In very basic terms, unless the stimulus bill and latest bank bailout include new business models, they’re both fluff with no legs. Translated: short term rally, maybe even a strong run, with an almost certain return to reality, where the reality is below DOW 8000.

here’s the Gross Pimco link on bailout and treasurieshttp://www.cnbc.com/id/15840232?video=1027217158&play=1

ok, 2009 Wall Street CEO Bonus Pool presentation will start tomorrow.

“Democrasocialist controlled congress”?well USA was not any better off during the Rebulican Neo-Cons, were they? Actually severe downhill started 2000-2001. The country was just on life support for the last 4 years by banks & other institutions peddling loans like there was no tomorrow and the government looking elsewhere (because that is what kept the system afloat while those two characters were in the Oval Office).Regardless of which clown party is in power you will end up in something that spells S, H, I and T. Unfortunately. It’s not your fault, unless if you voted.The reason is, you still have the Pentagon and everybody else for whom the income generated by status quo is too-big-to-lose.

Is it really? Our military is in Saudia Arabia, Kuiwait, Iraq and is dying to get into Iran. If our military wasn’t such a presence there I can guarantee you we would be paying $10 dollars for a gallon of gas and or I can guarantee you the U.S. government would collapse tomorrow because the Arabs would no longer be forced by military threat to buy our treasuries. Before calling some one a moron at least make sure you have the intellectual capital to get away with it. Moron- the U.S. and western allies have owned the middle east for a long time and the puppet governments in those countries are just that. It’s all about oil and yes of course proportionally we get the shaft on the oil profits but without our military dominance we would pay through the nose for energy and the middle east would be the countries with powerful militaries. Look a little deeper next time.

NR main headline on the FTft.com

China, Japan and Saudi Arabia are idiots for buying Treasury, ST Bill, or hoarding Dollar. Absolute moron. No doubt about it. Anyway, their PAIN, our GAIN.

STIMULUS = tremendous amounts of unaccountable money keep flowing into USA government spending. and count on TARP III/IV and STIMULUS II/III/IV.

David Faber (CNBC anchor) most of the nations financial institutions are insolventhttp://www.cnbc.com/id/15840232?video=1027231385&play=1

The majority of them, D or R, all work for the same special interests, banks, & corporations. As far as I’m concerned, their party affiliation is just a distraction for people who like to argue and finger-point.

Holy Hell, I never thought I’d believe it, but Ratigan really does nail it here!! Tells it like it is. Good for him. I love the anger too!! Thanks for this Guest.

Bloomberg has posted a great report this morning headlined, “U.S. Taxpayers Risk $9.7 Trillion on Bailouts as Senate Votes.”In its broad overview of U.S. spending and pledges made in response to the economic downturn, Bloomberg reports that this would be enough to send a check for $1,430.00 to every human being alive in the world, or it would almost be enough to pay off every home mortgage in the U.S.The Drudge Report is featuring the article in a huge headline on the front page of its web site, with a $100 Monopoly bill above the headline.

Our GDP is overstated, using hedonics, leverage, etc. Our GDP is only 2/3 of what is publicized, and contracting materially. The current debt to GDP ratio is even higher,and going high still!

Roubini and Taleb on CNBC now

I ‘eard it was magicrap with a hat full of complaints about it.

the video will be up on CNBC.com in about an hour – THIS IS A MUST WATCH -

And they said…We will fix this mess with Tarp 1As we all waited, nothing was doneWe will fix this mess with Tarp 2Still they had no clueNext they will say let’s do Tarp 3And we cry “will we ever be free?”Finally, they will try and pass Tarp 4But by then, they’ll be out the doorAnd we will no longer be able to find our wayFor we are now living in Zimbabewe!

Great post! And you’re right, the anchors are pitifully pathetic in every sense of the word! If they would just shut up and let T&R talk, they might learn something and not have to interupt all the time.

Thanks Hayes, that was enjoyable. It’s nice to see that NR has learned to stand his ground and get his points said while Taleb has yet to develop skills in this area.

I’ve been wondering if the delay is because there’s little economic news today, but tomorrow…ICSC-Goldman Store Sales 7:45 AM ETRedbook 8:55 AM ETWholesale Trade 10:00 AM ETPlus:4-Week Bill Auction52-Week Bill Auction3-Yr Note Auction

e,.http://en.wikipedia.org/wiki/Ecological_economics.good thinking!we need an energy revolution to begin now. it is our only hope, the only hope for civilization. energy economics, ecologic economics, bioeconomics, biophsical economics. alternate energy capture everywhere. ultimately it will be about energy, not money. knowledge and confidence makes the “world” go ’round, not money. mysterious energy makes the world go round. and all the knowledge base and innovation that implies. there is tremendous demand! a new “reality” from the home to nations capital, starting with, informed by, energy dynamics and principles evident in the physical world and articulated in ecologies, from forests to deserts to polar ice caps, and coral reefs and deep ocean environments.currency today is just paper. currency could be based on more, like something, anything. ( other than fictitious security guarantees.) americas current capital.”In order for there to be a growth spurt, money velocity has to increase. How do you envision this happening?”i was thinking unemployed ex working people are a growing demographic. at some point that group will become desperate. at that point money, at interest( terms will suck), might become available. mini growth surge possibly ending in disappointment due to lack of real direction (smart investment) and bad terms. (bankers last gasp at breath in a toxic atmosphere of their own adoption/creation.)?at some point with real estate the prices will just become, well, affordable, as with autos. so many people with so many divergent and semi manufactured expectations and “demands”; there are always imaginative/creative and hungry people from all over the world willing to climb out on a limb and only to see that limb cut from the trunk. however, somehow, some land on their feet.? some not so agile, all mostly blindin need of hope and decent directions..ecologically informed energy is that direction.