This is what I call action. The Europeans have awoken from their collective slumber. I still think we a bigger global coordinated rate cut like Roubini is calling for and the US needs to guarantee all deposits along with interbank lending.
Here comes the public utility model of banking. There is a lot of talk of nationalization, and such, but what it boils down to is governments are stepping in to assure that the continuation of activities of the financial services sector that are truly 'services,' in the sense of facilitating the commercial and business activities of the general economy, rather than speculative or proprietary (like running a house trading desk).
Of course, the trick is to untangle the two kinds of activities, and not much progress will be made on that until the senior management of the major financial institutions are bluntly taught that they answer in the first instance to their regulators. The mindset of those guys is mindboggling. I could not believe that Vikram Pandit would compare his deal with Wachovia to a winning lottery ticket. Very unfortunate choice of analogy for someone who should be taking lessons in starched rectitude and bankerly demeanor. Somebody needs to tell him the music's over, it's time to stop dancing, and platitudes about creating shareholder value are about as passe as a rascist joke. Perhaps the feds should cut him off from the window and FHLB liquidity for a week or so to help him see the error of his ways.
--
All these bailouts indicate that the problems are far worse than people have been told until last week's crashes in various Scam Markets.
Worldwide Greater Depression is unavoidable unless you believe in the powers of govts to make economies better. Good luck to those who believe.
What part of the same guys and gals who allowed the problems to develop are in power and have more powers over the people than before don't people get? Savings the bankers doesnt do much good for the people, does it?
Under what system do I pay money with little or no say in what is done with it? Taxes. I finally understand what's happening. The banks are taxing the governments for the FRN notes they are already taxing us with interest. Kinda like double jeopardy.
Does Germany have one person deciding where the money goes? Does it have to be voted on in their version of a legislature? Do they have to issue EU bonds to fund this and if yes who is buying? Does the EU have to ok this and if they don't what will Germany do? Anyone understand the ramifications of a country in the EU acting unilaterally? Is the EU showing some rather fundamental cracks in it's foundation? If the Euro crashes and countries revert back to Marks or Francs doesn't that leave the dollar as the sole choice for reserve currency continuing?
More fuel on the fire, soon to be lighting a bank near you.
--
Listening to Milton Friedman (rebroadcast from 1994) who says that in 1928 govt's share of the economy was 15% and now it is more like 50%. I bet when we are done with Obama's $5Tr. Fair Deal program in 2010 govt's share would be 60-70%.
We loaded up at a liquor store that went out of business too, 1/2 off on several gallons of liquor. Like my wife said,'You never know when we may need to perform surgery on ourselves.'
I don't disagree with your hypothesis, but IMO it's a year late and a couple of trillion short. A year ago it would have been a lot cheaper to do because moral hazard wouldn't have played chickens with ICBMs.
Wealth destruction is far outpacing credit creation, leverage be damned.
While I feel there is a tad more public recognition of what is going on here, I have decided that after my public milling around the past few days, most people are basically clueless.
Regarding the question of "who buys the bonds" to provide governments the cash to make these interventions, it seems to me that the governments could simply create debt obligations and swap them for equity. Additional "good as cash" sovereign debt on a bank's balance sheet should function like a recapitalization, I would think.
About a week ago (it seems like a lot longer than that) Krugman was speculating that this was how the TARP would work, with T-Bills (newly created for this purpose by Treasury) swapped for toxic bank assets. That could presumably work with equity interests as well, I would think.
Listening to Milton Friedman (rebroadcast from 1994) who says that in 1928 govt's share of the economy was 15% and now it is more like 50%. I bet when we are done with Obama's $5Tr. Fair Deal program in 2010 govt's share would be 60-70%.
--
"Who is going to buy all the new bonds? What happens if nobody bites?"
Mel,
Depends upon what your alternatives are. Why were the Japanese buying JGB debt at 0-1.5% with JG debt exploding?
I expect deflation in the US in 2009. Here is my rationale:
Why Printing Money (rapid increase in govt debt) IS Highly Deflationary?
The increase in the US govt borrowing crowds out the private borrowing and, most importantly, private investments! Both are highly deflationary. The Japanese govt had borrowed like crazy during 1990s and they had deflation. Please remember that US govt borrowing went negative during the boom of late 1960s & late 1990s. The govt borrowing shoots up during very bad economic times (when the CPI inflation rate invariably falls) and major wars (War On Iraq is not a major war) and NOT during good times.
ya, just inflate that bubble in treasuries a tad bit more, yup, a little more, almost, not yet, wait, little more....POP! (you think we have a mess now)
Handelsblatt said the Bundestag budget committee would hold hearings on the legislation on Wednesday, with pressure for a first reading of the legislation in parliament before the week was out.
The extra liquidity would be pumped into German banks and government guarantees would be offered as a backstop, while the sum of 100 billion euros ($134 billion) at the most was tagged as an equity injection, Handelsblatt quoted a German delegation source in Washington saying
Some people at our small and cordial website --- The Old Elm Tree --- are really beginning to envision a financial and social meltdown of our beloved United States. Links to YouTube at The Corbett Report -- are pounding in the hypothesis that the pResident's executive authority is now able to declare martial law in the US and put off the election. Rep. Brad Sherman of CA spoke of this recently. October 1, 2008 was a critical day because the US Army called back some of its people from Iraq to stand by for civil unrest of American citizens.
What should I tell my frightened friends and family here in Oregon? Is this really happening, or just another (not exactly urban) myth?
How is your fear level? It's Sunday, and our government just seems to be sinking into the morass of worse and worse decision making.
And then, my friend, a nice fireside chat. Here's hoping it works.
Deana,
OMG, Diana! That was the thought I had at lunch what would Obama fireside chat be like? I would make sure that I am not eating while listening to one out of curiosity. Not that McCains would be better.
The reason I asked Jas Jain what he'd invest in is that if you have such a dire prognosis for the future, then extreme nihilism should rule your thinking. What can you possibly hope will hold value, leave alone increase, in such a case?
In particular, Jas Jain has said in the past that he has bought US TrIPS. But this means that you assume the government won't game the inflation metric so as to pay out much less than the rate of inflation, effectively making this a worse investment than cash (as bonds' value drops with time). Just see what has been happening to US TrIPS versus Long Term Treasuries.
Jas Jain has also consistently spoken of buying Puts on financial stocks (JPM and GS for example) but if you make an investment periodically (every two weeks when you get a paycheck, for example) does it make sense to keep buying Puts when the stock prices have already dropped significantly?
Can anyone imagine the after-session laughter at IMF/G20 meeting today. after hearing this from Bush this morning:
In his Rose Garden appearance, Bush made a plea for nations work together to address the crisis, avoiding the go-it-alone protectionist trade strategies that worsened conditions during the Great Depression.
"In an interconnected world, no nation will gain by driving down the fortunes of another. We are in this together. We will come through it together," Bush said. "There have been moments of crisis in the past when powerful nations turned their energies against each other or sought to wall themselves off from the world. This time is different."
I think that the idea is that the Treasuries swapped for equity do improve bank balance sheets --- more capital --> less nearly insolvent. Of course, the banks still need to be confident that their loans will be repaid. How to restore that confidence, I know not.
The Japanese did not have a terrible quality of life in the 90's. They couldn't afford $3000 cashmere sweaters in Ginza anymore. BTW they commit suicide from loss of face more than loss of cash.
"Out of curiosity, if you were to invest all your life savings on Monday morning, what would you put it in?"
Confused,
Nothing on Monday or anytime soon. I built my positions way before the crisis. I am sticking with the few losing positions too. Have no idea which way the wind will blow. Safety is my main goal and I am happy with Cash, long-term puts on Scams, T-Bills, and long-dated UST STRIPS.
Looks to me like a whole generation of bankers and other financial leaders is going to learn what its like to be under very close supervision from their respective governments even if they are allowed to stay on the job.
Disrupting world trade, blowing gigantic credit bubbles, and selling badly engineered securities has just gone out of style. Strict regulation and possible jail time is the new black.
I think he channeling Bush with the speech. I just don't understand the British "clam" reference? Pulling back into their shells
"For Europe, the stakes could not be higher and this is a moment of truth," he said.
"No country - not even the biggest - can make it just on their own at a time like this.
"We are all in it together and have to work to solve it together."
He said he knew people were "worried" but praised the resilience of the British public.
"I've seen in the cities and town I've visited a clam, determined British spirit; that while this is a world financial crisis that started in America, Britain will lead the way in pulling through," he said.
OMG, Diana! That was the thought I had at lunch what would Obama fireside chat be like? I would make sure that I am not eating while listening to one out of curiosity. Not that McCains would be better.
Loans repaid? I keep coming back to this question as well. Short term they recapitalize the banks but long term rising unemployment, continued deflating house prices and no job creation leads back to more crisis. What am I not understanding here? How does any of this FIX the problem?
As I mentioned in my original comment on the previous thread (and CR owes me hat tip for the pointer) - you have to scale up the size of the Germany bailout by 4 (German GDP is 1/4 of the US GDP).
How Wrong Milton Friedman Was about Republicans and American System
Still listening to him.
Friedman: If an experiment in private enterprise is unsuccessful people lose money and they have close it down. If an experiment in govt is unsuccessful it is always expanded.
I'm long tampons and booze. The stockpiles are getting so big that my new venture is sure to be a success in the post-apocalyptic world. I hope to hire Finance MBAs to guard me. I hear they'll work for peanuts. Literally.
Coordinated Intervention to Strengthen the Dollar?
I never thought I would see the day when observers are talking about coordinated intervention by policymakers to strengthen the dollar. Here is the FT commentary:
Selling the dollar is now close to a one-way bet. So great is concern about the health of the US financial system that the dollar traded below Y100 on Thursday, and above $1.56 against the euro. The danger of a dollar rout is rising, and the Federal Reserve, European Central Bank and Japans Ministry of Fi nance should co-ordinate intervention to slow the greenbacks fall.
There are two distinct but related problems. THe most urgent is the credit freeze --- that is accelerating the decline in the real economy. But the recession/depression in the real economy is also there.
The current governmental scramble is to address the credit freeze, but after that there will still be the recession/depression to deal with. My guess is that there will be worldwide deficit spending (which I suppose means money printing), public works, FDR-style WPA things, who knows what else. Maybe it'll help.
Why@ ZIRP writes: "Looks to me like a whole generation of bankers and other financial leaders is going to learn what its like to be under very close supervision from their respective governments even if they are allowed to stay on the job.
Disrupting world trade, blowing gigantic credit bubbles, and selling badly engineered securities has just gone out of style. Strict regulation and possible jail time is the new black."
Thank God that the regulators, Chris and Barney and Chuck, can take over our entire financial system. That should make things a lot better. They were fighting the bubble inflation at every step.
Just a couple comments on MS/Bank Of Tokyo-Mitsubishi. More appropriate for two threads back, but they are stale now.
Look at the MS market cap when BT-M first made the 9B=21% offer vs the MS market cap today, as well as the USD-JPY level. Then it's easy to see why there were some rumors Thurs and yesterday that Mr. Mack was considering how they might change the deal most advantageously, because it was certainly going to change.
There is precedent for BT-M to own real, and not insignificant, US banks already. Just in the last couple weeks the purchase of Union of California, one of the 20 largest US by assets, was completed. Japanese successors to BofT had owned a majority of UBoC since about forever, though.
There was talk --maybe fact, I can't say for sure-- that BT-M has, or will acquire, MS' Asian operations.
Points 1 and 3 are based on conversations based on speculations. But 2 is a fact.
"Jas Jain has also consistently spoken of buying Puts on financial stocks (JPM and GS for example) but if you make an investment periodically (every two weeks when you get a paycheck, for example) does it make sense to keep buying Puts when the stock prices have already dropped significantly?"
Confused,
My total puts have gone up 900% since June-July 2007. I have been selling all along and have cashed out 600% of the 900% and that amount was put into cash, T-Bills and UST STRIPS. I still have three times the June-July 2007 dollar value in puts left. Basically, I have cashed out 2/3rd of the gains. I have more tech puts now than Fraudentials.
Seeing a lot of talk in the vein of AllenM and Popeye that the worst is over and the tide is turning now that govts the world over are taking action.
Not sure I buy that view. Someone posted on a thread earlier in the week that everyone seems to just assume that govts CAN actually fix this and yet, perhaps they really can't. This is something to consider. Perhaps am actual wringing out must occur for this to bottom. To date all we've seen is ad hoc govt intervention that is not working at all. This attitude that the govt will fix our problem may be the actual bubble that needs deflating.
On another score I don't see the capitulation in the middle class 401k holders yet. Ask around and I'll bet less than 10% of those you know have moved to cash in the last month. There is still a paralysis out there, that somehow this is just another 'dip', though much larger than ever before, but that it is just something to hold on through - not something requiring imminent attention to save what little you have. That, combined with the attitude of, "I've lost so much already, it's too late to make any moves because then I'll have no chance of making it back" bespeak a continuing confidence in the casino mentality of the stock markets. When I see that change, then I'll believe we're nearing the bottom of this event - not until,
Financial jobs imploding.
Manufacturing imploding.
Airlines imploding.
Auto industry..hahahahaha
Healthcare is dependent on Medicar'aid and all entitlement programs are assured of future cuts in funding.
No jobs equals mass social unrest.
I understand the need for the credit market to function to keep companies rolling but where does the next bailout for our economy happen. Restoring the credit market keeps the system moving but will it create jobs?
Federal regulators directed Fannie Mae and Freddie Mac to start purchasing $40 billion a month of underperforming mortgage bonds as the Bush administration expands its options to buy troubled financial assets and resuscitate the U.S. economy, according to three people briefed about the plan.
Re: " don't see the capitulation in the middle class 401k holders yet."
Gimmie a fuc-ing break, this downdraft has been day after day for about a month, what do you think, the market drop 40% in a few weeks and we get a big 5000 point spike because people are ready to get into stock> Please be realistic!
I thought we had agreed Merkel was only announcing the populist answer... and that it was better to wait for word from the Bundesbank {sure I misspelled that}
I'm gonna start a micro bank. The model works. Later, I'll be arrested, frog marched out of my home, tried and convicted and sent away to visit other luminaries from our present.
"Ask around and I'll bet less than 10% of those you know have moved to cash in the last month."
I have heard the number as in excess of 20%, from someone in MS Private Wealth Management. But that could have some selection bias in it, might not be an indication of the whole 401-K population.
--
How Wrong Milton Friedman Was about the American People
BTW, he has been proven dead-wrong about American People . "They wouldn't let the govt grow or get too big"! Friedman did not understand Americans and their leaders in the private eneterprise. He was an ideologue and a theoretocal person, IMO.
If I were MUFG, I'd be very concerned about Treasury plans to invest directly into banks, as I have no idea how much of MS my $9 Bil will buy.
And if I were Treasury, I would be quite scared to see MS going down if MUFG pulls out or even balks.
So Treasury has to make up its mind pronto and start discussing details with interested parties, or else it will have the problem 10x the size of Lehman on its hands.
KOna - Ask around and survey the attitudes of 401k holders you know, those that don't read CR. I think you'll be surprised.
You're inferring capitulation from market being down for 7 days, but that's an inference. Ask around and you'll see people aren't acting, they're paralyzed. The mass move to cash on the part of the 'little people' is ahead of us, not behind us.
I've got OTM calls and puts in equal amounts on spy, qqqq, and iwm. I've been long major swings in both directions and it has worked out pretty well so far. Timing is everything though.
One possible source of new jobs is infrastructure investments. I recently heard on NPR a blurb by Obama to the effect that there are $1.5 Tr in needed maintenance and repair of things like bridges, water systems, etc, and that these would be good jobs that cannot be exported.
It is certainly the case that the water systems are in need of repair. Last year I read a book about cholera called "The Blue Death", that asserted that in the next few decades practically every water system in every large city and town of the US will beed to be rebuilt, as those constructed ~100 years ago will built to last 100 years, those 75 years go, for 75 years, and for systems built 50 years ago --- you get the idea. Poor planning, but an opportunity for a gigantic jobs program doing something genuinely useful.
But I do think that living standards are going to have to fall. Median household real income has stagnated for years and will probably decline in the future.
Well folks... how much more evidence do you need to prove the failure of supply side/reaganomics? Will we finally agree to abandon that means of theft from the US Treasury by the wealthy elite?
Thanks to previous market panic recoveries, a tremendous number of folks, including my mother, will not take out money they don't need in the immediate future, and won't lock in 30% losses by going to cash.
Once again, they will print enough money to cover the immediate issues, and we will have enough inflation as the international terms of trade reset to recover a significant portion of the losses.
The part everyone seems to be underestimating is the need to break the downtrend significantly.
That seems to be beyond most of the commenters here.
Kona, capitulation is a leading indicator of a market turnaround, not a coincident indicator. Capitulation leads the people doing the capitulating to sell. Only when this selling is complete is the excess supply of stocks exhausted, and the market stabilizes and begins to turn around.
That's just a long way to say that I don't think Re implied that the market was about to turn up. In fact, I read his comments to say that he thought further declines were possible, because not all sellers had been flushed out yet.
txchick57 writes:
Well folks... how much more evidence do you need to prove the failure of supply side/reaganomics? Will we finally agree to abandon that means of theft from the US Treasury by the wealthy elite?
Had enough?
no, the beatings must continue....we are the slaves, teach us with pain.
Does anyone have an estimate of how much of the equity holdings and/or annual inflows are from 401K investors?
Everytime I see the statistical split between holdings by institutions/individuals/etc. I can never decide if the "institutional investor" includes the companies that warehouse/manage 401K's e.g. Fidelity.
I agree with poster above, I believe that if we have a bounce J-401K will see his/her opportunity to move everything into whatever non-equity options they have.
I've had to work the past two days, have I missed much or are we still on schecule with disaster porn and the end of the world? I am making a shopping list for tomorrow, you guys are great help with those.
Regarding capitulation, it is possible that a significant part of the prolonged equities markets decline is due to hedge funds deleveraging under twin problems of heavy Q4 redemptions and margin calls. Here's an intriguing post about the possible effects of margin calls:
Especially interesting is the conclusion of this post:
"There are rumors that the most massive of the calls are due Monday (October 13th). If so, this market could continue to decline through then."
A rout on Monday followed by stabilization might be a big HF unwind and not a capitulation at all.
If redemptions/margin calls on hedge funds are a significant downward pressure on the markets, it would appear (to ignorant me) plausible to suppose that the markets may stabilize once the hedge fund industry's deleveraging has played out.
From Bull's Eye Research (hat tip reader Marshall):
The selling has reached historic proportions. There literally is a "run on the market," as investors worldwide are dumping stocks. It seems that the major catalyst for this selling is the fact that the newest large banks primarily J. P. Morgan, Goldman Sachs, and possibly Morgan Stanley as well -- have issued massive margin calls to hedge funds and other professional traders who use these banks as prime brokers.
These calls were not issued because of market losses, but more because the banks arbitrarily decided that they wanted their customers to use less leverage. Margin rates as low as 15% for broker dealers were raised to 35%; hedge funds who had been used to operating on high leverage were told that they had to bring accounts up to a much larger percentage of equity.
In this illiquid environment, where all manor of exotic securities literally have no bids, the only place to raise the cash to meet margin calls was to sell stock. That is what really set this market over the edge -- as the first notice of these calls were issued on October 2nd and 3rd. There was something of a grace period to meet the calls, but funds realized they weren't going to be able to meet them other than by selling stock. There are rumors that the most massive of the calls are due Monday (October 13th). If so, this market could continue to decline through then.
Yah, I'm with you there, maybe I misunderstood, but yah, this has been like a blitzkrieg leaving most in shock and unable to respond, thus the next reaction made after stress may be to be somewhat alarmed.
There is an easy answer to this folks. Recapitalize the US Treasury by rescinding the multi-trillion dollar giveaway tax gifts by the K Street corporatists that Bush works for.
I've read about the 2 trillion in necessary investment into our infrastructure.
How much of that is to rebuild roads and bridges instead of mass transit systems?
How much of that is to refurbish the electric grid for more nuclear/coal plants instead of making it so each home can give back to the grid with their green energy systems?
How do we provide the capital to accomplish this while keeping the national debt under 10% of GDP?
Population in 1932 was 125 million. 2007 it was 282 million. If we do see 25% unemployment you have over double the amount of people to employ with infrastructure building? I can't even imagine the payroll necessary for that. Healthcare? Child care?
Are we even close to the same society we were then in regards to our moral standards?
I examine the size of this crisis and the subsequent fall out and I feel comfortable planning for a bleak future. I would love, LOVE, to be wrong and have faith we can reorganize and rebuild but where have we shown that type of unity in the last 40 years. I am tired of my pessimism and fear. I look for hope every day and am left waiting.
Re: rumors that the most massive of the calls are due Monday
With markets in the US and Japan closed on Monday, the remaining G7 nations are determined to avoid further slumps in banking stocks that could compound the global contagion.
"My total puts have gone up 900% since June-July 2007. I have been selling all along and have cashed out 600% of the 900% and that amount was put into cash, T-Bills and UST STRIPS. I still have three times the June-July 2007 dollar value in puts left. Basically, I have cashed out 2/3rd of the gains. I have more tech puts now than Fraudentials. "
Thank you for your replies.
Would you be willing to share insights into how you pick tech companies whose valuation you consider inflated? Do you just look at P/E ratios? Are there companies you are particularly bearish on despite their having reasonable P/E ratios?
Thanks in advance for any information/insights you may choose to share.
I'm not optimistic. But I think this is how it will play out. I'm currently working on finishing my attic in the expectation that there may be homeless economic refugees in my own who will need shelter.
--
"Well folks... how much more evidence do you need to prove the failure of supply side/reaganomics? Will we finally agree to abandon that means of theft from the US Treasury by the wealthy elite? Had enough?"
txchick57,
Welkomen! Please read my quite from Milton Friedman. They are scamsters.
Now I'm really pissed, WTF Condoleezza Rice doing at G7, this shows the depth of the Bush Coup Stupidity! She is not a member of G7!
See: The G7 (also known as the G-7 or Group of Seven) is the meeting of the finance ministers from a group of seven industrialized nations. It was formed in 1976, when Canada joined the Group of Six: France, Germany, Italy, Japan, United Kingdom, and United States of America.[1] The finance ministers of these countries meet several times a year to discuss economic policies.
Friedman? The chief voodoo priest of Chicago School of un-economics? What a bunch of charlatans. These thieving creeps who have taken over our government make this $hit up. Don't believe? Art Laffer and his Laugher Curve is case in point.
If I could camp and get high with just two dudes, it would be Pavel and Jas. Between the Soviet memories and the spooky American tales, I doubt I'd sleep, but I'd come out with stories to last a lifetime.
How about it, dudes? You guys want to do Burning Man next year?
I expect that there will be a lot of hardship, but no-one need freeze, and no-one need starve. There will be much opportunity for extravagant kindness.
Condoleezza Rice is now involved in fucking finance and currency intervention -- why the fuck is she there, to boost McCain votes or to talk about Iraq or playing the piano?
Condoleezza Rice, shit, why don't they prop up Kissinger:
Most of the non-original domestic functions of the Department of State have been transferred to other agencies. Those that remain include storage and use of the Great Seal of the United States, performance of protocol functions for the White House, drafting of proclamations, and replies to inquiries. In accordance with the United States Constitution, the Secretary performs such duties as the President requires.
Nova,
the real txchick from HBB is a lifelong Republican...currently working for McCain in Texas. The poster is an imposter having fun...the real deal would never make fun of her hero Reagan or of reagonomics. She's a true believer.
OK, I'm a bit of an idiot about a lot of this, just lurking about and picking up what I can from here and a few other enlightened places over the past few months. Hubby and I work in relatively safe jobs in a non-bubbled part of the county, live below our means, no debt save mortgage, and from a food/shelter/safety/cash standpoint we're covered barring anything shy of the Mad Max outcome. However, my inner historian keeps whispering "Fortunes are made in times like these", and I suspect that there may be some interesting opportunities in a few months when the panic passes. Where would be good places to look, either in stocks, or in possible local businesses to invest in?
(P.S. Conjure, hope you don't mind me coopting your line for my username, it's my new personal mantra when my stomach starts churning)
Comrade Clueless Dufus writes:
Seeing a lot of talk in the vein of AllenM and Popeye that the worst is over and the tide is turning now that govts the world over are taking action.
Popeye never said the worst was over. I am a short term trader. I don't decide big questions like "when it's over". My job is no larger than recognizing imbalance between perception and reality. The only time frame I am concerned about is the duration of my own bet.
--
"Would you be willing to share insights into how you pick tech companies whose valuation you consider inflated? Do you just look at P/E ratios? Are there companies you are particularly bearish on despite their having reasonable P/E ratios? Thanks in advance for any information/insights you may choose to share."
Confused,
BTW, that 900% gain included buying more puts (from the profits by mid-March) between mid-March to mid-May. I always have GTC orders to buy and sell long-term puts. My best purchase was 24 Jan'10 40 Puts on Goldchain Silverknife for 50c. I have been selling 2-3 at a time. Sold some on Fridat at $10.9 and $11.9.
Now, to your question, I have a total of 36 Scams that I take positions in (36-Pack!). I think I have some 15-20 tech Scams on the list and I buy puts on them when they are cheap and then place GTC orders to sell at various prices. The list for the past 15 months consisted of (copied from the spreadsheet):
Kicker, meanwhile who is going to foot the bill for folks that need bread and mik, just to get thru the week ?
Even in good times people go hungry....
Funny how the middle class assume that bread and milk are a right only bestowed on the middle class (and not the poor)
I've got a brother-in-law who runs a food pantry in a small town. Serving 30% more people this year than last. Another 30% and he won't be able to handle the load.
Re: I was wondering about Condi being there as well
Yah man, what gives here -- is this weird politics or is this a matter of state in terms of protecting turf and thus political negotiations versus just banking???? Why would the secretary of state drop in for a photo shoot or be at the meeting unless some turf was being carved out?
I've read several articles about the strain on food banks and shelters. It's everywhere and tent cities are also popping up everywhere. Google tent cities and you'll find many articles on the topic.
"Yah man, what gives here -- is this weird politics or is this a matter of state in terms of protecting turf and thus political negotiations versus just banking..."
America the Banana Republic
The ongoing financial meltdown is just the latest example of a disturbing trend that, to this adoptive American, threatens to put the Land of the Free and Home of the Brave on a par with Zimbabwe, Venezuela, and Equatorial Guinea.
It occured to me that part of the problem Paulson is having regards getting his programs running is timing. In DC with an administation change coming his people began bailing for the private sector months ago. Also political appointees are moving to SES civil service positions so they continue working.
I think Condi must be the heavy... when you think of what is going through Bush's little mind, and the NY Times piece today on how he thinks he an handle this, it starts to make sense. What a tool...
"It occured to me that part of the problem Paulson is having regards getting his programs running is timing. In DC with an administation change coming his people began bailing for the private sector months ago. Also political appointees are moving to SES civil service positions so they continue working."
Yeah, the common habits of bureaucratic life are bigger than some of the big deals. Someone who was at State told me that big shots spent half the day on the phone trying to move up a few rungs.
April 14 (Bloomberg) -- The concern that Group of Seven officials expressed about swings in exchange rates wasn't enough to change currency traders' outlook for the U.S. dollar.
``Intervention would run completely contrary to primary signals that drive currencies -- especially relative interest rates,'' said David Simmonds, London-based head of currency research at the Royal Bank of Scotland Plc, in a note to clients today. The bank, which ranks fourth among currency traders, predicts the dollar will trade at $1.63 by the end of September.
This is a two-for-one story about Intervention & Rice, so I get bonus points!
I think Condi must be the heavy... when you think of what is going through Bush's little mind, and the NY Times piece today on how he thinks he an handle this, it starts to make sense. What a tool...
No, she's there to keep the Russians at bay. There's a ton of concessions being made behind the scenes.
The Russians have strategically placed their deposits around the world. A simple withdrawal by an oligarch could cause major disruption. Trust me: the Russians are making out like bandits right now.
Glad to hear the talk about food banks--I worked my way through grad school as a welfare caseworker (an experience everyone should have IMHO), and know how good I have it. we're converting some of our cash into useable assets as an inflation hedge (mainly stocking the pantry, and a few infrastructure things we were considering doing anyway), might not be a bad idea to convert some of that capital into a case or two of canned goods for our local food pantry.
The next few years may be hard for us, but barring a true nightmare scenario we'll be able to stay fed and sheltered. Whatever you think of "welfare queens" or people who lived on credit cards and HELOCs, at the end of the day we're all just imperfect people who occasionally need a bit of help.
fried - im in with that view...paralysis. This has hit so fast, after most people were asleep at the wheel, that they dont know what to do. There is this bizarre hope that things bounce back, but it's understandable, because so few people can grasp the reason the shate has hit the fan out of seemingly nowhere. Of course we all know it's been a tidal wave coming ashore from three or four miles (years) out. But most peeps dont seem to have put it together, dont see where it is now, and cant understand where it is going. Better hope they stay paralyzed, because if the retail investor starts dumping, it's dow 3000.
Re: Condi being there. Hey, the girl's
going to be looking for a job soon. Secretary of State isn't starvation wages but it won't make you independantly wealthy either.
Condi's probably hunting for a nice sinecure and this is a perfect opportunity for her to do it.
Is Condoleezza Rice a Russian expert? Yes! No, no, no, no, no, no, no!
How did Condy get appointed as Secretary of State and labelled a Russian expert? Could it be that she told President Bush that she was an expert in rushin' around and he made her his "Rushin' expert"?
\t
Asked whether she would run for President at the next election on Ekho Moskvy Radio programme, Condoleezza Rice answered Da! Nyet! Nyet! Nyet! Nyet! Nyet! Nyet! Nyet! Not bad for someone who is quoted frequently by the Western press as being a fluent Russian speaker and a Russian expert, although she has never lived in the country.
Before admitting to this schoolgirl's question that is was difficult to speak Russian, she had already made a fool of herself on Tuesday, when she declared that the Kremlin's grip on the media is "very worrying." The question is, what grip?
For the information of Condoleezza Rice, who despite being Secretary of State of her country, continues to demonstrate an ignorance of world affairs at a shockingly consistent level, the notion that the Kremlin exerts a grip on the media is a fairy tale invented in the gardens of Washington.
"The Russians have strategically placed their deposits around the world. A simple withdrawal by an oligarch could cause major disruption. Trust me: the Russians are making out like bandits..."
"Working for old yeller toothed grandpa McCain? lmao.... get real."
Now confirmed, an imposter. The real txchick posted long essays for months on why she supported McCain, and her reasons for working on his campaign.
This is just someone trying to trash her name, one she has used since the old days at f@cked company.
I don't agree with her, but she's a serious woman and a smart trader. Imposters truly stink.
Moral hazard. I have never read or put those two words together in a sentence until the last few months.
Anonymous at 8:47 nailed my thoughts as well. I feel the economic stimulus check was a way to buy off the American people. We were given a small amount of money we knew was created by adding national debt for our kids to pay. Then when the money was needed by the banks we were already complicit.
I believe an unintended consequence of all this is the ease society will feel to just walk away from debt. No shame can be assessed due to our government leading the way in deficit spending and allowing criminal actions to go unpunished. What is going to happen when all the unsecured debt is defaulted on? 4% of sub prime loans default and the world markets/banks collapse. What happens when 10% of CC debt isn't paid back? Who holds the CDS on that?
--
The primary purpose of democratic form of govt is entertainment (all that humor!) including the pageantry of elections. However, we got two boring dudes vying to be the worst President in US history (because of the mess they would inherit). The title, otherwise, would go to G. W. Bush. My man Herbert Hoover would be relieved.
Geoff,
confirms my experience. Live in Manhattan, with people successful in all sorts of ventures. The stock market gyrations caught them totally off-guard.
They were concentrating on their businesses , their money under 'professional management". Though even some of the Wall St folks seem a little shell-shocked, and they should have known, you'd think.
I followed your advice and googled tent cities - scary."
--
I wish I could find the link to the private equity company that bought the lackluster tent manufacturer while we were still debating "typical vs. deep recession."
Has anyone considered how much more of the banking system will have to be taken over at the next intervention? The defaults on mortgages continue unabated and will likely intensify early next year. According to CR the option ARM and ALT-A resets really get started next quarter. As the recession grows we can also expect more losses in other credit products.
My questions:
If it is this bad now, how bad does it get next year?
Isn't a program to reduce the stress at the homeowner level (cramdowns) mandatory soon?
Or, are we going to inflate wages (and prices) to to gradually erase the stress?
"The Russians have strategically placed their deposits around the world. A simple withdrawal by an oligarch could cause major disruption. Trust me: the Russians are making out like bandits right now."
Tin foil hat in me: The Russians have recently positioned nuclear forces strategically around the globe also. A simple strike would also cause a major disruption. Checkmate.
fried....dont all 401k statements come out on a quarterly calendar basis? If so, most people opened theirs up in early September, and were like, dude, that sucks, but it will come back. And just as they put it in the refuse pile, bublam...take what they already werent too thrilled about losing, and nearly double it in a week or so.
So the question is, do they freak now, and start selling, or do they have a coronary when the January statement comes? I personally think a lot of them are going to push the panic button if we go down further next week, and if the margin calls im reading about are still coming on Monday, that is where we are headed.
They were concentrating on their businesses , their money under 'professional management". Though even some of the Wall St folks seem a little shell-shocked, and they should have known, you'd think.
You would be surprised. I was surprised during the auction rate securities crisis earlier this year how many financial advisers had absolutley no clue what they were putting their clients into. Not only did they not see the crisis coming, they could not even define the instrument they were putting in their clients' money into.
Drove through Finland on the way to Russia in 1979. Was amazed by the number of drunken bums on the streets. It was explained to me that drunkenness was common in the shadow of the bear.
Yeah the mortgage default rate will not be helped by high Libor rates, no doubt one reason why Paulsen is so interested in getting them down. Also why the GSE's were ordered to start buying non performing prime, alt-A and subprime mortgage bonds to the tune of $40 billion per month.
If they can't kick start the housing market nothing else they do is really going to matter.
The US is going to be treated like a 300 million population leper colony, after the collapse takes full effect. There's no way in the world we don't get blamed for the global depression and its consequences.
Stupid Americans will answer with bellicosity. Probably want to bomb those ungrateful foreigner bastards who blame us after all the aid we've given them.
I was surprised during the auction rate securities crisis earlier this year how many financial advisers had absolutley no clue what they were putting their clients into. Not only did they not see the crisis coming, they could not even define the instrument they were putting in their clients' money into.
Bond Girl | 10.11.08 - 9:25 pm | #
Explains why we need the high school grads to bailout MBA's, doesn't it?
Stupid Americans will answer with bellicosity. Probably want to bomb those ungrateful foreigner bastards who blame us after all the aid we've given them.
Well, it's about the only profit-making business we have left. Nobody makes aircraft carriers like us...
"If it is this bad now, how bad does it get next year? ... Or, are we going to inflate wages (and prices) to to gradually erase the stress?"
Within a few months, all that appears as separate bandaids (TAF, TARP, F/F, FHLB, FDIC, SIPC, ...) will be simplified and consolidated into a fat pipeline directly from Treasury to 1-800-total-bailout.
There will be token relief at the retail level, and unspeakable gushing at the wholesale level (to the bankers). All the Alt-A failures, etc, will just be minor modulation of the flow in the pipeline.
The real issues are (1) how much does the Fed print and when, and (2) how does the dollar hold up?
He had several short monologues about the Finnish president. Who is an ugly, overweight woman with a communist past. For some reason this touched Finns. Nobody else has ever cared about Tarja Halonen.
Tabloids ran cover stories about it and so forth... "Putting Finland on the map!". Kind of sad.
Why@ ZIRP writes:
I was surprised during the auction rate securities crisis earlier this year how many financial advisers had absolutley no clue what they were putting their clients into. Not only did they not see the crisis coming, they could not even define the instrument they were putting in their clients' money into.
Bond Girl | 10.11.08 - 9:25 pm | #
Explains why we need the high school grads to bailout MBA's, doesn't it?
Well, our financial system is really divided into two parts, isn't it? The engineers and the non-engineers. I was schooled in derivatives from the beginning of my career in finance, but it does surprise me sometimes how many people in the finance industry just go along with things. How many financial advisers understand innovative structures...hardly any, whatever their education background. How many financial advisers were telling their clients in the past two weeks that this is just a "blue light special" in the stock market? Probably plenty, because that's the line they get in their Monday marketing meetings.
I do think state and municipal pension funds must be getting spanked right now. Should go looking for information, but it is probably based on the end of the fiscal year for most municipalities, which was end of June. Most were severely underfunded to begin with, so this should just accelerate the concern for taxpayers. Can only imagine how taxpayers are going to feel about paying for lucrative pension benefits when their own 401ks are basically depleted....
Got appointed to the financial committee of a non-profit. Went over to the financial advisor's to confirm a bunch investments. Guy said to me "look I just sell this stuff, then I don't have anything to do with it."
Check out the Project for the New American Century website Welcome to the Project for the New American Century - Bill Krystal, Paul Wolfowitz and
the boys subtle outline for a strategic play for resources worldwide
through militaristic corporatism. Democracy means dealing with
congress and dissent - the kinds of things that make an "empire"
lethargic and ineffective.
I remember a stock broker telling me once that he "didn't care about derivatives." He said "listen, lady, there are three asset classes - stocks, bonds, and bullshit." He must be having a very difficult time figuring out what's going on right now.
Gonna pick myself up off the ground
When that old feeling comes around again
I've had enough of feeling down
There's something I've lost that must be found again
Sometimes it seems like such a hard life
But there's good times around the bend
The rollercoaster's got to roll to the bottom
If you want to climb to the top agai
One of my brothers was a derivatives trader (seems like eons ago). When he explained to me what that meant all I could say was I can't believe that's legal.
this is the second of the "dont go to cash" type of articles. Sickening. They have no business writing about this stuff, since theyve been basically clueless for years.
Within a few months, all that appears as separate bandaids (TAF, TARP, F/F, FHLB, FDIC, SIPC, ...) will be simplified and consolidated into a fat pipeline directly from Treasury to 1-800-total-bailout.
There will be token relief at the retail level, and unspeakable gushing at the wholesale level (to the bankers). All the Alt-A failures, etc, will just be minor modulation of the flow in the pipeline.
The real issues are (1) how much does the Fed print and when, and (2) how does the dollar hold up?
Plantagenet | 10.11.08 - 9:35 pm | #
Thanks, I didn't know they had that 800 number set up. Maybe I should give them a call, don't really need a bailout yet but maybe they got some cash laying around all ready for the first caller.
Seriously, printing won't work if wage arbitrage continues. You must get wage inflation to make the debt manageable. I don't see a real way out of the trap other than direct intervention at the household level otherwise the banks just hold the cash and the deadlock continues until the cities are decimated and the real nightmare gets started. Under your scenario the banks survive but the borrowers don't.
--
"How did Condy get appointed as Secretary of State...:
km4,
Condom Lisa is a political appointee, which means her expertise is not that important. Her color and gender are the most important qualifications for her getting the job.
How could I be so sure? I watched the GHW Bush vs. Clinton Presidential debates of 1992. GHWB was put on defensive (by a question on the subject of women and minorities) because he did not appoint enough blacks and women to important positions. Clinton was able to rattle off lot of names that he appointed as a governor. So, the number one task for GWB was to identify a black woman that would be placed in a very high position. That is how we got Condom Lisa.
However, my inner historian keeps whispering "Fortunes are made in times like these", and I suspect that there may be some interesting opportunities in a few months when the panic passes. Where would be good places to look, either in stocks, or in possible local businesses to invest in?
Direct investment with people you know and trust. Invest in their good will, invest in their businesses, invest in their personal future earnings capacity.
The strength of capitalism is that it allows investment with people you don't trust. If the financial system that supports that fail out, just fall back to the old standby of direct placement. Just be ready to be on the ground working your stake.
Invest as wisely as you can because these are the people you will hope like hell let you sleep in the front room if you go busto or who you hope will fish you out of a holding pen if the justice system morphs into arbitrary mass roundups. Also, as you note, you can make a fortune this way by riding it out then riding it up.
Learn a new skill directly relating to a known source of steady income. Learn a trade. Learn to use Excel and Word.
Learn about informal banking and investment practices. The Chinese had many interesting mechanisms by which investments could be pooled and bank transactions executed, even in very hostile business climates.
Invest in donations to local officials who might make your life a misery in desperate times.
Make your house / place of business well-repaired so that a decade of poverty doesn't deprive you of a leak-proof roof.
Get your car or business vehicle overhauled.
Look hard at your circumstances. If the country were plunged into an economic deep freeze for five years, would your area become untenable? If so, move before the act becomes unpopular.
How many financial advisers understand innovative structures...hardly any, whatever their education background. How many financial advisers were telling their clients in the past two weeks that this is just a "blue light special" in the stock market? Probably plenty, because that's the line they get in their Monday marketing meetings.
I'm not in finance, but my experience has been rife with this sort of mentality. PhDs shockingly ignorant of their own field and all sorts of "experts" little more than obsequious middle-managers/salesmen. The rot is deep.
Oh man...the Campout looks just my style. I'm not much of a pink fur punk. As I will probably be living in the midwest next year, this will be high on my list of priorities.
I remember a stock broker telling me once that he "didn't care about derivatives." He said "listen, lady, there are three asset classes - stocks, bonds, and bullshit." He must be having a very difficult time figuring out what's going on right now.
Bond Girl
Or he could understand that all the talk about gamma, vega, etc. was just bullshit and steered his clients away from the bullshit.
And lets be frank, most of financial engineering was designed to make opaque the fixed income products sold by Bear Stearns, Lehman, and the investment banks. That way the IB would have an information advantage and could scalp their clients.
Now the markets need transparency and most fixed income portfolios are opaque. Hence, no one trusts anyone else's financial statements because their know how fubar their own statements are.
From the NYT article Bond Girl posted: Mr. Heebners funds have not avoided the carnage this year. The CGM Focus fund is down about 42 percent so far in 2008. But his long-term track record is impressive. In the decade that ended Dec. 31, 2007, CGM Focus rose 26 percent a year, including reinvested dividends, making it among the best-performing mutual funds.
LOL. They are using this as a reason to follow this guy's advice.
Lawyerliz, no I haven't. I'll have to take a trip up to the book store while I'm on my doomsday shopping trip tomorrow. I have read all of Anne Rice though.
You must get wage inflation to make the debt manageable
Exactly.
Why do so few people still not understand this? Pushing money into the bank won't make a difference unless they push loans out to consumers at stupendously low interest rates like 3% for 30-year mortgage or so.
--
El Presidente Jorge (George) Booch wants to protect Americans' "household wealth" by stopping the slide in Scams and home prices by his new policies. He had no problem when the wealth was running wild, because that wealth was a result of his sound policies.
Americans losing the wealth is due to the bad policies of greedy bastards and not El Presidente. He also said that he is very happy that the crisis happened on his watch because he has some very good people. What a guy!
40 cases of Ribera de duero @ the G20 conference would do wonders.
They'd either drink themselves into a fit of inspiration and solve everything or become so sad in the thought of never having another wine so good they'd kill themselves, every last one of them.
IMHO and Humble theory, Rice is @ G7 to represent Middle East oil, because this is a coordinated devaluation of G7 currency relating to currency reserves, thus oil wants to be in on this shit and Condi has the cell phone hooked into OPEC
Bond girl - I was wondering when this was going to get rammed onto the front page of the NYTimes website. It would be fascinating to observe the mechanism of how this idea gets transported into the media's conscience, and how they foist it upon us. Gotta love propaganda. Goebbels would be proud.
Rice is @ G7 to represent Middle East oil, because this is a coordinated devaluation of G7 currency relating to currency reserves
Methinks, it will be the JPY and Swiss Franc that will be devalued this time around; you can't have a decade carry trade unwind in a matter of two weeks. Jim Rogers not gonna be happy.
Anybody else see this line in the NYT piece on GM? A reason Ford did not hool up with The General: "Mr. Ford and Mr. Mulally were said to have concluded that their company had a better chance to reorganize on its own than in tandem with another automaker."
first
Come on Paulson, you can do it.
Where is Nemo?
Only $400 Billion. Spare change.
This is what I call action. The Europeans have awoken from their collective slumber. I still think we a bigger global coordinated rate cut like Roubini is calling for and the US needs to guarantee all deposits along with interbank lending.
possible market holiday in us monday?
what,
no announcement on planned holiday for the XETRA-DAX?
Governments starting to play hardball by having the "option" of a direct stake?
When will governments start dictating terms to banks? Never or coming soon?
Enslavement of their citizens by their own governments around the world continue unabated. That's nice.
serdom is making a comeback (work 4 no pay or little pay for years)
oops...serfdom
When do executives at failed American banks get sacked?
I'm moving to Britain.
Looks like the brits are investing in preferred. The US will do the same. Short bank equities, long bank credit is going to be a killer trade....
If Europe acts faster than the US, will the markets punish the retarded one?
So, you all think we continue to sink on Monday. How much money will be floating through the remaining pipelines on Monday will be stunning.
Nothing like a large amount of cash available to buy when you know where you are taking prices next.
mp, sounds like conjure has noticed the bailout is finally here.
After the bailout, then life gets interesting.
That is what I am thinking about, not the prosaic part of the panic killing that has to take place to calm the markets.
Someday this war's gonna end...
So... is the the competitive devaluation the deflationists have been talking about? $400 billion here, $850 billion there...
C
Who is going to buy all the new bonds? What happens if nobody bites?
Here comes the public utility model of banking. There is a lot of talk of nationalization, and such, but what it boils down to is governments are stepping in to assure that the continuation of activities of the financial services sector that are truly 'services,' in the sense of facilitating the commercial and business activities of the general economy, rather than speculative or proprietary (like running a house trading desk).
Of course, the trick is to untangle the two kinds of activities, and not much progress will be made on that until the senior management of the major financial institutions are bluntly taught that they answer in the first instance to their regulators. The mindset of those guys is mindboggling. I could not believe that Vikram Pandit would compare his deal with Wachovia to a winning lottery ticket. Very unfortunate choice of analogy for someone who should be taking lessons in starched rectitude and bankerly demeanor. Somebody needs to tell him the music's over, it's time to stop dancing, and platitudes about creating shareholder value are about as passe as a rascist joke. Perhaps the feds should cut him off from the window and FHLB liquidity for a week or so to help him see the error of his ways.
--
All these bailouts indicate that the problems are far worse than people have been told until last week's crashes in various Scam Markets.
Worldwide Greater Depression is unavoidable unless you believe in the powers of govts to make economies better. Good luck to those who believe.
What part of the same guys and gals who allowed the problems to develop are in power and have more powers over the people than before don't people get? Savings the bankers doesnt do much good for the people, does it?
Jas
Under what system do I pay money with little or no say in what is done with it? Taxes. I finally understand what's happening. The banks are taxing the governments for the FRN notes they are already taxing us with interest. Kinda like double jeopardy.
Does Germany have one person deciding where the money goes? Does it have to be voted on in their version of a legislature? Do they have to issue EU bonds to fund this and if yes who is buying? Does the EU have to ok this and if they don't what will Germany do? Anyone understand the ramifications of a country in the EU acting unilaterally? Is the EU showing some rather fundamental cracks in it's foundation? If the Euro crashes and countries revert back to Marks or Francs doesn't that leave the dollar as the sole choice for reserve currency continuing?
More fuel on the fire, soon to be lighting a bank near you.
Conjure's report is coming along well, I hope.
--
Listening to Milton Friedman (rebroadcast from 1994) who says that in 1928 govt's share of the economy was 15% and now it is more like 50%. I bet when we are done with Obama's $5Tr. Fair Deal program in 2010 govt's share would be 60-70%.
Jas
Welcome to the National Bank of Earth! Would you like a toaster?
Jas Jain,
Out of curiosity, if you were to invest all your life savings on Monday morning, what would you put it in?
DERIVATIVES UBER ALLES!
confused:
most here are long ponies and chocolate, with a side toke and a little bump...heavy on the barley, and swimming in the Vodka...
when do the funny people arrive?
Jas Jain is correct.
We are freaking doomed!
Stock up people, food ammo, precious metals.
We loaded up at a liquor store that went out of business too, 1/2 off on several gallons of liquor. Like my wife said,'You never know when we may need to perform surgery on ourselves.'
AllenM,
I don't disagree with your hypothesis, but IMO it's a year late and a couple of trillion short. A year ago it would have been a lot cheaper to do because moral hazard wouldn't have played chickens with ICBMs.
Wealth destruction is far outpacing credit creation, leverage be damned.
No thanks. We're already toast.
Quick OT question.
Does anyone know of blog or other sources of information for green energy investing?
I'm looking for something like Calculated Risk or the Oil Drum for the green energy field.
Thanks in advance.
Just got back from Costco. First time I have ever bought the big sacks of rice and beans.
Seemed more crowded than your usual Saturday.
where can I but a 100lb bag of lye?
In case I need to bury some bodies...
While I feel there is a tad more public recognition of what is going on here, I have decided that after my public milling around the past few days, most people are basically clueless.
afraid of the chaos writes:
Just got back from Costco. First time I have ever bought the big sacks of rice and beans.
you'll need some cumin, salt, black pepper, onion and garlic powder to keep the blandness at bay
Some Brit words/idioms are sooo much better than US equivalents.
Sacking v. fired/laid off
Bullocks v. B.S.
Would the Brits take us back if we asked (like H. Paulson at Nancy's knees) HM QE realy nice?
Regarding the question of "who buys the bonds" to provide governments the cash to make these interventions, it seems to me that the governments could simply create debt obligations and swap them for equity. Additional "good as cash" sovereign debt on a bank's balance sheet should function like a recapitalization, I would think.
About a week ago (it seems like a lot longer than that) Krugman was speculating that this was how the TARP would work, with T-Bills (newly created for this purpose by Treasury) swapped for toxic bank assets. That could presumably work with equity interests as well, I would think.
afraid of the chaos writes:
where can I but a 100lb bag of lye?
In case I need to bury some bodies...
stack 'em, rack 'em and torch 'em
save the ashes for fertilizer though
Jas Jain writes:
Listening to Milton Friedman (rebroadcast from 1994) who says that in 1928 govt's share of the economy was 15% and now it is more like 50%. I bet when we are done with Obama's $5Tr. Fair Deal program in 2010 govt's share would be 60-70%.
And then, my friend, a nice fireside chat.
Here's hoping it works.
--
"Who is going to buy all the new bonds? What happens if nobody bites?"
Mel,
Depends upon what your alternatives are. Why were the Japanese buying JGB debt at 0-1.5% with JG debt exploding?
I expect deflation in the US in 2009. Here is my rationale:
Why Printing Money (rapid increase in govt debt) IS Highly Deflationary?
The increase in the US govt borrowing crowds out the private borrowing and, most importantly, private investments! Both are highly deflationary. The Japanese govt had borrowed like crazy during 1990s and they had deflation. Please remember that US govt borrowing went negative during the boom of late 1960s & late 1990s. The govt borrowing shoots up during very bad economic times (when the CPI inflation rate invariably falls) and major wars (War On Iraq is not a major war) and NOT during good times.
Jas
See the movie, "Fight Club" for a good organic source of lye.
ya, just inflate that bubble in treasuries a tad bit more, yup, a little more, almost, not yet, wait, little more....POP! (you think we have a mess now)
If they use treasuries instead of cash, how does that result in helping the credit freeze? We go from liquidity to solvency to liquidity problems.
Germany to Announce Comprehensive Bank Rescue Package | Germany | Deutsche Welle | 11.10.2008
Handelsblatt said the Bundestag budget committee would hold hearings on the legislation on Wednesday, with pressure for a first reading of the legislation in parliament before the week was out.
Did anyone think that nationalization of banks and stock market crashes would be the outcome of bad mortgages?
Certainly derivatives play a role as failures breed more failures.
I expected the housing crash and lots of pain, but not a reorganization of the world financial system.
If I would have known how this system was setup with the use of derivatives, etc, might have taken a bit different investment strategy.
The extra liquidity would be pumped into German banks and government guarantees would be offered as a backstop, while the sum of 100 billion euros ($134 billion) at the most was tagged as an equity injection, Handelsblatt quoted a German delegation source in Washington saying
Hello folks --
Some people at our small and cordial website --- The Old Elm Tree --- are really beginning to envision a financial and social meltdown of our beloved United States. Links to YouTube at The Corbett Report -- are pounding in the hypothesis that the pResident's executive authority is now able to declare martial law in the US and put off the election. Rep. Brad Sherman of CA spoke of this recently. October 1, 2008 was a critical day because the US Army called back some of its people from Iraq to stand by for civil unrest of American citizens.
What should I tell my frightened friends and family here in Oregon? Is this really happening, or just another (not exactly urban) myth?
How is your fear level? It's Sunday, and our government just seems to be sinking into the morass of worse and worse decision making.
Warm regards,
Ellen Kimball in Orego
And then, my friend, a nice fireside chat. Here's hoping it works.
Deana,
OMG, Diana! That was the thought I had at lunch what would Obama fireside chat be like? I would make sure that I am not eating while listening to one out of curiosity. Not that McCains would be better.
Jas
cracker:
The reason I asked Jas Jain what he'd invest in is that if you have such a dire prognosis for the future, then extreme nihilism should rule your thinking. What can you possibly hope will hold value, leave alone increase, in such a case?
In particular, Jas Jain has said in the past that he has bought US TrIPS. But this means that you assume the government won't game the inflation metric so as to pay out much less than the rate of inflation, effectively making this a worse investment than cash (as bonds' value drops with time). Just see what has been happening to US TrIPS versus Long Term Treasuries.
Jas Jain has also consistently spoken of buying Puts on financial stocks (JPM and GS for example) but if you make an investment periodically (every two weeks when you get a paycheck, for example) does it make sense to keep buying Puts when the stock prices have already dropped significantly?
again Jas Jain is correct, genau!
Can anyone imagine the after-session laughter at IMF/G20 meeting today. after hearing this from Bush this morning:
In his Rose Garden appearance, Bush made a plea for nations work together to address the crisis, avoiding the go-it-alone protectionist trade strategies that worsened conditions during the Great Depression.
"In an interconnected world, no nation will gain by driving down the fortunes of another. We are in this together. We will come through it together," Bush said. "There have been moments of crisis in the past when powerful nations turned their energies against each other or sought to wall themselves off from the world. This time is different."
Irony builds strong bones.
mel,
I think that the idea is that the Treasuries swapped for equity do improve bank balance sheets --- more capital --> less nearly insolvent. Of course, the banks still need to be confident that their loans will be repaid. How to restore that confidence, I know not.
The Japanese did not have a terrible quality of life in the 90's. They couldn't afford $3000 cashmere sweaters in Ginza anymore. BTW they commit suicide from loss of face more than loss of cash.
This time is different.
yes, this time it's happening now
"Out of curiosity, if you were to invest all your life savings on Monday morning, what would you put it in?"
Confused,
Nothing on Monday or anytime soon. I built my positions way before the crisis. I am sticking with the few losing positions too. Have no idea which way the wind will blow. Safety is my main goal and I am happy with Cash, long-term puts on Scams, T-Bills, and long-dated UST STRIPS.
Good luck to you.
Jas
Looks to me like a whole generation of bankers and other financial leaders is going to learn what its like to be under very close supervision from their respective governments even if they are allowed to stay on the job.
Disrupting world trade, blowing gigantic credit bubbles, and selling badly engineered securities has just gone out of style. Strict regulation and possible jail time is the new black.
British PM says
I think he channeling Bush with the speech. I just don't understand the British "clam" reference? Pulling back into their shells
"For Europe, the stakes could not be higher and this is a moment of truth," he said.
"No country - not even the biggest - can make it just on their own at a time like this.
"We are all in it together and have to work to solve it together."
He said he knew people were "worried" but praised the resilience of the British public.
"I've seen in the cities and town I've visited a clam, determined British spirit; that while this is a world financial crisis that started in America, Britain will lead the way in pulling through," he said.
OMG, Diana! That was the thought I had at lunch what would Obama fireside chat be like? I would make sure that I am not eating while listening to one out of curiosity. Not that McCains would be better.
FYI - Long time Jas reader.
I'm not pulling your toes, my good sir.
Loans repaid? I keep coming back to this question as well. Short term they recapitalize the banks but long term rising unemployment, continued deflating house prices and no job creation leads back to more crisis. What am I not understanding here? How does any of this FIX the problem?
BBC news is running stories about people "panicing"
As I mentioned in my original comment on the previous thread (and CR owes me hat tip for the pointer) - you have to scale up the size of the Germany bailout by 4 (German GDP is 1/4 of the US GDP).
So, $700Bil only covers a half of the problem
Clambake?
How Wrong Milton Friedman Was about Republicans and American System
Still listening to him.
Friedman: If an experiment in private enterprise is unsuccessful people lose money and they have close it down. If an experiment in govt is unsuccessful it is always expanded.
Jas
SRC writes: "... Of course, the banks still need to be confident that their loans will be repaid. How to restore that confidence, I know not."
Inflation.
I'm long tampons and booze. The stockpiles are getting so big that my new venture is sure to be a success in the post-apocalyptic world. I hope to hire Finance MBAs to guard me. I hear they'll work for peanuts. Literally.
Clambake?
Deana | 10.11.08 - 8:13 pm
Perhaps looking for the pearl. Probably a silver lining thing.
Currency Intervention and Plaza Accord/Bretton Woods On-The-Fly??
See: Macro and Other Market Musings: Coordinated Intervention to Strengthen the Dollar?
FRIDAY, MARCH 14, 2008
Coordinated Intervention to Strengthen the Dollar?
I never thought I would see the day when observers are talking about coordinated intervention by policymakers to strengthen the dollar. Here is the FT commentary:
Selling the dollar is now close to a one-way bet. So great is concern about the health of the US financial system that the dollar traded below Y100 on Thursday, and above $1.56 against the euro. The danger of a dollar rout is rising, and the Federal Reserve, European Central Bank and Japans Ministry of Fi nance should co-ordinate intervention to slow the greenbacks fall.
Currently Wearing Pampers....
Gone Fishing,
There are two distinct but related problems. THe most urgent is the credit freeze --- that is accelerating the decline in the real economy. But the recession/depression in the real economy is also there.
The current governmental scramble is to address the credit freeze, but after that there will still be the recession/depression to deal with. My guess is that there will be worldwide deficit spending (which I suppose means money printing), public works, FDR-style WPA things, who knows what else. Maybe it'll help.
Why@ ZIRP writes: "Looks to me like a whole generation of bankers and other financial leaders is going to learn what its like to be under very close supervision from their respective governments even if they are allowed to stay on the job.
Disrupting world trade, blowing gigantic credit bubbles, and selling badly engineered securities has just gone out of style. Strict regulation and possible jail time is the new black."
Thank God that the regulators, Chris and Barney and Chuck, can take over our entire financial system. That should make things a lot better. They were fighting the bubble inflation at every step.
Just a couple comments on MS/Bank Of Tokyo-Mitsubishi. More appropriate for two threads back, but they are stale now.
Points 1 and 3 are based on conversations based on speculations. But 2 is a fact.
De/In(flation)?
Unemployed, perhaps inflation.
Secured, perhaps deflation.
Many POV's.
And for this I am grateful.
"Jas Jain has also consistently spoken of buying Puts on financial stocks (JPM and GS for example) but if you make an investment periodically (every two weeks when you get a paycheck, for example) does it make sense to keep buying Puts when the stock prices have already dropped significantly?"
Confused,
My total puts have gone up 900% since June-July 2007. I have been selling all along and have cashed out 600% of the 900% and that amount was put into cash, T-Bills and UST STRIPS. I still have three times the June-July 2007 dollar value in puts left. Basically, I have cashed out 2/3rd of the gains. I have more tech puts now than Fraudentials.
Jas
Seeing a lot of talk in the vein of AllenM and Popeye that the worst is over and the tide is turning now that govts the world over are taking action.
Not sure I buy that view. Someone posted on a thread earlier in the week that everyone seems to just assume that govts CAN actually fix this and yet, perhaps they really can't. This is something to consider. Perhaps am actual wringing out must occur for this to bottom. To date all we've seen is ad hoc govt intervention that is not working at all. This attitude that the govt will fix our problem may be the actual bubble that needs deflating.
On another score I don't see the capitulation in the middle class 401k holders yet. Ask around and I'll bet less than 10% of those you know have moved to cash in the last month. There is still a paralysis out there, that somehow this is just another 'dip', though much larger than ever before, but that it is just something to hold on through - not something requiring imminent attention to save what little you have. That, combined with the attitude of, "I've lost so much already, it's too late to make any moves because then I'll have no chance of making it back" bespeak a continuing confidence in the casino mentality of the stock markets. When I see that change, then I'll believe we're nearing the bottom of this event - not until,
Jobs? Where are all the future jobs coming from?
Financial jobs imploding.
Manufacturing imploding.
Airlines imploding.
Auto industry..hahahahaha
Healthcare is dependent on Medicar'aid and all entitlement programs are assured of future cuts in funding.
No jobs equals mass social unrest.
I understand the need for the credit market to function to keep companies rolling but where does the next bailout for our economy happen. Restoring the credit market keeps the system moving but will it create jobs?
Federal regulators directed Fannie Mae and Freddie Mac to start purchasing $40 billion a month
of underperforming mortgage bonds as the Bush administration expands its options to buy troubled financial assets and resuscitate the U.S. economy, according to three people briefed about the plan.
Fannie, Freddie to Buy $40 Billion a Month of Troubled Assets - Bloomberg.com
The graft of this adminstration know no bounds.
Re: " don't see the capitulation in the middle class 401k holders yet."
Gimmie a fuc-ing break, this downdraft has been day after day for about a month, what do you think, the market drop 40% in a few weeks and we get a big 5000 point spike because people are ready to get into stock> Please be realistic!
I thought we had agreed Merkel was only announcing the populist answer... and that it was better to wait for word from the Bundesbank {sure I misspelled that}
I'm gonna start a micro bank. The model works. Later, I'll be arrested, frog marched out of my home, tried and convicted and sent away to visit other luminaries from our present.
I think GW is touting togetherness for fears of Treasury dumps by SWF's
DEBT freeze -ba bye credit.
What's credit?
Ya, expansion of spending.
Don't see it, but my eyes are a bit cloudy.
"Ask around and I'll bet less than 10% of those you know have moved to cash in the last month."
I have heard the number as in excess of 20%, from someone in MS Private Wealth Management. But that could have some selection bias in it, might not be an indication of the whole 401-K population.
--
How Wrong Milton Friedman Was about the American People
BTW, he has been proven dead-wrong about American People . "They wouldn't let the govt grow or get too big"! Friedman did not understand Americans and their leaders in the private eneterprise. He was an ideologue and a theoretocal person, IMO.
Jas
Austin Tex - Re: MS
If I were MUFG, I'd be very concerned about Treasury plans to invest directly into banks, as I have no idea how much of MS my $9 Bil will buy.
And if I were Treasury, I would be quite scared to see MS going down if MUFG pulls out or even balks.
So Treasury has to make up its mind pronto and start discussing details with interested parties, or else it will have the problem 10x the size of Lehman on its hands.
KOna - Ask around and survey the attitudes of 401k holders you know, those that don't read CR. I think you'll be surprised.
You're inferring capitulation from market being down for 7 days, but that's an inference. Ask around and you'll see people aren't acting, they're paralyzed. The mass move to cash on the part of the 'little people' is ahead of us, not behind us.
clam >> calm. typo.
How does this affect Austria? More specifically the Austria gold 100 Corona coins that I have?
I've got OTM calls and puts in equal amounts on spy, qqqq, and iwm. I've been long major swings in both directions and it has worked out pretty well so far. Timing is everything though.
Gone Fishing,
One possible source of new jobs is infrastructure investments. I recently heard on NPR a blurb by Obama to the effect that there are $1.5 Tr in needed maintenance and repair of things like bridges, water systems, etc, and that these would be good jobs that cannot be exported.
It is certainly the case that the water systems are in need of repair. Last year I read a book about cholera called "The Blue Death", that asserted that in the next few decades practically every water system in every large city and town of the US will beed to be rebuilt, as those constructed ~100 years ago will built to last 100 years, those 75 years go, for 75 years, and for systems built 50 years ago --- you get the idea. Poor planning, but an opportunity for a gigantic jobs program doing something genuinely useful.
But I do think that living standards are going to have to fall. Median household real income has stagnated for years and will probably decline in the future.
clam >> calm. typo.
newbie 101 | 10.11.08 - 8:26 pm
Sure? Could be MI-6 type code.
"I have no idea how much of MS my $9 Bil will buy."
Together, both your points suggest we shouldn't be too surprised if they just buy the whole thing, and are allowed to do so.
girlbear writes:
How does this affect Austria? More specifically the Austria gold 100 Corona coins that I have?
obviously, your going to have to burn them for warmth as the winter rolls in.
we are screwed
Well folks... how much more evidence do you need to prove the failure of supply side/reaganomics? Will we finally agree to abandon that means of theft from the US Treasury by the wealthy elite?
Had enough?
CCD,
Thanks to previous market panic recoveries, a tremendous number of folks, including my mother, will not take out money they don't need in the immediate future, and won't lock in 30% losses by going to cash.
Once again, they will print enough money to cover the immediate issues, and we will have enough inflation as the international terms of trade reset to recover a significant portion of the losses.
The part everyone seems to be underestimating is the need to break the downtrend significantly.
That seems to be beyond most of the commenters here.
Someday this war's gonna end...
From the taxpayers to the USG. If we're gonna get some love, let's be frank about it.
YouTube -
NSFSC
Not Safe For Senior Citizens
... we shouldn't be too surprised if they just buy the whole thing ...
... or decide to walk away and wait till the dust settles. They can always buy MS from Treasury in 6-12 months
There's a phenomenon called Orwell's Inversion, the confusion of Input and Output, that's in danger of happening now that it's systematized.
All of these interventions will absolutely be regarded as Output rather than Input.
ref: John Gall, Systemantics (1975)
Kona, capitulation is a leading indicator of a market turnaround, not a coincident indicator. Capitulation leads the people doing the capitulating to sell. Only when this selling is complete is the excess supply of stocks exhausted, and the market stabilizes and begins to turn around.
That's just a long way to say that I don't think Re implied that the market was about to turn up. In fact, I read his comments to say that he thought further declines were possible, because not all sellers had been flushed out yet.
Kona writes:
Currently Wearing Pampers....
is conjure in the garden, or has the announcement been delayed?
Conjure comes Sunday 7 Pacific.
Conjure comes Sunday 7 Pacific.
That would be 10 est
txchick57 writes:
Well folks... how much more evidence do you need to prove the failure of supply side/reaganomics? Will we finally agree to abandon that means of theft from the US Treasury by the wealthy elite?
Had enough?
no, the beatings must continue....we are the slaves, teach us with pain.
Does anyone have an estimate of how much of the equity holdings and/or annual inflows are from 401K investors?
Everytime I see the statistical split between holdings by institutions/individuals/etc. I can never decide if the "institutional investor" includes the companies that warehouse/manage 401K's e.g. Fidelity.
I agree with poster above, I believe that if we have a bounce J-401K will see his/her opportunity to move everything into whatever non-equity options they have.
And that - will be that.
Is this the txchck from the housing bubble blog?
I've had to work the past two days, have I missed much or are we still on schecule with disaster porn and the end of the world? I am making a shopping list for tomorrow, you guys are great help with those.
yes
Regarding capitulation, it is possible that a significant part of the prolonged equities markets decline is due to hedge funds deleveraging under twin problems of heavy Q4 redemptions and margin calls. Here's an intriguing post about the possible effects of margin calls:
Are Hedge Fund Margin Calls Leading to Stock Rout? « naked capitalism
Especially interesting is the conclusion of this post:
"There are rumors that the most massive of the calls are due Monday (October 13th). If so, this market could continue to decline through then."
A rout on Monday followed by stabilization might be a big HF unwind and not a capitulation at all.
If redemptions/margin calls on hedge funds are a significant downward pressure on the markets, it would appear (to ignorant me) plausible to suppose that the markets may stabilize once the hedge fund industry's deleveraging has played out.
terardrop bottom long on the BSC pre obliteration?
Good. I always enjoyed reading your commets.
Isn't the market closed Monday anyway or is that just the banks?
Just the banks.
Here's the money quote from that nakedcap post:
From Bull's Eye Research (hat tip reader Marshall):
The selling has reached historic proportions. There literally is a "run on the market," as investors worldwide are dumping stocks. It seems that the major catalyst for this selling is the fact that the newest large banks primarily J. P. Morgan, Goldman Sachs, and possibly Morgan Stanley as well -- have issued massive margin calls to hedge funds and other professional traders who use these banks as prime brokers.
These calls were not issued because of market losses, but more because the banks arbitrarily decided that they wanted their customers to use less leverage. Margin rates as low as 15% for broker dealers were raised to 35%; hedge funds who had been used to operating on high leverage were told that they had to bring accounts up to a much larger percentage of equity.
In this illiquid environment, where all manor of exotic securities literally have no bids, the only place to raise the cash to meet margin calls was to sell stock. That is what really set this market over the edge -- as the first notice of these calls were issued on October 2nd and 3rd. There was something of a grace period to meet the calls, but funds realized they weren't going to be able to meet them other than by selling stock. There are rumors that the most massive of the calls are due Monday (October 13th). If so, this market could continue to decline through then.
Re: " not all sellers had been flushed out yet"
Yah, I'm with you there, maybe I misunderstood, but yah, this has been like a blitzkrieg leaving most in shock and unable to respond, thus the next reaction made after stress may be to be somewhat alarmed.
What fun. The banks are closed, but the market is open. My antennae are twitching, but I know not why.
Collateral Damage
THe CEO of Chesapeake Energy forced to sell all his stock due to a margin call.
"Isn't the market closed Monday anyway or is that just the banks?"
Comrade Kristina,
The Scam Market would be open for business to scam the public.
Jas
Comrade Clueless Dufus writes:
Her eyes
Her eyes
Her eyes are a blue million miles
There is an easy answer to this folks. Recapitalize the US Treasury by rescinding the multi-trillion dollar giveaway tax gifts by the K Street corporatists that Bush works for.
SRC,
I've read about the 2 trillion in necessary investment into our infrastructure.
How much of that is to rebuild roads and bridges instead of mass transit systems?
How much of that is to refurbish the electric grid for more nuclear/coal plants instead of making it so each home can give back to the grid with their green energy systems?
How do we provide the capital to accomplish this while keeping the national debt under 10% of GDP?
Population in 1932 was 125 million. 2007 it was 282 million. If we do see 25% unemployment you have over double the amount of people to employ with infrastructure building? I can't even imagine the payroll necessary for that. Healthcare? Child care?
Are we even close to the same society we were then in regards to our moral standards?
I examine the size of this crisis and the subsequent fall out and I feel comfortable planning for a bleak future. I would love, LOVE, to be wrong and have faith we can reorganize and rebuild but where have we shown that type of unity in the last 40 years. I am tired of my pessimism and fear. I look for hope every day and am left waiting.
What is "Conjure"
Re: rumors that the most massive of the calls are due Monday
Jas Jain said:
"My total puts have gone up 900% since June-July 2007. I have been selling all along and have cashed out 600% of the 900% and that amount was put into cash, T-Bills and UST STRIPS. I still have three times the June-July 2007 dollar value in puts left. Basically, I have cashed out 2/3rd of the gains. I have more tech puts now than Fraudentials. "
Thank you for your replies.
Would you be willing to share insights into how you pick tech companies whose valuation you consider inflated? Do you just look at P/E ratios? Are there companies you are particularly bearish on despite their having reasonable P/E ratios?
Thanks in advance for any information/insights you may choose to share.
You know what Jas, we much preferred you the last few weeks when the crazy was dialed down.
Gone Fishing,
I'm not optimistic. But I think this is how it will play out. I'm currently working on finishing my attic in the expectation that there may be homeless economic refugees in my own who will need shelter.
--
"Well folks... how much more evidence do you need to prove the failure of supply side/reaganomics? Will we finally agree to abandon that means of theft from the US Treasury by the wealthy elite? Had enough?"
txchick57,
Welkomen! Please read my quite from Milton Friedman. They are scamsters.
Jas
Now I'm really pissed, WTF Condoleezza Rice doing at G7, this shows the depth of the Bush Coup Stupidity! She is not a member of G7!
See: The G7 (also known as the G-7 or Group of Seven) is the meeting of the finance ministers from a group of seven industrialized nations. It was formed in 1976, when Canada joined the Group of Six: France, Germany, Italy, Japan, United Kingdom, and United States of America.[1] The finance ministers of these countries meet several times a year to discuss economic policies.
This is so retarded!
ova writes:
clam >> calm. typo.
newbie 101 | 10.11.08 - 8:26 pm
Sure? Could be MI-6 type code.
I'm with Nova
Comrade Kristina,
Here's your shopping list.
100 Items to Disappear First
Friedman? The chief voodoo priest of Chicago School of un-economics? What a bunch of charlatans. These thieving creeps who have taken over our government make this $hit up. Don't believe? Art Laffer and his Laugher Curve is case in point.
If I could camp and get high with just two dudes, it would be Pavel and Jas. Between the Soviet memories and the spooky American tales, I doubt I'd sleep, but I'd come out with stories to last a lifetime.
How about it, dudes? You guys want to do Burning Man next year?
That should have been
"in my town"
I expect that there will be a lot of hardship, but no-one need freeze, and no-one need starve. There will be much opportunity for extravagant kindness.
"Are we even close to the same society we were then in regards to our moral standards? "
Well they've just given the average consumer the greatest victimization meme in financial history.
"They bailed out wall-street, why should I feel guilty for walking away, I live on main street."
Condoleezza Rice is now involved in fucking finance and currency intervention -- why the fuck is she there, to boost McCain votes or to talk about Iraq or playing the piano?
That seems to be beyond most of the commenters here.
Don't get too smug...
The plan still has to be hatched, has to work, and has to be enough.
Even if the government can confer solvency on the banking system via fiat the banks still have to sort out the solvent borrowers from the insolvent.
Once the banks have sorted out the solvent from the insolvent the solvent borrowers still need to be convinced to leverage up.
I believe it's called pushing on a string.
Anonymous writes:
You know what Jas, we much preferred you the last few weeks when the crazy was dialed down.
yes, Jas....you cant talk to us like friends... speak in subdude tones...
CSC can we get some thread music?
Condoleezza Rice, shit, why don't they prop up Kissinger:
Most of the non-original domestic functions of the Department of State have been transferred to other agencies. Those that remain include storage and use of the Great Seal of the United States, performance of protocol functions for the White House, drafting of proclamations, and replies to inquiries. In accordance with the United States Constitution, the Secretary performs such duties as the President requires.
Why?
txchick57,
(Re)capitalize the US Treasury.
(Not to anyone in particular) -
Why is the Treasury NOT captialized?
Yes, it's rhetoric.
Manufacturing imploding.
It is?
This is so retarded!
Ahh. You finally get the gist of the current administration.
Kicker, meanwhile who is going to foot the bill for folks that need bread and mik, just to get thru the week ?
In my town?
Nothing but the dead and dying in my little town.
Circuit City, Car Max, Capitol One, Wachovia Securities?
Rice is there because she has a special relationship with one of the other participants. The pressure is at peak levels.
Cue Scotty: I canna get another dram from her!
did I miss a link? How in HELL are we talking about Condi getting here confused little brain into this mess?
Nova,
the real txchick from HBB is a lifelong Republican...currently working for McCain in Texas. The poster is an imposter having fun...the real deal would never make fun of her hero Reagan or of reagonomics. She's a true believer.
OK, I'm a bit of an idiot about a lot of this, just lurking about and picking up what I can from here and a few other enlightened places over the past few months. Hubby and I work in relatively safe jobs in a non-bubbled part of the county, live below our means, no debt save mortgage, and from a food/shelter/safety/cash standpoint we're covered barring anything shy of the Mad Max outcome. However, my inner historian keeps whispering "Fortunes are made in times like these", and I suspect that there may be some interesting opportunities in a few months when the panic passes. Where would be good places to look, either in stocks, or in possible local businesses to invest in?
(P.S. Conjure, hope you don't mind me coopting your line for my username, it's my new personal mantra when my stomach starts churning)
I was wondering about Condi being there as well, she looked angry...and she scared me...
Comrade Clueless Dufus writes:
Seeing a lot of talk in the vein of AllenM and Popeye that the worst is over and the tide is turning now that govts the world over are taking action.
Popeye never said the worst was over. I am a short term trader. I don't decide big questions like "when it's over". My job is no larger than recognizing imbalance between perception and reality. The only time frame I am concerned about is the duration of my own bet.
The US market is open on Monday.
I once knew a girl who was half Scottish, half-Salvadoran. She had a very funny shtick in which she would put on a thick Bela Lugosi accent and say:
De drawbreedge is awp. You vill hafe to spend ze naighhhht!
That's what looking at the market and ancillary sites feels like lately.
Thread music for the Finance MBAs out there.
YouTube -
Sorry you skipped the LSAT for the much easier GMAT. You could have been coif.
--
"Would you be willing to share insights into how you pick tech companies whose valuation you consider inflated? Do you just look at P/E ratios? Are there companies you are particularly bearish on despite their having reasonable P/E ratios? Thanks in advance for any information/insights you may choose to share."
Confused,
BTW, that 900% gain included buying more puts (from the profits by mid-March) between mid-March to mid-May. I always have GTC orders to buy and sell long-term puts. My best purchase was 24 Jan'10 40 Puts on Goldchain Silverknife for 50c. I have been selling 2-3 at a time. Sold some on Fridat at $10.9 and $11.9.
Now, to your question, I have a total of 36 Scams that I take positions in (36-Pack!). I think I have some 15-20 tech Scams on the list and I buy puts on them when they are cheap and then place GTC orders to sell at various prices. The list for the past 15 months consisted of (copied from the spreadsheet):
A / 30.00
AAPL / 110.37
AMAT / 15.24
AMZN / 66.72
BRCM / 18.19
CSCO / 22.63
DELL / 16.36
GOOG / 399.28
HPQ / 46.30
IBM / 115.91
INFY / 30.70
JNPR / 21.32
MSFT / 26.72
NVLS / 19.75
ORCL / 19.98
QCOM / 41.00
YHOO / 17.99
Jas
Yeah, there will be a Russian finance official at the meeting.
Kicker, meanwhile who is going to foot the bill for folks that need bread and mik, just to get thru the week ?
Even in good times people go hungry....
Funny how the middle class assume that bread and milk are a right only bestowed on the middle class (and not the poor)
I've got a brother-in-law who runs a food pantry in a small town. Serving 30% more people this year than last. Another 30% and he won't be able to handle the load.
Citizen Scotto,
ISM - ISM Report - November 2009 Manufacturing ISM Report On Business®
Food banks in Maryland and DC are very strained.
Re: I was wondering about Condi being there as well
Yah man, what gives here -- is this weird politics or is this a matter of state in terms of protecting turf and thus political negotiations versus just banking???? Why would the secretary of state drop in for a photo shoot or be at the meeting unless some turf was being carved out?
I've read several articles about the strain on food banks and shelters. It's everywhere and tent cities are also popping up everywhere. Google tent cities and you'll find many articles on the topic.
The local small town food bank was burglarized last week. "We would have given them food for free, just don't steal it !"
Ok, I cant stand it anymore and am going to go read a trashy novel involving vampires.
And I appreciated the comments on Innocent III on a previous thread. Wow.
"Yah man, what gives here -- is this weird politics or is this a matter of state in terms of protecting turf and thus political negotiations versus just banking..."
No, a Russian will be there. That's her province.
America the Banana Republic
The ongoing financial meltdown is just the latest example of a disturbing trend that, to this adoptive American, threatens to put the Land of the Free and Home of the Brave on a par with Zimbabwe, Venezuela, and Equatorial Guinea.
America the Banana Republic | vanityfair.com
Courtesy of George Bush and the bananas
fried writes:
Nova,
the real txchick from HBB is a lifelong Republican -
Au contraire - word on the street -
Why not just ask TX?
Quite sure the answer will be honest?
--
The Scam prices are for 09/29/08. I copied from Scam/price column for that date.
Jas
PS: I rarely use the terms stock/stocks. I like to call things by their proper name including Bankrupters and Fraudsters of New York City since 2003.
It occured to me that part of the problem Paulson is having regards getting his programs running is timing. In DC with an administation change coming his people began bailing for the private sector months ago. Also political appointees are moving to SES civil service positions so they continue working.
Interesting that PBS is showing the movie "Wall Street" tonight
Lawyerliz, I love trashy vampire novels...Have you watched True Blood on HBO? It's my Sunday night fix...
I think Condi must be the heavy... when you think of what is going through Bush's little mind, and the NY Times piece today on how he thinks he an handle this, it starts to make sense. What a tool...
"It occured to me that part of the problem Paulson is having regards getting his programs running is timing. In DC with an administation change coming his people began bailing for the private sector months ago. Also political appointees are moving to SES civil service positions so they continue working."
Yeah, the common habits of bureaucratic life are bigger than some of the big deals. Someone who was at State told me that big shots spent half the day on the phone trying to move up a few rungs.
Working for old yeller toothed grandpa McCain? lmao.... get real.
Rice was not at the last meeting, so why now.... huh?
G-7 Statement Fails to Convince Major Traders to Change Outlook
G-7 Statement Fails to Convince Major Traders to Change Outlook - Bloomberg.com
April 14 (Bloomberg) -- The concern that Group of Seven officials expressed about swings in exchange rates wasn't enough to change currency traders' outlook for the U.S. dollar.
``Intervention would run completely contrary to primary signals that drive currencies -- especially relative interest rates,'' said David Simmonds, London-based head of currency research at the Royal Bank of Scotland Plc, in a note to clients today. The bank, which ranks fourth among currency traders, predicts the dollar will trade at $1.63 by the end of September.
The NYTimes just posted an article on Americans' reactions to the stock market losses...a lot of stunned paralysis, to be sure.
Across the Country, Fear About Savings, the Job Market and Retirement - NY Times
Bush and Condi
http://www.happyscrappy.com/blog/images/bushcondi.jpg
Re: No, a Russian will be there. That's her province.
The Russians are always at G7, but Rice never is, so why now, this makes me worry about turf wars.
I think Condi must be the heavy... when you think of what is going through Bush's little mind, and the NY Times piece today on how he thinks he an handle this, it starts to make sense. What a tool...
No, she's there to keep the Russians at bay. There's a ton of concessions being made behind the scenes.
The Russians have strategically placed their deposits around the world. A simple withdrawal by an oligarch could cause major disruption. Trust me: the Russians are making out like bandits right now.
@GF
Thanks, forgot that the Sept ISM was so bad.
Glad to hear the talk about food banks--I worked my way through grad school as a welfare caseworker (an experience everyone should have IMHO), and know how good I have it. we're converting some of our cash into useable assets as an inflation hedge (mainly stocking the pantry, and a few infrastructure things we were considering doing anyway), might not be a bad idea to convert some of that capital into a case or two of canned goods for our local food pantry.
The next few years may be hard for us, but barring a true nightmare scenario we'll be able to stay fed and sheltered. Whatever you think of "welfare queens" or people who lived on credit cards and HELOCs, at the end of the day we're all just imperfect people who occasionally need a bit of help.
fried - im in with that view...paralysis. This has hit so fast, after most people were asleep at the wheel, that they dont know what to do. There is this bizarre hope that things bounce back, but it's understandable, because so few people can grasp the reason the shate has hit the fan out of seemingly nowhere. Of course we all know it's been a tidal wave coming ashore from three or four miles (years) out. But most peeps dont seem to have put it together, dont see where it is now, and cant understand where it is going. Better hope they stay paralyzed, because if the retail investor starts dumping, it's dow 3000.
"The Russians are always at G7..."
I think this is someone with special cachet. Also, US-Russian relations are extremely complex, sensitive just now.
Re: Condi being there. Hey, the girl's
going to be looking for a job soon. Secretary of State isn't starvation wages but it won't make you independantly wealthy either.
Condi's probably hunting for a nice sinecure and this is a perfect opportunity for her to do it.
Comrade Kristina,
I followed your advice and googled tent cities - scary.
As the folks at Stafford-Miller Limited like to say... Nytol.
Is Condoleezza Rice a Russian expert? Yes! No, no, no, no, no, no, no!
How did Condy get appointed as Secretary of State and labelled a Russian expert? Could it be that she told President Bush that she was an expert in rushin' around and he made her his "Rushin' expert"?
\t
Asked whether she would run for President at the next election on Ekho Moskvy Radio programme, Condoleezza Rice answered Da! Nyet! Nyet! Nyet! Nyet! Nyet! Nyet! Nyet! Not bad for someone who is quoted frequently by the Western press as being a fluent Russian speaker and a Russian expert, although she has never lived in the country.
Before admitting to this schoolgirl's question that is was difficult to speak Russian, she had already made a fool of herself on Tuesday, when she declared that the Kremlin's grip on the media is "very worrying." The question is, what grip?
For the information of Condoleezza Rice, who despite being Secretary of State of her country, continues to demonstrate an ignorance of world affairs at a shockingly consistent level, the notion that the Kremlin exerts a grip on the media is a fairy tale invented in the gardens of Washington.
Can Condoleezza Rice speak Russian? - Pravda.Ru
By "heavy" I mean this definition :
"A bodyguard (or "close protection officer") is a type of security guard or government agent who protects a person"
And the person being protected is the Shrub.
"The Russians have strategically placed their deposits around the world. A simple withdrawal by an oligarch could cause major disruption. Trust me: the Russians are making out like bandits..."
That's what I read.
"Working for old yeller toothed grandpa McCain? lmao.... get real."
Now confirmed, an imposter. The real txchick posted long essays for months on why she supported McCain, and her reasons for working on his campaign.
This is just someone trying to trash her name, one she has used since the old days at f@cked company.
I don't agree with her, but she's a serious woman and a smart trader. Imposters truly stink.
"Conjure comes Sunday 7 Pacific"
Unless they get to him first.
(Who are they?)
Conjure, stay safe!
Pavel, think Putin will put Condi on Gazprom's payroll?
Moral hazard. I have never read or put those two words together in a sentence until the last few months.
Anonymous at 8:47 nailed my thoughts as well. I feel the economic stimulus check was a way to buy off the American people. We were given a small amount of money we knew was created by adding national debt for our kids to pay. Then when the money was needed by the banks we were already complicit.
I believe an unintended consequence of all this is the ease society will feel to just walk away from debt. No shame can be assessed due to our government leading the way in deficit spending and allowing criminal actions to go unpunished. What is going to happen when all the unsecured debt is defaulted on? 4% of sub prime loans default and the world markets/banks collapse. What happens when 10% of CC debt isn't paid back? Who holds the CDS on that?
Thought of the moment -
People (some) are suffering - living day to day.
Yet polos spend innumerous dollars for their gain/loss.
NOBODY (ok - few) questions the dollars = election.
Is it possible to proceed from greed into humane?
"What happens when 10% of CC debt isn't paid back? Who holds the CDS on that?"
YOU DO. Didn't you read the fine print of the bailout bill?
"Pavel, think Putin will put Condi on Gazprom's payroll?"
No, but I should think that everyone who meets V. V. Putin wants to be very polite to him.
--
The primary purpose of democratic form of govt is entertainment (all that humor!) including the pageantry of elections. However, we got two boring dudes vying to be the worst President in US history (because of the mess they would inherit). The title, otherwise, would go to G. W. Bush. My man Herbert Hoover would be relieved.
Jas
So someone is trying to tarnish the reputation of txchick... and you defend the original one by swearing that she is the biggest McCain fan ever?
OK...
Has anyone here heard a pension fund say anything about this financial crisis lately? They seem uncannily quiet about how things are playing out.
--
"Is it possible to proceed from greed into humane?"
Deana (not Diana),
Yes. The path traverses thru misery.
Jas
karelian: Don't you think that intelligent, informed people can see the world differently than you do?
Those are the most interesting friends to keep.
txchick57 writes:
Working for old yeller toothed grandpa McCain? lmao.... get real
One above said you were working for X.
(Per HBB)?
My point -
Ask her, she will tell ya!
No harm -
Without jobs the American people aren't paying anything back.
Universal default or debtor prisons are in America's future.
Sorry for the constant doom and gloom today. Life will go on and love will find a way. Good luck all/
These humongous bailouts by various countries are barely drops in the bucket. How much do they add up to? A few trillion dollars, possibly?
A hundred trillion more of less or quasi-money has vanished from existence, globally.
The hundred trillion must be replaced by real money. Otherwise all the institutions that held quantities of the quasi-money must write it off.
Which means default, bankruptcies, and asset collapses.
But there's only one way the nations can replace that much quasi-money: by printing.
Welcome to Zimbabwe. You can check out anytime you like, but you can never leave.
Geoff,
confirms my experience. Live in Manhattan, with people successful in all sorts of ventures. The stock market gyrations caught them totally off-guard.
They were concentrating on their businesses , their money under 'professional management". Though even some of the Wall St folks seem a little shell-shocked, and they should have known, you'd think.
"Bond Girl writes:
Comrade Kristina,
I followed your advice and googled tent cities - scary."
--
I wish I could find the link to the private equity company that bought the lackluster tent manufacturer while we were still debating "typical vs. deep recession."
Has anyone considered how much more of the banking system will have to be taken over at the next intervention? The defaults on mortgages continue unabated and will likely intensify early next year. According to CR the option ARM and ALT-A resets really get started next quarter. As the recession grows we can also expect more losses in other credit products.
My questions:
If it is this bad now, how bad does it get next year?
Isn't a program to reduce the stress at the homeowner level (cramdowns) mandatory soon?
Or, are we going to inflate wages (and prices) to to gradually erase the stress?
"The Russians have strategically placed their deposits around the world. A simple withdrawal by an oligarch could cause major disruption. Trust me: the Russians are making out like bandits right now."
Tin foil hat in me: The Russians have recently positioned nuclear forces strategically around the globe also. A simple strike would also cause a major disruption. Checkmate.
LOL - I'm from Eastern Finland. Ain't nobody here on Manhattan who does not see the world differently than I do.
I am literally surrounded by people who have a totally alien POV on politics, finance, culture and sports.
So yeah - I kind of get the point about diversity.
If anyone is trying to tarnish my good name it is those who suggest I support Yeller toothed Grandpa. And now I work for him? lmao.
Deana,
I'm sorry, I don't understand your posts. This imposter is trashing the rep. of a serious person.
As I said, it stinks.
fried....dont all 401k statements come out on a quarterly calendar basis? If so, most people opened theirs up in early September, and were like, dude, that sucks, but it will come back. And just as they put it in the refuse pile, bublam...take what they already werent too thrilled about losing, and nearly double it in a week or so.
So the question is, do they freak now, and start selling, or do they have a coronary when the January statement comes? I personally think a lot of them are going to push the panic button if we go down further next week, and if the margin calls im reading about are still coming on Monday, that is where we are headed.
Has anyone here heard a pension fund say anything about this financial crisis lately? They seem uncannily quiet about how things are playing out.
This morning's Albuquerque Journal, front page headline: "State Funds Lose Billions"
"...In all, the state's permanent and pension funds suffered losses totalling more than $2.5 billion during the fiscal year that ended June 30."
Can't imagine how bad it's gotten since then.
fried,
They were concentrating on their businesses , their money under 'professional management". Though even some of the Wall St folks seem a little shell-shocked, and they should have known, you'd think.
You would be surprised. I was surprised during the auction rate securities crisis earlier this year how many financial advisers had absolutley no clue what they were putting their clients into. Not only did they not see the crisis coming, they could not even define the instrument they were putting in their clients' money into.
RE Russia
From what I've seen here in Florida, I'm beginning to wonder if Russian strippers might be KGB officers..Taking my tinfoil hat off now...
They seem uncannily quiet about how things are playing out.
Why report bad news before you have to? I am sure they are being crushed. As is the PBGC.
I'd also love to see more on pensions. Where the heck is rich? That dude is a stud when it comes to these things.
merciless,
Yeah, no kidding. That was before any of this got going. Wow.
rich is vacationing, while there is still unrestricted travel for 'Mericans.
txchick was an established liar on the HBB.
Jas
Way upthread on limey swearing, it's BOLLOCKs not bullocks. Say often, loud or sotto voce.
Sample: that G20 statement tonight will really calm markets. Reply, ahh bollocks.
Sample 2: Sallie Mae chief says the fundamentals of our business are strong. Reply: BOLLOCKS.
Try also some other earthy charm, like dogs balls.
Sample: the flaws in the TARP stick out like dogs balls.
Much more sociolinguistics to transact if yr interested.
CC
PS is MW online? Or doing something sensible like discussing today with his family? I have a question about Savannah weather.
uhhh,
Jas is outing the Tech Bellweather shorts.
WAY TO GO JAS!!!!!
people, if he can maintain the tone he's golden.
Drove through Finland on the way to Russia in 1979. Was amazed by the number of drunken bums on the streets. It was explained to me that drunkenness was common in the shadow of the bear.
Yeah the mortgage default rate will not be helped by high Libor rates, no doubt one reason why Paulsen is so interested in getting them down. Also why the GSE's were ordered to start buying non performing prime, alt-A and subprime mortgage bonds to the tune of $40 billion per month.
If they can't kick start the housing market nothing else they do is really going to matter.
DO NOT MOCK DRUNKEN FINNS.
Part II
The US is going to be treated like a 300 million population leper colony, after the collapse takes full effect. There's no way in the world we don't get blamed for the global depression and its consequences.
Stupid Americans will answer with bellicosity. Probably want to bomb those ungrateful foreigner bastards who blame us after all the aid we've given them.
We've devoted a lot of comment space to drunken Finns in the past.
Am watching a synopsis of the financial crisis on Fox News - really entertaining.
296 Visitors at 9:21 on a Saturday.
You know I've had it!!!
Monday-Friday we got paid for all this reading, but the last 12 hours have been nothing but gratis.
And Monday is a Holiday. Are we supposed to spend all day here for free???
(Oh, we get paid for that too.)
Carry on.
I was surprised during the auction rate securities crisis earlier this year how many financial advisers had absolutley no clue what they were putting their clients into. Not only did they not see the crisis coming, they could not even define the instrument they were putting in their clients' money into.
Bond Girl | 10.11.08 - 9:25 pm | #
Explains why we need the high school grads to bailout MBA's, doesn't it?
Stupid Americans will answer with bellicosity. Probably want to bomb those ungrateful foreigner bastards who blame us after all the aid we've given them.
Well, it's about the only profit-making business we have left. Nobody makes aircraft carriers like us...
LOL I was wondering today if the world would send us food like we have done so many times.
Unirealist answered that question.
Not mocking, Karelian. I was young and impressionable, and took much about America for granted in those days. That trip was an education.
I still don't fully understand why Conan O'Brien is held in such high regard by the Finns. Does it work like Jerry Lewis in France? Payola?
"If it is this bad now, how bad does it get next year? ... Or, are we going to inflate wages (and prices) to to gradually erase the stress?"
Within a few months, all that appears as separate bandaids (TAF, TARP, F/F, FHLB, FDIC, SIPC, ...) will be simplified and consolidated into a fat pipeline directly from Treasury to 1-800-total-bailout.
There will be token relief at the retail level, and unspeakable gushing at the wholesale level (to the bankers). All the Alt-A failures, etc, will just be minor modulation of the flow in the pipeline.
The real issues are (1) how much does the Fed print and when, and (2) how does the dollar hold up?
So we are just killing time until the Brits rearrange the chairs?
Did the music stop?
He had several short monologues about the Finnish president. Who is an ugly, overweight woman with a communist past. For some reason this touched Finns. Nobody else has ever cared about Tarja Halonen.
Tabloids ran cover stories about it and so forth... "Putting Finland on the map!". Kind of sad.
Why@ ZIRP writes:
I was surprised during the auction rate securities crisis earlier this year how many financial advisers had absolutley no clue what they were putting their clients into. Not only did they not see the crisis coming, they could not even define the instrument they were putting in their clients' money into.
Bond Girl | 10.11.08 - 9:25 pm | #
Explains why we need the high school grads to bailout MBA's, doesn't it?
Well, our financial system is really divided into two parts, isn't it? The engineers and the non-engineers. I was schooled in derivatives from the beginning of my career in finance, but it does surprise me sometimes how many people in the finance industry just go along with things. How many financial advisers understand innovative structures...hardly any, whatever their education background. How many financial advisers were telling their clients in the past two weeks that this is just a "blue light special" in the stock market? Probably plenty, because that's the line they get in their Monday marketing meetings.
karelian: Thank you! Mystery solved.
Yes, these must be the End Times. Squirrels have overrun Washington, DC.
My BIL is a financial advisor. He was really pushing investing in financials like BS and such.
Here's George Soros talking to Bill Moyers.
Bill Moyers Journal . Watch & Listen | PBS
He thinks Paulson is not up to the job -- conflicted interests. Says that it is going to be painful.
One thing about the Brit. plan is that it's a decisive, swift move. A little leadership in this country would be helpful.
Currently Smoking Cannabis writes:
Thread music for the Finance MBAs out there.
what else do you know about me?
I do think state and municipal pension funds must be getting spanked right now. Should go looking for information, but it is probably based on the end of the fiscal year for most municipalities, which was end of June. Most were severely underfunded to begin with, so this should just accelerate the concern for taxpayers. Can only imagine how taxpayers are going to feel about paying for lucrative pension benefits when their own 401ks are basically depleted....
Got appointed to the financial committee of a non-profit. Went over to the financial advisor's to confirm a bunch investments. Guy said to me "look I just sell this stuff, then I don't have anything to do with it."
do think state and municipal pension funds must be getting spanked right now.
NC State Employee Pension is going to be ugly. CALPERS...
It seems a lot went chasing commodities for that higher than average return. I guess it worked until it did not.
File this under:
Ya just can't make this up.
Live near a major city.
Took grains, beans, stock, veggies to a pantry.
Back door - as always - be aware of your surroundings.
Give regularly - seldom cash - mostly just drop off said stuff.
Last giving: 8-10 days ago.
Almost mobbed.
Armed delivery?
This is not about ME.
Lived through hurricanes, tornatos (the worst), earthquakes...
He!! Lived in the middle east for two years. (NOT fun as a woman - Pellosi (sp?). Let's send her over there for two weeks.
My point.
Takes a brave one to give - easy to write a check - whole lot safer.
Be safe.
Check out the Project for the New American Century website
Welcome to the Project for the New American Century - Bill Krystal, Paul Wolfowitz and
the boys subtle outline for a strategic play for resources worldwide
through militaristic corporatism. Democracy means dealing with
congress and dissent - the kinds of things that make an "empire"
lethargic and ineffective.
Are These the Forging Fires of the NWO We Feel? « Your Mortgage or Your Life…
the Soros interview is just SO uplifting. Just what I need on a Saturday night. (well, that and at least one bottle of Ribera del Duero)
I remember a stock broker telling me once that he "didn't care about derivatives." He said "listen, lady, there are three asset classes - stocks, bonds, and bullshit." He must be having a very difficult time figuring out what's going on right now.
Can only imagine how taxpayers are going to feel about paying for lucrative pension benefits when their own 401ks are basically depleted....
Bondgirl lucrative doesn't describe it:
Relatives - 80K Public Pensions
(no state tax), 20K SSI.
Couple above called state tax department half a dozen times when they didn't get their $350 state tax refund.
I would say all their friends hold similar attitudes.
They have a depression era chip on their shoulder (because their parents had it - and rightly so) and a bottomless well of entitlement.
Bond Girl | 10.11.08 - 9:47 pm
I had a senior attorney years ago tell me as I installed a PC for her; "I didn't go to law school to learn how to type."
Soros is dead on, as usual.
Final tunes from the bong for tonight.....
This one is for the Finance MBAs who want to punch me in the face or jump in front of a train. Also for my fellow apocalypse watchers...
YouTube - Good Times Around The Bend - Emmitt Nershi Band
Gonna pick myself up off the ground
When that old feeling comes around again
I've had enough of feeling down
There's something I've lost that must be found again
Sometimes it seems like such a hard life
But there's good times around the bend
The rollercoaster's got to roll to the bottom
If you want to climb to the top agai
Food banks in Maryland and DC are very strained.
Nonprofits, charities brace for the worst:
Nonprofits, charities brace for the worst
One of my brothers was a derivatives trader (seems like eons ago). When he explained to me what that meant all I could say was I can't believe that's legal.
NYTimes trying REAL hard to prevent the capitulation :
Those With a Sense of History May Find It's Time to Invest - NY Times
this is the second of the "dont go to cash" type of articles. Sickening. They have no business writing about this stuff, since theyve been basically clueless for years.
Within a few months, all that appears as separate bandaids (TAF, TARP, F/F, FHLB, FDIC, SIPC, ...) will be simplified and consolidated into a fat pipeline directly from Treasury to 1-800-total-bailout.
There will be token relief at the retail level, and unspeakable gushing at the wholesale level (to the bankers). All the Alt-A failures, etc, will just be minor modulation of the flow in the pipeline.
The real issues are (1) how much does the Fed print and when, and (2) how does the dollar hold up?
Plantagenet | 10.11.08 - 9:35 pm | #
Thanks, I didn't know they had that 800 number set up. Maybe I should give them a call, don't really need a bailout yet but maybe they got some cash laying around all ready for the first caller.
Seriously, printing won't work if wage arbitrage continues. You must get wage inflation to make the debt manageable. I don't see a real way out of the trap other than direct intervention at the household level otherwise the banks just hold the cash and the deadlock continues until the cities are decimated and the real nightmare gets started. Under your scenario the banks survive but the borrowers don't.
Average Citizen: It's a good cover. No clean-sounding copy from SCI.
I've got some of their DVD's... in storage. I thought the barefoot guy looked really different!
If you feel in need of amusement, read this
Those With a Sense of History May Find It's Time to Invest - NY Times
That NY Times article encouraging people to stay put is a laugh.
Geoff,
Ha, great minds think alike!
Average Citizen: This is Emmitt Nershi Band. Like a cross between Leftover Salmon and SCI. SCI has an Asian dude.
Under your scenario the banks survive but the borrowers don't.
Why@ ZIRP | 10.11.08 - 9:53 pm
Is that really important to the current administration?
CalPERS fund value & allocation:
Current Investment Fund Values
Wonder what it was last month.
--
"How did Condy get appointed as Secretary of State...:
km4,
Condom Lisa is a political appointee, which means her expertise is not that important. Her color and gender are the most important qualifications for her getting the job.
How could I be so sure? I watched the GHW Bush vs. Clinton Presidential debates of 1992. GHWB was put on defensive (by a question on the subject of women and minorities) because he did not appoint enough blacks and women to important positions. Clinton was able to rattle off lot of names that he appointed as a governor. So, the number one task for GWB was to identify a black woman that would be placed in a very high position. That is how we got Condom Lisa.
Jas
Investment advice from NYT - double down on what seems like a bad bet.
The word is that Mr. and Mrs. Cheney met Condoleeza Rice at a swingers party in DC.
Gee, Jas. You almost sound human tonight. Feeling wistful this evening?
They're good! Is Emmit Nershi related to Billy Nershi?
It also helps that Chevron named an oil tanker after Condi as well.
Chevron redubs ship named for Bush aide / Condoleezza Rice drew too much attention
Currently Smoking Cannabis writes:
Average Citizen: This is Emmitt Nershi Band. Like a cross between Leftover Salmon...
got into Leftover salmon after David Lowery from Cracker (Camper Van)...
forget burning man....try one on in the Campout.
However, my inner historian keeps whispering "Fortunes are made in times like these", and I suspect that there may be some interesting opportunities in a few months when the panic passes. Where would be good places to look, either in stocks, or in possible local businesses to invest in?
Direct investment with people you know and trust. Invest in their good will, invest in their businesses, invest in their personal future earnings capacity.
The strength of capitalism is that it allows investment with people you don't trust. If the financial system that supports that fail out, just fall back to the old standby of direct placement. Just be ready to be on the ground working your stake.
Invest as wisely as you can because these are the people you will hope like hell let you sleep in the front room if you go busto or who you hope will fish you out of a holding pen if the justice system morphs into arbitrary mass roundups. Also, as you note, you can make a fortune this way by riding it out then riding it up.
Learn a new skill directly relating to a known source of steady income. Learn a trade. Learn to use Excel and Word.
Learn about informal banking and investment practices. The Chinese had many interesting mechanisms by which investments could be pooled and bank transactions executed, even in very hostile business climates.
Invest in donations to local officials who might make your life a misery in desperate times.
Make your house / place of business well-repaired so that a decade of poverty doesn't deprive you of a leak-proof roof.
Get your car or business vehicle overhauled.
Look hard at your circumstances. If the country were plunged into an economic deep freeze for five years, would your area become untenable? If so, move before the act becomes unpopular.
Woo woo, Jas why don't you come out and play?
How many financial advisers understand innovative structures...hardly any, whatever their education background. How many financial advisers were telling their clients in the past two weeks that this is just a "blue light special" in the stock market? Probably plenty, because that's the line they get in their Monday marketing meetings.
I'm not in finance, but my experience has been rife with this sort of mentality. PhDs shockingly ignorant of their own field and all sorts of "experts" little more than obsequious middle-managers/salesmen. The rot is deep.
another song, if u like.
YouTube - Bright Eyes - Four Winds
seems appropriate.
Condom Lisa
Jas, thats the tone right there Im talking about...man that really gets to people.
Not sure about Billy Nershi.
Oh man...the Campout looks just my style. I'm not much of a pink fur punk. As I will probably be living in the midwest next year, this will be high on my list of priorities.
I'm not sure if Condoleeza was accompanied by a man or woman at this swingers party but it makes you wonder doesn't it?
This is so funny... YouTube - Show Them To Me.
I read Cheney derides Rice as glorified graduate student.
txchick57 writes:
I'm not sure if Condoleeza was accompanied by a man or woman at this swingers party but it makes you wonder doesn't it?
txchick57 | 10.11.08 - 10:03 pm | #
She was accompanied by a textbook.
Kristina--Charlaine Harris is great.
Have you read the novels/
I've watched True Blood every week, but last week, when we had guests.
In light of where the novels went, I don't know how they are going to work out the changes they made.
Sorry to all you non chick, non vampire lovers.
I remember a stock broker telling me once that he "didn't care about derivatives." He said "listen, lady, there are three asset classes - stocks, bonds, and bullshit." He must be having a very difficult time figuring out what's going on right now.
Bond Girl
Or he could understand that all the talk about gamma, vega, etc. was just bullshit and steered his clients away from the bullshit.
And lets be frank, most of financial engineering was designed to make opaque the fixed income products sold by Bear Stearns, Lehman, and the investment banks. That way the IB would have an information advantage and could scalp their clients.
Now the markets need transparency and most fixed income portfolios are opaque. Hence, no one trusts anyone else's financial statements because their know how fubar their own statements are.
From the NYT article Bond Girl posted:
Mr. Heebners funds have not avoided the carnage this year. The CGM Focus fund is down about 42 percent so far in 2008. But his long-term track record is impressive. In the decade that ended Dec. 31, 2007, CGM Focus rose 26 percent a year, including reinvested dividends, making it among the best-performing mutual funds.
LOL. They are using this as a reason to follow this guy's advice.
lawyerliz, Full moon in 4 days
Lawyerliz, no I haven't. I'll have to take a trip up to the book store while I'm on my doomsday shopping trip tomorrow. I have read all of Anne Rice though.
Ok,
I have the skinny on Rice
You'd think elected officials would avoid such risque proclivities while in office. Goes to show you the arrogance of this crowd.
You must get wage inflation to make the debt manageable
Exactly.
Why do so few people still not understand this? Pushing money into the bank won't make a difference unless they push loans out to consumers at stupendously low interest rates like 3% for 30-year mortgage or so.
WTF Liz
--
El Presidente Jorge (George) Booch wants to protect Americans' "household wealth" by stopping the slide in Scams and home prices by his new policies. He had no problem when the wealth was running wild, because that wealth was a result of his sound policies.
Americans losing the wealth is due to the bad policies of greedy bastards and not El Presidente. He also said that he is very happy that the crisis happened on his watch because he has some very good people. What a guy!
Jas
Jas got his medical marijuana card. No doubt about it. Jas, try the THC breathstrips. You can hide em in your wallet.
I'll work for peanuts.
But they gotta be organic!
Can anyone send me a link to the NPR program on the subprime crisis that CR highly recommended?
Thanks!
40 cases of Ribera de duero @ the G20 conference would do wonders.
They'd either drink themselves into a fit of inspiration and solve everything or become so sad in the thought of never having another wine so good they'd kill themselves, every last one of them.
IMHO and Humble theory, Rice is @ G7 to represent Middle East oil, because this is a coordinated devaluation of G7 currency relating to currency reserves, thus oil wants to be in on this shit and Condi has the cell phone hooked into OPEC
Huh, huh, what think?
Bond girl - I was wondering when this was going to get rammed onto the front page of the NYTimes website. It would be fascinating to observe the mechanism of how this idea gets transported into the media's conscience, and how they foist it upon us. Gotta love propaganda. Goebbels would be proud.
Rice is @ G7 to represent Middle East oil, because this is a coordinated devaluation of G7 currency relating to currency reserves
Methinks, it will be the JPY and Swiss Franc that will be devalued this time around; you can't have a decade carry trade unwind in a matter of two weeks. Jim Rogers not gonna be happy.
fried writes:
Deana,
I'm sorry, I don't understand your posts. This imposter is trashing the rep. of a serious person.
As I said, it stinks.
Well, fried, this is going to sound silly.
Health does not equal weath.
Poor are not ignorant.
Monied believe they are rich.
Many believe they are cultured.
Rich are those whom live in a library; museum; love.
Poor are ones who cling to riches; outward; physical.
True are those that recognize the difference.
Currently Smoking Cannabis writes:
...the Campout looks just my style. I'm not much of a pink fur punk....
Its a short hike from the SoCali coast where the Tears of Allah fall on the City of Angels....banned from SD during my undergrad.....gate crashers.
yes, a deadhead MBA punk..... a difficult concept, but its right for me.
Bill Moyers interviews George Soros:
Bill Moyers Journal . Watch & Listen | PBS
Anybody else see this line in the NYT piece on GM? A reason Ford did not hool up with The General: "Mr. Ford and Mr. Mulally were said to have concluded that their company had a better chance to reorganize on its own than in tandem with another automaker."
See that word, reorganize, it means BK.
Did anyone else catch this piece on NPR today?
Weekend America: Conversations with America: Heather Ryan
An interesting and disturbing piece on what is happening to middle america for quite some time.