Seems kinda quiet tonight...maybe people are out trick or treating...
The reason I looked at and mentioned the SEC Report on their failure to uncover Madoff's ponzi scheme was I keep hearing the sentiment that regulators don't know what's going on...that they're 'clueless'..and from jail, Madoff is apparently saying that the SEC was not aware of what was going on...but even a quick glance at the SEC Madoff investigation report and you can see the SEC examiners were very suspicious of Madoff...it appears that even with all the obvious 'red flags' the SEC investigation was not allowed to follow-up or expand and the 'examination' was just closed. I don't think the regulators were 'idiots' or 'clueless'...many questions were left unanswered and Madoff documents weren't delivered but the active investigation or 'examination' was just ended and Madoff walked out..

Ha! A relevant place to post the following...

High street banks to be broken up - Telegraph

This is awesome news. It will bring further credible pressure to countries that refuse to break up the oligarchs. We need to say "Screw your primary dealer status, we're breaking you up and starting a bank for reconstruction and business development".

Lending is contracting in the United States at a rate of 14% / year (link). We'll never get out of this recession and create real jobs unless we can get some real new businesses started.

CalculatedRisk wrote:

And I'm looking forward to the clock change - although it will sure get dark early!
best to all

I'm looking forward to the time change. Mrs. Dawg drags my sorry butt out at 5:30 for a 2-3 mile walk. for some strange reason she wants me to stay alive for a few more years. Its been double dark lately. The Orionoid meteor shower was great last week but I like to see the coyotes on the golf course when I walk.

Rob Dawg wrote:

Mrs. Dawg drags my sorry butt out at 5:30 for a 2-3 mile walk.

That's just not civilized.

Edit: Ah. You meant pm.

energyecon (homepage, profile) wrote (in reply to...) on Sat, 10/31/2009 - 9:42 pm

Being a generalist rocks, though it can be tough to get 'cred' working with boatloads of technical types...quantitative and critical reasoning skills are crucial plus some 'classical liberal education' (in the oldest sense of the term)

thanks for the words of encouragement - math/cs liberal education plus MS (mgmt info sys) here - too many interests, not enough time - I like performing arts too... someday I'll figure out what I want to be when I grow up, but until then the ride is nice.

yagij - to turn your proposition around, what would entice, delude, or inveigle the exhausted and frightened consumer into returning to status quo bubblissime and take on unsustainable debt?

C

Counterpointer wrote:

returning to status quo bubblissime and take on unsustainable debt?

Suckers funneling OPM into it like last time? MBS was so simple. Just need a new abstracted construct, yes?

Counterpointer wrote:

Yes. And that new construct would be...?

Who knows? Come back in 20 years and let the "new derivatives" of tomorrow be born today?
.
Honestly, I'm all for the credit contraction, and since the wages have been under attack for 30+ years and the credit tide goes back out to sea, I think we are in for a huge world of hurt. Did my initial statement come across as if I wanted the debt to stay? What did you infer because I thought I implied that Dat Dare Depression is bearing upon us like a snowball rolling down a snow-covered hill?

Counterpointer (profile) wrote on Sat, 10/31/2009 - 10:38 pm

C

Can we sell the American public on China/India/Brazil? Any way for BBDs to easily play them or emerging markets...

Basel Too wrote:

we could blow asset bubbles in Africa...

Great! Then it will leave us Americans with nothing to export to the rest of the world. We may as well go back to living on subsistence farming...

Bird and fortune? When does fox and hound check in?

It will be interesting to see which is more disruptive; 1st world -> 2nd or 3rd -> 2nd.

RIF,

The MS is a help as well, same same here plus it came from "oil patch ivy league" so to speak - and on the growing up bit, I am working on the thesis that by never exiting the first childhood fully I won't have to worry about a second one!

"Lending is contracting in the United States at a rate of 14% / year"

Shhh, every inflationista worth his salt knows that deflation is impossible in a fiat system.

on a more serious note it will be interesting to see whether they can get the credit engine started again.

Counterpointer wrote:

were some bubblicious IB operations in emerging markets through the late 80s and 90s. And bailouts aplenty when they skrood up.

Yeah, but now that the 1st World IBs are shot and their governments are shot for trying to keep them afloat, who is going to be able to inflate 2nd and 3rd world bubbles? Who is going to bail us out?
.
Waaaaaaaaaaaaaaaaaait a minute...

poic wrote:

whether they can get the credit engine started again.

That is a simple problem! Just gotta find someone with the money to loan first and doesn't mind getting returns via 2nd derivatives...

Comrade Elmer Fudd wrote:

hu haz bail out $?

hu is going to mind China's problems? It won't be Yu that's for sure

energyecon (homepage, profile) wrote (in reply to...) on Sat, 10/31/2009 - 10:59 pm

I am working on the thesis that by never exiting the first childhood fully I won't have to worry about a second one!

Well-said. I feel about the same, really.

"pimp leprechaun"= green shoot?

Nobody said that inflation is totally predicated on oceans of credit- I think you can easily see that Weimar Germany managed to blow bubbles without credit cards, and without much credit for the common man.

As a matter of fact, this is even worse, because we could end up like Iceland, where they have both inflation due to a collapsing currency, and a credit collapse where they can't get loose from their variable interest loans denominated in foreign currency.

So, don't assume that the relationships are mechanical, like clockwork.

Someday this war's gonna end....

For the Africa sub-meme:

YouTube - Afro Celt Sound System - Lovers Of Light

C

Bad news... the recovery might be a little choppy.
Yahoo! 404 - Page Not Found

cool: Slashdot | Plowing Carbon Into the Fields

"A wheat farmer in Australia has eliminated adding fertilizer to his crop by the simple process of injecting the cooled diesel exhaust of his modified tractor into the ground when the wheat is being sown. In doing so he eliminates releasing carbon into the atmosphere and at the same time saves himself up to $500,000 (AUD) that would have been required to fertilize his 3,900 hectares in the traditional way. Yet his crop yields over the last two years have been at least on par with his best yields since 2001. The technique was developed by a Canadian, Gary Lewis of Bio Agtive, and is currently in trial at 100 farms around the world."

EvilHenryPaulson wrote:

The technique was developed by a Canadian, Gary Lewis of Bio Agtive, and is currently in trial at 100 farms around the world.

Wow. Seriously, W-O-W. Now that is an interesting proposition and would cut into quite a few areas of concern such as pollution (air and water/runoff waste from fertilizers) and farming costs. We still have a pesky water supply problem, but that isn't a bad idea!

The adjective you're looking for my dear RiF, is "ludic".

C

EHP,

Hoooboy, that is an intriguiging datapoint:

Adapting methods developed by Canadian farmer Gary Lewis, of BioAgtive Technologies, Mr Linklater spent $20,000 customising equipment that cools the tractor's fumes to 30 degrees then expels them into the soil as gas fertiliser when he sows his crop.

His trials, which are being replicated in Canada, Britain and South Africa, are gaining global attention and are now the focus of scientific research. ''When I heard about it, I listened and the science of it seemed to make sense, but with fertiliser costs at about $1200 to $1500 a tonne, the economics of it got me into gear,'' Mr Linklater says.

Whether that savings of $500,000 was for one year or two, that is an ROI that will have some ears perking up!

Spoil sport: Diesel exhaust air contaminants - Wikipedia, the free encyclopedia

Citizen AllenM wrote:

Nobody said that inflation is totally predicated on oceans of credit- I think you can easily see that Weimar Germany managed to blow bubbles without credit cards, and without much credit for the common man.

Very important point, Allen!

Here is an interesting link, once again from one of my favorite authors: Brian Pretti. He discusses coming state and local government job losses:

Market Observation - Brian Pretti 10.30.2009

.. Although this may not be common knowledge, the bulk of government employees are found at the State and local levels of government. In fact, Federal government employment only accounts for 12.6% of total aggregate government employment as of September 2009-month end. That’s pocket change compared to State and local levels of employment. And of course the current cycle irony is that it’s the State and local governments that are hurting big time under the duress of not only infrastructure, maintenance and support, but pension issues, loss of Federal support payments, etc. The following combo charts puts into perspective for you what local and state employment trends have looked like over the last four decades. Current rate of change weakness relative to prior cycles is indeed meaningful and important to keep in mind ahead. Something no one else appears to be concerned with at the moment. ...

Spoil sport: Diesel exhaust air contaminants - Wikipedia, the free encyclopedia

That's what I was thinking, what about the partial combustion products in the exhaust fumes ? They're not exactly pleasant.
~splat

Hey, thanks for the invite. I'm obviously not the only lurker here who hangs out to read and learn. Yes, this is what I'm doing on Halloween. Very rural, few and far neighbors. We will never have trick-or-treaters here. I kind of miss passing out candy to the rug rats.

Anyway, probably a dumb question, but if you were going to re-fi, would you do it now or wait (hope?) for a future lower rate?

Everything I ever wanted to know but was afraid to ask has been addressed on this blog. (Woody Allen)

dryfly wrote:

we aren't on the gold standard anymore.

can we haz glod standard plz?

yagij wrote:

So whether you inject it into the soil, OR you lay it on the top, it is the same.

Because plants take their food equally from the surface and the soil.

Comrade Elmer Fudd wrote:

at least our debt is denominated in $, they may well be held abroad though

This cycle they are in USD - next cycle I doubt it. Next time inflation won't even be an option. No a good option or bad option - not any kind of option. That is what happens when you borrow denominated to somebody else's currency.

On a brighter note I had a good mountain bike climb this morning. Started in absolute fog where I couldn't see more than 5 feet in front of me. An hour later and 2000 feet higher I was resting no more than 100 feet above the clouds in glorious sunshine and a blue sky. everything below me blanketed in clouds just like when your flying above the clouds.

Really amazing to look at.

You were over by Mt Hamilton, iirc?

EvilHenryPaulson wrote:

cool: Slashdot | Plowing Carbon Into the Fields

"A wheat farmer in Australia has eliminated adding fertilizer to his crop by the simple process of injecting the cooled diesel exhaust of his modified tractor into the ground when the wheat is being sown. In doing so he eliminates releasing carbon into the atmosphere and at the same time saves himself up to $500,000 (AUD) that would have been required to fertilize his 3,900 hectares in the traditional way. Yet his crop yields over the last two years have been at least on par with his best yields since 2001. The technique was developed by a Canadian, Gary Lewis of Bio Agtive, and is currently in trial at 100 farms around the world."

WTF - who cares if carbon gets into the ground - the plants need fixed nitrogen and minerals [like phosphorus] - that is what fertilizer is - the carbon comes from CO2 in the air... maybe the US schools aren't any worse than the rest of the world.

poic wrote:

maybe not clockwork but declining credit in a consumption based economy that requires credit to consume surely makes the sure-thing inflationary outcome a bit more uncertain wouldn't you agree?

I don't find 18% yoy decline in credit inflationary imo.

Understand the difference between deflationary pressures [credit contraction] and inflationary policy. Deflationary pressure can win today's battle but over time inflationary policy will win the war. The only way we end up with deflation is if we start choosing deflationary [money limiting] policy. Hasn't happened yet. Until that happens inflation is a when & how bad not an if question.

JP
I don't know the system's details, but I do know it is possible to clean diesel exhausts, and that with tractors so large and the application to food crops it would probably mean that more than just cooling + injecting is being done

Deflationary pressure can win today's battle but over time inflationary policy will win the war.

This is how Stalin and his generals won WWII - sacrificing the millions of the people

yagij wrote:

can we haz glod standard plz?

Only if you haz wayback machine.

Citizen AllenM wrote:

we start federalizing a bunch of state services.

Why do I have little faith in that process actually fixing or solving anything?

dryfly
diesel has NO, NO2 and SO2 emissions, which are much more powerful GHGs than CO2
Nitrogen and Sulfur go into fertilizers as well, no?

Thank you. I'll try to contribute something useful, if I can. I wouldn't have known what is really happening if I hadn't stumbled upon this site. I will be eternally grateful for that, although sickened and saddened with the knowledge. I'd rather see the train that will hit me rather than be blindsided. Just wish I could get those around me to BELIEVE what I tell them! But I won't give up. I really enjoy reading the comment section here. This is where I have really learned...it took a while to catch on though.

MLM wrote:

Because you are a bad and cynical person. Off to the watchlist with you...

No, I just think that there needs to be a test bed to better flesh out this idea of destroying the States' Rights v. Federal Government system. Why don't we agree that we should let the Fed's manage D.C. and Detroit first with this "federalize the localities" approach and then roll it out across the states once we prove how well it works?

EvilHenryPaulson wrote:

diesel has NO, NO2 and SO2 emissions, which are much more powerful GHGs than CO2
Nitrogen and Sulfur go into fertilizers as well, no?

Minimal - tiny amounts. In significant by any measure. PPM's.

Plus unless trapped [like anhydrous is when applied] most all escapes anyway. For that matter most anhydrous applied escapes... they apply way more than is needed so as to be sure there is enough [which is why the dead zone in the gulf get's bigger every year].

Its a silly suggestion.

People suggest silly stuff - that's pretty silly.

dryfly
Without details, I'm going to skept-optimistically take the anecdotal reports of it successfully substituting significant fertilizer at face value. Maybe it's just doing a better job of making existing nutrients accessible to plants, who knows

yagij wrote:

Why don't we agree that we should let the Fed's manage D.C. and Detroit first with this "federalize the localities" approach and then roll it out across the states once we prove how well it works?

Uhh, because working well isn't one of the outcomes we care about? But getting our claws into another revenue pump, that's attractive.

MrM wrote:

So long as you have Timmay and not Volcker at the helm, inflation will be fun for the mega banks

The more the take the more they'll look like the commerce dept. They are on the path to becoming 'money utilities'.

NorthByNW wrote:

I wouldn't have known what is really happening if I hadn't stumbled upon this site.

Hell, I'm a long time reader and I've yet to figure out what is really happening. So if anyone knows, please share.

A frustrated Madoff 'examiner' Ostrow: 'It's frustrating when you're out there for three months, lied to every day, and you try relaying that, and you try to get it across that, you know, how can this be. (pg 239) page counter
Examiner Ostrow...'still wanted to visit Madoff feeder funds to resolve open questions they had about Madoff's hedge fund trading...On June 16, 2005, the examiners learned they would not be visiting the hedge funds...because of (supervisor's) fear that they would be sued...and the feeling that enough time had been spent on the Madoff examination.' (pg. 240)
(Supervisor) played down Madoff's misrepresentations (pg. 218)
Examination Report Did Not Describe Madoff's Misrepresentations to Examiners or The Issues That Remain Unresolved (pg. 247)
http://www.sec.gov/news/studies/2009/oig-509.pdf public version
Examination indicated 'Madoff was powerful and well-connected' and examiners were told to proceed carefully...(pg 199)

If you want to focus on well founded optimism tonight that is tangentially related, there is the German advance of using lignin from wood to produce plastics, or Iogen in Canada with cellulosic ethanol

dryfly wrote:

Doesn't mean folks won't hold gold as insurance against bad monetary policy [that makes sense today]... but no gov't would be so foolish as to lock their money in a fixed rate to gold, land. oil or even another currency. Never happen again. Forex & Comex will be the world's federal reserve of the future.

I disagree. I am aware of Gresham's Law, but the fact that currencies were debased over the centuries didn't mean that you never saw silver or gold coins in circulation. The redistribution of a society's wealth be it through revolution, civil war, or just plain loot ala Rome's Triumvirate saw a return to an expected "normal" currency.
.
We have only known of a world through super-power global hegemony which has severely colored our views and thought process. We only know of globalization and secured regional and inter-regional trade. The energy and resources required to keep it going as it currently works isn't guaranteed, and eventually, the system will contract and/or break-down. At that point, a new system will emerge and have to establish its own legitimacy with its citizens and its neighbors. Jumping out of FiatA with a brand new FiatB will not build much confidence in the new regime.
.
As you know, this kind of major change has only occurred every few hundred years, but it does come. We may not be in an era that will usher in that kind of change, but to say that humanity will never return to the ways of old seems brash seeing how it always has before.

dryfly wrote:

There is no way in the modern world to effect a 'devaluation' except through forex. Even the Chinese 'peg' is a pseudo-peg established through sterilized 'buys' of assets in the target currency and then facilitated through forex transactions to 'recycle'.

I think that there is. It is all about political will and desperation. As I said, wage increases will have to be coordinated with a devaluation. Government interference at its MOST...

I just recently read about a policy suggestion for Spain because it cannot devalue on the FOREX. Spain just might be the forerunner if things stay bad enough.

btw, % by weight composition of diesel exhaust
Carbon dioxide 7.1
Water vapour 2.6
Oxygen 15.0
Nitrogen 75.2
more @ http://www.toronto.ca/health/pdf/de_technical_appendix.pdf

I note that dryfly also suffers from jaded-man disease. Dry and I can start a support group.

total bummer. if the whole point is just to lay carbon on the ground instead of the air, then there is nothing for me
someone change the topic please

there is nothing wrong with being jaded
jade is a prized rock

RE wrote:

I think that there is. It is all about political will and desperation.

The arbs & forex markets will bust them - they can devalue ONLY by printing and by doing so shift the exchange ratios. There is no will that can overcome these market forces. Even the BOJ & PBoC know this - they manipulate THROUGH the market not around it.

Sorry for a totally OT comment....but what's the heck's up with futures (S&P, Dow, NAS)? All down almost 2.5% -- for what reason?

I mean, besides the fact that stocks are massively overvalued...

I guess I'm an official doomer. Heh.

EvilHenryPaulson wrote:

Nitrogen 75.2

But it isn't 'fixable' - its N2 not NH3 and only tiny amounts of NOx... hell air is 80% N2... just pump air into the ground if that would work.

Didn't you guys ever take any science in school or weren't you paying attention?

dryfly
maybe there is a magic beanstalk involved

EvilHenryPaulson wrote:

maybe there is a magic beanstalk involved

There is a lot of gas involved with beans - not sure how much is 'nitrogen' though.

beans fix nitrogen. magic beans must fix a lot of nitrogen

fried wrote:

OT, but the union guys have rejected new terms to their contract at Ford. Are these guys nuts, or is reality no longer a concept in Detroit?

We talked about this here 6-8 months ago when GM was blowing up... everyone said Ford would be the winner... a few of us said Ford only survives if the Ford stockholders give the Ford UAW union the same deal the gov't gave the GM UAW union - a BIG chunk of the equity.

If Ford stockholders wants the same cost structure GM has then they have to give away much of the company. Why Ford is trading above pennies a share is beyond me [and no I don't own it].

EvilHenryPaulson wrote:

beans fix nitrogen.

Seriously that they do - and it is more easily utilized by plants than is anhydrous PLUS it doesn't end up in the GOM.

dryfly wrote:

I fully expect silver/gold to be valuable & hold value... but never be a standard for a gov't recognized and more importantly pegged currency. No more fixed '$40/oz'... or whatever... the forex [currencies to currencies] and comex[pm's to currencies] will float the ratios - keeping the central banks way more than honest.

You need a stable rule of law and enforcement to have a reliable ForEx and ComEx. I'd argue that if you didn't have a stable process between countries issuing/accepting fiat that you couldn't have a ForEx or ComEx to represent a people's faith in some kind of monetized product. That situation takes us back to the problem of currency returning to something of value (e.g. Silver, Beads, Gold). Right now, that "something of value" is nothing more than trust and faith. (e.g. Trust in future tax revenues, Full Faith & Credit). I think that fiat got its foot in the door because it used to actually represent that "something of value". The Italian city-state's bank receipts represented something just like the USD actually represented something more basic and tangible. You may have paper, but you could take it somewhere and exchange it for the underlying item against which your paper was issued.
.
The governments ripped out that foundation of those notes with the motto of "Trust Us", and for this century, the people were willing to trust the government even though the floor was removed. During the last GD, the USD had some worth even if it was some human-created peg. Nowadays, they have to worry that once that trust is shattered, you are left with other more basic or barbaric forces in play to accept fiat ( basically guns and threats of force ). At that point, your form of government changes and regresses back to more "normal" forms which has been used throughout the millenia.
.
The fact that California is having to issue IOUs for fiat shows how flawed the system is, and people's trust may break so completely that they may rather trade services for services or even blankets for chickens if they are left with paper for paper for paper for paper option. At that point, you are back to despotism or monarchy, and the soldiers who fight for those kinds of people don't do it for paper. Mercenaries never fight for "free".
.
Edit: I would also argue that The New Powers That Be may have to put their "money where their mouth is" to establish a new legitimacy that extends beyond weapons and violence. In other words, they will need to pony up their own possessions collectively to establish confidence and build trust among the people that they rule. At that point, fiat may be issued against items that have some agreeable amount of worth and everything old becomes new again.
.
Granted, you have to take your to a extreme end to get to this scenario, but again, mercs don't work for "paper".

Fine - I admit PMs will be great store of value & possible exchange media for 'barter' - just not fixed to gov't established 'monetary standards'. When I hear gold standard it means to me gov't will set a fixed number of their currency units per weight PM - that isn't ever going to happen - ever again.

That isn't to say countries won't hold gold as part of their reserve [they do that now]... they just aren't going to promise you a fixed exchange rate. Never.

The forex & comex will float those - both money & metal - and your level of trust/distrust will be reflected in what you buy/sell and short... and collectively 'move those markets'.

That is a big difference form a 'standard'. Sometimes I wonder if the gold bugs even know what a standard is?

Kids' halloween costumes are way too "put together" these days. They all look professionally made and/or purchased from a store

To those it may concern on Halloween Night...
Ron Paul's 'Audit the Fed' bill(audit monetary policy) with 308 co-sponsors has been gutted and there's nothing left, according to Paul.
Congress is also suggesting that the Fed be given more powers...making it the chief risk regulator of the entire banking system.'
(naked capitalism, Oct. 31, 2009)
Maybe for many who followed this bill, this is actually good news...

dryfly wrote:

Sometimes I wonder if the gold bugs even know what a standard is?

Do the anti-gold bugs ever think back to why there was a "standard"? The printing press has been out for hundreds of years and the world order of fiat has been for 60 years? Why the expectation that fiat is the one true way that will never change? Why is it now along side with Taxes & Death as the only constants in Life?
.
Edit: To the Roman in 200 AD, the thought of a world not functioning like Rome was probably unimaginable. In the year 2009 C.E., why do people think that their world's function will never change?

NorthByNW
pretend you are starring in your own episode of the Twilight Zone, it can work for years

yagij wrote:

Do the anti-gold bugs ever think back to why there was a "standard"? The printing press has been out for hundreds of years and the world order of fiat has been for 60 years? Why the expectation that fiat is the one true way that will never change? Why is it now along side with Taxes & Death as the only constants in Life?

Still - gov'ts aren't going back - never going to happen. Not to a standard. Fiat will replace fiat over time for sure as states fail & new states arrive. Gold & silver will remain 'valuable'...but there will be no fixed standards to those PM.

You want a standard - it will have to be your own personal one. Gov'ts aren't going there.

TJ and The Bear wrote:

Try 38. The whole world was more or less pegged to the dollar, and the dollar pegged to gold up until Nixon closed the window in '71.

The 'dollar standard' is over too. Now it will be the 'forex float'... and believe me - PMs will become a far bigger factor as a result. They will become the new cops of the forex world. You want that cop off your back then practice tight money... or else.

I give dollar hegemony maybe five years max as the Chinese work out of their positions and figure out how they substitute US export based 'growth' with something more real - that is unless they too blow up sooner than that.

They will go where the strangleholders tell them to. Unless they loosen the grip first.

C

Sorry, didn't mean to steal your thunder there!

TJ and The Bear wrote:

Perhaps not internally, but externally? That's only if things remain nice & peaceful.

Again - the idea is will it be a 'standard'... meaning a fixed number of dollars per unit metal that the gov't will guarantee they will exchange for - that isn't going to happen.

BUT if the dollar is viewed as worthless will people 'save' via metal holding? I'd say absolutely 'yes'... I'd also expect people to exchange items for gold say a car for X oz... but dollar valuation won't be 'fixed'. It will float... that is the key difference between gold as a store of value [which it is] and gold as a standard for gov't issued money [which it won't be ever again].

dryfly wrote:

and gold as a standard for gov't issued money [which it won't be ever again].

Not disagreeing with you, just wondering about the complexities in global trade arising from the instabilities dead ahead.

Personally, I'm in PMs not so much to gain wealth as to not lose it. I'm not sure exactly how it'll happen, but I'm damned sure something's going to happen that'll hammer anyone holding fiat. Remember that MASH episode where the military script changes?

With no hope of the public knowing what's going on and having everything stay basically the same with the economic/political/finance organizational structure in place, then what is the discussion on CR going to be about...just a daily accounting of the wreckage of failed policies and bubble cycles...maybe a few trading tips...waiting for the Dollar to Crash and just having to wonder when the devaluation accelerates rapidly...a lot of the crew here seems very cool, calm, and collected...
If the Fed doesn't even have to release information about where bailout money went and is given more 'systemic regulating' power after failing at regulating...and a Crash is inevitable as is pretty much the consensus...this will be a Doom echo chamber or a detached 'cool down' exercise...a way to learn to take this Crash in stride, accept losses and go home to your rental...to accept it gracefully...with no hope for anything better coming, very soon anyway...

yagij wrote:

As it was said, whatever weapons are used in WWIII, the next war will be fought with sticks and stones. I think that sentiment will play out in our currency markets too. Corporations exist through the benevolence of our legal system, and without these kinds of advance paper vehicles in place, I'd vote that fiat becomes paper to burn if that.

If we have end of world - even gold is useless - you can't eat gold. Before we used gold as a medium of trade we used wheat & other grains [Fertile Crescent - Mesopotamia & such].

Then it was metals & jewels... exchanged for goods

The it was money as a promise of exchange of metal and jewels [metal based money standards]...

Then it was money as a promise of exchange for OTHER money [dollar standard based money]...

Now it is just 'promises'... and float via exchange.

:: ::

I can see society going back to a NO MONEY world [barter for goods based on gold or some other good in exchange where gov't money no longer exists]... I see NO scenario where we go back to a gold standard or other fiat standard system... back to bedrock or stay where we are. Nothing in between.

I don't mean to be coming across like a PM honk. I'm long physical bullion, but my basic premise was that I don't foresee the new world order of global fiat being a mainstay for the rest of human history, and I'm 50/50 that it makes it through unphased to the next return to regionalism or collapse of the modern nation state. There wasn't much faith and trust between traders and countries in the past, and it is this lack of faith and trust that caused people to pick stores of wealth/value that would be hard to manipulate especially when it came to country-to-country transactions.
.
We may not return to a Gold Standard, but we may return to fixed price conversion rates--for however brief--if we lack the global socio-political structure to allow ForEx & ComEx markets to operate unencumbered. That "fixed price" may fluctuate on periodical basis too, but we are taking for granted the parts that make the current massive system work the way it does.
.
And obviously, I could be totally wrong.

SEC goes after $8 million in insider trading...the SEC Madoff Report was saying the SEC is pretty busy...

yagij wrote:

I don't mean to be coming across like a PM honk. I'm long physical bullion, but my basic premise was that I don't foresee the new world order of global fiat being a mainstay for the rest of human history...

I don't either - but I don't see us going back to stone tools and I don't see us going back to barter and I don't see us going back to a FIXED PM standard.

Humans have always 'negotiated' - its natural. Fixed standards are unnatural.

obsidian scalpels are excellent : )

Geithner: "It could be a little choppy. It could be uneven. And it's going to take awhile." .. Americans are going to have to save more [but the govt is going to encourage spending]

Geithner: Economy rebounding, but job growth lags - Yahoo! Finance

edit: sorry, didn't know ccst already posted this topic.

If you think global markets are volatile now...

dryfly wrote:

if they don't the forex & comex will crucify them [and us].

Better buy some more !
...
D'oh.
...
Old habits die hard.

Just got Mauldin's latest newsletter. Headline? Catching Argentinian Disease

Not a prediction so much as a theoretical exercise, but also a very real possibility.

p.s.: dryfly, Mauldin writes Ferguson pointed out in the quotes above that hyperinflation is always and everywhere a political decision. Governments have to choose to print money. Who does that sound like?

Why not dual currencies: fiat currency/scrip in government stores/px for government insiders and barter for the rest of us?

dryfly wrote:

to NOT print is the tough choice

Oh, definitely. It is still a choice though. Deflation doesn't have to be, though, because it can happen without any government action whatsoever.

Why not dual currencies: fiat currency/scrip in government stores/px for government insiders and barter for the rest of us?

It is happening now don't you think? Black market & underground economy.

Will it get bigger? Sure. If the central banks don't clean up their act.

EvilHenryPaulson wrote:

Ford may be steering towards bankruptcy. Which explains the lack of attempted negotiating

me thinks that Ford set their demand higher enough to be rejected by the unions so they can wipe out their worker contracts in bankruptcy

BTW, that Mauldin piece also references reports that show that 92% of the 3Q GDP was stimulus related, and that as a result 4Q could very likely be negative. I figured 4Q for 1% or so with 1Q10 going red again.

Geez, I'm going to ruin my rep with such optimism.

Welcome NorthByNW. Got popcorn?

YouTube - Swervedriver - The Birds (audio)

Roll up, roll up, it's the greatest show on earth...

C

TJ & the Bear
that's Niall Ferguson he's quoting? from what book?
I met him in NYC in 2003 when Empire came out. one of his weaker works,
IMO the rock star thing was starting to interfere, as I remember it he even had a few
groupies in 2003...
the bio on Henry Alfred K should be an interesting read...

The Ascent of Money.

Always a pleasure. Sweet dreams!!!

NorthbyNW
glad to know you took the name after the Cary Grant Eva Marie Saint & James Mason movie thriller ...
some of the wittiest dialogue ever for that genre, my favorite has to be the seduction scene bwt Cary and Eva Marie,
auction house scene is a close second... I always thought the homo-erotic tension between Martin Landau and Mason
was an interesting sub-textual story...
yeah, I grew up in Indiana but I've lived in Manhattan 5 more years than I ever lived there, hard to go back as I get older..
nobody wants to be be the village explainer but boy a lot of Hoosiers need to get out more....

As an aside, "The Birds", another fav

yea, it made a fortune--voila! we're back on topic Bird & Fortune.

Counterpointer
Roll up, roll up, it's the greatest show on earth...
are you quoting Emerson Lake and Palmer, by chance...

as a side note the script for The International was set on the late 70s, loosely
based on BCCI. the writer's set piece was the big shoot-up in the Guggenheim
but it's obvious it became their albatross, spent 6 weeks building the Gug set in Germany
and then a number of weeks shooting... instead of a scene that had snap to it and made sense
logically and came in around 6 minutes they bloated it up to around 12 minutes... too many camera angles
esp on nameless assassins who seemed to pop up like whack a moles.
NorthbyNW, if like Hitch you must also like de Palma?

Duke, De Palma, John Carpenter, David Lynch. Too many to name. "The Fog" is also one of my favorites. Then there are the Christmas movies, Westerns......etc.

question... I have some money, not big bucks or anything like that but I'd like to start trading again
but I already use Fidelity and back when I actually had some money (respectable amount that is)
I spent way too much on their over inflated fees...
so, does anyone know of a good brokerage house outside of the USA? this isn't a tax dodge or anything
but if I somehow make some profit I'd like to keep that off shore??
someone recommended Interactive Brokers?
<pros or cons?

UBS? They must be looking for new clients.

C

NorkaWest,
maybe ANZ or HSBC, they seem to be all over the map over here and
I'm sure they are pretty good credit wise. I know a head trader for VinaCap in 'Nam
he uses Interactive, but after watching countless commercials on CNBC from that firm
about how solid they are that gave me pause...
thanks...

dryfly (you'll never see this),

Commercial fertilizers, I know, provide nitrogen, potassium and phosphorus in abundance, and their use forms a kind of agricultural orthodoxy, and on well-tested grounds.

A number of researchers have been looking into the questions raised by much older practices based on providing carbon directly into soils, where microorganisms perform an unknown series of poorly-understood functions. Those old methods make for a complex uptake of a far broader range of minerals and, interestingly, bind them such that they reduce the loss of water-soluble minerals into the water table and as runoff. And the crops are robust, with yields superior to those we get with current methods. Audacious claims, I realize, but it's Cornell making them.

And we don't really know why. Just working on it, I hear.

I had a gigantic organic garden when I lived in GA. NO fertilizers, herbicides or pesticides were used save bone meal. Really ancient means of increasing yields requires understanding of how the soil works and what is necessary to keep it fertile. Crop rotation, using different varieties for planting, companion planting, resting beds, tilling under waste, etc., etc. . We've been farmers for the greater part of our existence on the planet.

Industrialization of food production has wrought some big problems. Attaching food production to energy production is a fools game; not that we can't develop organic energy sources but must consider those that are not harmful otherwise. Just like with meat, the quality goes down when you crowd out everything that allows life to thrive, be healthy and therefore nourishing. If you do not respect that life, then it will come back and bite you. We're overdue. You can fool mother nature some of the time, but not ALL of the time.

I'm on my first cup of coffee so my apologies to you for misunderstanding your post. I'm trying to digest and multi-task too much at once! Organic chemistry is a bitch, seriously. Thats what renders some students in medicine out of the game in college. Obviously the applications are far reaching as our entire existence is organic obviously and to the chagrin of those who believe we are somehow above and special creatures, exempt from the rules of nature. One thing is clear to this lowly reader, the human animal possesses pathological arrogance that maybe our entire species ultimate undoing.

Now onto a topic we all enjoy, Goldman Sachs. This is a compelling read!!

http://www.mcclatchydc.com/227/story/77791.html

I'm not familiar with this website and that all important sourcing is beyond me. Perhaps someone else knows of their reporting reliability?

Nanoo,
I think mcclatchy is legit. Someone above was referencing the same website.

oh crap!!! I didn't realize these guys were Bird & Fortune were satirists,
I did think in that short excerpt the guy on the left was, as the Brits say,
awfully cheeky...
...........
all that talk from EHP about injecting carbon back into the soil, and then dryfly gave us a bot of schooling
on anhydrous and I'm thinking WOW that's a bubble destroyer! all the Meth producers in Indiana will be put
out of business if their anhydrous disappears....
....................................................................................

a belated 4 second Happy Halloween from duke Crown YouTube - Orson Welles Squats on Times Square under a Vampire Moon - Happy Halloween from the Duke

Thanks all: For me, its just more dazzle and confuse which is wearing thin wrt the complexities of our so called financial system that exists for itself and nothing else.

Honestly and sincerely, I haven't been as challenged to understand like this since my college days. I strongly suspect I'll never get it and won't get my diploma in calculating hucksterism.

Implications of a Weaker Dollar for Oil Prices and the U.S.Economy (US House of Representatives Hearing from 2008)
Interesting hearing I'm reading through...

I see I owe Dirk an apology.

Finally found the auction catalogue for the Lehman art objects. Quite a few heavy-hitters in there and not the 'corporate art' I had supposed. Warhol, Lichtenstein, Louise Bourgeois. Nice things, mostly, at least as nice as the infamous commode.

nanoo-nanoo you're right,maybe we can borrow a couple trillion from china but.......
anyway good morning and happy november

j d
ok i keep forgeting who's red
i just clump them all into purple and let it go
i see that comment is still on daylight time.

burnside wrote:

I never for a moment imagined that Goldman or the other IBs would require their trading desks to reflect the brokerage-side research recommendations.

But you see, that is not what it is all about - rather, how the public at large reacts to the situation - and their desire for the assignment of blame (as the Merican public deals with rising foreclosure and extended job loss while the banks formerly known as IB's deal with record bonuses)...

"Obviously the applications are far reaching as our entire existence is organic obviously and to the chagrin of those who believe we are somehow above and special creatures, exempt from the rules of nature."

I'm not chagrined. We have bodies, which are organic in nature. But there is more to us than that. In any case, who knows what 'matter' is?

Report on Goldman's Bets on the Housing Crash

yagij wrote:

Honestly, I'm all for the credit contraction, and since the wages have been under attack for 30+ years and the credit tide goes back out to sea, I think we are in for a huge world of hurt. Did my initial statement come across as if I wanted the debt to stay?

I'm kinda looking forward to wages inflating again. I hope we don't get to stagflated again.