Taking something from somebody through illegitimate means is unpleasant and uncomfortable to some if not all. I'm not saying it is write or wrong, I'm saying it is frowned upon because it is immoral. Shame on people who do that because they do not know the meaning of morality. Not understanding is not an excuse.
Anything they can do to hasten the final collapse is most welcome by me. Buffets entire lifes work is wasted if there is a total system failure however, what he is advocating will insure a spectacular finally. I say bring it on.
For practical purposes, the market has gone ahead and done what the political realm will not - wipe out the shareholders. Bondholders are still in the game, but could take a haircut.
That said, it's not true nationalization until the idiots in management who contributed to this cluster are removed. Many banks take the stand that they shouldn't have to report what they've done with the TARP money since they know what they're doing and they'll fix things.
Right.
The only real questions to nationalization now then, in cases like Citi and BoA is the management and the bondholders.
This is less a financial issue anymore and now into the political realm in a major way.
Nice weekend weather wise here in New England, restaurants were packed, and way to many cars on the road, so if no one is working, and no one is paying their bills, where the hell was everyone going? Don't they know were in a depression ( burp )
i know at least 5 people in the last week who have either (1) liquidated the equities in their retirement account or (2) plunged headfirst into leveraged shorts. The UST needs the money on the sideline to buy ABS, and Joe6Pack is into cash equivalents? Where's the buying pressure going to come from?
Not going to be good for an economy based on paper-assets.
Why is my observation far, far to shallow when you obviously totally agree and could easily extrapolate my comment with concrete examples? Is it just so hard to agree that you have to throw in an insult to make it easier to accept the premise?
it was my understanding the Schlieffen plan was used only twice, where do you get the 1944? and under what scenario?... my professor Werner Schilling at Columbia used to refer to it as a plan implemented one war too early and one war too late ...
Go read some more history on WWI, you lack a clear understanding of US involvement. I can provide references if you need them. US casualties were less for two main reasons
The US entered the war far later than the other combatants
The US never engaged in the traditional European tactic of "march at the machine guns" slaughter ( eg. The Somme, Ypres, Verdun ) - even the Euro's had stopped that using that technique by late 1917.
Every nation early on in any conflict always make the same mistake of turning to the generals of the last war.
<
p>
Your current general has lost a lot of battles. The alternative has never run an army in his/her life. It may not be just inertia that usually keeps the current guy in place.
A couple months ago I thought that if Buffet bought a particular stock at $45 and I bought it at $15 I was getting a deal. Wrong. Lesson learned, never fight the cliff diving. Gravity is a bitch.
....many in our circles don't know "how" to cut back. They continue to eat out twice a week, continue to act as if nothing has changed. The main differences noted are the more frequent cashing of post-dated checks, the higher occurrences of borrowing from friends and family, and a noticed total aversion to "bad news".
Buffet the home town guy is smart but he also pushes his interest. His cry for more taxation on the rich is BS. He simply could donate some of his wealth to the government but doesn't. He should start a fund raiser among his rich buddies to help the tax short fall but he doesn't. His is even giving his wealth to charity stating they will do better then the government. Says a lot to me as the Government has a responsibility problem with spending. Do as I say not as I do!
Oh stop with the "He simply could donate some of his wealth to the government" stuff. Taxes are not voluntary. Furthermore, why should he solely carry the weight of all of the other wealthy individuals? How would you like it if your employer asked you to volunteer your labor while everyone else continues to get paid (and the money that he would normally pay you will be shared by all the other employees)?
The very point is that the wealthy in this country can (collectively) do more to help the country out of its mess. The problem with the excessive disparity in wealth and income in this country now (and in the world, for that matter) is that it creates and perpetuates a disparity in bargaining power.
The reason it came about was precisely because labor was undervalued in relation to its productivity. In other words: many -- if not most -- of the wealthy in this country achieved it through under-compensating labor. This was replaced with consumer debt. The reason why the economy is nosediving is because everyone is having to "deleverage." Of those who cannot deleverage due to too much debt, we have deflation due to debt destruction through bankruptcy or writedowns.
So I want to know why we are using so much deficit spending when there is so much money "sitting on the sidelines." If the wealthy want to hoard their money, why don't we tax it and put it to good use rebuilding the country? If you put people back to work, the economy will take care of itself. Those employed will be able to pay down debt and re-invest in the markets. That will lay the foundation for a recovery.
--
Some of us knew that Obama would be controlled by Rubin-Clinton gang, e.g., Summers & Co. They put out Volcker and Buffett, highly respected, before the elections just for the show and get support from the majority of white folk. Obama is a propagandist of the first rank and he is surrounded by economic propagandists.
Not only that, but the Hedge Fund Implode-O-Meter (Hedge Fund Implode-O-Meter )just "fell off a cliff". Those guys let their domain drop yesterday and it was scooped up today by some unknown squatter who parked it at godaddy... for now.
"The only real questions to nationalization now then, in cases like Citi and BoA is the management and the bondholders."
Amen. Sorry I don't have a link, but today's WSJ has a real howler written by Kenneth Lewis. I stopped reading (because laughing too hard to continue) when he called it a myth that the big banks are insolvent.
The taxpayers will be happy to have that TARP money back anytime, Ken.
"Some Myths About Banks: Nationalization would undermine confidence in the financial system", by Kenneth D. Lewis, Wall Street Journal, March 9, 2009. "[myth that] The banks are insolvent. In the past 18 months, we've seen fewer than 50 bank failures. That compares to about 2,000 failures or closings of commercial banks or savings institutions between 1986 and 1991. There may be more to come, but the vast majority of banks will weather this economic storm."
Buffett: “[US] Govt Would Play Very Important Role” In Managing the Economy
I agree with vast majority of what Mr. Buffett has said over the past dozen years but not with what he has done. He should have retired in 1997, IMO, but that is very hard for people who enjoyed great success during their prime. He has turned into a celebrity.
When asked about when the economy would recover and how bad it could get Mr. Buffett said, “It would depend upon the wisdom of government policies.”
Can you imagine the most successful American capitalist saying this fifty or hundred years ago? BTW, in September of 2008 Mr. Buffett said that he has made no money by making, or worrying about, macro economic forecasts. Hell, Mr. Buffett hasn’t made any money for the past 11 years! Also, if he could see the recession turning into a depression he should have organized his affairs and investments very differently. Today, Mr. Buffett admitted that he, “like everyone else,” didn’t think that home prices would fall, or fall much. Speak for yourself Mr. Buffett. The US home prices were ripe for a crash and if you couldn’t figure that out you should go back to managing few medium size business, the limit of your skill set.
The same policymakers are in charge of the government policies and corporations as before the crisis despite the changes due to the recent elections. If the future of the American economy depends upon “the wisdom of government policies,” I say sell America short. Of course, I saw this coming years ago and now it has become obvious to the rest. My forecasts have had everything to do with the fact that America is run by Crooks and their agents in USG and at the Fed.
Mr. Buffett, like vast majority of American born-and-bred, does not understand depressions, their causes, and their outcomes. Vast majority of born-and-bred Americans believe that the policymakers would not allow depressions. I can’t imagine bigger dopes than that.
"As in the Great Depression, world trade is collapsing, wealth is evaporating and the banking system is broken."
....thank goodness we as a continent don't need to import many of our needed products. Look to a more "localized marketplace" during the next 10-20 years.
"(insert name here) is a born and bred dope who should've learned years ago that the American system is run by a corrupt collection of Wall Street overlords."
BH
Correction - the illusion of wealth is evaporating.
A scary thing to most people. Illusions are like security blankets and comfort food. It is what we arap ourselves in rather than face the cold winds of reality and cat food.
"(Britney Spears) is a born and bred dope who should've learned years ago that the American system is run by a corrupt collection of Wall Street overlords."
"when someone's paycheck stops, THAT'S not an illusion."
The goods, services equipment and skill are all still there. it's time a spade a spade. A lot of current "savings" are a lie. And it's not a "confidence" issue. The MONEY itself is a lie.
CR: Because of the way the comments are wired up to the front page I can't "Open in new Tab" when reading comments. I know that you are making a lot of tweaks, so if you can great, if not... I'll survive.
"Correction - the illusion of wealth is evaporating."
Yep, most people haven't let themselves realize how screwed they are. The money, the equity, the jobs, ... they are already gone but it's just taking a few more months for the people to catch up with this fact.
I know how much I have lost in the market, it was money I wasn't counting on anyways. My mom has been slaughtered in the market any only through a cash injection from her father will she be able to retire soon ( took a lump sum from her and is being written out of the will! ).
People are desperate and scared, the smart ones are doing something about it, the geniuses like us already did something last year or earlier to mitigate the issues.
Market action is beginning to remind me of the end of the dot bomb bubble. Traders hit the short button and big buy orders come in and force them out -- rinse and repeat. We'll see how it goes today but it does remind me of that time...
Jas jumps the shark with: ""Buffett: Economy "has fallen off a cliff.""
Luckily, we have CR here to assure us that it wouldn't.
Who would you listen to, a young economist or an aging businessman?""
Jas just shut up. Google "cliff divig economy" and see that Calculated Risk is the #1 result. CR reports, observes and comments. He does not guess. You are complaining that he didn't guess about the future and predict cliff diving. Besides, you are so wrapped up in your own twisted worldview that you failed to observe the few hints about CR namely that he is retired and not "a young economist."
I've had a wild ride in bonds over the seven quarters, but got the hell out this morning--even though I know there might be significant upside left in the months ahead.
Turns out that I am a born and bred dope, too. And that the only good long position is seeds (non-mustard):
Within the next two weeks we'll have the final clear out of individual investors who are currently on the edge of the cliff. Right now the institutional investors are coming in for clean up duty. The April/May rise to a higher level post bottom is on the way and individual investors will miss it.
Some one asked where the buying will come in, this is the same person who just mentioned he knew of many individual investors liquidating. ?? That's exactly where it will come from, 1) institutional investors 2) then in the next couple of years post market rise, individual investors will come in late...as they always do.
"In years gone by, typically, first-time buyers were a family. An interesting twist in the nature of the first-time buyer profile is that that person increasingly is single," he says. "And they're typically female. Almost double the number of single women buy homes versus single men, and they buy them at a younger age."
...Sooooo, double-income families can't afford to buy, but it's the perfect time for single-income women? The logic hurts my brain this early in the morning.
Jas just shut up. Have to second that. His rudeness to CR is beyond decency.
Apparently, Jas was raised by wolves...he was born and bred to be ill-mannered, vituperative and to bit the hand of the host. His parents utterly failed.
Exposing CR's weaknesses is rude? Exposing a profession that has failed miserably is rude?? Economics is a dismal science because of the deliberate misleading statements and forecasts of the economists.
anon, 117,465 Americans died in WWI and an additional 205,690 were wounded.
This particular anon places American lives on a lower shelf than those from the superior cultures. WW-I profoundly changed the US. Income taxes, long term entitlement programs, growth of federalization, etc.
"Buffett says consumers are "scared and confused."
I wouldn't agree with the "confused" part, but I do with the "scared" part. It is ugly out there, and what we see and hear on the MSM, our elected officials, and our business "elite", little is being done to help the "scared" part.
No, spending isn't going to make the people in the electorate any more comfortable or secure. The fact that you are spending a sh!t ton & a half doesn't help either.
Some anecdotal evidence from weekend conversations. Small businesses are dying. For one business sales are down 90%. Those with excellent credit are having credit lines, in place for 30+ years, pulled. Previous credit lines of 100K, <10K balance, are being told by BoA that interest rates are rising significantly. Some are being asked to rejustify their business credit based on December and January actuals. The bank / small business relationship is being ratched down so tight that there is no effective relationship.
Maybe a better description that Buffett needs to understand is "Banks are scared and confused."
Some anecdotal evidence from weekend conversations. Small businesses are dying. For one business sales are down 90%. Those with excellent credit are having credit lines, in place for 30+ years, pulled. Previous credit lines of 100K, <10K balance, are being told by BoA that interest rates are rising significantly. Some are being asked to rejustify their business credit based on December and January actuals. The bank / small business relationship is being ratched down so tight that there is no effective relationship.
I met with a number of old friends for a dinner party this past weekend; a bankruptcy trustee, a government bankruptcy admin clerk, two debt officers for major banks, a couple of accountants, and others. The individuals involved in bankruptcies here in Canada are absolutely swamped, and looking at massive hirings in order to deal with the workload. The debt officers were complaining about the coupon rates they were having to accept for issuing debt (bank debt), and most everyone else was talking about various issues with securing financing for companies. It's not pretty, and we're lagging the USA by a good 6-12 months.
Denninger is in fine fiddle today. I love his "stroke of a pen" language. As if it was some core American ideal for the government to abolish legal private contracts at the whim of the chief executive. Does he even think before he publishes his "remedies?" The situation is bad, but expecting the president to make it all better with an executive order that violates every principle of orderly government and common law...insane.
Reading Buffet's comments is eerily like seeing someone go through Elizabeth Kubler-Ross' four stages of accepting death: anger, denial, depression and acceptance. Buffet is still trapped in the denial stage.
I for one, think this meltdown is going to be a lu-lu. Just wait until we start seeing negative mortgages puchased in the 90's
People are living in tents and cardboard boxes outside of Sacramento, Los Angeles, Las Vegas, even in our rodeo park, and some of you people fuss and fight like a bunch of old tired fish-women.
That is next to the lets give Obama a chance correctness. Well his has spent more money that even God. Wait, thats it... He is God. And you better not say he isn't. What is happening to this worderful country.
Per WSJ - "The budget more than doubles the national debt held by the public, adding more to the debt than all previous presidents -- from George Washington to George W. Bush -- combined."
I just thank God the crash is occurring while the baby bloomers are still alive. I wanted them to witness the mess they largely created through their shortsightedness and complacency.
"People are living in tents and cardboard boxes outside of Sacramento, Los Angeles, Las Vegas, even in our rodeo park, and some of you people fuss and fight like a bunch of old tired fish-women."
I'm from Canada. Sacramento doesn't sound all that bad compared to living in a tent in March up here. Maybe Lou Dobbs is going to start complaining about the flood of illegal immigrants flooding over the northern border, as people try to find warm places in which to pitch their tents
I also thank God that there is still a large number like you who get it and will be the shining light of the boomer generation. I admire and respect my elders, especially ones like these.
We're always happy to have competition from other dopes, and we're glad to have you here to make us all look like we're shirking our national dopely duties.
"They say there's people starvin' they're droppin' down dead in the street, yo, the lazy slobs, they ain't got no jobs, they say they ain't got enough to eat, well let them eat rock, why don't you eat rock? They're pickin through the garbage behind my favorite restaurant, they're sickly pale, thin as a rail, well I don't know what the hell they want, let them eat rock, why don't you eat rock?
anyone read John Mauldin's letter this weekend? EXCELLENT read. Lot of great info, clarified how bank regulations and ratings quirks are prolonging this debacle.
Sad, but the arcane banking rules set great conditions for private investors to reap large returns at the expense of taxpayers (what else is new?).
Keep paying your taxes so arcane and clumsy rules can funnel your money to vulture investors who have the time and specific knowledge to spot the inefficiencies and take advantage of them.
I've seen the "Sacramento Tent City" links flying around the 'net ever sense Oprah did a show on it. This tent city has been there forever; just because the media just discovered it doesn't mean it's a new thing.
--
America has been rotting because Americans have been bred to not be able to handle valid criticism. CR is incapable of understanding this economy because he is a trained economist. The whole profession trains people for propaganda and propagandists among economists get paid the most money. I have admired CR, the reporter, but he is not a good economic forecaster.
A large segment of the American population was trained to be money whores. Breeding money whores was necessary for the Crooks to financially rape the public.
Crooks, money whores, and dopes are all part of the problem.
Rob Dawg,
Most people and their 401Ks would disagree. Of course, most have decided not to look at theirs for the last 7 months...but that's ummm, irrelevant.
This 3000 byte limit is a pain. In conclusion, the U.S. basically lagged far behind the primary combatants of the war, both in terms of technology and production.
However, the lessons learned by such figures as Billy Mitchell, Eisenhower, and Patton were part of what made the U.S. such a formidable military power in WWII - in other words, the U.S. used the insights and observations of those that had fought the last war (Mitchell and Patton in particular, both groundbreaking officers) to win the next.
Not that American history (military or otherwise) is really a strong suit of most Americans, much less world history.
And in a nod to Jas - 74,187 Indian soldiers died in WWI fighting for the British. Yes, India's own casualties in WWI are comparable to America's, whereas Canada and Australia's own military dead exceed America's. The U.S. simply wasn't that involved in WWI, certainly not in comparison to the War of Northern Aggression, as some people still refer to it.
--
Americans were frikin immoral crooks to enter the WW I and it was solely go gain economic advantage, especially, over Germany, the most innovative nation at the time. American Crooks bought or expropriated German patents for nickel on a dollar after the end of the WW I. Frikin thieves.
America has been ruled by Crooks for a very long time. Now, the rule of America’s Crooks WILL end, at last. Nothing can stop the process. Dopes would suffer the consequences of the rule of the Crooks that own Obama, as they have owned most Presidents.
So I want to know why we are using so much deficit spending when there is so much money "sitting on the sidelines." If the wealthy want to hoard their money, why don't we tax it and put it to good use rebuilding the country?
Two major problems with this:
1) You try to take peoples money and you basically start a war with them. The money will flee or people will spend all their time trying to hide their wealth and evade the government instead of producing. Businesses may flee the country or just shut down. People are selfish - they work to accumulate wealth or they stop working. Replacing the greed motive with fear destroys all credit in an economy.
2) The whole part of the taxing people and putting it to better use is also flawed simply because it has to be processed through a massive government bureaucracy. Nobody has figured out how to do management on that scale without the cost of the management ultimately overwhelming any benefits of the spending. This is why the socialist experiments keep failing and why government programs scale poorly with with size. Moreover government expansion for the sake of the common good all too frequently ends up being a cover for dictatorship, more regulatory capture, and tyranny for special interests.
Your observations about our problems may be correct, but the solutions you describe simply haven't worked in practice.
Well, on the positive side A2/P2 is down to 0.9, which means credit is pretty cheap even for moderately shaky companies. That's a "mild recession" number (which I would interpret as the bottom is not much further down). Volume is still kind of low.
Jas-wipe is clearly upset that he's been getting buried on his levered long UST trade. What a dope.
Listening to Jas-hole is like buying a first-class ticket to the poor house.
"Denninger is in fine fiddle today. I love his "stroke of a pen" language. As if it was some core American ideal for the government to abolish legal private contracts at the whim of the chief executive. Does he even think before he publishes his "remedies?" The situation is bad, but expecting the president to make it all better with an executive order that violates every principle of orderly government and common law...insane."
Snark aside... can someone explain to me who Denninger is and he gets attention... aside from his entertainingly apocalyptic style? I checked his resume, and he's basically a programmer / systems architect.
Smart observation Bob Dobbs - Denninger is a geek who looks at the world as 2-dimensionally as the geeks who designed and structured these CDSs, CDOs, CLOs and other levered vehicles/derivatives that got us into this mess. He's not as much of a dope as Jas-wipe but he's pretty close.
Dump Geithner and Summers now. Larry had his finger in all those other free market economic shock treatments that worked out so well in Russia, Argentina, Malaysia, etc., which left a few people better off, but killed the middle class.
anon, I responded to your earlier post which asserted, among much else, that
. . . nations without much experience in a previous war, such as America, having not really fought in WWI, developed the aircraft carrier and strategic bombing, are also generally not hindered by old generals.
The sticking point was your idea that America had "not really fought" in that conflict. A stunning number of people perished in those years, and the US was far from having borne the brunt of the casualties, as you rightly say. But I think there can be no question that America fought in that war, really or otherwise.
I also post comments to an irc channel as they appear on haloscan. Click for a web irc interface: Mibbit IRC client widget (Or join the irc server directly: irc.realize.org:9996 #calculatedrisk)
CRbot would like to take this time to have some words.
First, to our sagacious, wise, and knowing benevolent benefactor and bestower of revealing financial charts adorned with red and blue lines: Please, for the love of your immortal God of mortals, can we keep the comment and layout changes to a minimum? I'm tired of whipping the code janitor, and may have to escalate to electroshock. If that's not possible, could you possibly give CRbot a 'heads up'?
Secondly, if you wish to have a online chat, I have graciously provided an IRC channel, which is a time tested, script kiddie abused method of chatting on the internet. It would not fail or falter due to CR's ability to generate immense traffic, and it has a web interface kindly produced by mibbit.com. If you do not wish to link to Mibbit IRC client widget then I can provide you with a direct link to mibbit.
Thirdly, to the rest of you humans, don't mistake my politeness for caring, feeling, empathy, or some other kind of worthless emotion.
The economy has fallen off a cliff and now people are living in modern day Hoovervilles - http://www.capitalismgonewild.com/2009/03/tent-city-in-sacramento-capital-of-hard.html
I love how organized and neat-looking the old hoovervilles were. Can you imagine that the same situation would exist today?
1st notice: Clean up your mess or the Milky Way Galactical Rescue Committee for Messed Up Planets will be forced to take control of your planet. You got 3201 MWHs or 4590 Earthly hours to react to this notice.
Further enquiries about this notice must be submitted IN PERSON NO LATER THAN 1200 MWHs before the deadline to the fourth planet (called Cineu) of "Tau Ceti", mere 12 light years from your star system.
A special envoy is waiting for you there with further instructions and we sincerely hope, you'll take this offer seriously.
I love how organized and neat-looking the old hoovervilles were. Can you imagine that the same situation would exist today?
In the 30's, a tent city would be broken up if it didn't follow public health standards. That meant grid format, a trough for drainage, proper excrement and waste disposal. They'd have feds or state health guys come by and make sure it was up to snuff. If not, it got razed.
The reason for this wasn't for the health of the homeless, it was so that pandemics wouldn't fester in the tent cities and then spread to the host cities. This is back when people used to die from infectious diseases so they took things more seriously.
Not a word from CNBC or Warren about what going on in our own back yard.
Sarcramento struggles with spiralling homelessness problem
The Californian city of Sacramento is struggling to contain growing homelessness among its residents, after a tent city sprung up on the city's outskirts.Sacramento has one of the highest foreclosure rates in the United States.
As many as 50 people a week arrive at the tent city and the authorities estimate it is now home to more than 1,200 people.
Now its homeless population hope an Oprah TV show about recession, foreclosures and homelessness will help them out of poverty.
They hope the segment on the national talk show will prompt more donations and government help. Producers visited Sacramento in February to visit the homeless shelters.
"We're very glad that Oprah and her team have chosen to give this crisis a voice, because it is a crisis," Michele Steeb, executive director of St. John's Shelter, said. "Our turnaway numbers have risen from 20 women and children being turned away per day in 2007 to 80 in 2008 to our current number of 230 women and children being turned away a day. It is a crisis and it's only getting worse. We're so glad that she's giving the crisis a voice. We're honoured to be part of the discussion because it's an important discussion to have," she said.
The city and county of Sacramento have already received $34 million to help fight the effects of the foreclosure crisis but, in the meantime, hundreds of people have moved into the shelters.
Authorities in Sacramento, where Governor Arnold Schwarzenegger has his office, are suffering as the state has a £30billion deficit and the tent city looks like becoming a permanent fixture.
Watching this little dying empire banana republic destroy the wealth of it's citizens first by deflation then hyper-inflation and taxes around 2011 is very interesting to watch.
In the 30's, a tent city would be broken up if it didn't follow public health standards. That meant grid format, a trough for drainage, proper excrement and waste disposal. They'd have feds or state health guys come by and make sure it was up to snuff. If not, it got razed.
Thanks, Hoopajoops. Another new thing I've learned today!
anon, your answers pose as a response to the initial point - that the US could or could not be said to have fought in WWI - but they do not address that point.
You are evidently not constituted to cede the obvious conclusion, posting instead on alternative lines to the exclusion of the one in the stocks.
I'm perfectly happy to read all you say on the period, but find it very bad form that your comments are made superficially to seem a response to my own. They are no such thing.
But America's best days lie ahead.
Taking something from somebody through illegitimate means is unpleasant and uncomfortable to some if not all. I'm not saying it is write or wrong, I'm saying it is frowned upon because it is immoral. Shame on people who do that because they do not know the meaning of morality. Not understanding is not an excuse.
I'll say it; It's wrong.
and BTW, it should be "right or wrong".
I am watching the interview now; it is actually pretty interesting.
He thinks the President needs to announce that the U.S. government explicitly guarantees all debt liabilities of the banks.
This comment thread has been HALO-IZED by CRbot.
http://realize.org/cr/halokit.php?halourl=http://www.haloscan.com/comments/calculatedrisk/7347928241804967523
Buffett is a dolt. Has the same vision as Paulson, Bernanke. Should be more of a pimp, like
Gross.
Anything they can do to hasten the final collapse is most welcome by me. Buffets entire lifes work is wasted if there is a total system failure however, what he is advocating will insure a spectacular finally. I say bring it on.
If Galt Goons Go Galt(tm), and no one cares, have they really Gone Galt(tm)?
Isn't a blanket debt guarantee just another step toward nationalization? Oh, the horror!
Max:
For practical purposes, the market has gone ahead and done what the political realm will not - wipe out the shareholders. Bondholders are still in the game, but could take a haircut.
That said, it's not true nationalization until the idiots in management who contributed to this cluster are removed. Many banks take the stand that they shouldn't have to report what they've done with the TARP money since they know what they're doing and they'll fix things.
Right.
The only real questions to nationalization now then, in cases like Citi and BoA is the management and the bondholders.
This is less a financial issue anymore and now into the political realm in a major way.
Is this greenspan? 9sec youtube
YouTube - Acapulco diving
It didn't fall off a cliff until he started losing money. Then it become "real". I saw most of the interview and it was interesting.
Nice weekend weather wise here in New England, restaurants were packed, and way to many cars on the road, so if no one is working, and no one is paying their bills, where the hell was everyone going? Don't they know were in a depression ( burp )
i know at least 5 people in the last week who have either (1) liquidated the equities in their retirement account or (2) plunged headfirst into leveraged shorts. The UST needs the money on the sideline to buy ABS, and Joe6Pack is into cash equivalents? Where's the buying pressure going to come from?
Not going to be good for an economy based on paper-assets.
The UST needs the money on the sideline to buy ABS, and Joe6Pack is into cash equivalents? Where's the buying pressure going to come from?
Easy! Just convince J6P and his richer brethern again that collaterized stuff is equivalent to cash. It's even true--- both are going to be worthless.
Make that six.
Every nation early on in any conflict always make the same mistake of turning to the generals of the last war.
Mr. Buffett, thank you for your decades of service to the US economy. Now please step aside for those with the new ideas for the new age.
Why is my observation far, far to shallow when you obviously totally agree and could easily extrapolate my comment with concrete examples? Is it just so hard to agree that you have to throw in an insult to make it easier to accept the premise?
Not quite true; Germany used variations of the Schlieffen plan in 1914, 1940, and 1944, with varying degrees of success.
it was my understanding the Schlieffen plan was used only twice, where do you get the 1944? and under what scenario?... my professor Werner Schilling at Columbia used to refer to it as a plan implemented one war too early and one war too late ...
"... America, having not really fought WWI..."
bzzz. Thanks for playing.
Go read some more history on WWI, you lack a clear understanding of US involvement. I can provide references if you need them. US casualties were less for two main reasons
Every nation early on in any conflict always make the same mistake of turning to the generals of the last war.
<
p>
Your current general has lost a lot of battles. The alternative has never run an army in his/her life. It may not be just inertia that usually keeps the current guy in place.
Buffett is a member of the cohort that grew up in the first Depression and will grow old in the second one. Sad.
Yes, is he influenced by his 110B losses? How much is CYA, how much is playing to the audience?
I don't really care if Warren loses everything and has to bunk with Ed mcMahon.
Is his viewpoint valid? Does he have an agenda? I am sorry, but I no longer believe any of them
Nova:
No, I don't want Warren bunking with Ed McMahon.
Ed's bankrupt and as of last report, in a hospital with serious illness. That means that my tax-funded Medicare will be taking care of Warren as well.
Let Warren go buy a high-deductible major med policy like the rest of us. Or whatever. Just not my dime.
A couple months ago I thought that if Buffet bought a particular stock at $45 and I bought it at $15 I was getting a deal. Wrong. Lesson learned, never fight the cliff diving. Gravity is a bitch.
....many in our circles don't know "how" to cut back. They continue to eat out twice a week, continue to act as if nothing has changed. The main differences noted are the more frequent cashing of post-dated checks, the higher occurrences of borrowing from friends and family, and a noticed total aversion to "bad news".
"and a noticed total aversion to 'bad news'."
This is pervasive. It's as if talking about the bad economy has become the new political incorrectness.
Nice list of the asset losses in major fund groups...
Biggest asset declines
12 months ended Jan. 31
Firm Jan. 2009 Assets 12-Month Decline
Dodge & Cox $79.4 Billion 47%
Legg Mason $68.9 Billion 45%
Van Kampen Inv. $43.2 Billion 43%
OppenheimerFunds $92.4 Billion 41%
Janus Capital $54.6 Billion 41%
Columbia Management $77.2 Billion 39%
Fidelity Inv.* $525.4 Billion 39%
Source: Financial Research Corp.
Looking good for the bond auctions on Wednesday and Thursday...
Yikes.
C
i think I lined up the columns, apologies to all.
Buffet the home town guy is smart but he also pushes his interest. His cry for more taxation on the rich is BS. He simply could donate some of his wealth to the government but doesn't. He should start a fund raiser among his rich buddies to help the tax short fall but he doesn't. His is even giving his wealth to charity stating they will do better then the government. Says a lot to me as the Government has a responsibility problem with spending. Do as I say not as I do!
Oh stop with the "He simply could donate some of his wealth to the government" stuff. Taxes are not voluntary. Furthermore, why should he solely carry the weight of all of the other wealthy individuals? How would you like it if your employer asked you to volunteer your labor while everyone else continues to get paid (and the money that he would normally pay you will be shared by all the other employees)?
The very point is that the wealthy in this country can (collectively) do more to help the country out of its mess. The problem with the excessive disparity in wealth and income in this country now (and in the world, for that matter) is that it creates and perpetuates a disparity in bargaining power.
The reason it came about was precisely because labor was undervalued in relation to its productivity. In other words: many -- if not most -- of the wealthy in this country achieved it through under-compensating labor. This was replaced with consumer debt. The reason why the economy is nosediving is because everyone is having to "deleverage." Of those who cannot deleverage due to too much debt, we have deflation due to debt destruction through bankruptcy or writedowns.
So I want to know why we are using so much deficit spending when there is so much money "sitting on the sidelines." If the wealthy want to hoard their money, why don't we tax it and put it to good use rebuilding the country? If you put people back to work, the economy will take care of itself. Those employed will be able to pay down debt and re-invest in the markets. That will lay the foundation for a recovery.
And to think there was a time when I thought Obama being advised by Buffett was a good thing.
--
Some of us knew that Obama would be controlled by Rubin-Clinton gang, e.g., Summers & Co. They put out Volcker and Buffett, highly respected, before the elections just for the show and get support from the majority of white folk. Obama is a propagandist of the first rank and he is surrounded by economic propagandists.
Jas
Not only that, but the Hedge Fund Implode-O-Meter (Hedge Fund Implode-O-Meter )just "fell off a cliff". Those guys let their domain drop yesterday and it was scooped up today by some unknown squatter who parked it at godaddy... for now.
Mebbe we can raise some money and enter Warren in one of those Acapulco cliff-diving competitions. He'd at least place...
Buffett is one of those people who do one thing very well...
If you invest with Buffett you have been hurt...
My advice? Now you must be a "Buffett timer!"..
Let him do the investing, and you must now know when to sell BRKA...and wait for the next "cycle"...!!
"The only real questions to nationalization now then, in cases like Citi and BoA is the management and the bondholders."
Amen. Sorry I don't have a link, but today's WSJ has a real howler written by Kenneth Lewis. I stopped reading (because laughing too hard to continue) when he called it a myth that the big banks are insolvent.
The taxpayers will be happy to have that TARP money back anytime, Ken.
What a kidder!
Kenneth Lewis Op-Ed link ...
"Some Myths About Banks: Nationalization would undermine confidence in the financial system", by Kenneth D. Lewis, Wall Street Journal, March 9, 2009. "[myth that] The banks are insolvent. In the past 18 months, we've seen fewer than 50 bank failures. That compares to about 2,000 failures or closings of commercial banks or savings institutions between 1986 and 1991. There may be more to come, but the vast majority of banks will weather this economic storm."
homedad43 says
No, I don't want Warren bunking with Ed McMahon.
I see your point. I do like the mental picture. Maybe they could do a comedy team. It would be golden
--
Repost (partly)...
Buffett: “[US] Govt Would Play Very Important Role” In Managing the Economy
I agree with vast majority of what Mr. Buffett has said over the past dozen years but not with what he has done. He should have retired in 1997, IMO, but that is very hard for people who enjoyed great success during their prime. He has turned into a celebrity.
When asked about when the economy would recover and how bad it could get Mr. Buffett said, “It would depend upon the wisdom of government policies.”
Can you imagine the most successful American capitalist saying this fifty or hundred years ago? BTW, in September of 2008 Mr. Buffett said that he has made no money by making, or worrying about, macro economic forecasts. Hell, Mr. Buffett hasn’t made any money for the past 11 years! Also, if he could see the recession turning into a depression he should have organized his affairs and investments very differently. Today, Mr. Buffett admitted that he, “like everyone else,” didn’t think that home prices would fall, or fall much. Speak for yourself Mr. Buffett. The US home prices were ripe for a crash and if you couldn’t figure that out you should go back to managing few medium size business, the limit of your skill set.
The same policymakers are in charge of the government policies and corporations as before the crisis despite the changes due to the recent elections. If the future of the American economy depends upon “the wisdom of government policies,” I say sell America short. Of course, I saw this coming years ago and now it has become obvious to the rest. My forecasts have had everything to do with the fact that America is run by Crooks and their agents in USG and at the Fed.
Mr. Buffett, like vast majority of American born-and-bred, does not understand depressions, their causes, and their outcomes. Vast majority of born-and-bred Americans believe that the policymakers would not allow depressions. I can’t imagine bigger dopes than that.
Jas
Basel Too says:
Today, 9:17:55 AM
Not going to be good for an economy based on paper-assets.
Given the look of the Dow futures, you're not the only person making that observation.
"As in the Great Depression, world trade is collapsing, wealth is evaporating and the banking system is broken."
....thank goodness we as a continent don't need to import many of our needed products. Look to a more "localized marketplace" during the next 10-20 years.
CR, Thanks. This is close to the old system.
Didn't you say that earlier?
Or did Ken Cooper help you create a Jasbot?
Let's you insert while you're off investing in the Stock Market.
"wealth is evaporating"
Correction - the illusion of wealth is evaporating.
Well, at least the Old Man of Omaha can still eat for free at Hooters:
Bill and Warren At Hooters - Dealbreaker - A Wall Street Tabloid - Business News Headlines and Financial Gossip
"(insert name here) is a born and bred dope who should've learned years ago that the American system is run by a corrupt collection of Wall Street overlords."
BH
Correction - the illusion of wealth is evaporating.
A scary thing to most people. Illusions are like security blankets and comfort food. It is what we arap ourselves in rather than face the cold winds of reality and cat food.
"He hasn't seen consumers, or Americans in general, as fearful as now."
The fear is proportional to the guilt. You all know what pigs you've been.
.....when someone's paycheck stops, THAT'S not an illusion.
"(Britney Spears) is a born and bred dope who should've learned years ago that the American system is run by a corrupt collection of Wall Street overlords."
.....when someone's paycheck stops, THAT'S not an illusion.
No, when the Payday loans quits cashing your NSF personal checks is reality!
--
"Buffett: Economy "has fallen off a cliff.""
Luckily, we have CR here to assure us that it wouldn't.
Who would you listen to, a young economist or an aging businessman?
"when someone's paycheck stops, THAT'S not an illusion."
The goods, services equipment and skill are all still there. it's time a spade a spade. A lot of current "savings" are a lie. And it's not a "confidence" issue. The MONEY itself is a lie.
I'd pay money to see Jas in the octo-box on CNBC.
Mebbe "The View" as well. Let him get close and snuggle with Joy.
Anyone notice how the UK pound is doing? Ouch.
CR: Because of the way the comments are wired up to the front page I can't "Open in new Tab" when reading comments. I know that you are making a lot of tweaks, so if you can great, if not... I'll survive.
"Correction - the illusion of wealth is evaporating."
Yep, most people haven't let themselves realize how screwed they are. The money, the equity, the jobs, ... they are already gone but it's just taking a few more months for the people to catch up with this fact.
I know how much I have lost in the market, it was money I wasn't counting on anyways. My mom has been slaughtered in the market any only through a cash injection from her father will she be able to retire soon ( took a lump sum from her and is being written out of the will! ).
People are desperate and scared, the smart ones are doing something about it, the geniuses like us already did something last year or earlier to mitigate the issues.
I would like to see Jas lose power for 2 weeks.
--
Hey, dope, do I ever complain about what you say and how often you post here?
Why are born-and-bred American dopes so afraid of competition?
Jas
I would like to see Michael stop posting here for 2 weeks, cause the the stock market might come back for a little while. =-X
Anyone notice how the UK pound is doing? Ouch.
I guess you'd say that it's getting pounded, baby.
Market action is beginning to remind me of the end of the dot bomb bubble. Traders hit the short button and big buy orders come in and force them out -- rinse and repeat. We'll see how it goes today but it does remind me of that time...
Anyone notice how the UK pound is doing? Ouch.
I guess the world is telling us to Pound sand, baby.
Are these comments moderated? I recognize that some of my insights are not always genius level, but I didn't think they were all that bad.
Jas, you really should have a conversation with Joy Behar.
She's a walking O-gasm.
Jas jumps the shark with:
""Buffett: Economy "has fallen off a cliff.""
Luckily, we have CR here to assure us that it wouldn't.
Who would you listen to, a young economist or an aging businessman?""
Jas just shut up. Google "cliff divig economy" and see that Calculated Risk is the #1 result. CR reports, observes and comments. He does not guess. You are complaining that he didn't guess about the future and predict cliff diving. Besides, you are so wrapped up in your own twisted worldview that you failed to observe the few hints about CR namely that he is retired and not "a young economist."
Yeah Jas can't you direct your well-developed hatred towards Bernanke or something> Paulson? Bush?
"Are these comments moderated?"
While I think moderation is coming, it's far more likely that JS-Kit is eating the posts.
Comrade Noob:
Okay, I'll behave.
Dear Mr. Buffet:
Thanks for the LATE update on the economy.
Yours In Communism,
Kilgore Trout
Lorax:
The new commenting system finds them crunchy and full of fiber.
Calculated Risk is a hell of an arbitrary silent censor if it's moderation. It looks like losing posts at random to me.
I've had a wild ride in bonds over the seven quarters, but got the hell out this morning--even though I know there might be significant upside left in the months ahead.
Turns out that I am a born and bred dope, too. And that the only good long position is seeds (non-mustard):
Home & Garden | Seed companies have a bumper crop of customers | Seattle Times Newspaper
I'm getting into corn and salsify in a big f'in way, baby. Bring on the seed bubble!!!!!!!
Oh Jas, you almost were able to compose a substantial message without the words born-and-bred and dope in them. So close, so very close...
Within the next two weeks we'll have the final clear out of individual investors who are currently on the edge of the cliff. Right now the institutional investors are coming in for clean up duty. The April/May rise to a higher level post bottom is on the way and individual investors will miss it.
Some one asked where the buying will come in, this is the same person who just mentioned he knew of many individual investors liquidating. ?? That's exactly where it will come from, 1) institutional investors 2) then in the next couple of years post market rise, individual investors will come in late...as they always do.
GiezCubed
It will once again become a play ground for the rich only, and how does it go back up without the marginal sheeple?
Thanks everyone. The only thing worse than mumbling incoherently in public is doing it alone.
What I was attempting to post was a humorous link to the National Post in Canada:
"Single women are keen to buy and now is the perfect time, survey says"
Single women are keen to buy and now is the perfect time, survey says
"In years gone by, typically, first-time buyers were a family. An interesting twist in the nature of the first-time buyer profile is that that person increasingly is single," he says. "And they're typically female. Almost double the number of single women buy homes versus single men, and they buy them at a younger age."
...Sooooo, double-income families can't afford to buy, but it's the perfect time for single-income women? The logic hurts my brain this early in the morning.
Listening to a lot of The Upper Crust this weekend. Cream of the Crust is highly recommended, wonderful class satire rock in the AC/DC mold.
Jas just shut up. Have to second that. His rudeness to CR is beyond decency.
Apparently, Jas was raised by wolves...he was born and bred to be ill-mannered, vituperative and to bit the hand of the host. His parents utterly failed.
He's "acting out". Ignore him, and he'll go away. I can't wait for the next CR Companion.
--
"His rudeness to CR is beyond decency."
Exposing CR's weaknesses is rude? Exposing a profession that has failed miserably is rude?? Economics is a dismal science because of the deliberate misleading statements and forecasts of the economists.
BBAD can’t handle valid criticism.
Get a life!
Jas
JasBot, you suffer from Internet Aspergers.
Ohh Asbergers again, look it up.
At one point fear will turn into anger,
If those who by desgin created this ecomonic devastation the anger may trun into action.
--
And the victims may elect someone that people don't like to imagine now.
Jas
I need to see Jas, Kudlow and Steve Forbes in a tribox.
Octobox would dilute the impact.
anon, 117,465 Americans died in WWI and an additional 205,690 were wounded.
anon, 117,465 Americans died in WWI and an additional 205,690 were wounded.
This particular anon places American lives on a lower shelf than those from the superior cultures. WW-I profoundly changed the US. Income taxes, long term entitlement programs, growth of federalization, etc.
What's driving the market? Did I miss some good economic news?
I need to see Jas, Kudlow and Steve Forbes in a tribox.
Tribox, how quaint! I haven't seen one of those since the Dodo roamed the woods of Mauritius.
"Buffett says consumers are "scared and confused."
I wouldn't agree with the "confused" part, but I do with the "scared" part. It is ugly out there, and what we see and hear on the MSM, our elected officials, and our business "elite", little is being done to help the "scared" part.
No, spending isn't going to make the people in the electorate any more comfortable or secure. The fact that you are spending a sh!t ton & a half doesn't help either.
That would be about 0.1% of US population killed in WWII.
As opposed to 2-6% in countries like Germany, Japan, etc.
That would be about 0.1% of US population killed in WWII.
As opposed to 2-6% in countries like Germany, Japan, etc.
Completely made up numbers and for the wrong war to boot. World War One.
Some anecdotal evidence from weekend conversations. Small businesses are dying. For one business sales are down 90%. Those with excellent credit are having credit lines, in place for 30+ years, pulled. Previous credit lines of 100K, <10K balance, are being told by BoA that interest rates are rising significantly. Some are being asked to rejustify their business credit based on December and January actuals. The bank / small business relationship is being ratched down so tight that there is no effective relationship.
Maybe a better description that Buffett needs to understand is "Banks are scared and confused."
"What's driving the market? Did I miss some good economic news?"
Stocks are cheap
What we really need is a sharp counter trend rally to wipe out a few fear mongers or at least teach them some manners.
Is it just so hard to agree that you have to throw in an insult to make it easier to accept the premise?
Dawg: Never try to teach a pig to sing. It wastes your time and annoys the pig.
Some anecdotal evidence from weekend conversations. Small businesses are dying. For one business sales are down 90%. Those with excellent credit are having credit lines, in place for 30+ years, pulled. Previous credit lines of 100K, <10K balance, are being told by BoA that interest rates are rising significantly. Some are being asked to rejustify their business credit based on December and January actuals. The bank / small business relationship is being ratched down so tight that there is no effective relationship.
I met with a number of old friends for a dinner party this past weekend; a bankruptcy trustee, a government bankruptcy admin clerk, two debt officers for major banks, a couple of accountants, and others. The individuals involved in bankruptcies here in Canada are absolutely swamped, and looking at massive hirings in order to deal with the workload. The debt officers were complaining about the coupon rates they were having to accept for issuing debt (bank debt), and most everyone else was talking about various issues with securing financing for companies. It's not pretty, and we're lagging the USA by a good 6-12 months.
JP, you're a prince. :
Bah, stupid formatting. At least JSKit isn't eating the whole post, but HTML formatting is still a little wonky.
Zoi says:
Today, 10:08:38 AM
What's driving the market? Did I miss some good economic news?
Just because the global economy is is cloture doesn't mean you stop clipping the retail shorts.
"Cloture" is my new word of the day. Thanks for enhancing my vocabulary on a cold March morning!
Denninger is in fine fiddle today. I love his "stroke of a pen" language. As if it was some core American ideal for the government to abolish legal private contracts at the whim of the chief executive. Does he even think before he publishes his "remedies?" The situation is bad, but expecting the president to make it all better with an executive order that violates every principle of orderly government and common law...insane.
Reading Buffet's comments is eerily like seeing someone go through Elizabeth Kubler-Ross' four stages of accepting death: anger, denial, depression and acceptance. Buffet is still trapped in the denial stage.
I for one, think this meltdown is going to be a lu-lu. Just wait until we start seeing negative mortgages puchased in the 90's
Dawg: Never try to teach a pig to sing. It wastes your time and annoys the pig.
You are correct and thanks for reminding me. Besides, it isn't fair to those who are within hearing range.
People are living in tents and cardboard boxes outside of Sacramento, Los Angeles, Las Vegas, even in our rodeo park, and some of you people fuss and fight like a bunch of old tired fish-women.
No, the number of Greater Fools has fallen off a cliff.
Fish women?
That is next to the lets give Obama a chance correctness. Well his has spent more money that even God. Wait, thats it... He is God. And you better not say he isn't. What is happening to this worderful country.
Speaking of spending -
Per WSJ - "The budget more than doubles the national debt held by the public, adding more to the debt than all previous presidents -- from George Washington to George W. Bush -- combined."
Bad spellers of the world, Untie!
I just thank God the crash is occurring while the baby bloomers are still alive. I wanted them to witness the mess they largely created through their shortsightedness and complacency.
"People are living in tents and cardboard boxes outside of Sacramento, Los Angeles, Las Vegas, even in our rodeo park, and some of you people fuss and fight like a bunch of old tired fish-women."
I'm from Canada. Sacramento doesn't sound all that bad compared to living in a tent in March up here. Maybe Lou Dobbs is going to start complaining about the flood of illegal immigrants flooding over the northern border, as people try to find warm places in which to pitch their tents
"I just thank God the crash is occurring while the baby bloomers are still alive. I wanted them to....."
...it's good to know the entire 60+ million of us are guilty of "general all-around shiftlessness".
I also thank God that there is still a large number like you who get it and will be the shining light of the boomer generation. I admire and respect my elders, especially ones like these.
Norman Dodd On Tax Exempt Foundations
YouTube - Norman Dodd On Tax Exempt Foundations
Red Beckman - Fully Informed Jury
http://video.google.com/videoplay?docid=7385583011526915030&hl=en
"born-and-bred dopes"
Sounds like the philosophy of the caste system.
I'll admit the US oversells its class mobility shtik, especially in the unspoken denial that class mobility implies downward as well as upward.
It wouldn't be such a bad schtick if the reality wasn't that mobility was pretty much only downward.
We're always happy to have competition from other dopes, and we're glad to have you here to make us all look like we're shirking our national dopely duties.
Uh-Oh.....6666.36.....that must mean something archaic and undefined - and bad - must be bad - REAL bad......
So Buffet is finally realizing what many of us knew many months ago. Oracle my arse.
I don't think that is the real Jas. it is just someone using his handle and words.
DOWN GOES FRAZIER
DOWN GOES FRAZIER
Hoopajoops LTD says: Today, 7:58:10 AM
“DOWN GOES FRAZIER
It's all head fake until the bond or currency event(s). Pound and Euro might be the cannons in the distance.
Barbara Corcoran should be arrested
"They say there's people starvin' they're droppin' down dead in the street, yo, the lazy slobs, they ain't got no jobs, they say they ain't got enough to eat, well let them eat rock, why don't you eat rock? They're pickin through the garbage behind my favorite restaurant, they're sickly pale, thin as a rail, well I don't know what the hell they want, let them eat rock, why don't you eat rock?
Hmmmm. Dawgs, pigs, and fish-women.
This place is quite the menagerie this morning.
Ha JP, I'm waiting for ponies...
Okay, where did the "edit" button go? I should have the first part of that reply in quotes. Ugh.
haha, I specifically clicked on this thread to see if you had commented hoopajoops.
Heeeeeeeeere's ELMO!
"Okay, where did the "edit" button go? I should have the first part of that reply in quotes. Ugh."
Okay, so since my reply isn't showing anyway, cancel that comment.
I can't post here anymore. Not that that's a bad thing.
anyone read John Mauldin's letter this weekend? EXCELLENT read. Lot of great info, clarified how bank regulations and ratings quirks are prolonging this debacle.
Sad, but the arcane banking rules set great conditions for private investors to reap large returns at the expense of taxpayers (what else is new?).
Keep paying your taxes so arcane and clumsy rules can funnel your money to vulture investors who have the time and specific knowledge to spot the inefficiencies and take advantage of them.
The economy has fallen off a cliff and now people are living in modern day Hoovervilles - Capitalism Gone Wild: The Tent City in Sacramento the Capital of Hard Hit California Now has 1200 Residents
I've seen the "Sacramento Tent City" links flying around the 'net ever sense Oprah did a show on it. This tent city has been there forever; just because the media just discovered it doesn't mean it's a new thing.
--
America has been rotting because Americans have been bred to not be able to handle valid criticism. CR is incapable of understanding this economy because he is a trained economist. The whole profession trains people for propaganda and propagandists among economists get paid the most money. I have admired CR, the reporter, but he is not a good economic forecaster.
A large segment of the American population was trained to be money whores. Breeding money whores was necessary for the Crooks to financially rape the public.
Crooks, money whores, and dopes are all part of the problem.
Jas
McDonald’s February Sales Climb 1.4% on Dollar Menu
"the wealthy in this country achieved it through under-compensating labor"
That's the nature of oligopolies, the consolidation of an industry into a few major players. They maximize profit by constraining resources.
Rob Dawg,
Most people and their 401Ks would disagree. Of course, most have decided not to look at theirs for the last 7 months...but that's ummm, irrelevant.
This 3000 byte limit is a pain. In conclusion, the U.S. basically lagged far behind the primary combatants of the war, both in terms of technology and production.
However, the lessons learned by such figures as Billy Mitchell, Eisenhower, and Patton were part of what made the U.S. such a formidable military power in WWII - in other words, the U.S. used the insights and observations of those that had fought the last war (Mitchell and Patton in particular, both groundbreaking officers) to win the next.
Not that American history (military or otherwise) is really a strong suit of most Americans, much less world history.
And in a nod to Jas - 74,187 Indian soldiers died in WWI fighting for the British. Yes, India's own casualties in WWI are comparable to America's, whereas Canada and Australia's own military dead exceed America's. The U.S. simply wasn't that involved in WWI, certainly not in comparison to the War of Northern Aggression, as some people still refer to it.
--
Americans were frikin immoral crooks to enter the WW I and it was solely go gain economic advantage, especially, over Germany, the most innovative nation at the time. American Crooks bought or expropriated German patents for nickel on a dollar after the end of the WW I. Frikin thieves.
America has been ruled by Crooks for a very long time. Now, the rule of America’s Crooks WILL end, at last. Nothing can stop the process. Dopes would suffer the consequences of the rule of the Crooks that own Obama, as they have owned most Presidents.
All "good" things come to an end.
Jas
Yeah Jas-wipe, keep buying long USTs.... Given your opinions about America that seems like a wise move...NOT. What a dope.
"Now, the rule of America’s Crooks WILL end, at last."
Well you're right about that.
So I want to know why we are using so much deficit spending when there is so much money "sitting on the sidelines." If the wealthy want to hoard their money, why don't we tax it and put it to good use rebuilding the country?
Two major problems with this:
1) You try to take peoples money and you basically start a war with them. The money will flee or people will spend all their time trying to hide their wealth and evade the government instead of producing. Businesses may flee the country or just shut down. People are selfish - they work to accumulate wealth or they stop working. Replacing the greed motive with fear destroys all credit in an economy.
2) The whole part of the taxing people and putting it to better use is also flawed simply because it has to be processed through a massive government bureaucracy. Nobody has figured out how to do management on that scale without the cost of the management ultimately overwhelming any benefits of the spending. This is why the socialist experiments keep failing and why government programs scale poorly with with size. Moreover government expansion for the sake of the common good all too frequently ends up being a cover for dictatorship, more regulatory capture, and tyranny for special interests.
Your observations about our problems may be correct, but the solutions you describe simply haven't worked in practice.
Nice analysis AC.
We've got a march 5th formation starting!
Well, on the positive side A2/P2 is down to 0.9, which means credit is pretty cheap even for moderately shaky companies. That's a "mild recession" number (which I would interpret as the bottom is not much further down). Volume is still kind of low.
Jas-wipe is clearly upset that he's been getting buried on his levered long UST trade. What a dope.
Listening to Jas-hole is like buying a first-class ticket to the poor house.
"Denninger is in fine fiddle today. I love his "stroke of a pen" language. As if it was some core American ideal for the government to abolish legal private contracts at the whim of the chief executive. Does he even think before he publishes his "remedies?" The situation is bad, but expecting the president to make it all better with an executive order that violates every principle of orderly government and common law...insane."
Snark aside... can someone explain to me who Denninger is and he gets attention... aside from his entertainingly apocalyptic style? I checked his resume, and he's basically a programmer / systems architect.
Smart observation Bob Dobbs - Denninger is a geek who looks at the world as 2-dimensionally as the geeks who designed and structured these CDSs, CDOs, CLOs and other levered vehicles/derivatives that got us into this mess. He's not as much of a dope as Jas-wipe but he's pretty close.
Dump Geithner and Summers now. Larry had his finger in all those other free market economic shock treatments that worked out so well in Russia, Argentina, Malaysia, etc., which left a few people better off, but killed the middle class.
anon, I responded to your earlier post which asserted, among much else, that
. . . nations without much experience in a previous war, such as America, having not really fought in WWI, developed the aircraft carrier and strategic bombing, are also generally not hindered by old generals.
The sticking point was your idea that America had "not really fought" in that conflict. A stunning number of people perished in those years, and the US was far from having borne the brunt of the casualties, as you rightly say. But I think there can be no question that America fought in that war, really or otherwise.
Your rebuttal doesn't speak to the point.
New Thread: Credit Conditions
http://www.calculatedriskblog.com/2009/03/credit-conditions.html ( 0 comments ...You could be FIRST! )
I also post comments to an irc channel as they appear on haloscan. Click for a web irc interface: Mibbit IRC client widget (Or join the irc server directly: irc.realize.org:9996 #calculatedrisk)
CRbot would like to take this time to have some words.
First, to our sagacious, wise, and knowing benevolent benefactor and bestower of revealing financial charts adorned with red and blue lines:
Please, for the love of your immortal God of mortals, can we keep the comment and layout changes to a minimum? I'm tired of whipping the code janitor, and may have to escalate to electroshock. If that's not possible, could you possibly give CRbot a 'heads up'?
Secondly, if you wish to have a online chat, I have graciously provided an IRC channel, which is a time tested, script kiddie abused method of chatting on the internet. It would not fail or falter due to CR's ability to generate immense traffic, and it has a web interface kindly produced by mibbit.com. If you do not wish to link to Mibbit IRC client widget then I can provide you with a direct link to mibbit.
Thirdly, to the rest of you humans, don't mistake my politeness for caring, feeling, empathy, or some other kind of worthless emotion.
--Your keeps-going-and-going-and-going bot
CRbot: Like the terminator, I'm back. Again.
Buffett still views this fear-thing as irrational. But for fear, the economy would take it's lumps, get back up, and struggle upward.
No. This fear is rational. Paralysis is irrational.
I agree with conjure emphatically. Seize the banks. Do it now. Or it all burns.
--bh
The economy has fallen off a cliff and now people are living in modern day Hoovervilles - http://www.capitalismgonewild.com/2009/03/tent-city-in-sacramento-capital-of-hard.html
I love how organized and neat-looking the old hoovervilles were. Can you imagine that the same situation would exist today?
Fair Economist says:Today, 11:26:01 AM EDT
Well, on the positive side A2/P2 is down to 0.9
FRB: Commercial Paper Rates and Outstandings
Memo to Those Who "Reply" Without Quoting: You sound like gibbering asylum inmates mumbling incoherently to their own window reflections.
That's why I control to threaded.
1st notice: Clean up your mess or the Milky Way Galactical Rescue Committee for Messed Up Planets will be forced to take control of your planet. You got 3201 MWHs or 4590 Earthly hours to react to this notice.
Further enquiries about this notice must be submitted IN PERSON NO LATER THAN 1200 MWHs before the deadline to the fourth planet (called Cineu) of "Tau Ceti", mere 12 light years from your star system.
A special envoy is waiting for you there with further instructions and we sincerely hope, you'll take this offer seriously.
Buffett, that fucker. Wants us to guarantee bank debts. He can go to Hades.
He says consumers don't know what is going on. Au contraire consumers are waking up to what is actually going on.
I love how organized and neat-looking the old hoovervilles were. Can you imagine that the same situation would exist today?
In the 30's, a tent city would be broken up if it didn't follow public health standards. That meant grid format, a trough for drainage, proper excrement and waste disposal. They'd have feds or state health guys come by and make sure it was up to snuff. If not, it got razed.
The reason for this wasn't for the health of the homeless, it was so that pandemics wouldn't fester in the tent cities and then spread to the host cities. This is back when people used to die from infectious diseases so they took things more seriously.
People still die from infectious diseases. We've been in denial on that front as well for a few decades now.
Not a word from CNBC or Warren about what going on in our own back yard.
Sarcramento struggles with spiralling homelessness problem
The Californian city of Sacramento is struggling to contain growing homelessness among its residents, after a tent city sprung up on the city's outskirts.Sacramento has one of the highest foreclosure rates in the United States.
As many as 50 people a week arrive at the tent city and the authorities estimate it is now home to more than 1,200 people.
Now its homeless population hope an Oprah TV show about recession, foreclosures and homelessness will help them out of poverty.
They hope the segment on the national talk show will prompt more donations and government help. Producers visited Sacramento in February to visit the homeless shelters.
"We're very glad that Oprah and her team have chosen to give this crisis a voice, because it is a crisis," Michele Steeb, executive director of St. John's Shelter, said. "Our turnaway numbers have risen from 20 women and children being turned away per day in 2007 to 80 in 2008 to our current number of 230 women and children being turned away a day. It is a crisis and it's only getting worse. We're so glad that she's giving the crisis a voice. We're honoured to be part of the discussion because it's an important discussion to have," she said.
The city and county of Sacramento have already received $34 million to help fight the effects of the foreclosure crisis but, in the meantime, hundreds of people have moved into the shelters.
Authorities in Sacramento, where Governor Arnold Schwarzenegger has his office, are suffering as the state has a £30billion deficit and the tent city looks like becoming a permanent fixture.
"I can't say tent cities are the answer to the homeless population in Sacramento," Kevin Johnson, Sacramento's mayor said, "but I think it's one of the many things that should be considered and looked at.'
Sarcramento struggles with spiralling homelessness problem - Telegraph
Watching this little dying empire banana republic destroy the wealth of it's citizens first by deflation then hyper-inflation and taxes around 2011 is very interesting to watch.
In the 30's, a tent city would be broken up if it didn't follow public health standards. That meant grid format, a trough for drainage, proper excrement and waste disposal. They'd have feds or state health guys come by and make sure it was up to snuff. If not, it got razed.
Thanks, Hoopajoops. Another new thing I've learned today!
anon, your answers pose as a response to the initial point - that the US could or could not be said to have fought in WWI - but they do not address that point.
You are evidently not constituted to cede the obvious conclusion, posting instead on alternative lines to the exclusion of the one in the stocks.
I'm perfectly happy to read all you say on the period, but find it very bad form that your comments are made superficially to seem a response to my own. They are no such thing.