Question (maybe a dumb one): if credit card delinquencies are 4.9% that means that 95.1% of credit cards (accounts) are not delinquent so it would seem as though by far the majority are not. So is it important/a matter of significant concern that 4.9% are(is?) delinquent because, at that %, short term profits of the credit card issuers are already severely decreased? Or what is the reason it seems to matter a great deal? (is there a great deal of leverage involved?)

I believe the credit card delinquencies will be a lot higher than 91. People have gone all out since their going to be screwed anyway. If you know you’re going belly up. Why not go belly up with a beer belly?

Moreworriedthanyou

o'driscoll is not so smart

the US will never repudiate its debt,,,escape by inflation probably , but repudiation, never

jus t to show you how studpid this op-ed is,

the author, gerald odriscole re-writes history when he says:

"In the 1980s, Ronald Reagan and Paul Volcker worked together to get inflation under control. They were greatly assisted by the "bond vigilantes," traders who were by then exerting discipline in bond markets by bidding up interest rates to double-digit levels. The outcome of the Reagan/Volcker policy of tight money and low marginal tax rates was not only a great economic expansion, but also a great boost to the Fed's credibility. The Fed proved it was able and willing to withstand political heat in the fight against inflation."

Reagans fiscal policies, tax reductions with increased federal government spending worked exactly against Volkers fight against inflation and necessitated higher interest rates than otherwise would have been necessary to get inflation under control.

odriscol needs a spanking.

Bush administration for sure will do its best to delay bank failures, or bank failures anounsment.

As Marc Faber said, 2008 is just an appetizer, main course will be served in 2009.

Thanks Energyecon,I think I'll skip dessert and move directly to the Everclear and Valerian root.

I can not open this "http://online.wsj.com/article/ SB...in_commentaries" !!

How can I do that?

Let me be more clear, not that I like the second order plots, just they are more revealing IMNSHO (ref my post upthread)...

wut,
Cease listening to larry kudlow, turn off fox news, tune out cnbc.

Now go back and read the archives- the news here matters as it documents the decline of the financial/housing/credit nexus in modern America.

Did you miss the promise of nationalization for Fannie and Freddie the last couple of weeks?

I was talked about months ago here.

Someday this war's gonna end...

Are you joking or are you a complete nutter

He's 'farting through silk'... [do a search of comments from a year or two ago].

Conjure is considering changing his peak inflation forecast to 08-Q4.

He is undecided. He may leave it 09-Q1.

Decisions, decisions. At least Ben is on board.

I look at those charts and it makes me think of pots of gold at the end of the plot (rainbow) in the form of more largesse from the USG. The national debt will look like those charts, or worse, shown in step function fashion.

What a train wreck.

CONJURESCOPE

Peak Core CPI: 08-Q4

was 09-Q1

"Have a nice day."

We're ahead of the curve here... I'd like to know why conjure moved it up. I think American economy is like a zombie from night of the living dead or something... no matter what some perverse power is still giving it life.

There was a comment on here today or yesterday about the fact that it feels like all the big boys are just passing money back and forth like a hot potato trying not to be the ones stuck when it explodes... even though I buy a catastophic event, there are still a lot of rings around the castle... (didn't we use this analogy when the subsidary of some company went BK last week?) So sure, as the "enemy" gets closer but there's a lot of knights still fighting the "good fight".

Or maybe a lot of "good knights" have been slain, the enemy is upon us, and the other knights have abandoned the village.... I dunno... I don't get what's going on... I mean... all signs point to worldwide economic collapse... but it feels like waiting for the rapture.

I really wish at some point we can remember the names of the politicians/policy wonks/power mongers running this country for the past 15 years and when "we the people" get control of this country we give them some nice medicine. You have to figure there will be a tipping point when all the soldiers, cops, entry-level bankers, and everyone else working for the hyppocracy realizes just how much damage has been done to the American way of life. Oh wait, I forgot I'm just some dumb-stain who didn't graduate from Harvard Business so that makes me some stupid populist or something. Both parties are full of traitors... full enough that anyone not a traitor should see what's going on and run away as fast as possible...

We are seeing inflation and deflation at the same time in different parts of the global economy. Both are occurring as monetary phenomena, but the effects vary among segments. Div, curl, and grad are all present in the monetary stream. Put another way, even a strong presence can fail in the middle of the stream, while others are made rich or poor according to the whims of the current and their ability to surf. The fed is running fire hoses around with 1000 gal/minute while the river is flowing at 100,000 gal/minute. When the current takes you the best strategy is don't fight; hang on and save your energy for when it can make a difference.

Wow--that kenosha school thing is incredible, amazing and scary. I'm gonna go check local government investment portfolios next week.
John Stark | 08.23.08 - 12:41 am | #

C'mon John, I thought as a journalist you'd have recognized the eternal verities of life, the only thing that has changed is the absolute magnatude. Thousands lost- average idiots; Millions lost-doctors and lawyers; Hundreds of millions lost- rogue traders and small banks; Billions lost pension funds and government agencies. Cause that's where the money is.

The size of a planned government pump-priming package is expected to be around 8 trillion yen, government sources said Saturday.

They can hand out as much paper as they want.

That doesn't change the fact that paper is not wealth and never will be.

History may look back on this period as the financial dark ages.

The idea that economists once thought we could make the economy better by throwing around pieces of paper could one day go down as the most embarassing and absurd mass delusion in human history.

Hopefully for our sake it will seem so ridiculous that no one will believe it.

conjure needs a tune up. We're entering severe deflation.

Cheers,
Misean

It still kind of unnerves me that Marc Faber argued that we are facing a hyperinflation threat precisely because we're headed for a deflationary depression.

In other words, we may have hyperinflation because we're likely to crack under the stress of severe deflation.

There seems to be some historical support for this view also.

Hmmmm, the only thing I can come up with is he lives in a high tax state where his property was re assessed upwards by 100K-200K?

Serve

How was there ever a 12% CRE delinquency in 91?

Seriously, how does that happen?

volley

There's no such thing as a distressed sale in the Manhattan real estate market,'' Zuckerman said in a May 27 interview.Manhattan is a key part of the global economy as well as the national economy and an attractive place for investment.

There are no such thing as unicorns. The thing Zuckerman doesn't believe in, exists. Existed quite a bit in 1991.

Of course, some of the top hedge fun managers and IB punks in the world are only in their early 30's. They probably skipped that lesson. I'm only 37 but I got a first hand education in distressed sales of big buildings at an early age.

Cook me up some more SRS, bitches. I drink your divvies! I drink them up!!

The GM Building will cost Boston Properties about $5.5 million during its first year of ownership, according to a June 10 report by Deutsche Bank REIT analyst Lou Taylor. While cash flow will improve to $26.8 million by 2012, meaningful lease expirations don't occur until 2010 and 2012,'' wrote Taylor, who has ahold'' rating on the stock.

Boston Properties owned 139 properties, almost all of them office buildings, comprising 43.9 million square feet, as of March 31, according to its Web site. It has another 3.6 million square feet in development, including 250 West 55th St., a 1- million-square-foot tower at Eighth Avenue in Midtown Manhattan, where the law firm Gibson, Dunn & Crutcher LLP is to be the anchor tenant. (Bloomberg)

I predict the term "anchor tenant" will take on new meaning in the coming years.

In other words, we may have hyperinflation because we're likely to crack under the stress of severe deflation.

ac | 08.23.08 - 3:59 am | #

Yup - my view exactly... deflationary pressures eventually leading to an inflationary response. I expect inflation to eventually win - over time. There maybe considerable deflationary pressure in the meantime...

::::

All that matters is accumulated wealth, and productivity. I have capitulated. We must have a precious metal standard.
yogi | 08.23.08 - 4:23 am | #

I'll pass on the 'official' metal standard, thank you - I don't want to go back to the 1800s.

However that doesn't mean I am willing to lock into fiat denominated assets indefinitely either - dollars are means of immediate transaction, they alone make terrible stores of 'wealth'... its the underlying asset (land, productive capacity, useful commodity, etc.) that is the 'wealth'... the currency is just a floating measure of the immediate 'price' wealth. No natural law saying he have to measure those prices in dollars or that they can't change.

As long as we are allowed to own metal, land, factories, etc. (real assets) or shares of same it doesn't much mater what that wealth is denominated in. The truly rich have known this forever - they never hold 'money' they own real assets - its harder for us peons to grasp that.

El Cliffo writes:
So the rich keep land, factories, and other productive assets in their secret Swiss bank accounts?
El Cliffo | 08.23.08 - 10:26 am | #

Sure they hold some cash - not much relative to their net worth. They would rather hold gold, stocks, bonds, land or own whole companies out right - if they hold a lot of 'money' in them (savings accounts) the interest rates are too low and a generation or two later they aren't rich anymore.

If they bury that money in stocks, bonds, etc. - they return income over the long haul and are invisible to the tax man (until some transaction turns them back into cash... dividend payment, capital gain, etc.)

The only real cash money they hold is temporary funds & short run requirements - any sizable accumulation getting submerged back into real assets again ASAP.

As I said above - that's pretty tough to do for us peons. We are mostly paycheck to paycheck.

dryfly's right - those rules are for people who want to become rich. Their children and following generations are rich and generally have none of those disciplines. Exceptions are notable for that very reason.

I'm pretty sure Michael Jackson hasn't a clue about finances but lives in a house he couldn't afford. Half a billion dollars wasn't enough I guess.