I was just reading about the upcoming "reset" of US Treasuries. 1.6 trillion is rolling over in the next 4.5 months. I know the world's appetite for treasuries will drop in the near future and if it does it will drop catastrophically, but I had no idea such a big lump was about to roll over so soon.
Alistair Darling really screwed up by not getting rid of Northern Rock when he could have
Gordon Brown will not be re-elected no matter what now. Gone is the North Sea Oil, gone are the capital inflows from Canary Wharf, arrived are the Olympics, arrived are the bailouts, arrived is a deficit multiplied from a chain of deficits in prosperous years.
Labour has to hold an election before May 2009. Connect the dots and realize why the G20 planned an April 2009 election (rumours are returning for a snap election, the earlier the better for labour in this environment)
OT: I have recently incorporated as a bank. Bank of Barkingtribe and submitted request for immediate bailout on Friday, considering of course lack of capital, a small pittance of 500 million...
Avaiting approval in Monte Carlo....
O/T
I just got back from a 2 week vacation in Japan. I have to say that the deflation argument does not hold water. Things are expensive for the common man: restaurant food, electronic gadgets, public transport (I was actually paying less as a tourist!) clothes... The only thing that has dropped in value is home prices to some extent and rent to a large extent in Tokyo. In Kyoto and other places life is much better but a strain on the commoner since the wages are around Y1000 /hr (roughly $10). I asked what a good salary was. The answer: $30k. If one makes $60 (for piping designer, accountant) then it is considered very good.
I hope we don't see that sort of deflation here in the US. One thing that stood out is that people actually work and do it with pride (street cleaning, food, railway conductors) unlike the rude service you typically get for the low paying jobs in the US.
Where appropriate, we will offer payment holidays, reduced monthly repayments and conversion to interest-only mortgages," said Jemma Rundle, a spokeswoman for Northern Rock.
Can a lawyer work on a contingency basis in the UK? That is can a law firm go after these folks on fee for success basis? This would make people's lives horrible.
In Fla all mtges are non-recourse. No bank or lender EVER goes after defaulters and they still aren't. This would be futile, as almost all borrowers have no NO I repeat No money.
If they did get pursued, the borrowers would simply file bankruptcy.
The same lenders who don't pursue homeborrowers do pursue underwater car borrowers. Less likely to file bankruptcy maybe?
In actuality, what do they do in Great Britain?
A lower interest rate would, in some marginal cases be benefical to the borrowers, so long as it wasn't ever added back on in the form of neg am, or piled at the end of the loan.
Of course principal reduction is the most likely source of an actual solution.
I personally wouldn't do this on a contingency. I don't think it would be profitable, especially if I had to front filing fees and service of process fees, and whatever other fees that turned out to be necessary.
Of course Florida is very pro debtor, but I rather think that it would be financially futile even in a pro creditor state/nation.
Beaver(Unrated) writes: ...I think that now would be a good time for banks to start pursuing people who choose to walk away from recourse loans....
Really quite pointless.
What is your thesis? Punishment for the sake of punishment? Using the mechanism of the state to encourage banks to make future bad loans by insulating them from the full costs of the error? Prolonging the downturn by keeping more people living in hand-to-mouth poverty for longer?
China is giving power to the words "A friend in need, is a friend indeed" Hu Jintao to visit struggling ally Cuba
| Reuters
One part good value in diplomacy, one part hedge against America dropping the Cuban trade embargo
I also wonder if China is trying to drum up business for industrial exports
It seems to me that the world today is where the U.S. was in August-Sept of 2007. If you remember, the Fed recognized the credit crisis in Aug. 07 and started cutting rates and expanding credit facilities. This was then viewed as very bullish, and the market rallied in September and early August. That rally looks stupid in hindsight, but there's a lot of stupid investors out there, including some with billion dollar piles.
Now, multiply that liquidity and sentiment several times as the world follows Bernanke's model, one year later.
It may turn out that Bernanke's model works a lot better in some foreign and emerging markets than it will here. The U.S. is the most screwed of all economies, long-run.
Poor Cuba has been hit by 3 major hurricanes this year, one just a short time ago. Lots of reconstruction to do, no money. No cranes, no machinery to help. Or, hardly any. I think a lot of crops damaged.
In my opinion Cuba should be treated as any other poor soul hard luck nation, but none of my Cuban friends agree.
The next election in the UK can take place as late as May 2010 - there's a maximum five-year term from the date of the previous election ( which was May 2005 ).
If the election were held tomorrow, it's possible that Brown would lose - but I wouldn't discount a "revival" in Labour fortunes over the next 12-18 months.
Both Cameron and Osborne, the shadow chancellor, have floundered badly of late, and the "crisis" is actually a political plus for dear old Gord.
Max,
Don't have the time right now, but other states publish online mass layoff notices -- learned about it on CR comments. I remember Florida, Texas, Washington I think
The campaign to discredit 401(k)s and convince people that the government knows how to use the money better has begun.
"The current 401(k) system has not turned out to be as secure as we want it to be," said Rep. George Miller (D-Martinez), chairman of the House Education and Labor Committee. "It has not provided the returns that we want it to. And it's not provided the level of savings that we want it to. It's kind of failing on a number of fronts.
"Should there be a serious reassessment? Absolutely," he said.
This is the first step toward the government hijacking the funds or reworking the program to direct the funds somewhere more "beneficial".
A co-worker asked for advice on how to handle a brother asking for a loan to stay out of foreclosue. My advice was not to help avoid fc but make sure the brother has a place to stay, ie help with rent if possible.
"crispy&cole writes:
All of the Mervyn's layoffs occur on 12/23...Merry Christmas...
crispy&cole | Homepage | 11.16.08 - 11:28 am | "
They'll get my Aunt Marie at the Vallejo store. And they'd laid her off before, a couple of yeas ago; she'd had 20 years in, and seniority, and they didn't want to pay so much for people anymore. They took her back at minimum wage. Circuit City wasn't the first to pull this kind of crap.
I was just reading about the upcoming "reset" of US Treasuries. 1.6 trillion is rolling over in the next 4.5 months. I know the world's appetite for treasuries will drop in the near future and if it does it will drop catastrophically, but I had no idea such a big lump was about to roll over so soon.
Hoopajoops LTD | 11.16.08 - 11:16 am
I raised this matter a couple days ago and some others have ably dug up some info concerning it. I first had my attention called to this by The Mogambo Guru, who satirically gagged and fled to his bunker.
I am a plebe, without any real credentials. So, here goes with another question:
Previously we have exported this to other CB's, at least to some great extent i.e. sovereign wealth funds, CB's, or whatever. Now, or so we seem to fear, the appetite for this is waning and therefore we won't be able to export this.
Doesn't this mean monetary inflation?
Should the fed take it onto its balance sheet, the treasury has to react, right?
What will this mean in terms of credits coming into circulation?
Will this mean a ratcheting up of interest rates until the price is discovered?
the shareholders, taxpayers and public at large would be best served by actually holding the "walkaways" responsible for their actions.....
The money isn't there and won't ever be.
We would be best served by a combination of cramdowns, forgiveness, short-sales, lease-backs, and other such programs that split the losses between lenders and borrowers and keep as many people in their homes as possible. Moral hazard issues abound, but after the TARP nonsense and given the upcoming deep recession I think they aren't as relevant.
Principal reductions/payment reductions are no ultimate solution. You start giving reductions of any kind to delinquent mortgagees, and you will get a flood of delinquincies.
Most people with mortgages continue to keep current, but they are pissed off at talk of letting deadbeats keep their homes and paying less than they borrowed, and if this becomes the standard response to mortgage defaults, those keeping current will stop doing so.
6 years? Make that FOREVER - so long as they don't let 6 years elapse between consecutive requests for payment.
Actually, I have no idea why the US treats mortgage debt as being optional as to payment. Where else can you borrow large sums of money and then just decide to walk away? No wonder you're having so many problems - even worse than the UK I suspect (although things are pretty dire here).
Max,
Don't have the time right now, but other states publish online mass layoff notices -- learned about it on CR comments. I remember Florida, Texas, Washington I think
The data are overwhelming these days. I could quit my job and blog full time and still not cover 10% of what's going on (CR manages to do 20%; bow to the master .
Interesting omission from the WARN list: Linens 'n Things. I guess the each individual store falls below the employee-level threshold of 75. If WARN reporting is voluntary below that level, there's a ton of layoffs happening under the radar.
Off topic question that I have been wondering about for the last month or so.
Everyone here knows of the large discrepency between the spot price of precious metals on Comex and buying these on the open market. What exactly happens if enough people take delivery to clean out all the metal Comex holds? How would the default proceed?
FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess. I was hoping Tanta might have something to say
Jim Bennett writes:
6 years? Make that FOREVER - so long as they don't let 6 years elapse between consecutive requests for payment
liz...if an enterprizing lawyer could or would take this on a contingency basis it might prove to be a lifelong income stream! At some point these jingle mail folks would have to have some money to collect...hech hound their employer!
A Rescue Plan Without Taxpayer Money By GRETCHEN MORGENSON
Published: November 15, 2008
HELLO, taxpayers. Worried about the fate of the $350 billion that the government has asked you to fork over so far to help rescue financiers from themselves?
Ubiquicert: One interesting idea was conceived by two veteran investment managers, Thomas H. Patrick, co-founder of New Vernon Capital, and Mac Taylor, a principal of the Verum Capital Group.
They propose refinancing all $1.1 trillion of the loans in securitization pools that are still performing but that may soon face punishing interest rate resets. Homeowners whose loans are in these pools would receive newly issued loans with fixed interest rates, currently 6.14 percent, and 30-year terms. Under this plan, Fannie Mae and Freddie Mac would issue debt to pay off the outstanding principal on the loans and then guarantee the new ones.
Voilà: Investors who own the underlying interests in the mortgages would be fully repaid and the securitizations would be closed out.
The odds are still against Labour, but since the financial crisis struck they've turned a corner in the national opinion polls, and also managed to carve out a by-election win a couple of weeks ago. The Tories have been "poor" of late, Osborne is being knifed in the back by elements in his own party ( if you think US politics are vicious....)....in short, the crisis is playing well for the incumbents at present; the key variable will be unemployment.
You also need to factor in the vagaries of a parliamentary system with 3 national parties, 2 powerful regional parties in Scotland and Wales, Northern Ireland's peculiar arrangements, a number of "fringe" players ( UKIP, BNP, Green party ) that can muck up the arithmetic on a constituency level, and the sophistication of an electorate that understands tactical voting.
I've assumed since 2005 that the next UK general election will produce a hung-parliament, and, quite possibly, a minority Labour government a la 1974.
RE: my four questions--maybe I'm asking the wrong questions. Maybe nobody who has something more than nothing in the form of credentials wants to tackle the subject.
This rollover, and the evolving situation in cargo at sea and on the docks seem to me to be the two potential triggering events that would make much of the rest of our problems seem quite small.
--
"FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess."
theotherdeb,
Only Crooks, Crooks' agents (mostly economists) and born-and-bred American dopes have a solution. Enforcing the existing contracts (and laws at the time of the contract) and letting the markets work it out is not one of them.
Americans have no faith; only blind faith in the system.
I've assumed since 2005 that the next UK general election will produce a hung-parliament, and, quite possibly, a minority Labour government a la 1974.
dan | 11.16.08 - 12:05 pm
Insightful post. At best we should hope that the next government, if hung, be well hung.
It is astonishing how hard it is to collect money by the legal process.
lawyerliz
God tell me about it. I have spent $19k in legal fees and two years talking to Optimum West Insurance about how to proceed to recover some non-insured losses following a p&c claim. Our out of pocket is only 40-50k
dan,
A minority government sounds about right. The times I've noticed the Tories, they certainly haven't been inspired or cogent. Similar situation exists in Canada right now, except our Tories have better political organization while the other parties need to rebuild.
I can Attest that LawyerLiz is right when she says she can't make a dollar pursuing "recourse" loans.I was licensed to run a collection agency here in California for a dozen years.I started out collecting second and third placement debt in Oakland and Richmond in the 1970's...and made a living doing it.(second and third placement refers to the number of times an account has been assigned to collection agencies and returned as uncollectable).
...(second and third placement refers to the number of times an account has been assigned to collection agencies and returned as uncollectable).
Tom Stone
I admit that I hadn't bothered to spend much time worrying about the fractional reserve banking system and its implications when considered in conjunction with the trade system we have developed with China and certain other nations. But it's now clear that our economy has become dependent upon a lot of commercial bank-created money which simply does not exist any more and will not exist in the foreseeable future.
This last decade has been almost a perfect storm for an economic bubble, with money serving as a nice substitute for heroin. China has been the wholesale dealer of the heroin sent to the US, pegging the yuan to the dollar (with the secret approval of America), thereby allowing a trade bubble to persist which, under Bretton Woods, would have popped many years ago with inflation in China and a healthy recession in the US.
The financial services industry in the US has served as the local dealers for the Chinese heroin, with the federal reserve, Congress and the SEC playing the role of the corrupt police force, secretly greasing the skids of commerce while pretending to police things. If you look back at the last decade or so, it's clear that it's all been a gigantic scam, with opaque and artificial financial entities like collateral debt obligations, structured investment vehicles, and credit default swaps being created which are all designed to slice and dice the heroin from China and mix it with meth, cocaine, etc so that the worthless debt can be foisted on unsuspecting customers and kept off of the books of banks. Of course, the rating services like Moody's have all been certifying that it's good healthy stuff so the public will buy it.
So we've had all this artificial debt and money circulating around, and the commercial banks, with the fractional reserve system have been creating even more. It's always been known that the fractional reserve system depends upon a constantly expanding supply of borrowing and lending and that there will be quite a nasty crash when the music stops as it did in 1929-33.
Well, it has stopped big time and the situation we're in now is like if we suddenly woke up one day and there was a lot less oxygen in the room. And the funny thing is that a lot of these people you see participating in stock rallies seem to think that this is just a bump in the road, but I really don't think it is. The US government is going to try to keep the music playing with huge amounts of borrowing, but these aren't the Reagan years, when we had more manufacturing than we have now. Plus, there's a limit to how much we can borrow with all our Medicare and Social Security debt.
Also, it clear that this bubble was largely the result of a one-time phenomemon where China kept pumping dollars back in the US economy, and China has now wised up to the unsustainability of that practice. So the bubble has popped and we find that the money floating around was largely an illusion and that actual real products are largely manufactured overseas. All our economy has had in the last decade is the creation and maintenance of a scam which the public has wised up to.
The illusory money that we thought we had is crashing down like one of the twin towers on 9-11, and there are many more floors still to go. Deflation will inevitably result, and, in deflation, those lucky banks and individuals who actually have real money will have every incentive to hold on to it. It will be the exact opposite of the situation we had in the last decade's bubble, when anyone would loan to anybody.
And we're very early in the process. A lot of oxygen has left the room, but so far only the weak have actually died. I hope I'm wrong, but I'm thinking now that the reduced oxygen is a permanent part of the US economy today, and that, as more and more people realize it, we really could be seeing 1933 again.
Comrade Counterpointer - I don't believe there are any circuit breakers on the way up. Or are you inferring a +5% futures means a -14% drop in reality. At current levels it would take about a -14% drop to trigger the 1st circuit breaker
Thanks PeakVT - that was an upshot of the conversation with you, MLM and Austin Tex last night. IIRC, they made a case for this being a business as usual rollover and typically front end loaded...sort of but not really is my interpretation of the data presented.
And hat tip to Plantagenet for providing the direct link to the Treasury data (though EHP provided the original thread to tug with a .pdf from Treasury).
They weren't recourse loans,for the most part.I got 10% of recoveries,was VERY good at locating assets and approached people in a courteously firm manner.I dealt with a lot of minorities,and they reacted well for the most part to a white man who assumed they were responsible members of society who wanted to honor their promises and resume a place in society.
I like your post. I disagree on the source of heroin; China. The USA has a direct source of the pretty red poppy; Afghanistan. Why else are we in that god-forsaken place of poverty and goats. The heroin output has expotentially grown since we declared war. The military is protecting that untaxed, unregulated, blackmarket commodity. We don't need no stinkin Chinese heroin. USA needs China to buy treasuries. The deal is buy our treasuries, we'll offshore industry to mainland China and buy your finished products. And not inspect the cargoe for poisonous goods. China's forex is around $1.9 trillion.
And let me shout you out for providing the awesome superposition securities aka hoopajoops - though Rob Dawg seems like the only other one who is prone to make esoteric Schrodinger's cat jokes - ah, physics nerdiness at its finest!
What about bad faith? If you can set them up for bad faith in Fla, you can hope for some punitive damages. I don't do this stuff personally.
lawyerliz
This is a Canadian claim. For the most part and in my opinion, there is no distinction between bad faith and good faith there. And, the Courts dont really assign damages per se.
I have to say claim was/is really complicated. Lots of parties involved. Example: the company who did the intital damage assessment and remediation was/is owned and managed by the same person who owned the vehicle that struck a fire hydrant which caused the flooding and this same restoration firm screwed up the job by installing machinery incorrectly (they introduced high hummidity into areas that were previously dry and wetted areas that were already wet) and this firm was hired by the insurer.
I made the error by not wanting to rush to court and merely wanted to remain whole. A sad and bad error in judgement.
If you look back at the last decade or so, it's clear that it's all been a gigantic scam, with opaque and artificial financial entities like collateral debt obligations, structured investment vehicles, and credit default swaps being created which are all designed to slice and dice the heroin from China and mix it with meth, cocaine, etc so that the worthless debt can be foisted on unsuspecting customers and kept off of the books of banks.
Your analogy fails in that cocaine/meth infused herion would actually be an asset.
A better analogy might be herion cut with pixie dust and tooth fairy farts.
According to the article, virtually all the buyers on Little Lake St. in Chula Vista, refinanced and retrieved their down payment before losing their houses.
Most are actually up on the deal like a certain Ernesto Guevarra who "pulled out" $380K in two years and spent all on jewelry and vacations to Acapulco and the Philippines. Now he's moved back in with his mother.
Well I am not deep in my understanding of bond markets et al, it just looks like a sh!tpot of short term lending for long term liabilities which sounds...I dunno, kinda familiar?
Actually, I have no idea why the US treats mortgage debt as being optional as to payment. Where else can you borrow large sums of money and then just decide to walk away? No wonder you're having so many problems - even worse than the UK I suspect (although things are pretty dire here).
The thought behind non-recourse mortgages it that it encourages lender to due their dili before loaning money.
When the dust has settled, the UK may want to think about it...
If the world loses its taste for US debt, then there will be a dramatic increase interest rates on Treasury debt, monetization (aka printing) or some combination thereof...anyone else see another outcome?
The challenge is we have dramatically increased the total debt, and done a huge proportion of it on a very short term basis. So we need to keep rolling it short term or when it comes due roll it into longer term debt. However, the latest offering of 30 year bonds went poorly...
And this is all before we have any additional new borrowing due to increased spending 'needs' and declining revenues...
Altair- "China kept pumping dollars back in the US economy"
I partially agree. The Japan carry trade is the main culprit. Cheap loans at near 0% was the trojan horse. And the carry trade collapsed on 07-07-07. The G7 are frantic to restart it. Japan, Germany, and OPEC are desperately trying to strengthen the US dollar as they deliberately try to deflate their currencies, (China is an exception as they have a world plan). Free trade exports has been largely flowing one-way; to the shores of the USA. We are overconsumed and manufacturing depleted.
Well I am not deep in my understanding of bond markets et al, it just looks like a sh!tpot of short term lending for long term liabilities which sounds...I dunno, kinda familiar?
citizen energyecon | Homepage | 11.16.08 - 12:33 pm
Dawg,I subcontracted for 10% plus expenses.And I spent some time looking over and evaluating 2 kinds of deficiency Balances,Automobile and Eviction.people recover from financial problems in rough 2,5 and 7 year cycles...with recourse or deficiency balances the survivors tend to have a real resentment to the lender...so the ones that have recoverable assets go BK or run while the folks who have to borrow a pot to pee in are not profitable.A recovery rate of .5% of dollars assigned on deficiency balances would be very good,and would be expensive.on normal 2nd placement accounts 2% recovery is acceptable,I averaged 4%.You have to find them,you have to find a way to actually talk to them,and you have to find a lever,not cheap,not easy.
citizen energyecon - it looks like you are using publicly-held debt instead of total debt. That would be the correct subset to use for this discussion since there are no rollover issues with intragovernmental debt. However, you might want to change some wording in the post if it is indeed just publicly-held debt.
According to the report, tighter rules mean that just 37 percent of unemployed Americans are receiving jobless benefits today, down from 42 percent during the 1981-82 recession and 50 percent during the 1974-75 downturn. Americans today receive a maximum of 39 weeks of unemployment benefits, down from 65 weeks in the 1970s. The average weekly benefit is $293. And low-income workers a category that tends to include women and those in part-time employment are one-third as likely to receive unemployment insurance as higher-income workers.
Hmm actually that thought applied to the first graph from yesterday, then just had the trend set that way - the post today does make more sense with the years going up from left to right - I will jack with that when my nephew gets off my computer (currently playing LotRO lol, I am using my wife's computer atm).
Yesterday's plot looks better to me as is, the one that hoopajoops was kind enough to display. But the other ones from today will be improved by resequencing...
I didn't mean to suggest it was a nothingburger (makes me miss banker just typing that). Meant to suggest that a roll provides the opportunity, but not necessarily the motivation. All of the dollars that are paid back will be sitting briefly in custodial account somewhere. The easiest course of action is to re-up for another round probably via standing instructions.
The question is, what will create the tipping point for those standing instructions to be changed. Once that happens, given the term structure, it will be anything but a nothingburger.
November 15, 2008
Tech Companies, Long Insulated, Now Feel Slump
By ASHLEE VANCE
In the span of just a few weeks, orders for both business and consumer tech products have collapsed, and technology companies have begun laying off workers. The plunge is so severe that some executives are comparing it with the dot-com bust in 2000, when hundreds of companies disappeared and Silicon Valley lost nearly a fifth of its jobs.
Silly.con Valley, without a doubt, has the highest concentration of born-and-bred American dopes as well as Americanized dopes. It also has second, or third, largest concentration of Crooks. One characteristic of dopes is that they never learn anything from history (who has the time!) and Crooks is that downplay any negative historical precedences.
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example! Be prepared for a hellhole in 2-4 years when the fraud money dries up for good.
theotherdeb(Unrated) writes:
FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess. I was hoping Tanta might have something to say
Do you notice how all the mortgage rescue plans assume as a basic foundation assumption that the plans have to originate and run from Washington?
I still favor the Norka 4 point plan of cram downs through bankruptcy. Once it was up and running, it would be decentralized and minimize regulatory capture by the K Street crowd.
It would be interesting to see Tanta's reaction to these plans, if she is up to it.
FWIW- have to help a friend move from apt to condo he got for about 100K, right across from another friend who paid 300K four years ago. Hasta la vista.
"What exactly happens if enough people take delivery to clean out all the metal Comex holds?"
Comex does not hold any gold. The "shorts" of the open interest (outstanding contracts) are responsible for delivery. On or after the "first notice day" any short contract can give notice of intent to deliver. A long holder is chosen (random or FIFO) and given notice of the delivery, and their clearing broker is debited the full price of the contract less the margin already being held.
So, if you want to take delivery, all you have to do is hold after the notice day and wait. This bias is what can cause short squeezes: since, for every long there is a short, if you (long) don't get out of your position, there is a short that can't either.
So, towards the end of the contract's life, if there are "stubborn" longs, then their counterparties either have to find gold to deliver, or the price will be bid up to where the long will be pursuaded to take the higher (maybe much higher) price.
Look back at the price spikes of the Oct oil future (CL) on the last trading day in late Sep as a case of what happens.
But there is never a default, because of the basic way the market clears itself.
citizen energyecon - you are doing valuable community service, thank you. Which leads me to the following request
Can you also add schedule for Fannie/Freddie debt (not MBS, just straight debentures)? It would be a very valuable addition since much of foreign CB holdings are in this paper, which essentially competes with Treasuries.
So the total mortgage market is 12.5 tril, with 5.5 held by gse's and 7 tril in the private sector. Total alt-a and sub is about 4.5 trill. Total cc debt is about 1 trill. If we had 100% failure of cc,sub, and alt-a, total would be 5.5 trill. So far the fed/treas have put in a bit over 4 trill. The loss potential in these items will be big but don't explain why the ptb are freaking? I suspect the losses in the cdo, cds, and synthetic swaps market are going to be substantial. Apparently the change in the TARP ie no longer buying "toxic assets", was triggering defaults and margins in the swaps market. In any case methinks the real party is whats going on in the "shadow banking" system.
Second and third tier debt collection, probably some zombie debt thrown in for the lottery winning feeling if they actually pay.
Congratulations for making these people feel better about their social status to make you a little money. They dealt with collections for years before you bought their debt for pennies. I have a hard time believing a white man dealing with minorities with respect turned the trick for you.
Share with us the real approach you used. The lies you told, the illegal collections tactics you employed.
Parasite is the best description for your contribution to a better society.
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example! Be prepared for a hellhole in 2-4 years when the fraud money dries up for good.
Jas
A friend's family lived in SV. When their 3 year old daughter started acting like an American kid and trash talking her grandfather and the 10 year old daughter wanted to leave the house dressed up in the Britney Spears tart outfit, the parents said enough and moved the family back to India.
Tom Stone writes:
They weren't recourse loans,for the most part.I got 10% of recoveries,was VERY good at locating assets and approached people in a courteously firm manner.I dealt with a lot of minorities,and they reacted well for the most part to a white man who assumed they were responsible members of society who wanted to honor their promises and resume a place in society.
Tom,
Worked at an agency that was WAY beyond 3rd placement while in school. This was long ago, but I recall that we got WAY more than 10%. 30 to 50 percent comes to mind.
A very tough gig. Could not imagine doing it for a living.
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example!
And dopes who point out that the companies are populated by dopes. It's dope heaven, where everyone is a dope!
Anyone here ever read 'Little Dorrit' by Dickens? They had the right idea back then: Debtor's prisons and work houses. Although it didn't reduce poverty, it sure made the poor suffer, which is the point, isn't it? We must punish the poor to teach them not to be poor. It also helped keep wages down. And most of all, it helped the upper classes to feel even better about themselves than their wealth alone enabled them to feel. If we have learned any lesson from consumerism it is that merely having lots of stuff isn't satisfying unless you have someone to look down on.
lol! Man I live by that creed - no promises, I have to get back on my machine and find the time - won't bore with the particulars, just RL like we all have...
--
When it comes to my holdings of US Treasuries I don't need any help from dopes. They have been warning me for more than 10 years. Many of these dopes are Scam Lovers and defenders of Crooks. Amazing ignorance, the most defining characteristic of dopes in America and elsewhere.
"China kept pumping dollars back in the US economy" "I partially agree. The Japan carry trade is the main culprit."
The yen carry trade has definitely caused some wild swings in the stock and currency markets, but I don't see that as being the same kind of structural weakness in the world economy like the broken trade system between China and the US has been.
It's not surprising that there will be some nations where borrowing is cheap, and I'm not sure how you'd stop hedge funds from borrowing money in that nation and then investing it somewhere where interest rates are higher.
Then again, maybe I'm wrong- has there been any proposal floated about how you can stop hedge funds from doing something like that?
At any rate, I see the carry trade as being responsible for some of the big swings we've seen in the markets, but not for the structural weakness in the entire economic system.
maybe we could start eating babies too, aClem. you know. cut down on the overabundant poor population.
OT
out here in Riverside county i have been seeing lots of impromptu yardsales on the side of major streets. Mostly just a pile of stuff that looks like the contents of a garage with a sad looking cardboard sign in the dirt. Sometimes I see something that i might want to look closer at- but i cant bring myself to stop. Im not sure if its out of embarrassment or shame or ?
: NorkaWest writes:
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example! Be prepared for a hellhole in 2-4 years when the fraud money dries up for good.
Jas
A friend's family lived in SV. When their 3 year old daughter started acting like an American kid and trash talking her grandfather and the 10 year old daughter wanted to leave the house dressed up in the Britney Spears tart outfit, the parents said enough and moved the family back to India.
Don't blame the parents at all.
Schools are better over there anyway.
NorkaWest | 11.16.08 - 12:58 pm | # :
SO TRUE! I love how parents raise little boys to look and act like little girls in SV. Long hair, no conflict allowed, no toy guns, etc. I've seen it first hand lots of times.
I almost took an entry-level management job in Mountain View, and I'm almost happy that they low-balled me with a 100k/year offer (which is virtually equivalent to minimum wage for a family of 4 with stay-at-home Mom with $3000/mo rent). Needless to say, I told them that the offer was insulting, and that they would be happier hiring an H-1B worker.
The philosophy behind the 100k offer was that my wife would also be making 100k, so then we would be able to survive. This household income model is virtually assumed in the Bay area, and screw the kids.
citizen energyecon writes:
"If the world loses its taste for US debt, then there will be a dramatic increase interest rates on Treasury debt, monetization (aka printing) or some combination thereof...anyone else see another outcome?
The challenge is we have dramatically increased the total debt, and done a huge proportion of it on a very short term basis. So we need to keep rolling it short term or when it comes due roll it into longer term debt. However, the latest offering of 30 year bonds went poorly..."
A lot of the new funding is needed to finance the purchases of private sector liabilities, which are short term. It makes sense to use short term paper to do that. If the economy starts growing again, private sector credit creation will also be working, and so the financing arrangements can be run off (along with the debt used to finance the purchases).
If the economy does not grow again, nobody in the bond market will really worry about funding the U.S. deficit. The only debt that investors will want is that issued by the U.S. Treasury. Sure, they may be plenty of people outside the market worried about financing, but most of those expert forecasters were expecting 10-year Treasury yields to be 7% or so right about now.
As for the foreigners, they are only needed for funding the deficit if the U.S. is running a current account deficit. And, by the mathematical definition (known as an "accounting identity" in the jargon), if there's a current account deficit, there must be foreign savings flowing into the U.S.
If foreigners do not want to fund the U.S. current account deficit, they have to figure out where else they can send their exports, or else deal with a massive growth collapse as their trade surplus swings to a deficit.
I'm not saying that a funding crisis is impossible, but you have to think very carefully about what the funding crisis implies about savings flows. What alternatives are out there that will take absorb cash flows? Are foreigners willing to give up on their export-led growth strategies, especially in the current environment? Can oil producers thrive without their largest market?
Unfortunately, I have to run, so I can't respond to follow ups.
"Show me some of those 12% 13-week bills and deflation."
There's another effect that 12% bills would have, at least short term. Long term, I'm not clever enough to say; too complex a series of connections.
That effect is on the market value of the entire outstanding debt. "Duration" (not maturity) is a measure of dP/dy, where P is price-value of a bond, and y is the yield. Duration is, for typical longer maturities, about half to third of maturity, expressed in years.
So say yields jump 8%, and the duration of the term part of the debt is 4. Then, the change in the market value of the term debt is -32%.
So, holders of the term debt have some incentives to not have those yields jump too much, but also, if there is risk of this kind of thing due to the short end of the curve, it's harder to sell term debt.
Remember last week there was a failed 30yr Treasury reoffer? A report someone posted on this blog said it was surprising in light of the previous "appetite for duration."
You guys may well be right on top of why that appetite seems to be less ravenous.
Re: In the span of just a few weeks, orders for both business and consumer tech products have collapsed, and technology companies have begun laying off workers. The plunge is so severe that some executives are comparing it with the dot-com bust in 2000, when hundreds of companies disappeared and Silicon Valley lost nearly a fifth of its jobs.
On the front page -- above the fold! -- of a UK paper there is this gem: "Brown argues for coordinated attempt to reinflate global economy by cutting taxes and interest rates"
looks like nobody has picked up that post of the gold short squeeze coming into play. Based on mp stating that he is currently holding gold but is not happy about tells me (confirming a short term buy signal) that a spike appears imminent.
With tomorrow being a sad redemption song for the hedge funds forced liquidations, might be a straddle on gold situation...
Adustin Tex wrote
...if you want to take delivery, all you have to do is hold (the gold contract) after the notice day and wait.
towards the end of the contract's life, if there are "stubborn" longs, then their counterparties either have to find gold to deliver, or the price will be bid up to where the long will be pursuaded to take the higher (maybe much higher) price....
But there is never a default, because of the basic way the market clears itself.
Austin Tex | 11.16.08 - 12:51 pm |
Austin Tex
are you certain that there will be a physical delivery of gold from the short to the long contract holder???
i'm ignorant but i'm beginning to believe that in this market, the guy holding the short end will settle, with cash in an amount equal to spot at the time of expiration.
Talk about CROOKS! Now Paulson and his mini-me want to use the bailout money for the Credit Card industry.
Note that CC's are unsecured, and without our tax dollars, the CC companies would have to take it in the shorts.
Meanwhile, mortgages are secured by property they can repossess. We have people who CAN PAY all of their obligations and avoid foreclosure IF THEY COULD REFI to a 30y fixed at the current market rate.
Basic Structure and Scope of Proposal
This proposal is designed to promote wider adoption of such a systematic loan modification program:
by paying servicers $1,000 to cover expenses for each loan modified according to the required standards; and
sharing up to 50% of losses incurred if a modified loan should subsequently re-default
bond guy,
Few days back there was lot of discussion around this denniger post. What are your thoughts? Is this the first time something like this has happened?
"are you certain physical metal will be delivered?"
The short is the one who announces intent to deliver. If he cannot deliver, he must exit the contract before expiration. His clearing broker can force him to post full margin (marked to market) after notice day, and if he doesn't, the clearing broker can buy him in "at the market".
But if the only long's left are stubborn and there is no ask side, then the market price rises until so far above the (real) market price that the longs are pursuaded that a couple hundred an ounce over physical spot is worth giving up the dream of a shiny bar coming by insured express delivery.
Re: sharing up to 50% of losses incurred if a modified loan should subsequently re-default
50% of re-defaults fail, so, like ahhh, is thus a good idea, or are they just delaying the reality that someone making $8.00 an hour can't make a payment on a house that has a mortgage of $1000+
crispy&cole writes:
List of future jingle mailers:
Ouch!
I cannot take any schadenfreude as my company has a layoff scheduled 2Q2009. We're not going onto that list until the last minute.
And what is with companies laying off one? You know that isn't pure economics. What is with Boeing doing so many tiny layoffs too? I know its department by department... but they should just announce one layoff. Multiple mini-layoffs scare the workforce.
Hoopajoops LTD writes:
Nobody will ever say the magic word "Principal Reduction." It's the painful, sole solution that will help, but greed stops us from using it.
Hoopajoops LTD | 11.16.08 - 11:11 am | #
How about the magic phrase, "stupid is as stupid does"...shouldn't have bought a house you couldn't afford or shouldn't sign a contract you don't understand unless you're represented by a lawyer. Excuses, excuses.
Oh man, that Gretchen. Where to begin? With the notion that "falling home prices" are the problem? Or with the idea that the MBS containing Alt-A's are correctly valued at 65 cents on the dollar? Or maybe with the notion that Alt-A homedebtors will be substantially more capable of handling their "homes" purchased if they get a 6.15 percent 30-y fixed, than at present. Every facet of this plan is fantastic.
bond guy writes:
If foreigners do not want to fund the U.S. current account deficit, they have to figure out where else they can send their exports,...
xlated from german Wikipedia :
In 2007 only ca. 15% of the german exports went outside the EU, of these ca. 8% to the US.
So you see, as seen from e.g. Germany, the US is fairly irrelevant .
Key points that are aligned with MLM's observation on 'status quo' rolling of T debt - the petrodollar recycling from the ME and the mercantile recycling from China are being diminished by falling commodity prices and cratering consumer demand - now competing places for dollars to go are emerging with domestic funding priorities emerging in both locales...ME domestic bailout requirements and Chinese stimulus needs may grow with time.
Additionally, the size of the US borrowings appear set only to increase, perhaps at the exponential pace recently experienced...seems like a collision in the making.
reminds me of wage garnishment. take it out before the deadbeat has a chance to spend it. Only now, companies have figured out that treasury is an even richer vein.
what happens when 10% or more are unemployed, companies have tax exempted themselves, and there is no tax base from which to draw? are these guys cutting their own throats?
--
"On the other hand, your interpersonal skills could use help..."
Anonymous,
You mean the communications skills employed by those who BREED dopes?!!!!!!!!! How smart and wonderful American People are? How great our system of democracy is?
If dopes like your communications skills you are a liar, a deceivers, or just a bad communicator trying to be polite.
The best validation that you are telling the truth in plain English is when dopes are offended, they start to harass you, attack you, and even go as far as requesting a ban.
From the responses here, I must be telling the truth in plain English. Dupes, dopes, crooks, evildoers, etc., are all plain English words and they exist for a reason.
I AM on the message. Please ignore if you don't like my message and the supporting commentaries.
I'm of the opinion, shared by others more well informed than me, that there's not enough gold to effect delivery if demanded. Same for silver. Do the math, and it will become suspiciously familiar for the set up of a significant short squeeze.
The closest any world leader will get to Barack Obama this weekend is if they meet Madeleine Albright and Jim Leach - the two Obama transition "surrogates" who have been deputed to stand in for the president-elect during the G20 summit.
Neither the former secretary of state nor the former Republican congressman is close to Mr Obama. But that is partly the point. Since his election 11 days ago, the president-elect has repeatedly said there is "only one president at a time".
"The legislation he is perhaps best known for is the 1999 Gramm-Leach-Bliley Act, one of the seminal pieces of banking legislation of the 20th century."
Also responsible for the Enron loophole. A little ironic he sent the same guy who pushed this through the house. Even though he wants this loop hole closed.
The Economic Cycle Research Institute, a New York-based independent forecasting group, said the annualized growth rate of its Weekly Leading Index slid from minus 24.6 percent to negative 25.9 percent, its historic lowest, according to ECRI data recorded since January 1949. "With WLI growth continuing to plumb new lows, not only is no economic recovery on the horizon, but the economy is falling off a cliff at its fastest pace in at least six decades," said Lakshman Achuthan, managing director at ECRI.
In January 1949 the US economy was in a recession that was continuation of the Great Depression (intruppted only by the WW II). Nothing can prevent, or postpone, the Greater Deoression in the US from the current condtions.
The 60 Minute Chart shows the Dow has been rejected at clear resistance at 8,900 several times over the last week of trading. This level is a clear "line in the sand" between Bulls and Bears at this time. Given today's stern rejection at this level, we could see another drop back toward the 8,000 level for another major test of support.
Bond guy's point is that any dollars sent to the ME or China have to end up back here somehow (unless they take delivery of stacks of $100's and put them in a vault somewhere). If they want to build infrastructure with our dollars, they need to buy some U.S. produced infrastructure thingies with those dollars. But then the dollars have returned via the thingie production company.
I think bond guy is way too sanguine about global exporters being willing to keep sending us their crap if we're looking more and more like a shaky credit risk. And crap demand is already falling from this end anyway.
Wonder if a more productive way to look at this is noting that fewer dollars are flowing in general, and the places they are flowing are less likely to be T buyers.
The G-20 leaders, representing 90 percent of the world economy, blamed the crisis on investors who "sought higher yields without an adequate appreciation of the risks."
My Comment: Banks and brokerage packages sold poison apples. The G-20 is blaming those who bought poison apples not those who knowingly sold poison apples.
Now that I know I was born in "a recession that was continuation of the Great Depression (intruppted only by the WW II)" I feel proud to be a Great Depression baby. Gives me some status for the Greater Depression, I feel.
Elizabeth Warren is now one of five appointees to oversee the tarp. This is relatively good news. We'll see if the oversight board actually exercises any power.
You mean the communications skills employed by those who BREED dopes?!!!!!!!!! How smart and wonderful American People are? How great our system of democracy is?
No Jas, the kind where your insight produces policies.
I completely agree with so much of your criticism. Now what. Events are taking their course. Even the dopes get the point. Now what. You're so right, now what does Jas say we should do?
The best validation that you are telling the truth in plain English is when dopes are offended, they start to harass you, attack you, and even go as far as requesting a ban.
Dude you are just slightly more tolerable than the right-wing ranters. Please go beyond I told you so. You most assuredly did.
This is when gentlemen of heroic mien and good character show their talents as administrators and advisors. You are smart and articulate enough to make something of yourself. This is opportunity knocking, Jas.
If you guys would stop quoting him, the rest of us wouldn't have to read what he says anymore. I've got the message. He thinks I'm a dope. No more cycles need to be wasted on it/him.
Many countries pay for their imports not in their home currencies.
What will prevent China and Petro-states from asking their US customers to begin to pay in a basket of currencies - USD, EUR, JPY, RMB to begin with (yes, I know, the US-pegged RMB is a funny one, but it could be a matter of principle for China).
That will take care of current account problem.
I not saying they will, I am just saying they might...
I really was born in the 30s, but too far into them to remember the GD. I can testify though that many people who can remember them have never really recovered. My mother, in her 90s and in a retirement home, still frets about her savings and the banks, although she has quite enough to last comfortably for years. It's a kind of chronic anxiety disorder that one contracts by having lived through it.
Millions should be demanding accountability from CONgress and the financial community. Equity investors should be zeroed out, NOT bailed out.
So far my numerous attempts to demand justice from my CONgressmen have been a waste of time. We need bigger numbers to reach critical mass. We need millions of angry emails to congress on a daily basis.
Perhaps you could quit grinding the axe. Unless you experience tremendous joy by your endless "born and bred dopes" comments, I suggest posting something productive.
Following layoffs, participation drops in community, social groups, finds UCLA-University of Michigan study
The pain of downsizing extends far beyond laid off workers and the people who depend on their paychecks, according to a new UCLA-University of Michigan, Ann Arbor study.
Even a single involuntary displacement has a lasting impact on a worker's inclination to volunteer and participate in a whole range of social and community groups and organizations, found the study, which appears in the September issue of the international scholarly journal Social Forces.
"What we find is that even just one disruption in employment makes workers significantly less likely to participate in a whole range of social activities from joining book clubs to participating in the PTA and supporting charities," said Jennie E. Brand, a UCLA sociologist and the study's lead author. "After being laid off or downsized, workers are less likely to give back to their community."
People will literally need to go hungry or be homeless before you see riots in the street. Good news is this is happening so fast it could be sooner then you think.
In this video, Karl Denninger catches Kashkari and Congressman Issa admitting that they both knew, before the bailout was passed, that $350 billion of it was already earmarked to bail out foreign speculators.
The C-Span video where Issa questions Kashkari will appear suddenly in the lower left corner of Denninger's video, the first two minutes of which are quite funny.
--
"Perhaps you could quit grinding the axe. Unless you experience tremendous joy by your endless "born and bred dopes" comments, I suggest posting something productive."
Allen C,
You mean that I should not talk often about the single most important cause of the current Global Crisis?
What is productive in the eyes, or minds, of born-and-bred American dopes is definitely not so in my opinion.
I keep hearing about crappy the U.S. economy is doing and how bad it'll be in the future, but who's doing good? Or at least, who do you guys think will make out and establish themselves in the world economy in the future? Any surprise picks?
"The G-20 is blaming those who bought poison apples not those who knowingly sold poison apples."
We live in a caveat emptor society. Over-selling may have begun as far back as the oldest profession. Imagine the first buyer falling for a tranny. Who would you blame?
In my opinion Cuba should be treated as any other poor soul hard luck nation, but none of my Cuban friends agree.
"Cubans" in Miami are almost all Americans. Don't know if they helped kill Kennedy or not, and they seemed to have stopped terrorist activity Orlando Bosch style, but they are about as open-minded about their former homeland as was the Shah of Iran.
Huge layoff announcements are coming soon for NGC (NOC) in CA. Not sure why they aren't on the list, unless they don't meet the reporting requirements.
Like many subs, they have 10-12 employees at "sites" co-located at customer locations throughout the country.
Pavel wrote about effects of the depression:
It's a kind of chronic anxiety disorder that one contracts by having lived through it.
I suspect that this disorder isn't limited to only those who lived through the GD. Though I was only 12 years old at the time, the 81/82 recession conditioned me for a lifetime of frugality and anxiety in all matters financial. I will never forget the closing of the city's major employer, seeing my friends' parents out of work for months/years, and the problems that caused. None of the recessions since then left as strong an impression on me - not even the tech bust (and that's my industry).
Always enjoy your comments, Jain. Byzantine_Ruins is right, opportunity knocks. There is a point at which beating the mule only makes it more stubborn and it begins to hate you. Telling the truth is one thing, having the courage to move beyond that and inspire progress is another.
--
"No Jas, the kind where your insight produces policies. I completely agree with so much of your criticism."
Byzantine_Ruins,
Thanks for the kind words, but producing policies in a system totally controlled by evildoers and Crooks? Sorry.
The system must and will collapse and I am not the guy to tell people how to do it and what to do except to plan for personal safety, economically and otherwise. And I am not an expert in safety.
MY JOB IS TO WARN PEOPLE OF THE DANGERS THAT ARE HERE ALREADY.
The causa prima of the dangers are born-and-bred American dopes led by evildoers and Crooks, I dont know how to turn dopes and Crooks into normal thinking and behaving people, got it?
I think I'm going to short the S&P heavy this week:
By Rex Nutting, MarketWatch
Last update: 12:38 p.m. EST Nov. 16, 2008 WASHINGTON (MarketWatch) -- Few observers have ever seen anything like the economic data that will be released in the coming week, with the consumer price index and housing starts each expected to breach records dating back to the late 1940s.
Babu: Quiet!! You shut up! You make me change restaurant, but nobody comes! You say make Pakistani, Babu Bhatt have only Pakistani restaurant. But where are people? You see people? Show me people. There are no people!
Jerry: You know, I think I'll just take the check.
Babu: You bad man! You very very bad man! [leaves]
Jerry thinking: Bad man? Could've my mother been wrong?
re: bond guy's comments.
I agree completely. In the long term there can be a rebalancing of current accounts, but those are the rules for the near term -- which might help resolve some of the hesitation of some people accepting the argument.
On the edge writes:
I think I'm going to short the S&P heavy this week:
It's auto-bailout week in Congress fyi
Another country who's citizens are being crushed due to central fractional reserve banking with fiat money and a corrupt government. Great fun, carry on.
I was explicity acknowledging bond guy's point (I thought lol) - just that the torrent of USD is rapidly slowing to both the ME and China - and rather than roll over the Treasury they have other demands on their resources...potentially huge demands. AND the issue is not just rollover, it is huge new borrowings...when the rest of the world is all trying to borrow at the same time.
On the edge writes:
I think I'm going to short the S&P heavy this week:
It's auto-bailout week in Congress fyi
Meaning don't short? I don't think auto-bailout will occur. Obama/Biden resigned, Dems at 49(inc. Bernie and Lieberman), Repubs. at 49. 60 needed for cloture, I don't think the center will hold.
That would be very un-dope like. Dopes have a need to reveal themselves at every opportunity.
Discrediting the messenger, whose message one doesn't like, is the number one method to counter criticism in America, especially, of America, Americans, in general, and the American system.
Dopes and Crooks are frustrated. They KNOW that America has very serious and incurable problems. Attacking the critics is their way to deal with their frustrations.
Reader comments on a NYT story on rising bankruptcies are worth perusing:
have heard in order for the American economy to be robust and healthy, the average American consumer needs to be teetering on the brink of bankruptcy. What's wrong with this picture?
What a bunch of cowards engaging in un-gentleman-like behavior. But, that is to be expected.
Americans have lost most of the human qualities; all they have left are technical skills. They will lose that too in due course. America is doomed because Americans are so thoroughly doped by Crooks.
Jas, I know nothing of your ethnicity and happen to agree with many of your statements. But you go on and on and on and...Maybe we respond to you to assist in your relief. I suspect that you don't have your own blog because no one wants to visit a site that has endless pages of "born and bred dopes."
Angry Saver writes:
People just aren't angry enough. Where is the outrage? The greatest financial swindle in history is taking place and American's take it lying down.
That's right, people aren't angry enough. Yet.
As one of my friends said to me when I was complaining about the imminent bailout bill - "The economy is boring." (Not to the posters here, clearly, but I see her point.) Until it directly effects people in large numbers nothing will happen.
Many of my wife's wide circle of friends are beginning to be laid off - a half dozen so far out of a pool of say 50. These are middle class, single income families, most with young children and a stay-at-home parent. "Now, what about this COBRA thingy?" they're saying, now that they are unemployed and looking into health care. Several of them have pre-existing conditions that will make individual insurance unaffordable or impossible to buy once COBRA runs out. Many are in houses more expensive than was prudent at any time.
In six months or a year, when we know not just a half dozen, but dozens of such people, I think we will start to see outrage. When we are told that we can't have affordable healthcare because we blew the money on bonuses for insolvent, criminal-run banks, we will see real anger. When people who played by the rules have to choose between eating and heating the house, we will have demonstrations. If the long bond blows out and crippling inflation starts, we will have a brutal awakening.
We need overwhelming, immediate, undeniable pain. Only that will wake up the mass of complacent and underinformed Americans. My fear is that by the time that happens America will be ripe for a very bad sort of demagogue to take control.
Comrade Counterpointer (and Mel from previous thread),
Thanks for your suggestions to improve the marketable US Treasury debt plots - they are done - now I will have a late lunch and dig into those Agency stats MrM 'kindly' provided if I have the opportunity.
I keep hearing about crappy the U.S. economy is doing and how bad it'll be in the future, but who's doing good? Or at least, who do you guys think will make out and establish themselves in the world economy in the future? Any surprise picks?
The truth you are being shown is difficult to face. I balance between respecting your steadfast approach and pitying you for the obvious need of attention. I'm moving beyond that to disregarding you entirely.
The problem is every new visitor to CR feels the need to respond to your "ababd" commentary. Tiresome.
MY JOB IS TO WARN PEOPLE OF THE DANGERS THAT ARE HERE ALREADY.
That's great Jas.
I dont know how to turn dopes and Crooks into normal thinking and behaving people, got it?
Well what in the world have you been applying yourself to since you realized the game is rigged and of finite duration? Opportunity is knocking, Jas, and you are investing in Treasuries.
--
"Calling people dopes is evidently intelligent and constructive."
1worldcurrencyyogi,
Calling dopes dopes and giving examples is constructive, no?
Oh, but is offends the guilty? Sorry.
Why would anyone talk about Hitler and Nazis, day in and day out, for some thirteen years during 1933-45? American dopes, American Crooks, and American system are in the same league as threat to the world and most here on this blog. Got it?
Focusing on the root causes and not distracted by saucy details of who screwed whom and in what ways,
The main characters (born and bred American dopes) are on trial for their selfish and wanton ways. Babu (Jas Jain) shows up to testify against them. "very very bad"
No gangs here. All individuals coming to the same conclusion, I'm afraid. Positive political action entails risk; just ask the Bhutto family. Too easy call everyone a dope.
If I recall correctly, Jas has said he holds plenty of US Treasury Bonds, but apparently he doesn't realize that the repayment of those bonds relies on the full faith and credit of "born and bred American dopes."
"Can you think of a better way to torque an Indian-born purveyor of ethnic hatred?"
Suggest that they stick to their caste and get back to work cleaning toilets, and if they do a good job they might come back in their next life as an American Dope?
Suggest that they stick to their caste and get back to work cleaning toilets, and if they do a good job they might come back in their next life as an American Dope?
LOL.
Surely you jest. We've been told repeatedly that the american caste is well beneath the untouchables by the indian purveyor of ethnic hatred.
"So you see, as seen from e.g. Germany, the US is fairly irrelevant ."
Tell that to Daimler. Or to their suppliers. Or to my neighbors working at Mercedes. Or the local governments collecting a lot less tax revenue than expected.
I will assume that the same applies to BMW equally.
As for Opel/GM - seems like some of America's problems have long legs.
Maybe Koch can arrange something in his last days in office (he can't expect to stay in office realistically) for thousands of Opel workers - but it seems as if laws (especially those of the EU relating to state subsidies) and regulations (let's just say that handing out billions seems more difficult in practical terms in Hesse than it does in the America of Paulson) prevent him from simply giving a state guarantee to Opel.
Which means that he is likely to be happy to let someone else deal with it..
The German vehicle industry is heading for the 'crash' the Greens wanted in the 1990s - shame that no one listened to the Greens then about shifting the economy, because the crash is coming regardless. As are the economic shifts.
What a bunch of cowards engaging in un-gentleman-like behavior.
A gentleman is more than a tie and table manners.
Citizenship in a Republic is a public office. Screaming about dopes is not living up to the public obligation of your Citizenship oath.
I hereby declare, on oath, that I absolutely and entirely renounce and abjure all allegiance and fidelity to any foreign prince, potentate, state, or sovereignty of whom or which I have heretofore been a subject or citizen; that I will support and defend the Constitution and laws of the United States of America against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I will bear arms on behalf of the United States when required by the law; that I will perform noncombatant service in the Armed Forces of the United States when required by the law; that I will perform work of national importance under civilian direction when required by the law; and that I take this obligation freely without any mental reservation or purpose of evasion; so help me God.
And by doing it on a sunday, hopefully not incredibly disruptive.
Hopefully, it may serve the purpose of getting thru Jas' thick skull that he comes from a country premised on ethnic hatred, and that he's the biggest dope of all by propagating that hatred.
I would like to add to Mike's very thorough answers a general consideration for Mutuals and ETFs:
ETFs may exhibit some of the characteristics of some derivative debt instruments. Depending on the fund, you are essentially trading on very complex claims of claims on claims. If that makes any sense:)
Look, it's hard enough to pore over some of the annuals these days. Multiply that by the number and type of assets under the fund and throw in some market dynamics and it just gets too hard to "price" these things intelligently.
Operationally akin to gambling to me. Plus, I'd have to worry every day about the admins not blowing up the funds.
/yuck
@AustinTex:
That was another good "roundup" on COMEX. It doesn't remove the possibility of failure, but large spreads do help cushion the blow.
Summary: Millions of Americans live in a non-reality-based belief system informed by childish clichés - they can barely differentiate between lies and truth.
I think you're right. But people refuse to let go of dreaming of easy money themselves. Friend trying to sell 1 bed in Manhattan, after 1 price drop and 5 months got her first offer...and at 50k below her price, doesn't want to deal. Sent her email with all the financial layoffs coming just this week...still convinced she can hold out for more.
Na ja, 8% isn't all that much, is it ? ( was surprised myself, but it shows how Germanys economy is centered in the EU ).
The german car industry has, I think a string of "record" years behind it, so some downturn may anyway be in order. I don't see the situation there as dramatic : extented Christmas holiday, probably some temporary reduction of working hours in early summer. 2009 ? Jobcuts "the german way" : very "sozial-verträglich", i.e. early retirement with 85% of salary, etc. You can live with that.
Now, Opel is definitely a different story. I think there should be absolutely no subsidies before the GM situation is clarified : Money is fungible, subsidies would flow in the front-door and immediately go out the back-door to GM. No way ! After a GM bankruptcy, we can see what should happen to Opel.
Koch may have to deal with that, since he will probably be reelected in a landslide thanks to "Dilettanties" chaos/lies. Have no idea whether Koch is good or bad, but after Ypsilanti probably good.
Medium to longer term, the weight of the car-industry needs to be reduced. Cars are not really "high tech" anymore, a lot of nations can now produce cars (and a lot of stuff is over-engineered. I can live w/o 300 hp & 6-drive automatic). Production technology is a different thing, ties into mechanical engineering, where Germany has a profound and very diverse basis. That segment may roll along for a couple of decades.
As to the Greens, I really am not impressed at all with them . They do not understand physics! Their propaganda goes back to the 70's and I still have not heared anything which makes from a technical point of view sense for a industrialized country. You can not e.g supply a noticeable portion of energy with wind or solar in Germany. The ideas are old and you see the meager fruits : a few windmills (supplying a whopping ca. 1 % of the energy demand, provided the wind blows ) and some roof solar-collectors for warm water to shower or wash your hands.
A couple of years ago, I actually looked into the technical specification of some 3MW windmills and the wind data in the wider area around my little town. 3MW generation capacity sounds good, but unfortuanately you need almost hurrican windspeeds. And you are really surprised to see how steep the generation capacity drops with real-live (top) windspeeds (goes somewhat with the inverse of the square of the windspeed) : I think the conclusion was if you install such a thing on a choise location you will get max 800-400kW (if the wind blows). If you drive on the Autobahn from Stuttgart to München, you actually see some windmills (don't know their rating ) at the edge of the "Alp" (Alpaufstieg) . Just watch how sluggish they usually rotate, if any at all. And that is a prime location!
The Greens should study physics, chemistry, engineering, etc.
Millions of Americans live in a non-reality-based belief system informed by childish clichés - they can barely differentiate between lies and truth.
Being fluent in Japanese, having lived and worked in Japan (in Japanese companies -- not as an ex-pat), and being well-read in the history of WWII and the Japan's conflicts leading up to it -- and of how the Japanese populace was propagandized and socialized into supporting those wars, I can assure you that the same can be said about millions of Japanese, and probably of the people of any nation.
Oh thank God!
Good morning from Mortgage Pig!
That beautiful pig!
hmm... hope that crazie Dk doesn't show
Nobody will ever say the magic word "Principal Reduction." It's the painful, sole solution that will help, but greed stops us from using it.
I know what the Ken CR thing is, but what is the Mortgage Pig
I'm here in Phnom Penh
People are shopping- here goes some of my silver:
http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&ssPageName=STRK:MESELX:IT&item=270300157777
Admittedly low quality stuff, gotta make room.
Someday this war's gonna end...
Duke of Con Dao(Excellent) writes:
I know what the Ken CR thing is, but what is the Mortgage Pig.
The icon that appears to announce a new post is Mortgage Pig(tm), one of the board's long-time mascots.
Hoopajoops,
Agreed they will extend the length, lower the interest, do interest only and basically anything that is good for them and bad for you.
People laughed at me 2 years ago when I said walking would be common. Been there done that in Texas in the 80's and the 90's.
Anyone care to try and correlate the magnitude of the bubble with whether mortgage loans are recourse/non-recourse?
It may be possible that non-recourse mortgage loans may have actually discouraged some outrageous lending...
I'm getting shivers, through, when I think of the type of lending that would have happened if CA were a recourse state...
http://1.bp.blogspot.com/_jbs0fnMs1sc/SR-U5qX5tPI/AAAAAAAAAC0/77lVymKJwi8/s1600-h/US+Debt+Maturity+15NOV2008.PNG
I was just reading about the upcoming "reset" of US Treasuries. 1.6 trillion is rolling over in the next 4.5 months. I know the world's appetite for treasuries will drop in the near future and if it does it will drop catastrophically, but I had no idea such a big lump was about to roll over so soon.
...I think that now would be a good time for banks to start pursuing people who choose to walk away from recourse loans....
the shareholders, taxpayers and public at large would be best served by actually holding the "walkaways" responsible for their actions.....
2009-2010 could be the year everyone starts singin' "I'm walking, Yesirree, I'm walkin'....."
Alistair Darling really screwed up by not getting rid of Northern Rock when he could have
Gordon Brown will not be re-elected no matter what now. Gone is the North Sea Oil, gone are the capital inflows from Canary Wharf, arrived are the Olympics, arrived are the bailouts, arrived is a deficit multiplied from a chain of deficits in prosperous years.
Labour has to hold an election before May 2009. Connect the dots and realize why the G20 planned an April 2009 election (rumours are returning for a snap election, the earlier the better for labour in this environment)
thanks for the info... guess here in Cambodia they grab the Pig and eat it before I get a chance to see it...
off to the 'Heart of Darkness' for well... hmm
OT: I have recently incorporated as a bank. Bank of Barkingtribe and submitted request for immediate bailout on Friday, considering of course lack of capital, a small pittance of 500 million...
Avaiting approval in Monte Carlo....
@ patientrenter :
posted a reply in the "San Jose to Request $14 Billion from TARP" thread.
Anyone know where to buy bullion in the Bay Area?
O/T
I just got back from a 2 week vacation in Japan. I have to say that the deflation argument does not hold water. Things are expensive for the common man: restaurant food, electronic gadgets, public transport (I was actually paying less as a tourist!) clothes... The only thing that has dropped in value is home prices to some extent and rent to a large extent in Tokyo. In Kyoto and other places life is much better but a strain on the commoner since the wages are around Y1000 /hr (roughly $10). I asked what a good salary was. The answer: $30k. If one makes $60 (for piping designer, accountant) then it is considered very good.
I hope we don't see that sort of deflation here in the US. One thing that stood out is that people actually work and do it with pride (street cleaning, food, railway conductors) unlike the rude service you typically get for the low paying jobs in the US.
-sb
Where appropriate, we will offer payment holidays, reduced monthly repayments and conversion to interest-only mortgages," said Jemma Rundle, a spokeswoman for Northern Rock.
Um, yeah.
List of future jingle mailers:
California Layoff Notices (Frequently Updated)
Jingle Mail = lotsa lawyer fees
Can a lawyer work on a contingency basis in the UK? That is can a law firm go after these folks on fee for success basis? This would make people's lives horrible.
C&C - never seen this before. thx
All of the Mervyn's layoffs occur on 12/23...Merry Christmas...
Ok, one more time.
In Fla all mtges are non-recourse. No bank or lender EVER goes after defaulters and they still aren't. This would be futile, as almost all borrowers have no NO I repeat No money.
If they did get pursued, the borrowers would simply file bankruptcy.
The same lenders who don't pursue homeborrowers do pursue underwater car borrowers. Less likely to file bankruptcy maybe?
In actuality, what do they do in Great Britain?
A lower interest rate would, in some marginal cases be benefical to the borrowers, so long as it wasn't ever added back on in the form of neg am, or piled at the end of the loan.
Of course principal reduction is the most likely source of an actual solution.
And besides Carthage must be destroyed.
Good point liz, can you imagine the banks wasting yet more money chasing down broke people to try and get blood from the proverbial turnip?
Lawyerliz
from last thread, a somewhat old but still relevant fire primer in California
So once you start thinking like this, it's hard to stop:
What would stop a sequential currency flight from the middle, say, 30 or 40 countries or so with an independent currency?
In other words, Iceland, Pakistan, Turkey, ..., drop by drop. I can't think of any structures which could prevent this.
I need some sleep.
I personally wouldn't do this on a contingency. I don't think it would be profitable, especially if I had to front filing fees and service of process fees, and whatever other fees that turned out to be necessary.
Of course Florida is very pro debtor, but I rather think that it would be financially futile even in a pro creditor state/nation.
Beaver(Unrated) writes:
...I think that now would be a good time for banks to start pursuing people who choose to walk away from recourse loans....
Really quite pointless.
What is your thesis? Punishment for the sake of punishment? Using the mechanism of the state to encourage banks to make future bad loans by insulating them from the full costs of the error? Prolonging the downturn by keeping more people living in hand-to-mouth poverty for longer?
If you got what you wanted you'd wish you hadn't.
PS thanks for the roll-over link Hoopajoop.
China is giving power to the words "A friend in need, is a friend indeed"
Hu Jintao to visit struggling ally Cuba
| Reuters
One part good value in diplomacy, one part hedge against America dropping the Cuban trade embargo
I also wonder if China is trying to drum up business for industrial exports
All of the Mervyn's layoffs occur on 12/23...Merry Christmas...
Thanks, man. Never seen the WARN thing before. Total Cali Mervyn's layoffs taking place on 12/23: 10,953. Ho ho ho.
It seems to me that the world today is where the U.S. was in August-Sept of 2007. If you remember, the Fed recognized the credit crisis in Aug. 07 and started cutting rates and expanding credit facilities. This was then viewed as very bullish, and the market rallied in September and early August. That rally looks stupid in hindsight, but there's a lot of stupid investors out there, including some with billion dollar piles.
Now, multiply that liquidity and sentiment several times as the world follows Bernanke's model, one year later.
It may turn out that Bernanke's model works a lot better in some foreign and emerging markets than it will here. The U.S. is the most screwed of all economies, long-run.
Poor Cuba has been hit by 3 major hurricanes this year, one just a short time ago. Lots of reconstruction to do, no money. No cranes, no machinery to help. Or, hardly any. I think a lot of crops damaged.
In my opinion Cuba should be treated as any other poor soul hard luck nation, but none of my Cuban friends agree.
EHP
The next election in the UK can take place as late as May 2010 - there's a maximum five-year term from the date of the previous election ( which was May 2005 ).
If the election were held tomorrow, it's possible that Brown would lose - but I wouldn't discount a "revival" in Labour fortunes over the next 12-18 months.
Both Cameron and Osborne, the shadow chancellor, have floundered badly of late, and the "crisis" is actually a political plus for dear old Gord.
Max,
Don't have the time right now, but other states publish online mass layoff notices -- learned about it on CR comments. I remember Florida, Texas, Washington I think
OT:
The campaign to discredit 401(k)s and convince people that the government knows how to use the money better has begun.
"The current 401(k) system has not turned out to be as secure as we want it to be," said Rep. George Miller (D-Martinez), chairman of the House Education and Labor Committee. "It has not provided the returns that we want it to. And it's not provided the level of savings that we want it to. It's kind of failing on a number of fronts.
"Should there be a serious reassessment? Absolutely," he said.
This is the first step toward the government hijacking the funds or reworking the program to direct the funds somewhere more "beneficial".
You might switch to a 401 (k) Plan B - Los Angeles Times
Foreclosures are in.
A co-worker asked for advice on how to handle a brother asking for a loan to stay out of foreclosue. My advice was not to help avoid fc but make sure the brother has a place to stay, ie help with rent if possible.
"crispy&cole writes:
All of the Mervyn's layoffs occur on 12/23...Merry Christmas...
crispy&cole | Homepage | 11.16.08 - 11:28 am | "
They'll get my Aunt Marie at the Vallejo store. And they'd laid her off before, a couple of yeas ago; she'd had 20 years in, and seniority, and they didn't want to pay so much for people anymore. They took her back at minimum wage. Circuit City wasn't the first to pull this kind of crap.
I was just reading about the upcoming "reset" of US Treasuries. 1.6 trillion is rolling over in the next 4.5 months. I know the world's appetite for treasuries will drop in the near future and if it does it will drop catastrophically, but I had no idea such a big lump was about to roll over so soon.
Hoopajoops LTD | 11.16.08 - 11:16 am
I raised this matter a couple days ago and some others have ably dug up some info concerning it. I first had my attention called to this by The Mogambo Guru, who satirically gagged and fled to his bunker.
I am a plebe, without any real credentials. So, here goes with another question:
Previously we have exported this to other CB's, at least to some great extent i.e. sovereign wealth funds, CB's, or whatever. Now, or so we seem to fear, the appetite for this is waning and therefore we won't be able to export this.
Doesn't this mean monetary inflation?
Should the fed take it onto its balance sheet, the treasury has to react, right?
What will this mean in terms of credits coming into circulation?
Will this mean a ratcheting up of interest rates until the price is discovered?
okay, four questions
dan,
Thanks for the correction/info. I assumed it was a 4 year term.
The reason why I think Brown/Labour will lose is that in a poor economy, the incumbents have a natural tendency to lose.
the shareholders, taxpayers and public at large would be best served by actually holding the "walkaways" responsible for their actions.....
The money isn't there and won't ever be.
We would be best served by a combination of cramdowns, forgiveness, short-sales, lease-backs, and other such programs that split the losses between lenders and borrowers and keep as many people in their homes as possible. Moral hazard issues abound, but after the TARP nonsense and given the upcoming deep recession I think they aren't as relevant.
It means the government will launder by purchasing more Hoopajoops...
Principal reductions/payment reductions are no ultimate solution. You start giving reductions of any kind to delinquent mortgagees, and you will get a flood of delinquincies.
Most people with mortgages continue to keep current, but they are pissed off at talk of letting deadbeats keep their homes and paying less than they borrowed, and if this becomes the standard response to mortgage defaults, those keeping current will stop doing so.
6 years? Make that FOREVER - so long as they don't let 6 years elapse between consecutive requests for payment.
Actually, I have no idea why the US treats mortgage debt as being optional as to payment. Where else can you borrow large sums of money and then just decide to walk away? No wonder you're having so many problems - even worse than the UK I suspect (although things are pretty dire here).
--
"Oh thank God!"
Rob Dawg,
For making you a barking dawg?! You have barked one too many times, dawg, and I will shoot back when shot at repeatedly.
Dopes employ many methods to suppress criticism and harassment is one of them.
Jas
Max,
Don't have the time right now, but other states publish online mass layoff notices -- learned about it on CR comments. I remember Florida, Texas, Washington I think
The data are overwhelming these days. I could quit my job and blog full time and still not cover 10% of what's going on (CR manages to do 20%; bow to the master
.
Interesting omission from the WARN list: Linens 'n Things. I guess the each individual store falls below the employee-level threshold of 75. If WARN reporting is voluntary below that level, there's a ton of layoffs happening under the radar.
Jingle mail in Woodland Hills, CA
AIG is laying off 197 folks
EHP - the Cuba play is the call option on the Seventh Fleet Put.
Jus sayin.
CC
Off topic question that I have been wondering about for the last month or so.
Everyone here knows of the large discrepency between the spot price of precious metals on Comex and buying these on the open market. What exactly happens if enough people take delivery to clean out all the metal Comex holds? How would the default proceed?
FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess. I was hoping Tanta might have something to say
FAIR GAME; Everyone Out of the Security Pool - NY Times
Jim Bennett writes:
6 years? Make that FOREVER - so long as they don't let 6 years elapse between consecutive requests for payment
liz...if an enterprizing lawyer could or would take this on a contingency basis it might prove to be a lifelong income stream! At some point these jingle mail folks would have to have some money to collect...hech hound their employer!
How would the default proceed?
Yancey Ward | 11.16.08 - 11:55 am
Not well. Chaotically for awhile, bankruptcies, lawsuits, government intervention, true price discovery.
Of course, I could be wrong.
Volker the Viking writes:
How would the default proceed?
Yancey Ward | 11.16.08 - 11:55 am
Not well. Chaotically for awhile, bankruptcies, lawsuits, government intervention, true price discovery.
Of course, I could be wrong.
Volker the Viking | 11.16.08 - 11:59 am | #
Since it is a bubble and we now have substantial recent experience with bursting bubbles, I don't think you are wrong.
A Rescue Plan Without Taxpayer Money
By GRETCHEN MORGENSON
Published: November 15, 2008
HELLO, taxpayers. Worried about the fate of the $350 billion that the government has asked you to fork over so far to help rescue financiers from themselves?
Ubiquicert:
One interesting idea was conceived by two veteran investment managers, Thomas H. Patrick, co-founder of New Vernon Capital, and Mac Taylor, a principal of the Verum Capital Group.
They propose refinancing all $1.1 trillion of the loans in securitization pools that are still performing but that may soon face punishing interest rate resets. Homeowners whose loans are in these pools would receive newly issued loans with fixed interest rates, currently 6.14 percent, and 30-year terms. Under this plan, Fannie Mae and Freddie Mac would issue debt to pay off the outstanding principal on the loans and then guarantee the new ones.
Voilà: Investors who own the underlying interests in the mortgages would be fully repaid and the securitizations would be closed out.
All I can say is "Poor Gretchen."
Garnishment is limited to a certain percentage of the head of household's income. Federal law. Forget what it is.
I repeat, I would not go into this business, not out of softheardedness, but because I don't believe I would make any money.
It is astonishing how hard it is to collect money by the legal process.
I know. I've tried and have had clients who have tried. Futile.
EHP
The odds are still against Labour, but since the financial crisis struck they've turned a corner in the national opinion polls, and also managed to carve out a by-election win a couple of weeks ago. The Tories have been "poor" of late, Osborne is being knifed in the back by elements in his own party ( if you think US politics are vicious....)....in short, the crisis is playing well for the incumbents at present; the key variable will be unemployment.
You also need to factor in the vagaries of a parliamentary system with 3 national parties, 2 powerful regional parties in Scotland and Wales, Northern Ireland's peculiar arrangements, a number of "fringe" players ( UKIP, BNP, Green party ) that can muck up the arithmetic on a constituency level, and the sophistication of an electorate that understands tactical voting.
I've assumed since 2005 that the next UK general election will produce a hung-parliament, and, quite possibly, a minority Labour government a la 1974.
All I can say is "Poor Gretchen."
Rob Dawg
lol
RE: my four questions--maybe I'm asking the wrong questions. Maybe nobody who has something more than nothing in the form of credentials wants to tackle the subject.
This rollover, and the evolving situation in cargo at sea and on the docks seem to me to be the two potential triggering events that would make much of the rest of our problems seem quite small.
Of course, I could be wrong.
--
"FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess."
theotherdeb,
Only Crooks, Crooks' agents (mostly economists) and born-and-bred American dopes have a solution. Enforcing the existing contracts (and laws at the time of the contract) and letting the markets work it out is not one of them.
Americans have no faith; only blind faith in the system.
Jas
I've assumed since 2005 that the next UK general election will produce a hung-parliament, and, quite possibly, a minority Labour government a la 1974.
dan | 11.16.08 - 12:05 pm
Insightful post. At best we should hope that the next government, if hung, be well hung.
It is astonishing how hard it is to collect money by the legal process.
lawyerliz
God tell me about it. I have spent $19k in legal fees and two years talking to Optimum West Insurance about how to proceed to recover some non-insured losses following a p&c claim. Our out of pocket is only 40-50k
Hoopajoops,
I pulled together some time series on the Treasury rollover to compare it to the past when it was suggested this was business as usual...
Jas Jain(Irritating) writes:
"FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess."
Until Gretchen figures out that there's 2 sides to every transaction, she's just wasting bits.
OT - wonder if S&P futures go to circuit breaker? Already 5%+.
CC
...Thanks, man. Never seen the WARN thing before. Total Cali Mervyn's layoffs taking place on 12/23: 10,953. Ho ho ho.
Max
Max, here's a federal fact sheet on the WARN law:
Fact Sheet - The Worker Adjustment and Retraining Notification Act
Here's the latest from Ohio:
ODJFS Online | WARN Home
We have always been pretty well treated by insurance companies personally. But oh, the horror stories I've heard.
What about bad faith? If you can set them up for bad faith in Fla, you can hope for some punitive damages. I don't do this stuff personally.
dan,
A minority government sounds about right. The times I've noticed the Tories, they certainly haven't been inspired or cogent. Similar situation exists in Canada right now, except our Tories have better political organization while the other parties need to rebuild.
I can Attest that LawyerLiz is right when she says she can't make a dollar pursuing "recourse" loans.I was licensed to run a collection agency here in California for a dozen years.I started out collecting second and third placement debt in Oakland and Richmond in the 1970's...and made a living doing it.(second and third placement refers to the number of times an account has been assigned to collection agencies and returned as uncollectable).
Well how did you make a living Tom Stone?
...(second and third placement refers to the number of times an account has been assigned to collection agencies and returned as uncollectable).
Tom Stone
By that time it was what? 3-5¢ on the dollar?
I admit that I hadn't bothered to spend much time worrying about the fractional reserve banking system and its implications when considered in conjunction with the trade system we have developed with China and certain other nations. But it's now clear that our economy has become dependent upon a lot of commercial bank-created money which simply does not exist any more and will not exist in the foreseeable future.
This last decade has been almost a perfect storm for an economic bubble, with money serving as a nice substitute for heroin. China has been the wholesale dealer of the heroin sent to the US, pegging the yuan to the dollar (with the secret approval of America), thereby allowing a trade bubble to persist which, under Bretton Woods, would have popped many years ago with inflation in China and a healthy recession in the US.
The financial services industry in the US has served as the local dealers for the Chinese heroin, with the federal reserve, Congress and the SEC playing the role of the corrupt police force, secretly greasing the skids of commerce while pretending to police things. If you look back at the last decade or so, it's clear that it's all been a gigantic scam, with opaque and artificial financial entities like collateral debt obligations, structured investment vehicles, and credit default swaps being created which are all designed to slice and dice the heroin from China and mix it with meth, cocaine, etc so that the worthless debt can be foisted on unsuspecting customers and kept off of the books of banks. Of course, the rating services like Moody's have all been certifying that it's good healthy stuff so the public will buy it.
So we've had all this artificial debt and money circulating around, and the commercial banks, with the fractional reserve system have been creating even more. It's always been known that the fractional reserve system depends upon a constantly expanding supply of borrowing and lending and that there will be quite a nasty crash when the music stops as it did in 1929-33.
Well, it has stopped big time and the situation we're in now is like if we suddenly woke up one day and there was a lot less oxygen in the room. And the funny thing is that a lot of these people you see participating in stock rallies seem to think that this is just a bump in the road, but I really don't think it is. The US government is going to try to keep the music playing with huge amounts of borrowing, but these aren't the Reagan years, when we had more manufacturing than we have now. Plus, there's a limit to how much we can borrow with all our Medicare and Social Security debt.
Also, it clear that this bubble was largely the result of a one-time phenomemon where China kept pumping dollars back in the US economy, and China has now wised up to the unsustainability of that practice. So the bubble has popped and we find that the money floating around was largely an illusion and that actual real products are largely manufactured overseas. All our economy has had in the last decade is the creation and maintenance of a scam which the public has wised up to.
The illusory money that we thought we had is crashing down like one of the twin towers on 9-11, and there are many more floors still to go. Deflation will inevitably result, and, in deflation, those lucky banks and individuals who actually have real money will have every incentive to hold on to it. It will be the exact opposite of the situation we had in the last decade's bubble, when anyone would loan to anybody.
And we're very early in the process. A lot of oxygen has left the room, but so far only the weak have actually died. I hope I'm wrong, but I'm thinking now that the reduced oxygen is a permanent part of the US economy today, and that, as more and more people realize it, we really could be seeing 1933 again.
BR,
You can find the original posted on my blog...just sayi
Comrade Counterpointer - I don't believe there are any circuit breakers on the way up. Or are you inferring a +5% futures means a -14% drop in reality. At current levels it would take about a -14% drop to trigger the 1st circuit breaker
citizen energyecon - those new graphs are nice additions.
--
"Jas Jain(Irritating) writes:"
Anonymous,
If Jas Jain quotes, he "writes?" Amazing ignorance.
I guess, CR needs to open a Jas Haters Club to give meaning to the lives of life-long ignorance.
Jas
Thanks PeakVT - that was an upshot of the conversation with you, MLM and Austin Tex last night. IIRC, they made a case for this being a business as usual rollover and typically front end loaded...sort of but not really is my interpretation of the data presented.
And hat tip to Plantagenet for providing the direct link to the Treasury data (though EHP provided the original thread to tug with a .pdf from Treasury).
citizen energyecon - I am sorry for not giving a shout out to your fine blog when linking your graphic
energyecon
This is where I Got the treasury rollover graph guys.
They weren't recourse loans,for the most part.I got 10% of recoveries,was VERY good at locating assets and approached people in a courteously firm manner.I dealt with a lot of minorities,and they reacted well for the most part to a white man who assumed they were responsible members of society who wanted to honor their promises and resume a place in society.
Wait a minute. Are these Brit's "walking away" the same ones who are supposed to buy all those condos in Miami and save the RE market?
ce: so can you articulate what this in some ways that will have meaning for the uninitiated?
Altair,
I like your post. I disagree on the source of heroin; China. The USA has a direct source of the pretty red poppy; Afghanistan. Why else are we in that god-forsaken place of poverty and goats. The heroin output has expotentially grown since we declared war. The military is protecting that untaxed, unregulated, blackmarket commodity. We don't need no stinkin Chinese heroin. USA needs China to buy treasuries. The deal is buy our treasuries, we'll offshore industry to mainland China and buy your finished products. And not inspect the cargoe for poisonous goods. China's forex is around $1.9 trillion.
s'ok - though appreciated - the info is the thing
And let me shout you out for providing the awesome superposition securities aka hoopajoops - though Rob Dawg seems like the only other one who is prone to make esoteric Schrodinger's cat jokes - ah, physics nerdiness at its finest!
What about bad faith? If you can set them up for bad faith in Fla, you can hope for some punitive damages. I don't do this stuff personally.
lawyerliz
This is a Canadian claim. For the most part and in my opinion, there is no distinction between bad faith and good faith there. And, the Courts dont really assign damages per se.
I have to say claim was/is really complicated. Lots of parties involved. Example: the company who did the intital damage assessment and remediation was/is owned and managed by the same person who owned the vehicle that struck a fire hydrant which caused the flooding and this same restoration firm screwed up the job by installing machinery incorrectly (they introduced high hummidity into areas that were previously dry and wetted areas that were already wet) and this firm was hired by the insurer.
I made the error by not wanting to rush to court and merely wanted to remain whole. A sad and bad error in judgement.
If you look back at the last decade or so, it's clear that it's all been a gigantic scam, with opaque and artificial financial entities like collateral debt obligations, structured investment vehicles, and credit default swaps being created which are all designed to slice and dice the heroin from China and mix it with meth, cocaine, etc so that the worthless debt can be foisted on unsuspecting customers and kept off of the books of banks.
Your analogy fails in that cocaine/meth infused herion would actually be an asset.
A better analogy might be herion cut with pixie dust and tooth fairy farts.
Front page article today in the San Diego paper:
Street of risk and loss
According to the article, virtually all the buyers on Little Lake St. in Chula Vista, refinanced and retrieved their down payment before losing their houses.
Most are actually up on the deal like a certain Ernesto Guevarra who "pulled out" $380K in two years and spent all on jewelry and vacations to Acapulco and the Philippines. Now he's moved back in with his mother.
Volker,
Well I am not deep in my understanding of bond markets et al, it just looks like a sh!tpot of short term lending for long term liabilities which sounds...I dunno, kinda familiar?
Actually, I have no idea why the US treats mortgage debt as being optional as to payment. Where else can you borrow large sums of money and then just decide to walk away? No wonder you're having so many problems - even worse than the UK I suspect (although things are pretty dire here).
The thought behind non-recourse mortgages it that it encourages lender to due their dili before loaning money.
When the dust has settled, the UK may want to think about it...
Linky for S&P futures? Bloomberg has friday's numbers.
citizen energyecon - how come your time series is right to left??
Ahem, I also pointed out the $1T AAA coming on market in Q4 and the rollover risks. Clearly Cooper's panopticon is screening.
CC
sdtfs writes:
Wait a minute. Are these Brit's "walking away" the same ones who are supposed to buy all those condos in Miami and save the RE market?
No, these are the Brits who are supposed to be propping up the Dubai freehold market.
rps - Altair's use of 'heroin' was metaphorical for 'money'-
SDM- is his nickname "Che"???
Howls of derisive laughter.
Jas- look at energyecon's page of doom for you.
You were warned, now you are turning into the dope.
Someday this war's gonna end...
Volker,
If the world loses its taste for US debt, then there will be a dramatic increase interest rates on Treasury debt, monetization (aka printing) or some combination thereof...anyone else see another outcome?
The challenge is we have dramatically increased the total debt, and done a huge proportion of it on a very short term basis. So we need to keep rolling it short term or when it comes due roll it into longer term debt. However, the latest offering of 30 year bonds went poorly...
And this is all before we have any additional new borrowing due to increased spending 'needs' and declining revenues...
Altair- "China kept pumping dollars back in the US economy"
I partially agree. The Japan carry trade is the main culprit. Cheap loans at near 0% was the trojan horse. And the carry trade collapsed on 07-07-07. The G7 are frantic to restart it. Japan, Germany, and OPEC are desperately trying to strengthen the US dollar as they deliberately try to deflate their currencies, (China is an exception as they have a world plan). Free trade exports has been largely flowing one-way; to the shores of the USA. We are overconsumed and manufacturing depleted.
Gerkinov - ROTFLMAO.
And unicorn smiles.
CC
Well I am not deep in my understanding of bond markets et al, it just looks like a sh!tpot of short term lending for long term liabilities which sounds...I dunno, kinda familiar?
citizen energyecon | Homepage | 11.16.08 - 12:33 pm
not good? or we're fooked?
Dawg,I subcontracted for 10% plus expenses.And I spent some time looking over and evaluating 2 kinds of deficiency Balances,Automobile and Eviction.people recover from financial problems in rough 2,5 and 7 year cycles...with recourse or deficiency balances the survivors tend to have a real resentment to the lender...so the ones that have recoverable assets go BK or run while the folks who have to borrow a pot to pee in are not profitable.A recovery rate of .5% of dollars assigned on deficiency balances would be very good,and would be expensive.on normal 2nd placement accounts 2% recovery is acceptable,I averaged 4%.You have to find them,you have to find a way to actually talk to them,and you have to find a lever,not cheap,not easy.
001, thanks. I must walk away and enjoy the day
Comrade CC,
the graph reflects the timing of the obligations from today forward...just made more sense to me I guess (without really thinking about it)
whatever that says about how I look at the world lol
Jas Jain(Irritating) writes: "Jas Jain(Irritating) writes:"
If Jas Jain quotes, he "writes?" Amazing ignorance.
Nope dope. Just a cut-and-paste, cuz I know it would set you off.
Hey Ken: How about a "Dope" label?
citizen energyecon - it looks like you are using publicly-held debt instead of total debt. That would be the correct subset to use for this discussion since there are no rollover issues with intragovernmental debt. However, you might want to change some wording in the post if it is indeed just publicly-held debt.
CE - as Walter Benjamin said, history is an angel being blown backwards into the future.
CC
According to the report, tighter rules mean that just 37 percent of unemployed Americans are receiving jobless benefits today, down from 42 percent during the 1981-82 recession and 50 percent during the 1974-75 downturn. Americans today receive a maximum of 39 weeks of unemployment benefits, down from 65 weeks in the 1970s. The average weekly benefit is $293. And low-income workers a category that tends to include women and those in part-time employment are one-third as likely to receive unemployment insurance as higher-income workers.
THE NATION; Will the Safety Net Catch the Economy's Casualties? - NY Times
Unemployment insurance is a sham.
Comrade CC,
Hmm actually that thought applied to the first graph from yesterday, then just had the trend set that way - the post today does make more sense with the years going up from left to right - I will jack with that when my nephew gets off my computer (currently playing LotRO lol, I am using my wife's computer atm).
Yesterday's plot looks better to me as is, the one that hoopajoops was kind enough to display. But the other ones from today will be improved by resequencing...
PeakVT,
You are exactly right and it will be updated - thanks!
rps...ditto
rps...ditto
The US consumer has no voice except with their cash....Only consume out of neccesity.
energyecon -
I didn't mean to suggest it was a nothingburger (makes me miss banker just typing that). Meant to suggest that a roll provides the opportunity, but not necessarily the motivation. All of the dollars that are paid back will be sitting briefly in custodial account somewhere. The easiest course of action is to re-up for another round probably via standing instructions.
The question is, what will create the tipping point for those standing instructions to be changed. Once that happens, given the term structure, it will be anything but a nothingburger.
--
Something not posted on San Jose thread yeatserday...
TECH COMPANIES, LONG INSULATED, NOW FEEL SLUMP - NY Times
November 15, 2008
Tech Companies, Long Insulated, Now Feel Slump
By ASHLEE VANCE
In the span of just a few weeks, orders for both business and consumer tech products have collapsed, and technology companies have begun laying off workers. The plunge is so severe that some executives are comparing it with the dot-com bust in 2000, when hundreds of companies disappeared and Silicon Valley lost nearly a fifth of its jobs.
Silly.con Valley, without a doubt, has the highest concentration of born-and-bred American dopes as well as Americanized dopes. It also has second, or third, largest concentration of Crooks. One characteristic of dopes is that they never learn anything from history (who has the time!) and Crooks is that downplay any negative historical precedences.
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example! Be prepared for a hellhole in 2-4 years when the fraud money dries up for good.
Jas
Hey Ken: How about a "Dope" label?
Better yet, A "Born and Bred Dope" label?
theotherdeb(Unrated) writes:
FWIW, Gretchen Morgenson, in her infinite wisdom (/sarcasm) has a new Times article on how to fix the mortgage mess. I was hoping Tanta might have something to say
Do you notice how all the mortgage rescue plans assume as a basic foundation assumption that the plans have to originate and run from Washington?
I still favor the Norka 4 point plan of cram downs through bankruptcy. Once it was up and running, it would be decentralized and minimize regulatory capture by the K Street crowd.
It would be interesting to see Tanta's reaction to these plans, if she is up to it.
Hope she is doing well.
NorkaWest
FWIW- have to help a friend move from apt to condo he got for about 100K, right across from another friend who paid 300K four years ago. Hasta la vista.
"What exactly happens if enough people take delivery to clean out all the metal Comex holds?"
Comex does not hold any gold. The "shorts" of the open interest (outstanding contracts) are responsible for delivery. On or after the "first notice day" any short contract can give notice of intent to deliver. A long holder is chosen (random or FIFO) and given notice of the delivery, and their clearing broker is debited the full price of the contract less the margin already being held.
So, if you want to take delivery, all you have to do is hold after the notice day and wait. This bias is what can cause short squeezes: since, for every long there is a short, if you (long) don't get out of your position, there is a short that can't either.
So, towards the end of the contract's life, if there are "stubborn" longs, then their counterparties either have to find gold to deliver, or the price will be bid up to where the long will be pursuaded to take the higher (maybe much higher) price.
Look back at the price spikes of the Oct oil future (CL) on the last trading day in late Sep as a case of what happens.
But there is never a default, because of the basic way the market clears itself.
CE - it's just that if you go left to right it conveys more of a sense of the crescendo of clusterfks coming.
And all this is supply side into remainder Q4. Where is the demand?
No. Where. Erewhon.
CC
PeakVT,
I responded to your questions in the other thread
Response to PeakVT
citizen energyecon - you are doing valuable community service, thank you. Which leads me to the following request
Can you also add schedule for Fannie/Freddie debt (not MBS, just straight debentures)? It would be a very valuable addition since much of foreign CB holdings are in this paper, which essentially competes with Treasuries.
It is available at Debt Securities: Debt Reports and Freddie Mac Debt Securities: Security Information
I realize this does look like "no good deed goes unpunished"
So the total mortgage market is 12.5 tril, with 5.5 held by gse's and 7 tril in the private sector. Total alt-a and sub is about 4.5 trill. Total cc debt is about 1 trill. If we had 100% failure of cc,sub, and alt-a, total would be 5.5 trill. So far the fed/treas have put in a bit over 4 trill. The loss potential in these items will be big but don't explain why the ptb are freaking? I suspect the losses in the cdo, cds, and synthetic swaps market are going to be substantial. Apparently the change in the TARP ie no longer buying "toxic assets", was triggering defaults and margins in the swaps market. In any case methinks the real party is whats going on in the "shadow banking" system.
Tom Stone,
Second and third tier debt collection, probably some zombie debt thrown in for the lottery winning feeling if they actually pay.
Congratulations for making these people feel better about their social status to make you a little money. They dealt with collections for years before you bought their debt for pennies. I have a hard time believing a white man dealing with minorities with respect turned the trick for you.
Share with us the real approach you used. The lies you told, the illegal collections tactics you employed.
Parasite is the best description for your contribution to a better society.
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example! Be prepared for a hellhole in 2-4 years when the fraud money dries up for good.
Jas
A friend's family lived in SV. When their 3 year old daughter started acting like an American kid and trash talking her grandfather and the 10 year old daughter wanted to leave the house dressed up in the Britney Spears tart outfit, the parents said enough and moved the family back to India.
Don't blame the parents at all.
Schools are better over there anyway.
Tom Stone writes:
They weren't recourse loans,for the most part.I got 10% of recoveries,was VERY good at locating assets and approached people in a courteously firm manner.I dealt with a lot of minorities,and they reacted well for the most part to a white man who assumed they were responsible members of society who wanted to honor their promises and resume a place in society.
Tom,
Worked at an agency that was WAY beyond 3rd placement while in school. This was long ago, but I recall that we got WAY more than 10%. 30 to 50 percent comes to mind.
A very tough gig. Could not imagine doing it for a living.
Jas Jain(dope) writes:
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example!
And dopes who point out that the companies are populated by dopes. It's dope heaven, where everyone is a dope!
Show me some of those 12% 13-week bills and deflation.
Anyone here ever read 'Little Dorrit' by Dickens? They had the right idea back then: Debtor's prisons and work houses. Although it didn't reduce poverty, it sure made the poor suffer, which is the point, isn't it? We must punish the poor to teach them not to be poor. It also helped keep wages down. And most of all, it helped the upper classes to feel even better about themselves than their wealth alone enabled them to feel. If we have learned any lesson from consumerism it is that merely having lots of stuff isn't satisfying unless you have someone to look down on.
They're non-recourse here in California for purchase-price loans.
MrM,
lol! Man I live by that creed - no promises, I have to get back on my machine and find the time - won't bore with the particulars, just RL like we all have...
--
When it comes to my holdings of US Treasuries I don't need any help from dopes. They have been warning me for more than 10 years. Many of these dopes are Scam Lovers and defenders of Crooks. Amazing ignorance, the most defining characteristic of dopes in America and elsewhere.
Jas
"China kept pumping dollars back in the US economy" "I partially agree. The Japan carry trade is the main culprit."
The yen carry trade has definitely caused some wild swings in the stock and currency markets, but I don't see that as being the same kind of structural weakness in the world economy like the broken trade system between China and the US has been.
It's not surprising that there will be some nations where borrowing is cheap, and I'm not sure how you'd stop hedge funds from borrowing money in that nation and then investing it somewhere where interest rates are higher.
Then again, maybe I'm wrong- has there been any proposal floated about how you can stop hedge funds from doing something like that?
At any rate, I see the carry trade as being responsible for some of the big swings we've seen in the markets, but not for the structural weakness in the entire economic system.
Mike in Long Island -
re: last thread post to PeakVt - it's stuff like this that makes me hope CR and Tanta don't have to shut down the comments section.
Thanks for the edikashun...
Jas Jain(Irritating) writes:
When it comes to my holdings of US Treasuries I don't need any help from dopes.
On the other hand, your interpersonal skills could use help from the dopiest of dopes. Maybe the great dwarf Dopey himself.
maybe we could start eating babies too, aClem. you know. cut down on the overabundant poor population.
OT
out here in Riverside county i have been seeing lots of impromptu yardsales on the side of major streets. Mostly just a pile of stuff that looks like the contents of a garage with a sad looking cardboard sign in the dirt. Sometimes I see something that i might want to look closer at- but i cant bring myself to stop. Im not sure if its out of embarrassment or shame or ?
.
: NorkaWest writes:
Silly.con Valley is no place to raise healthy children, at least morally. It is a cesspool of moral contamination. With Crooks leading the dopes by example! Be prepared for a hellhole in 2-4 years when the fraud money dries up for good.
Jas
A friend's family lived in SV. When their 3 year old daughter started acting like an American kid and trash talking her grandfather and the 10 year old daughter wanted to leave the house dressed up in the Britney Spears tart outfit, the parents said enough and moved the family back to India.
Don't blame the parents at all.
Schools are better over there anyway.
NorkaWest | 11.16.08 - 12:58 pm | # :
SO TRUE! I love how parents raise little boys to look and act like little girls in SV. Long hair, no conflict allowed, no toy guns, etc. I've seen it first hand lots of times.
I almost took an entry-level management job in Mountain View, and I'm almost happy that they low-balled me with a 100k/year offer (which is virtually equivalent to minimum wage for a family of 4 with stay-at-home Mom with $3000/mo rent). Needless to say, I told them that the offer was insulting, and that they would be happier hiring an H-1B worker.
The philosophy behind the 100k offer was that my wife would also be making 100k, so then we would be able to survive. This household income model is virtually assumed in the Bay area, and screw the kids.
Eating babies? That's not a very swift idea, IMHO.
citizen energyecon writes:
"If the world loses its taste for US debt, then there will be a dramatic increase interest rates on Treasury debt, monetization (aka printing) or some combination thereof...anyone else see another outcome?
The challenge is we have dramatically increased the total debt, and done a huge proportion of it on a very short term basis. So we need to keep rolling it short term or when it comes due roll it into longer term debt. However, the latest offering of 30 year bonds went poorly..."
A lot of the new funding is needed to finance the purchases of private sector liabilities, which are short term. It makes sense to use short term paper to do that. If the economy starts growing again, private sector credit creation will also be working, and so the financing arrangements can be run off (along with the debt used to finance the purchases).
If the economy does not grow again, nobody in the bond market will really worry about funding the U.S. deficit. The only debt that investors will want is that issued by the U.S. Treasury. Sure, they may be plenty of people outside the market worried about financing, but most of those expert forecasters were expecting 10-year Treasury yields to be 7% or so right about now.
As for the foreigners, they are only needed for funding the deficit if the U.S. is running a current account deficit. And, by the mathematical definition (known as an "accounting identity" in the jargon), if there's a current account deficit, there must be foreign savings flowing into the U.S.
If foreigners do not want to fund the U.S. current account deficit, they have to figure out where else they can send their exports, or else deal with a massive growth collapse as their trade surplus swings to a deficit.
I'm not saying that a funding crisis is impossible, but you have to think very carefully about what the funding crisis implies about savings flows. What alternatives are out there that will take absorb cash flows? Are foreigners willing to give up on their export-led growth strategies, especially in the current environment? Can oil producers thrive without their largest market?
Unfortunately, I have to run, so I can't respond to follow ups.
Get in my belly!
This can be said for squirrels too:
Austin Powers- Get In My Belly!
YouTube -
"Show me some of those 12% 13-week bills and deflation."
There's another effect that 12% bills would have, at least short term. Long term, I'm not clever enough to say; too complex a series of connections.
That effect is on the market value of the entire outstanding debt. "Duration" (not maturity) is a measure of dP/dy, where P is price-value of a bond, and y is the yield. Duration is, for typical longer maturities, about half to third of maturity, expressed in years.
So say yields jump 8%, and the duration of the term part of the debt is 4. Then, the change in the market value of the term debt is -32%.
So, holders of the term debt have some incentives to not have those yields jump too much, but also, if there is risk of this kind of thing due to the short end of the curve, it's harder to sell term debt.
Remember last week there was a failed 30yr Treasury reoffer? A report someone posted on this blog said it was surprising in light of the previous "appetite for duration."
You guys may well be right on top of why that appetite seems to be less ravenous.
Re: In the span of just a few weeks, orders for both business and consumer tech products have collapsed, and technology companies have begun laying off workers. The plunge is so severe that some executives are comparing it with the dot-com bust in 2000, when hundreds of companies disappeared and Silicon Valley lost nearly a fifth of its jobs.
Cisco to $5
On the front page -- above the fold! -- of a UK paper there is this gem: "Brown argues for coordinated attempt to reinflate global economy by cutting taxes and interest rates"
Latest news, comment and reviews from the Guardian |
guardian.co.uk
Austin Tex.
looks like nobody has picked up that post of the gold short squeeze coming into play. Based on mp stating that he is currently holding gold but is not happy about tells me (confirming a short term buy signal) that a spike appears imminent.
With tomorrow being a sad redemption song for the hedge funds forced liquidations, might be a straddle on gold situation...
Adustin Tex wrote
...if you want to take delivery, all you have to do is hold (the gold contract) after the notice day and wait.
towards the end of the contract's life, if there are "stubborn" longs, then their counterparties either have to find gold to deliver, or the price will be bid up to where the long will be pursuaded to take the higher (maybe much higher) price....
But there is never a default, because of the basic way the market clears itself.
Austin Tex | 11.16.08 - 12:51 pm |
Austin Tex
are you certain that there will be a physical delivery of gold from the short to the long contract holder???
i'm ignorant but i'm beginning to believe that in this market, the guy holding the short end will settle, with cash in an amount equal to spot at the time of expiration.
are you certain physical metal will be delivered?
Talk about CROOKS! Now Paulson and his mini-me want to use the bailout money for the Credit Card industry.
Note that CC's are unsecured, and without our tax dollars, the CC companies would have to take it in the shorts.
Meanwhile, mortgages are secured by property they can repossess. We have people who CAN PAY all of their obligations and avoid foreclosure IF THEY COULD REFI to a 30y fixed at the current market rate.
A Hardship Letter to Countrywide – A Family on the Brink of Disaster « Your Mortgage or Your Life…
There is no incentive for them to do so - they will make more money in the long run by stealing our tax dollars and our homes.
Message to Distressed Borrowers: You Have to Help Yourselves « Your Mortgage or Your Life…
Time to pick up the pitchforks everybody - the Oligarchy needs a reset and a recast - then some serious modification.
Mike in Long Island writes:
PeakVT,
I responded to your questions in the other thread..
Such a detailed post! So good of you to make it. Thanks!
Talk about CROOKS! Now Paulson and his mini-me want to use the bailout money for the Credit Card industry.
Taxpayers use credit cards to buy crap, and then bail out the credit cards that hold the IOUs.
Hilarious. Taxpayers bail out themselves.
Did any of you crazy bastards see this:
FDIC Loss Sharing Proposal to Promote Affordable Loan Modifications
FDIC: FDIC Loss Sharing Proposal to Promote Affordable Loan Modifications
Basic Structure and Scope of Proposal
This proposal is designed to promote wider adoption of such a systematic loan modification program:
by paying servicers $1,000 to cover expenses for each loan modified according to the required standards; and
sharing up to 50% of losses incurred if a modified loan should subsequently re-default
Hmmmmm??
bond guy,
Few days back there was lot of discussion around this denniger post. What are your thoughts? Is this the first time something like this has happened?
How Do You Spell "Liquidity Trap"? - The Market Ticker
Thanks!
"are you certain physical metal will be delivered?"
The short is the one who announces intent to deliver. If he cannot deliver, he must exit the contract before expiration. His clearing broker can force him to post full margin (marked to market) after notice day, and if he doesn't, the clearing broker can buy him in "at the market".
But if the only long's left are stubborn and there is no ask side, then the market price rises until so far above the (real) market price that the longs are pursuaded that a couple hundred an ounce over physical spot is worth giving up the dream of a shiny bar coming by insured express delivery.
UnhappyCakeEater,
You are on to something, my good man! I hear Irish babies taste best.
Re: sharing up to 50% of losses incurred if a modified loan should subsequently re-default
50% of re-defaults fail, so, like ahhh, is thus a good idea, or are they just delaying the reality that someone making $8.00 an hour can't make a payment on a house that has a mortgage of $1000+
Re: I hear Irish babies taste best
I hear, Icelandic babies
White wine with blondes?
crispy&cole writes:
List of future jingle mailers:
Ouch!
I cannot take any schadenfreude as my company has a layoff scheduled 2Q2009. We're not going onto that list until the last minute.
And what is with companies laying off one? You know that isn't pure economics. What is with Boeing doing so many tiny layoffs too? I know its department by department... but they should just announce one layoff. Multiple mini-layoffs scare the workforce.
Got Popcorn?
Neil
Still time to order Fresh, delicious Belgian chocolate turkeys
Dark Chocolate Turkeys -Candy Turkey - Milk Chocolate Turkey
Hoopajoops LTD writes:
Nobody will ever say the magic word "Principal Reduction." It's the painful, sole solution that will help, but greed stops us from using it.
Hoopajoops LTD | 11.16.08 - 11:11 am | #
How about the magic phrase, "stupid is as stupid does"...shouldn't have bought a house you couldn't afford or shouldn't sign a contract you don't understand unless you're represented by a lawyer. Excuses, excuses.
Oh man, that Gretchen. Where to begin? With the notion that "falling home prices" are the problem? Or with the idea that the MBS containing Alt-A's are correctly valued at 65 cents on the dollar? Or maybe with the notion that Alt-A homedebtors will be substantially more capable of handling their "homes" purchased if they get a 6.15 percent 30-y fixed, than at present. Every facet of this plan is fantastic.
I am hearing 90,000 job cuts by C in next 3 weeks
IS THIS TRUE ?
But there is never a default, because of the basic way the market clears itself.
Austin Tex | 11.16.08 - 12:51 pm
Not yet, so far. Doubt that the system is sound enough to withstand a stubborn test.
As we've pointed out before, the total gold known in the world wouldn't fill up a huge space. And there's even less silver than that.
The whole system is strung out like a junkie chasing the rush.
REBear - the TAF auction fail has had about a dozen people posting here since Thursday night.
It's very much Houston we have a problem. That is why Setser, Energyecon, me and others have been tracking the rollover $500bil +.
My own pet poodle is the total of AAA coming on market, abt $1T, and where the other side of the trade is, why the long bond invert etc etc.
Sound of crickets.
CC
bond guy writes:
If foreigners do not want to fund the U.S. current account deficit, they have to figure out where else they can send their exports,...
xlated from german Wikipedia :
In 2007 only ca. 15% of the german exports went outside the EU, of these ca. 8% to the US.
So you see, as seen from e.g. Germany, the US is fairly irrelevant .
OT - check out Mish on G20. Most excellent.
Go direct or via Yves.
CC
bond guy,
Key points that are aligned with MLM's observation on 'status quo' rolling of T debt - the petrodollar recycling from the ME and the mercantile recycling from China are being diminished by falling commodity prices and cratering consumer demand - now competing places for dollars to go are emerging with domestic funding priorities emerging in both locales...ME domestic bailout requirements and Chinese stimulus needs may grow with time.
Additionally, the size of the US borrowings appear set only to increase, perhaps at the exponential pace recently experienced...seems like a collision in the making.
re: taxpayers bail themselves out
reminds me of wage garnishment. take it out before the deadbeat has a chance to spend it. Only now, companies have figured out that treasury is an even richer vein.
what happens when 10% or more are unemployed, companies have tax exempted themselves, and there is no tax base from which to draw? are these guys cutting their own throats?
TARP vs. NASA, WWII, etc.: Big Budget Events - CNBC
Fилгоy writes:
I am hearing 90,000 job cuts by C in next 3 weeks
Think that number's on the high side. Still, Citi is in deep doo doo since their oil squeeze unraveled. We're gonna need a bigger bucket....
--
"On the other hand, your interpersonal skills could use help..."
Anonymous,
You mean the communications skills employed by those who BREED dopes?!!!!!!!!! How smart and wonderful American People are? How great our system of democracy is?
If dopes like your communications skills you are a liar, a deceivers, or just a bad communicator trying to be polite.
The best validation that you are telling the truth in plain English is when dopes are offended, they start to harass you, attack you, and even go as far as requesting a ban.
From the responses here, I must be telling the truth in plain English. Dupes, dopes, crooks, evildoers, etc., are all plain English words and they exist for a reason.
I AM on the message. Please ignore if you don't like my message and the supporting commentaries.
Jas
--
"It's [Silly.con Valley] dope heaven, where everyone is a dope!"
Anonymous,
By galley, you almost got it! Some are Crooks and they know how to manage and use dopes.
Jas
The boss has our schedule for the afternoon, and fail to deliver on my part is not an option.
Austin: YEs, I'm afraid of my wife too.
I'm of the opinion, shared by others more well informed than me, that there's not enough gold to effect delivery if demanded. Same for silver. Do the math, and it will become suspiciously familiar for the set up of a significant short squeeze.
Don't flinch when it happens.
Jas Jain(Irritating) writes:
I AM on the message. Please ignore if you don't like my message and the supporting commentaries.
What's the matter, you can dish out dopiness but you can't take it?
What a dope.
AT
thanks. im lernin
MT
Jas Jain writes:
When it comes to my holdings of US Treasuries I don't need any help from dopes.
When I read something like that, the first thought that pops through my head is: Man, I hope the US defaults, just to stick it to that guy.
There's growling in the background; it's not the dogs, but here's a link on the delivery process of Comex gold. Just scanned it, but it looks good.
http://www.resourceinvestor.com/pebble.asp?relid=47347
The closest any world leader will get to Barack Obama this weekend is if they meet Madeleine Albright and Jim Leach - the two Obama transition "surrogates" who have been deputed to stand in for the president-elect during the G20 summit.
Neither the former secretary of state nor the former Republican congressman is close to Mr Obama. But that is partly the point. Since his election 11 days ago, the president-elect has repeatedly said there is "only one president at a time".
FT.com / UK - Obama conspicuous by absence at G20 meeting
James A Leach:
"The legislation he is perhaps best known for is the 1999 Gramm-Leach-Bliley Act, one of the seminal pieces of banking legislation of the 20th century."
Jim Leach - Wikipedia, the free encyclopedia
Also responsible for the Enron loophole. A little ironic he sent the same guy who pushed this through the house. Even though he wants this loop hole closed.
I am starting to lose that loving feeling I enjoyed 12 days ago.
Obama calls for closing 'Enron loophole' - First Read - msnbc.com
--
OT but topical...
WLI Growth Falling at Fastest Pace in 60 Yrs
Reuters November 14, 2008
ECRI | News | Media Coverage
The Economic Cycle Research Institute, a New York-based independent forecasting group, said the annualized growth rate of its Weekly Leading Index slid from minus 24.6 percent to negative 25.9 percent, its historic lowest, according to ECRI data recorded since January 1949. "With WLI growth continuing to plumb new lows, not only is no economic recovery on the horizon, but the economy is falling off a cliff at its fastest pace in at least six decades," said Lakshman Achuthan, managing director at ECRI.
In January 1949 the US economy was in a recession that was continuation of the Great Depression (intruppted only by the WW II). Nothing can prevent, or postpone, the Greater Deoression in the US from the current condtions.
Jas
The 60 Minute Chart shows the Dow has been rejected at clear resistance at 8,900 several times over the last week of trading. This level is a clear "line in the sand" between Bulls and Bears at this time. Given today's stern rejection at this level, we could see another drop back toward the 8,000 level for another major test of support.
Didn't a mouse say, "rally"?
"Of course some mortgages in the U.S. are recourse too, but historically U.S. lenders have rarely pursued homeowners for any losses."
Those with recourse are aggressively pursuing homeowners now.
@Lawyerliz - Most lenders of mortgages in Florida have recourse.
Jas Jain(Irritating) writes:
OT but topical...
"OT but topical..." is for dopes. You are now manifestly one of them.
energyecon -
Bond guy's point is that any dollars sent to the ME or China have to end up back here somehow (unless they take delivery of stacks of $100's and put them in a vault somewhere). If they want to build infrastructure with our dollars, they need to buy some U.S. produced infrastructure thingies with those dollars. But then the dollars have returned via the thingie production company.
I think bond guy is way too sanguine about global exporters being willing to keep sending us their crap if we're looking more and more like a shaky credit risk. And crap demand is already falling from this end anyway.
Wonder if a more productive way to look at this is noting that fewer dollars are flowing in general, and the places they are flowing are less likely to be T buyers.
Mish is good today, which is weird.
The G-20 leaders, representing 90 percent of the world economy, blamed the crisis on investors who "sought higher yields without an adequate appreciation of the risks."
My Comment: Banks and brokerage packages sold poison apples. The G-20 is blaming those who bought poison apples not those who knowingly sold poison apples.
Thank you Jas,
Now that I know I was born in "a recession that was continuation of the Great Depression (intruppted only by the WW II)" I feel proud to be a Great Depression baby. Gives me some status for the Greater Depression, I feel.
People just aren't angry enough. Where is the outrage? The greatest financial swindle in history is taking place and American's take it lying down.
The Fed, Treasury and CONgress are bailing out the wealthy on the backs of the majority not to mention our children and grandchildren.
What a sham.
Counterpointer,
Thanks
I just saw energyecon's blog. Its time to evade falling debris.
Elizabeth Warren is now one of five appointees to oversee the tarp. This is relatively good news. We'll see if the oversight board actually exercises any power.
The Crypt: Pelosi, Reid name members of TARP oversight - Politico.com
Jas Jain(Excellent) writes:
You mean the communications skills employed by those who BREED dopes?!!!!!!!!! How smart and wonderful American People are? How great our system of democracy is?
No Jas, the kind where your insight produces policies.
I completely agree with so much of your criticism. Now what. Events are taking their course. Even the dopes get the point. Now what. You're so right, now what does Jas say we should do?
The best validation that you are telling the truth in plain English is when dopes are offended, they start to harass you, attack you, and even go as far as requesting a ban.
Dude you are just slightly more tolerable than the right-wing ranters. Please go beyond I told you so. You most assuredly did.
This is when gentlemen of heroic mien and good character show their talents as administrators and advisors. You are smart and articulate enough to make something of yourself. This is opportunity knocking, Jas.
You're so right, now what does Jas say we should do?
Jas, Mr Dopey McDope himself, says that we should all run out and develop interpersonal skills before we are consumed in a tidal wave of dopiness.
If you guys would stop quoting him, the rest of us wouldn't have to read what he says anymore. I've got the message. He thinks I'm a dope. No more cycles need to be wasted on it/him.
Many countries pay for their imports not in their home currencies.
What will prevent China and Petro-states from asking their US customers to begin to pay in a basket of currencies - USD, EUR, JPY, RMB to begin with (yes, I know, the US-pegged RMB is a funny one, but it could be a matter of principle for China).
That will take care of current account problem.
I not saying they will, I am just saying they might...
I've got the message. He thinks I'm a dope.
Jas McDope, Master of Interpersonal Skillz, calls the kettle black. Now THAT's a dope!
"I feel proud to be a Great Depression baby."
I really was born in the 30s, but too far into them to remember the GD. I can testify though that many people who can remember them have never really recovered. My mother, in her 90s and in a retirement home, still frets about her savings and the banks, although she has quite enough to last comfortably for years. It's a kind of chronic anxiety disorder that one contracts by having lived through it.
I'll tell you what we should do.
Millions should be demanding accountability from CONgress and the financial community. Equity investors should be zeroed out, NOT bailed out.
So far my numerous attempts to demand justice from my CONgressmen have been a waste of time. We need bigger numbers to reach critical mass. We need millions of angry emails to congress on a daily basis.
Byz - good points. Nice work on DK too.
REBear - whocoodanode that a house of cards would produce debris of a thousand falling knives?
While we're waiting for Asia to open:
YouTube -
CC
I guess there's such thing as too much truth, even in the UK:
Under-fire George Osborne says: 'I was just telling the truth about sterling'
Where's the shadow government when you need it?
"Jas Haters Club" Jas,
Perhaps you could quit grinding the axe. Unless you experience tremendous joy by your endless "born and bred dopes" comments, I suggest posting something productive.
Following layoffs, participation drops in community, social groups, finds UCLA-University of Michigan study
The pain of downsizing extends far beyond laid off workers and the people who depend on their paychecks, according to a new UCLA-University of Michigan, Ann Arbor study.
Even a single involuntary displacement has a lasting impact on a worker's inclination to volunteer and participate in a whole range of social and community groups and organizations, found the study, which appears in the September issue of the international scholarly journal Social Forces.
"What we find is that even just one disruption in employment makes workers significantly less likely to participate in a whole range of social activities from joining book clubs to participating in the PTA and supporting charities," said Jennie E. Brand, a UCLA sociologist and the study's lead author. "After being laid off or downsized, workers are less likely to give back to their community."
Bowling alone because the team got downsized
People will literally need to go hungry or be homeless before you see riots in the street. Good news is this is happening so fast it could be sooner then you think.
REBear writes:
bond guy,
Few days back there was lot of discussion
It also happened to Germany last week..great post on Naked Capitalism yesterday
oh no! It's rubbing off.
"The House is ready to do it," said Democratic Rep. Barney Frank of Massachusetts
Expired
Infrastructure thingies are, ironically, mostly made in China. Or India.
In this video, Karl Denninger catches Kashkari and Congressman Issa admitting that they both knew, before the bailout was passed, that $350 billion of it was already earmarked to bail out
foreign speculators.
The C-Span video where Issa questions Kashkari will appear suddenly in the lower left corner of Denninger's video, the first two minutes of which are quite funny.
--
"Perhaps you could quit grinding the axe. Unless you experience tremendous joy by your endless "born and bred dopes" comments, I suggest posting something productive."
Allen C,
You mean that I should not talk often about the single most important cause of the current Global Crisis?
What is productive in the eyes, or minds, of born-and-bred American dopes is definitely not so in my opinion.
Get used to it or ignore my comments, please.
Jas
Bailing out crap products, volume 23:
10 Cars That Sank Detroit - Rick Newman (usnews.com)
CC
I keep hearing about crappy the U.S. economy is doing and how bad it'll be in the future, but who's doing good? Or at least, who do you guys think will make out and establish themselves in the world economy in the future? Any surprise picks?
"The G-20 is blaming those who bought poison apples not those who knowingly sold poison apples."
We live in a caveat emptor society. Over-selling may have begun as far back as the oldest profession. Imagine the first buyer falling for a tranny. Who would you blame?
In my opinion Cuba should be treated as any other poor soul hard luck nation, but none of my Cuban friends agree.
"Cubans" in Miami are almost all Americans. Don't know if they helped kill Kennedy or not, and they seemed to have stopped terrorist activity Orlando Bosch style, but they are about as open-minded about their former homeland as was the Shah of Iran.
Jas Jain(Irritating) writes:
Get used to it or ignore my comments, please.
Well well well. Look at how Dopey McDope himself instruct others as to how to act with Great Interpersonal Skills.
Huge layoff announcements are coming soon for NGC (NOC) in CA. Not sure why they aren't on the list, unless they don't meet the reporting requirements.
Like many subs, they have 10-12 employees at "sites" co-located at customer locations throughout the country.
Pavel wrote about effects of the depression:
It's a kind of chronic anxiety disorder that one contracts by having lived through it.
I suspect that this disorder isn't limited to only those who lived through the GD. Though I was only 12 years old at the time, the 81/82 recession conditioned me for a lifetime of frugality and anxiety in all matters financial. I will never forget the closing of the city's major employer, seeing my friends' parents out of work for months/years, and the problems that caused. None of the recessions since then left as strong an impression on me - not even the tech bust (and that's my industry).
Well well well. Look at how Dopey McDope himself instruct others as to how to act with Great Interpersonal Skills.
And YOU wonder why he refers to Americans as born and bred dopes?
Always enjoy your comments, Jain. Byzantine_Ruins is right, opportunity knocks. There is a point at which beating the mule only makes it more stubborn and it begins to hate you. Telling the truth is one thing, having the courage to move beyond that and inspire progress is another.
--
"No Jas, the kind where your insight produces policies. I completely agree with so much of your criticism."
Byzantine_Ruins,
Thanks for the kind words, but producing policies in a system totally controlled by evildoers and Crooks? Sorry.
The system must and will collapse and I am not the guy to tell people how to do it and what to do except to plan for personal safety, economically and otherwise. And I am not an expert in safety.
MY JOB IS TO WARN PEOPLE OF THE DANGERS THAT ARE HERE ALREADY.
The causa prima of the dangers are born-and-bred American dopes led by evildoers and Crooks, I dont know how to turn dopes and Crooks into normal thinking and behaving people, got it?
Jas
Jas, constructive time, please.
It's a bit rich you keep posting the FSU homepage when you haven't written anything since April.
Calling dopes is like blasting the barn door with a 12 gauge. Do some real hunting.
CC
I think I'm going to short the S&P heavy this week:
By Rex Nutting, MarketWatch
Last update: 12:38 p.m. EST Nov. 16, 2008 WASHINGTON (MarketWatch) -- Few observers have ever seen anything like the economic data that will be released in the coming week, with the consumer price index and housing starts each expected to breach records dating back to the late 1940s.
Jas,
How about defining normal thinking and behaving?
Good baseline to add a solution context to your comments.
Everyone here is aware of the crisis and many of the causes. How many times can the choir say amen before you broaden your agenda?
Jas,
You remind me of Babu from Seinfeld -
Babu: Quiet!! You shut up! You make me change restaurant, but nobody comes! You say make Pakistani, Babu Bhatt have only Pakistani restaurant. But where are people? You see people? Show me people. There are no people!
Jerry: You know, I think I'll just take the check.
Babu: You bad man! You very very bad man! [leaves]
Jerry thinking: Bad man? Could've my mother been wrong?
Don't shoot Jas, the messenger
re: bond guy's comments.
I agree completely. In the long term there can be a rebalancing of current accounts, but those are the rules for the near term -- which might help resolve some of the hesitation of some people accepting the argument.
On the edge writes:
I think I'm going to short the S&P heavy this week:
It's auto-bailout week in Congress fyi
Jas Jain(Irritating) writes:
MY JOB IS TO WARN PEOPLE OF THE DANGERS THAT ARE HERE ALREADY.
And lord knows that a great master of interpersonal skills like Dopey McDope is the great communicator of ideas.
Another country who's citizens are being crushed due to central fractional reserve banking with fiat money and a corrupt government. Great fun, carry on.
Food banks seeing increased demand
Stats like 80% can't meet demand, doubling of demand
Federal Reserve preparing to layoff thousands at its JP Morgan division
MLM,
I was explicity acknowledging bond guy's point (I thought lol) - just that the torrent of USD is rapidly slowing to both the ME and China - and rather than roll over the Treasury they have other demands on their resources...potentially huge demands. AND the issue is not just rollover, it is huge new borrowings...when the rest of the world is all trying to borrow at the same time.
On the edge writes:
I think I'm going to short the S&P heavy this week:
It's auto-bailout week in Congress fyi
Meaning don't short? I don't think auto-bailout will occur. Obama/Biden resigned, Dems at 49(inc. Bernie and Lieberman), Repubs. at 49. 60 needed for cloture, I don't think the center will hold.
"Great fun, carry on."
You can't cry all of the time. Anyone that has been on this site for the last 20 or so months should have avoided the big hit.
Sorry for the OT crap. Thanks for the informative posts including the govi debt rollover.
Was there a vote for Jas campaign anywhere?
--
"Don't shoot Jas, the messenger"
On the edge,
That would be very un-dope like. Dopes have a need to reveal themselves at every opportunity.
Discrediting the messenger, whose message one doesn't like, is the number one method to counter criticism in America, especially, of America, Americans, in general, and the American system.
Dopes and Crooks are frustrated. They KNOW that America has very serious and incurable problems. Attacking the critics is their way to deal with their frustrations.
Jas
Jas Jain(Irritating) writes:
Dopes have a need to reveal themselves at every opportunity.
This from a dope who doesn't even know the proper usage of the word "paraphrase".
Please don't encourage our local crank. Or talk about him, since ultimately that is what he wants.
Reader comments on a NYT story on rising bankruptcies are worth perusing:
have heard in order for the American economy to be robust and healthy, the average American consumer needs to be teetering on the brink of bankruptcy. What's wrong with this picture?
jmf3210, massachusetts
Downturn Drags More Consumers Into Bankruptcy - Readers' Comments - NYTimes.com
--
Jas, You remind me of Babu from Seinfeld - "
Allen C,
Commenting on my ethnicity is a common ploy to hide bigotry on some blogs. You are a bigot but you wouldnt know that for obvious reasons.
Just challenge my conclusions and leave my ethnicity out of it, please. I realize that that is too much to ask of some people.
Jas
Calling people dopes is evidently intelligent and constructive.
1worldcurrencyyogi writes:
Calling people dopes is evidently intelligent and constructive
True. But, you got to go to the body to get to the head
Just challenge my conclusions and leave my ethnicity out of it, please.
Here's a challenge: Pretend that you learned interpersonal skills in grade school. Or are you such a dope that you forgot them?
"Just challenge my conclusions and leave my ethnicity out of it, please."
Allen C, you are a veddy bad man!
"Just challenge my conclusions and leave my ethnicity out of it, please."
LMAO! Mr "American-born-and-bred dopes" can dish out ethnicity hatred but can't take it.
What a dope.
--
Gang attacks?
What a bunch of cowards engaging in un-gentleman-like behavior. But, that is to be expected.
Americans have lost most of the human qualities; all they have left are technical skills. They will lose that too in due course. America is doomed because Americans are so thoroughly doped by Crooks.
Evidence continues to mount, even on this blog.
Jas
Amazing that a man with a PhD has reduced his vocabulary to around a dozen clauses and fractured syntax.
CC
Once more (sorry),
Jas, I know nothing of your ethnicity and happen to agree with many of your statements. But you go on and on and on and...Maybe we respond to you to assist in your relief. I suspect that you don't have your own blog because no one wants to visit a site that has endless pages of "born and bred dopes."
Angry Saver writes:
People just aren't angry enough. Where is the outrage? The greatest financial swindle in history is taking place and American's take it lying down.
That's right, people aren't angry enough. Yet.
As one of my friends said to me when I was complaining about the imminent bailout bill - "The economy is boring." (Not to the posters here, clearly, but I see her point.) Until it directly effects people in large numbers nothing will happen.
Many of my wife's wide circle of friends are beginning to be laid off - a half dozen so far out of a pool of say 50. These are middle class, single income families, most with young children and a stay-at-home parent. "Now, what about this COBRA thingy?" they're saying, now that they are unemployed and looking into health care. Several of them have pre-existing conditions that will make individual insurance unaffordable or impossible to buy once COBRA runs out. Many are in houses more expensive than was prudent at any time.
In six months or a year, when we know not just a half dozen, but dozens of such people, I think we will start to see outrage. When we are told that we can't have affordable healthcare because we blew the money on bonuses for insolvent, criminal-run banks, we will see real anger. When people who played by the rules have to choose between eating and heating the house, we will have demonstrations. If the long bond blows out and crippling inflation starts, we will have a brutal awakening.
We need overwhelming, immediate, undeniable pain. Only that will wake up the mass of complacent and underinformed Americans. My fear is that by the time that happens America will be ripe for a very bad sort of demagogue to take control.
Americans are so thoroughly doped by Crooks.
Wow. What happened to "Just challenge my conclusions and leave my ethnicity out of it, please."
Why does it bother you when people pick on your native background? and for some reason, you think you should do EXACTLY the same thing?
What are you, a dope?
Comrade Counterpointer (and Mel from previous thread),
Thanks for your suggestions to improve the marketable US Treasury debt plots - they are done - now I will have a late lunch and dig into those Agency stats MrM 'kindly' provided if I have the opportunity.
Mexico
Jas,
The truth you are being shown is difficult to face. I balance between respecting your steadfast approach and pitying you for the obvious need of attention. I'm moving beyond that to disregarding you entirely.
The problem is every new visitor to CR feels the need to respond to your "ababd" commentary. Tiresome.
Find a new message. Please.
Rich
Malaysia.
CC
Jas Jain(Excellent) writes:
MY JOB IS TO WARN PEOPLE OF THE DANGERS THAT ARE HERE ALREADY.
That's great Jas.
I dont know how to turn dopes and Crooks into normal thinking and behaving people, got it?
Well what in the world have you been applying yourself to since you realized the game is rigged and of finite duration? Opportunity is knocking, Jas, and you are investing in Treasuries.
YOU are a dope.
Jas Jain(Irritating) writes:
Just challenge my conclusions and leave my ethnicity out of it, please.
Poor, poor Jas' sensitivities are offended. Let us all shed a tear for the man who spreads ethnic hatred but can't take it.
Let's go to the video tape! Schiff vs. Norman, Laffer, and more: Alea | Must See Video
CC
I thought of Malaysia too. Not so much Mexico like rich said but who knows?
"Mexico"
Doubtful. Too much corruption.
--
"Calling people dopes is evidently intelligent and constructive."
1worldcurrencyyogi,
Calling dopes dopes and giving examples is constructive, no?
Oh, but is offends the guilty? Sorry.
Why would anyone talk about Hitler and Nazis, day in and day out, for some thirteen years during 1933-45? American dopes, American Crooks, and American system are in the same league as threat to the world and most here on this blog. Got it?
Focusing on the root causes and not distracted by saucy details of who screwed whom and in what ways,
Jas
Jas Jain(Irritating) writes:
Why would anyone talk about Hitler and Nazis,
You, who spread ethnic hatred, have no leg to stand on. You are exposed.
Ok Jas, you just did the Full Godwin.
Unbelievable.
CC
Ok Jas(spreader of ethnic hatred), you just did the Full Godwin.
He's too much of a dope to know what you mean.
Five Million Dead and Counting.
The disaster in Congo is all the more tragic because it was utterly avoidable.
The disaster in Congo is all the more tragic because it was utterly avoidable. - By Michael J. Kavanagh - Slate Magazine
The first world comes with a very high cost.
It also happened to Germany last week
Barley,
Thanks for the suggestion. Germans probably need a Dezemberfest to wash away their sorrow.
It's probably Jas telling his Swedish and German girlfriends to dump Euro.
The last Seinfeld episode -
The main characters (born and bred American dopes) are on trial for their selfish and wanton ways. Babu (Jas Jain) shows up to testify against them. "very very bad"
No gangs here. All individuals coming to the same conclusion, I'm afraid. Positive political action entails risk; just ask the Bhutto family. Too easy call everyone a dope.
Babu (Jas Jain) shows up to testify against them. "very very bad"
Careful there. The indian-born dope Jas will castigate you for using his ethnicity by calling you an american-born dope.
Hey Jas, do you know the word "castigate"? Or are you too much of a dope to have that in your vocabulary?
Have you looked up "paraphrase" yet? Or are you too much of a dope to use a web dictionary?
MY JOB IS TO WARN PEOPLE OF THE DANGERS THAT ARE HERE ALREADY.
We want our money back in GLOD!
If I recall correctly, Jas has said he holds plenty of US Treasury Bonds, but apparently he doesn't realize that the repayment of those bonds relies on the full faith and credit of "born and bred American dopes."
"Babu (Jas Jain) shows up to testify against them. "very very bad""
Babu was Pakistani...
Babu was Pakistani...
I thought that was the point. (Can you think of a better way to torque an indian-born purveyor of ethnic hatred?)
"Can you think of a better way to torque an Indian-born purveyor of ethnic hatred?"
Suggest that they stick to their caste and get back to work cleaning toilets, and if they do a good job they might come back in their next life as an American Dope?
Suggest that they stick to their caste and get back to work cleaning toilets, and if they do a good job they might come back in their next life as an American Dope?
LOL.
Surely you jest. We've been told repeatedly that the american caste is well beneath the untouchables by the indian purveyor of ethnic hatred.
Jas et al:
Cool it.
Everyone just drop it!!!
I can't GreaseMonkey everyone and Ken's Mortgage Pig is about to puke.
Please move on to another topic.
Sorry CR. I promise not to pick on Babu and contaminate the comments for at least another week.
"Surely you jest."
Of course, just having a little dark humored fun. Perhaps a little severe for a financial blog.
"So you see, as seen from e.g. Germany, the US is fairly irrelevant ."
Tell that to Daimler. Or to their suppliers. Or to my neighbors working at Mercedes. Or the local governments collecting a lot less tax revenue than expected.
I will assume that the same applies to BMW equally.
As for Opel/GM - seems like some of America's problems have long legs.
Maybe Koch can arrange something in his last days in office (he can't expect to stay in office realistically) for thousands of Opel workers - but it seems as if laws (especially those of the EU relating to state subsidies) and regulations (let's just say that handing out billions seems more difficult in practical terms in Hesse than it does in the America of Paulson) prevent him from simply giving a state guarantee to Opel.
Which means that he is likely to be happy to let someone else deal with it..
The German vehicle industry is heading for the 'crash' the Greens wanted in the 1990s - shame that no one listened to the Greens then about shifting the economy, because the crash is coming regardless. As are the economic shifts.
Jas Jain(Excellent) writes:
Gang attacks?
What a bunch of cowards engaging in un-gentleman-like behavior.
A gentleman is more than a tie and table manners.
Citizenship in a Republic is a public office. Screaming about dopes is not living up to the public obligation of your Citizenship oath.
I hereby declare, on oath, that I absolutely and entirely renounce and abjure all allegiance and fidelity to any foreign prince, potentate, state, or sovereignty of whom or which I have heretofore been a subject or citizen; that I will support and defend the Constitution and laws of the United States of America against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I will bear arms on behalf of the United States when required by the law; that I will perform noncombatant service in the Armed Forces of the United States when required by the law; that I will perform work of national importance under civilian direction when required by the law; and that I take this obligation freely without any mental reservation or purpose of evasion; so help me God.
Of course, just having a little dark humored fun.
And by doing it on a sunday, hopefully not incredibly disruptive.
Hopefully, it may serve the purpose of getting thru Jas' thick skull that he comes from a country premised on ethnic hatred, and that he's the biggest dope of all by propagating that hatred.
But probably not. He's too much of a dope.
@Peak-
I would like to add to Mike's very thorough answers a general consideration for Mutuals and ETFs:
ETFs may exhibit some of the characteristics of some derivative debt instruments. Depending on the fund, you are essentially trading on very complex claims of claims on claims. If that makes any sense:)
Look, it's hard enough to pore over some of the annuals these days. Multiply that by the number and type of assets under the fund and throw in some market dynamics and it just gets too hard to "price" these things intelligently.
Operationally akin to gambling to me. Plus, I'd have to worry every day about the admins not blowing up the funds.
/yuck
@AustinTex:
That was another good "roundup" on COMEX. It doesn't remove the possibility of failure, but large spreads do help cushion the blow.
"I'd have to worry every day about the admins not blowing up the funds."
Is there no oversight of the actual securities involved?
I have a few of these, shorting the dollar and long on commodities, that I keep as a hedge, and would be disappointed if they were to blow up.
UDN Blackhalo?
Here's an article by Chris Hedges that tends to confirm what Jas Jain is saying.
http://www.alternet.org/mediaculture/106551/forget_red_vs.blue--_it%27s_the_educated_vs._people_easily_fooled_by_propaganda/
Summary:
Millions of Americans live in a non-reality-based belief system informed by childish clichés - they can barely differentiate between lies and truth.
Angry Saver writes:
People just aren't angry enough. Where is the outrage?
It's percolating.When they get hungry enough you'll see the outrage. We'll see how Obama puts his community activist skills to use soon enough
@citizen energyecon
"UDN Blackhalo?"
Yes.
hong konger - Thanks.
Millions of Americans live in a non-reality-based belief system informed by childish clichés
It sounds more like they've been studying Jas. Childish clichés?! That's him all over.
"That's right, people aren't angry enough. Yet."
I think you're right. But people refuse to let go of dreaming of easy money themselves. Friend trying to sell 1 bed in Manhattan, after 1 price drop and 5 months got her first offer...and at 50k below her price, doesn't want to deal. Sent her email with all the financial layoffs coming just this week...still convinced she can hold out for more.
CR has stated that he might suspend the comments. Please, please, do not respond to Jas when he's trolling...it endangers the comments section.
"CR has stated that he might suspend the comments."
I would be sad about that. The comments are my favorite part of the site, particularly during the trading day.
CR is having a reaction to the Paparazzi.
o he's not
It's a cost of success.
He'll decide and we'll accept. Or move on. Registration will dampen the site. A separate 'closed board' will ruin it.
We need to something out of character and be adults.
rent_to_own writes:
...Tell that to Daimler...
Na ja, 8% isn't all that much, is it ? ( was surprised myself, but it shows how Germanys economy is centered in the EU ).
The german car industry has, I think a string of "record" years behind it, so some downturn may anyway be in order. I don't see the situation there as dramatic : extented Christmas holiday, probably some temporary reduction of working hours in early summer. 2009 ? Jobcuts "the german way" : very "sozial-verträglich", i.e. early retirement with 85% of salary, etc. You can live with that.
Now, Opel is definitely a different story. I think there should be absolutely no subsidies before the GM situation is clarified : Money is fungible, subsidies would flow in the front-door and immediately go out the back-door to GM. No way ! After a GM bankruptcy, we can see what should happen to Opel.
Koch may have to deal with that, since he will probably be reelected in a landslide thanks to "Dilettanties" chaos/lies. Have no idea whether Koch is good or bad, but after Ypsilanti probably good.
Medium to longer term, the weight of the car-industry needs to be reduced. Cars are not really "high tech" anymore, a lot of nations can now produce cars (and a lot of stuff is over-engineered. I can live w/o 300 hp & 6-drive automatic). Production technology is a different thing, ties into mechanical engineering, where Germany has a profound and very diverse basis. That segment may roll along for a couple of decades.
As to the Greens, I really am not impressed at all with them . They do not understand physics! Their propaganda goes back to the 70's and I still have not heared anything which makes from a technical point of view sense for a industrialized country. You can not e.g supply a noticeable portion of energy with wind or solar in Germany. The ideas are old and you see the meager fruits : a few windmills (supplying a whopping ca. 1 % of the energy demand, provided the wind blows ) and some roof solar-collectors for warm water to shower or wash your hands.
A couple of years ago, I actually looked into the technical specification of some 3MW windmills and the wind data in the wider area around my little town. 3MW generation capacity sounds good, but unfortuanately you need almost hurrican windspeeds. And you are really surprised to see how steep the generation capacity drops with real-live (top) windspeeds (goes somewhat with the inverse of the square of the windspeed) : I think the conclusion was if you install such a thing on a choise location you will get max 800-400kW (if the wind blows). If you drive on the Autobahn from Stuttgart to München, you actually see some windmills (don't know their rating ) at the edge of the "Alp" (Alpaufstieg) . Just watch how sluggish they usually rotate, if any at all. And that is a prime location!
The Greens should study physics, chemistry, engineering, etc.
Millions of Americans live in a non-reality-based belief system informed by childish clichés - they can barely differentiate between lies and truth.
Being fluent in Japanese, having lived and worked in Japan (in Japanese companies -- not as an ex-pat), and being well-read in the history of WWII and the Japan's conflicts leading up to it -- and of how the Japanese populace was propagandized and socialized into supporting those wars, I can assure you that the same can be said about millions of Japanese, and probably of the people of any nation.
jm,
You are probably right.
But, Americans get to go first in everything -- including being called fools.
http://www.bloomberg.com/apps/news?pid=20601039&sid=atMfvSfyLnUQ&refer=home
<a href="http://www.bloomberg.com/apps/news?pid=20601039&sid=atMfvSfyLnUQ&refer=home>
<a href="http://URL>http://www.bloomberg.com/apps/news?pid=20601039&sid=atMfvSfyLnUQ&refer=home
http://www.bloomberg.com/index.html?Intro=intro3
<a href=">http://www.bloomberg.com/apps/news?pid=20601087&sid=ask7NL3CnYq4&refer=home
<a href="http://www.bloomberg.com>http://www.bloomberg.com/apps/news?pid=20601087&sid=ask7NL3CnYq4&refer=home
http://www.bloomberg.com/apps/news?pid=20601087&sid=aaqH6BETpCoI&refer=home
http://www.bloomberg.com/apps/news?pid=20601087&sid=aaqH6BETpCoI&refer=home"
http://www.youtube.com/user/travisandjonathan
http://www.youtube.com/user/travisandjonathan
http://www.youtube.com/watch?v=rwRqD4Kmiy4