The rulers of Abu Dhabi are expected to make a statement before the markets open on whether they will bail out Dubai and which businesses and projects will be rescued.
Hopefully, the FED has taught them how to run a Sunday night intervention properly.
I met a traveller from an antique land
Who said: "Two vast and trunkless legs of stone
Stand in the desert. Near them on the sand,
Half sunk, a shattered visage lies, whose frown
And wrinkled lip and sneer of cold command
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed.
And on the pedestal these words appear:
`My name is Ozymandias, King of Kings:
Look on my works, ye mighty, and despair!'
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare,
The lone and level sands stretch far away".
basically they feel like Dubai was taken in by a bunch of slick talking western snake oil salesmen, they're not sure how but they don't want to pay out money unless they're getting something back, and they don't want to overpay
AM No one wants welfare to go to cheats or to be more valuable than wages for real labor. That wasn't the argument. The unqualified suggestion was made that giving out food stamps encouraged people per se not to work or learn a valuable trade.
The central bank did not give more details, only saying that it stood behind UAE banks and branches of foreign banks operating in the UAE, adding the country’s banking system was more sound and liquid than a year ago.
“It is important because the main concern is that there might be some panic behaviour by depositors in Dubai and by bankers who want to take deposits out of the banking system,” said John Sfakianakis, chief economist at Banque Saudi Fransi-Credit Agricole Group in Riyadh.
“This will support the liquidity and the overall soundness of the banking system in the UAE and especially in Dubai.
Announcements on the BBC and NPR were saying that the UAE CB was going to provide whatever "liquidity" was necessary. No hint that there might be a solvency problem. Why do these journalists call themselves independent?
One can't refer to the fact that France was occupied by Germany 1940 - 1944? You want to cut it out of the Great Internet Encyclopedia?
Can I refer to the fact that my Uncle Fritz was on trial for murder in Berlin in 1933, on a charge of having thrown a bomb into a restaurant frequented by Nazis, and that he called the prosecutor a monkey, and that he was acquitted because not all judges at that early date were Nazis?
Or that thereafter the "guys with letters on their lapels" (SD) were after him.
We met a Canadian college racer and her local father who showed us "secret" Blackcomb. Heavy snow...drinks last night... altitude...sitting on the blog in lieu of coaching squash...Spanky's spanked me silly. Rock and roll rocked my world.
Can't move a toe but must rally since we're meeting her older sister and drop-dead gorgeous friend for dinner and hot tub. Eat your heart out Broward and you wingnuts don't even try to union-bait me. Living the banker's dream...
Separate Arab Emirates (SAE)
Dystopic Arab Emirates (DAE)
Formerly United (FUAE)
The Emirates Formerly Known as (TEFKAUAE)
Emirates We Knew And Loved (EWKAL)
Harmonious But Separate (HBSAE)
lastly, LUAU, or Lackadaisically United Arab Umirates
the truth is that too many people have borrowed way more than can ever be paid back. The lenders are in panic mode. All the polite phraseology in the world can't fix it.
Basically Godwin's law is the observation that once someone brings up Nazis/Hitler, the argument is over. Not because of censorship, but there is no room for further progress. It's the stage where discussion has reduced to name calling, and all attempts to use reason will be futile.
What is Godwin's Rule of Nazi Analogies?
Godwin's Rule of Nazi Analogies, sometimes also known as Godwin's Law, is a theory put forward by Mike Godwin in 1990. Godwin noticed that long-threaded discussions on the Internet tended to turn into mud slinging competitions by the end. The longer a thread got, the more likely it was that a Nazi comparison would be dragged into the discussion. Godwin's Rule states that: “As an online discussion grows longer, the probability of a comparison involving Nazis or Hitler approaches one.”
There are several implications to Godwin's Rule. Many online discussions involve intense personal beliefs and values, which sometimes clash quite dramatically. As the discussion continues, it tends to become less rational, especially after most of the valid arguments from both sides have been presented. On a hot button issue with no “right” answer, opponents may start to exchange insults because they become angry and frustrated.
Comparing someone, or an action, with the Nazis is a serious charge. The German Nationalsozialismus party dominated Germany from the 1920s through the 1940s. In 1921, Adolf Hitler was elected leader of the Nazi Party. Throughout most of the world, Hitler and the Nazis are equated with ultimate evil, due to their actions in the Second World War, which included the roundup of millions of Jewish people, homosexuals, gypsies, and other “undesirables” in the name of ethnic purity. The Nazis are associated with dictatorship, totalitarianism, and rigid order.
There are situations in which bringing up the Nazi party or Hitler is entirely legitimate. Any discussion of modern German history, for example, should include a discussion of the Nazis. Conversations about dictatorships and genocide are also situations in which a Nazi analogy is valid. However, when Nazis are brought up because a conversation is not going well, it suggests that the other side may have won the argument. Furthermore, it weakens valid comparisons.
Often, an example of Godwin's Rule accompanies hyperbole. The idea is to invalidate the opposition by comparing it to the Nazi Party. However, this can backfire, and usually does. Unless the comparison is valid, the person who brought up Nazis or Hitler is considered to be the loser. In a rational discussion or debate on or off the Internet, resorting to a Nazi comparison is generally a strong indicator that you have run out of material to discuss or support your claims.
Many Internet communities have taken Godwin's Rule to mean that when Nazis enter a conversation, the discussion is over. In some cases, someone may invoke Godwin's Rule to end a conversation before it gets worse. However, sometimes a discussion should continue, even though Godwin's Rule has been illustrated by a Nazi reference. Individual members of the discussion decide whether or not a conversation will be carried or ended with an instance of Godwin's Rule.
I met a traveller from an antique land
Who said: "Two vast and trunkless legs of stone...
No argument with this, or posting it. But it's showing up about once a week from different posters. How about instituting an Ozymandius emoticon -- two stone legs, no torso. It'd be popular.
the truth is that too many people have borrowed way more than can ever be paid back. The lenders are in panic mode. All the polite phraseology in the world can't fix it.
This captures 90% of it.
I would quibble about how much can be paid back, versus how much people would prefer not to pay back. I have lived on Wonder Bread and peanut butter and milk and no heat in the middle of winter in order to meet my other bills, and that's just the start of it. Others would choose simply to say that they cannot pay.
The Godwin stuff has become a thought-terminating cliche. A little like the "political correctness" overreaction was used to cut off criticism of insensitive, bigoted slurs and stereotypes.
The Godwin stuff has become a thought-terminating cliche. A little like the "political correctness" overreaction was used to cut off criticism of insensitive, bigoted slurs and stereotypes.
That's exactly what Hitler would have said. and you smell bad. < < good example of Godwin's law
it's not what you are arguing, it's how you are arguing. could have as easily been the "arguing like a 4 year old law" I'm rubber you're glue, your words bounce off me and stick to you
A minute ago, the Dow Jones futures were up 31 points and the S&P futures up 3.25. That puts both indices up less than 1/3 of 1 per cent. Both look pretty much in line to me. I make a market in Dow futures.
A minute ago, the Dow Jones futures were up 31 points and the S&P futures up 3.25. That puts both indices up less than 1/3 of 1 per cent. Both look pretty much in line to me. I make a market in Dow futures.
i don't think any of us believe that 12% number was accurate.
" The Godwin stuff has become a thought-terminating cliche. A little like the "political correctness" overreaction was used to cut off criticism of insensitive, bigoted slurs and stereotypes.
That's exactly what Hitler would have said. "
Not at all. Hitler would have said: Get rid of that sonofabitch.
Dubai residents do not have to pay for parking across the emirate until December 4, the Roads and transport Authority (RTA) has said.
The free parking move is to mark the Eid and National Day holidays, but does not include the Deira Fish Market, where motorists will still have to pay, the authority said in a statement.
Motorists were urged not to park on pavements or double park in front of other cars. A senior official warned drivers would face fines if found breaking the law.
A minute ago, the Dow Jones futures were up 31 points and the S&P futures up 3.25. That puts both indices up less than 1/3 of 1 per cent. Both look pretty much in line to me. I make a market in Dow futures.
Right, I know that. That's why I said the level looked right. IB just has an incorrect close, so they're showing up 120 handles on the spoos right now. Entertaining, is all.
iirc he coined that law after a multi-month flame fest across all the usenet culture groups which began with a post that was titled, "Is there any nation out there that actually likes the Germans".
I think the chief result was that it was pretty much established that there was a significant group out there that didn't like anybody, and that cross posting across the national culture groups was a really bad idea.
ah, Usenet in those precious few days we had before September.
Rocky, every time I hear something wild about the stock market I want to know what's really going on. I had my quote screen open, so I posted what I saw. For the record, I believed some pretty crazy things in the past, at least for a little while.
“The market is willing to assume that there will be no actual default in Dubai,” said Sean Callow, a strategist at Westpac Banking Corp. in Sydney. “We’re likely to get back to what everybody is most comfortable with, which is selling U.S. dollars.”
Jackrabbit: "The industry didn't want it funded because they know that it is MUCH more likely that the resolution authority will be used if it is funded. Resolution generally means a bank is put out of business BEFORE your problems are so immense that it threatens the financial system.
Having it funded benefits the taxpayer because it makes bailouts (using taxpayer $$$) less likely. Bank executives don't want it to be funded because they are much more likely to keep their jobs in a bailout vs. resolution. (as we have seen)"
This is the theory, jackrabbit. But I have lived long enough to see some practice. I will be assuming that they will do a bailout, one way or another, regardless of prior funding.
Barfly, he was, and, much later, as the chief estimator for the industrial painting company that got the contracts for the subway in NY and the George Washington Bridge, he knew a lot about what went on in the construction industry. But God bless his soul, he died some years ago,and up until his death he received a sizable monthly compensation pension from the German government.
I do know that he used to walk around mid-town Manhattan with five grand in cash in his pocket, in case he needed it in the course of business.
He was invited to spend the war in Moscow, and wisely turned down the offer. He spent the war in the States, was drafted, and then discharged for an injury received in training.
My favorite rental 'o the week was "Drag Me to Hell," about the "nice" mortgage loan officer who brushes off a gypsy fortune-teller who comes in for a workout on her home loan and... pays the price. I truly enjoyed the part where she sacrificed her cat to get the avenging demons off her back. Worth a look if you like unholy vengeance.
Ahhh.......and then there are "distasteful cartoons" that also need judicial review in Dubai.........
"Dubai censors scrambled to stop The Sunday Times reaching news stands yesterday. SAB Media, the Dubai licensee, was told the paper was blocked from distribution. No reason was given but the recall was probably prompted by an illustra- tion of Sheikh Mohammed bin Rashid Al Maktoum swept away in a wave of debt. In Dubai it is illegal to produce a derogatory image of the ruler or to deface his picture."
Yes. I have always wondered if gold would be "the last bubble" -- at least, in the global financial system as it's currently structured.
Edit -- as bubbles go, this one may be a weather balloon, with a lot of puffing still needed to inflate it; early days, even now. So when I say "yes" and Volcker says "not yet," we're not really disagreeing
"This is the theory, jackrabbit. But I have lived long enough to see some practice. I will be assuming that they will do a bailout, one way or another, regardless of prior funding."
Well, I acknowledged that in my reply. Why didn't you include that in the clip? (see full reply below). We agree on the fact that the government will protect the financial system, but you have ignored the larger point: that large firms and concentrated industries seek to wield their power to influence legislation in a way that is anti-competitive and benefits narrow interests.
In this case, NOT funding a resolution authority is adverse to the public interest. It doesn't really have much impact (if any) on bank investors but it does have a great impact on bank management. Management is MUCH more likely to lose their jobs if there is a resolution, wheras a bailout comes when there is an imminent threat so bank management will remain for "stability."
My previous post in full: =================================
Patientrenter:
"The funding is a red herring. . . . They'll bail and spend regardless of whether the fund is there, and regardless of how much is in it."
We'll yes and no.
Yes, the government is going to do what it takes to protect the financial system, BUT I used it as an EXAMPLE of how industry has undue influence, and I'm not sure that your counterpoint reflects that and ...
The industry didn't want it funded because they know that it is MUCH more likely that the resolution authority will be used if it is funded. Resolution generally means a bank is put out of business BEFORE your problems are so immense that it threatens the financial system.
Having it funded benefits the taxpayer because it makes bailouts (using taxpayer $$$) less likely. Bank executives don't want it to be funded because they are much more likely to keep their jobs in a bailout vs. resolution. (as we have seen)
New Delhi , Nov. 29: India may try to buy another 200 tonnes of gold from the International Monetary Fund (IMF) at a time the Dubai crisis has smudged the yellow metal.
The finance ministry will not interfere in the Reserve Bank of India’s decision-making process on the purchase.
Officials said the RBI might try to buy more gold if the price was right. “The price could determine whether and how much India decides to trade in its dollar reserves for gold.”
India has already traded part of its US currency reserves to buy 200 tonnes at market prices on November 3, spending $6.7 billion on the purchase.
** With prices on the upswing, prior to the Dubai crisis, the value of the 200 tonnes has increased by nearly $800 million**.
On Friday, however, gold in London for immediate delivery dropped as much as $50.28, or 4.2 per cent, to $1,138.10 an ounce, the biggest intra-day slide since January 12. Bullion futures for February delivery on the New York Mercantile Exchange slid 3 per cent to $1,153.20.
The crisis began on Wednesday when Dubai, part of the United Arab Emirates, asked to delay payment on $59 billion of debt issued by conglomerate Dubai World and its main property subsidiary Nakheel, sending global markets into turmoil and sparking fears of another financial meltdown. In India, the sensex on Friday fell 223 points in very volatile trading, with banking and real estate stocks taking a hit.
The officials said the Dubai crisis only underlined a possible delay in economic recovery in the West.
The dollar, therefore, may continue to lose its shine, and more and more nations will try to trade in their dollar reserves and US federal bonds for alternative reserves.
Gold, which is already up 32 per cent this year, is likely to gain more as central banks, pension funds and individual buyers seek to protect their assets from potential currency depreciation and inflation.
Most believe the gold market will remain bullish as US inflation expectations will continue to run high next year. Bullion traditionally draws strength from fears of higher inflation because it is regarded as a safe haven in times of economic uncertainty.
Analysts say that for the first time in more than two decades central banks will remain net buyers of gold.
Since India bought gold at market prices, Mauritius purchased two tonnes for $71.7 million and Sri Lanka 10 tonnes for $375 million.
The global markets expected China to buy the 200 tonnes, which the IMF had put up for sale and were purchased by the RBI.
Analysts said the high market prices might have dissuaded China from buying.
Besides, the country had increased domestic output to become the No. 1 producer in the world, and the analysts said it was buying its own gold to shore up its reserves.
Officials in the finance ministry, however, believe that China may trade in its huge stock of US federal bonds to buy some of the IMF gold. “India will not compete with China to drive up gold prices but rather may consider buying if offered at market prices which do not seem too abnormal,” the officials said.
As on November 13, 2009, India had total foreign exchange reserves of $286 billion, of which foreign currency reserves and gold constituted $263 billion and $17.5 billion, respectively .
**The officials said that one of the reasons for India not being under any pressure to diversify is its relatively low holding of dollar bonds compared with many other countries.
India has about 12 per cent of its foreign exchange reserves in US treasury bonds compared with Brazil’s 64.63 per cent of reserves in US bonds, Russia’s 29.46 per cent and China’s 35.15 per cent.**
“However, in the ultimate analysis most central banks would like to hold more bullion to strengthen its reserves value and India is no exception,” the officials said. **
gold will be worthless in the face of food or even water.
Well -- then it won't be the same financial system anymore. From my point of view gold has been a great hedge, and will remain so until it doesn't. The point is, where to get out (and what to get into). The only cynical investment I've ever made.
NEW YORK (AP) - By a wide margin, Americans consider Rush Limbaugh the nation's most influential conservative voice.
Those are the results of a poll conducted by "60 Minutes" and Vanity Fair magazine and issued Sunday. The radio host was picked by 26 percent of those who responded, followed by Fox News Channel's Glenn Beck at 11 percent. Actual politicians - former Vice President Dick Cheney and former vice presidential candidate Sarah Palin - were the choice of 10 percent each.
"Does the IMF send a Spanish Galleon with 200 tonnes of gold to India?"
....at night they send thousands of tiny little Indians with picks, shovels, & pans......scuttling the desert hills for caves, strange rock formations, and "Danger-Mine" signs..........and then disappear by sunrise..........I've seen 'em..........honest Injian!
the larger point: that large firms and concentrated industries seek to wield their power to influence legislation in a way that is anti-competitive and benefits narrow interests.
I am not trying to ignore that point, Jackrabbit. I understand regulatory capture and all that, and I don't much like it.
But having said all that, we have to decide whether to set up yet another insurance fund that pays money to ventures that lost money. Should we do it? Well, if you believe that it's possible to set up insurance funds that can pay out enough to offset the occasional large losses caused by systemic risk, and you think that having risks covered by an insurance fund won't generate more bad behavior through an increase in moral hazard, then it would be a good idea. I've seen enough consequences recently of large-scale systemic risk and moral hazard to believe that our number one priority should be reducing them. You may draw different conclusions.
Cactually the gold is moved from one side of a room at the Bank of England or the federal reserve bank of New York to the other, and the label is changed, being so heavy gold is costly to transport so it tends not to move.
Went to Target in Burke VA. Busy as in 2005 weekend busy. Lines were 1 person deep. No large amounts of items seen purchased. The woman in front of us got mad when I started counting the number of $1 socks she bought.
Went to CA Tortilla. Sunday is Kids Eat Free Night. We usually eat there before going grocery shopping. Usual kid count 4. Tonights kid count 16 and the woman in front of us argued that her kids didn't get counted correctly.
Electronics are always deflationary. Still, husband got a 14" emachines laptop (I guess that's an acer brand) for $279 today, including computer bag & optical plug in mouse.
I've wondered about that too, bosch............the only time you might need it, is when everyone else will...........kinda like guns and ammo - why would anyone want to leave it off-premises?
I'd be surprised if the people who want to diversify out of dollar$ would want to leave their gold...
Unless they are assuming the financial system won't collapse. I'd guess if India demanded real gold that might "raise some eyebrows". (Hey, yeah, uh... would you guys mind actually sending that glod too us? Naa, just my bosses boss wants it, I donno. Yeah, I know, probably nothing you know how management is.... Uh? Sure, UPS is fine. Thanks....)
I hope not..........I like the decreased traffic - less homicidal drivers, no lines at the fast-food joints once a month when we're there.......quite seriously, LV Metro PD has lost a half dozen officers in the last 6-months......the place is turning into a free-fire zone......upscale neighborhoods with home invasions - shots fired nightly - killings on the streets.........old west kinda stuff.....the network news here reminds me of LA news before they started censoring the gang bangers.
IMF does not have a vault. Their gold is mostly book entries in other peoples vaults. It would not surprise me if the gold that India bought is already in their vault. Remember, in the "official" Breton Woods days, countries settle their trade deficits by "transfering" gold. The IMF was set up to facilitate these transfer. When the U.S. went off the gold standard, the IMF was out of a job.
My idea was to bail out the Gamblers. Cash4HoplessLosers. That would pump a lot of bux into the local economy if they could just an ATM for more funds. Push the C4HL card in and go right on being patriotic.
Ordinarily I would completely agree with you. But I am one of those that believe that we shouldn't have too big to fail banks. Separate out the depository function.
If we are going to accept that some banks are too big to fail, then the resolution process should have some teeth.
blonderengel, I'm a hopeless loser in the great void, but I love you. Unless, of course, you're just a volker sock puppet. But if you will, please grace us with one of your writings, old or new. TIA.
Enough about Me: Minimum Requirements for Getting Through the Day
Jesus, sweet and hot, and The Secret—whatever it is—fits all. If
not, pry bars and sledge hammers adjust tolerances. He serves
coffee, black with a sugar troughed to the nearly commuted, those up early
trudging past the commuter lane, cruising for porn or top of the line
queries and questions asked--is this legal… Everything we do is legal.
It’s those others, the ones with shaky business plans and several sets of books
(more than one off) and the thing we most grudge: the sexy assistant, available
for work after work and for work when no work is due and for work
because work simply is. That is the meaning of is. For all the workers
in the world, in the factories, in the fields, in windowless cubes, in offices
where people crop eight hour days (weekends included). In
pursuit of what might be a brilliant idea the sprinkler feeds the pool
and the pool is exercise central for orange coated butts and oatmeal thighs.
Lap after lap dance away watery illusion, no resistance persists—one less
insurgent seeking demolition, destruction, despair. The action is here,
in our certain arena, blared over and stared after women standing
in front of what used to be buildings, whole buildings, whole bodies. Keeping
it together, finding the pieces, down to the last molar—they last longer, longer
than bones, a kind of punishment for uppity jiggles of flesh,
not a kind punishment. We covered all that.
A possible bailout for Dubai is especially bullish for the markets because it's the largest of folly of all. If Dubai can get bailed out then anyone can get bailed out. Just don't be late to the exits, folks.
It is more dangerous to be a great prophet or poet than to promote twenty companies for swindling simple folk out of their savings.-- George Bernard Shaw
The U.A.E.’s banking industry is already the biggest among the six Gulf Arab states including Saudi Arabia, Kuwait and Qatar, with 1.54 trillion dirhams ($418 billion) in assets, central bank data shows.
But I am one of those that believe that we shouldn't have too big to fail banks. Separate out the depository function.
If we are going to accept that some banks are too big to fail, then the resolution process should have some teeth.
You are not disagreeing with me when you say that we should not have TBTF financial institutions. Nor when you say that we should have a resolution process with some teeth. Or even when you say that we should split off depositary functions.
But my point is that the proposals in Congress for tackling these issues are mostly red herrings, designed to get you and others focused away from the bigger problems. For example, we already have a resolution process with lots of sharp teeth - bankruptcy. Horrors! Oh, that's a little too tough. Really? AIG was bankrupt, and it's being wound down very, very gently. So the existing processes can achieve the full range of goals that we might want. As for TBTF, new capital requirements that are higher for larger institutions could get the results (if Congress really wanted them to). Splitting off depositary functions? Fine, let's re-enact Glass-Steagall, since some people seem to be hell-bent on that, and won't even look at the real problems until that is done. So get it over with.
But the real problem here is very, very simple: too much lending against bubble-priced assets. And it has not been recognized yet. If it were, we'd be shutting down all low money down loans, and 45% DTI loans. Instead, we've poured govt money into them.
It is more dangerous to be a great prophet or poet than to promote twenty companies for swindling simple folk out of their savings.-- George Bernard Shaw
There are no more great prophets and no significant numbers read poets. Swindling is doing just fine though
For real. Legislation moving through congress accepts that some banks are TBTF and puts into place a means of resolving (closing) TBTF banks. The question that came up (a few weeks ago) was whether this authority should be funded (like the FDIC) or not funded. The industry did not want it funded and most of the committee (I believe), including the chairman was OK with that but there was a small uproar and now everyone (mostly) seems to agree that the authority should be funded.
I believe that it was previously decided that TBTF resolution power would not be given to the FDIC. ( I think it goes to a new agency or the head of a joint agency -- don't know all the details, sorry).
If Dubai can get bailed out then anyone can get bailed out.
[Borrowing my earlier metaphor...] So Taleb's turkey survives Thanksgiving... not realizing he's being saved for Christmas?
if anyone can get bailed out, and all participants in the system accept it and play along, then nothing much will change from here. remember that fiat money is worth nothing, means nothing, and has a very low marginal cost of production. we really are living on a monopoly board.
it goes without saying that unconnected savers get screwed, but how many of them are there anyhow?
There are no more great prophets and no significant numbers read poets. Swindling is doing just fine though
VK:
Easy credit money leads to speculative boom.
Excess overcapacity is built, asset prices soar, general feeling of goodwill and trust. People more willing to go into debt as future looks all rosy.
Cash flow problems occur, as credit growth far outstrips wage growth.
Minsky moment reached and the greatest fool is left holding the bag, asset prices plunge due to declining liquidity as borrowers refuse to borrow due to exorbitant costs of servicing the interest.
Banks reduce lending sharply as asset price decline leads to a balance sheet recession and lots and lots of losses. Further liquidity drained from the system.
Now Government steps in to fill in the gap caused by massive deleveraging. It's sole goal is to reflate, reflate, reflate.
If the gap between debt to income is sufficiently small, the Government can kick the can down the road but once it grows larger, they can no longer do so.
Wage price deflation takes hold as the economy simply can't handle the debt. Wages fall, asset prices fall, debt burden soars as money goes down the proverbial black hole, banks collapse and government revenue and cost of servicing debt soars. Unemployment shoots up thus removing any wage pressures.
The Government has two options at this point, one is to print its way out, thus destroying its currency and isolating itself from the broader international community or it can allow massive deflation to occur through which it is not isolated and the value of its currency rises. In both scenarios the middle class is F***ED but in the deflation scenario the elites are saved.
The elites would prefer an outcome whereby there is massive deflation; as Ilargi once mentioned, if you lose 50% of your net worth but asset prices fall 80%, you're up 30%! Buying back the country for cents on the dollar is a delicious outcome and lets the game be carried on for a little while longer.
Hyperinflation carries more risk then deflation for the elite. Both pose risks to social stability and the possible collapse of society but in a deflationary collapse the elite would have more of an advantage.
Bobby was a good son, sought the approving nod
and when that didn’t come he kept right on
keeping on just the same. And so it went
until the day came when he questioned going home.
What was the difference, between going home versus
driving off the pier. And who would notice anyway.
Both outcomes lead to the same drowned state of affairs.
He hooked himself up with an older woman who missed
the sixties, hit the road. There was the moment
in that venture, (Bobby would never attempt an adventure)
when the road narrowed to two lanes and the Bubba
beside him decided he should go first. Bobby, for the first
time in his life, decided not to give in, not to be the good son,
the forgiving guy smiling, with a wave and a you go
right ahead frame of mind. No, today Bobby said Fuck ‘em
and laid on the gas. Of course Bubba was used
to having his way and pressed the point. Neither one gave
an inch. Bubba’s truck was bigger and stronger and faster.
He hauled ass and by-passed Bobby’s good guy little car,
slammed the brakes, which led to Bobby slamming
his. Bobby stopped inches from Bubba’s
bumper. He sat stock still while Bubba’s Pickrick Drumstick
rearranged Bobby’s fender, headlight and windshield.
The nice, older woman fell to a stroke and died
that same day. Bobby didn’t press charges. Almost
a thousand days now, Bobby’s been working on
a new way of believing whatever is in
his life. He may not have changed any more
or less than he would have otherwise, but Bobby can’t
help himself. The urge to consider the pier
makes its way back to his head. They’ve got him
on acid. The chips keep his keepers
aware of what he’s doing and where
he’s going. They turn up the static when he gets to
thinking of there, so he pastes one on--a smile
with a big baby face, whiskers and teeth. He turns
toward that which he currently calls home. His
keepers know he won’t go over the edge
but they don’t tell Bobby. It just wouldn’t be right.
Personally, I think regulation of any kind only works if the regulators aren't working for the regulated. But, ALL government in the US - from local through the Fed's - primarily exists to aid the already connected in extracting more loot from the system. So, regulations currently exist, did exist, and will exist and will be ignored because of this.
I don't know if there is a way to fix this. It's the way the US works, it's probably the way all governments work where they the government has successful disconnected itself from "the citizens".
if anyone can get bailed out, and all participants in the system accept it and play along, then nothing much will change from here.
Seems we heard something similar about the housing bubble, e.g. "if anyone can get financing for anything then why can't housing go up forever"? Same thing about stocks, too -- I remember quotes along the lines of "I don't see how the boom can go bust in the face of endless liquidity".
I think the approach discussed by Mish is much more efficient: Mish's Global Economic Trend Analysis: law school professor advises underwater homeowners to walk away from mortgages
why not? we have to change the way we view money. we can throw gobs of it around, lose bunches of it, so long as we keep printing. as a society, we won't start to get into any real trouble until J6P decides money is no longer worth busting his ass to get. i fear there is a tipping point at which the number of people not working and spending their time playing silly paper games to get more "money" will exceed the number people actually trying to do something good with their lives by a sufficiently large margin... or at least the proportion will get so great... that we reach systemic breakdown.
we aren't there, yet. it's ok that you and i know the truth, just so long as J6P doesn't catch on. J6P, the worker, is the one we need to keep fooled.
I don't think there will be riots in the streets until people get organized by a messiah or two. The worse possible combination is 2 messiahs coming out at the same time
you know how many people who've said to me that everything is fixed... the crisis was overblown? i carry a towel around with me to mop up drool, i swear.
Mish's Global Economic Trend Analysis: law school professor advises underwater homeowners to walk away from mortgages
sm_landload (?) posted this link on here this morning. The pdf is a great read. I'm going to pass it on to the people that I know are well underwater. I assuming TPTB are gambling that most of the underwater peasants will be too embarrassed to make this into "mass movement" (they're probably right).
It depends on your horizon. In mid-1974, the 1973 bubble had burst. By 1983, it had reflated again, never to go back down below the 1973 highs. Think in decades, not years.
i fear there is a tipping point at which the number of people not working and spending their time playing silly paper games to get more "money" will exceed the number people actually trying to do something good with their lives by a sufficiently large margin
And that's why it is better to make money a reliable long term store of value, instead of constantly 'goosing' the GDP numbers for next year by inflating a little today.... every day.
If we knew that $1 held for the next 30 years would buy exactly the same things it buys today, we'd all be able to plan for retirement and other future needs. Half of FIRE would collapse, because it is based on money illusion, the illusion that it is adding value when it is really eating value.
the illusion that it is adding value when it is really eating value
Yeah, well, remember you said before how you didn't like people that knew nothing about economics "talking economics". The same is true of politics. The US is an illusion built on bubbles. Perhaps all societies are, who knows... But, getting to a political reality where $1 is $1 for 30 years is impossible.
If we knew that $1 held for the next 30 years would buy exactly the same things it buys today, we'd all be able to plan for retirement and other future needs. Half of FIRE would collapse, because it is based on money illusion, the illusion that it is adding value when it is really eating value.
But, getting to a political reality where $1 is $1 for 30 years is impossible.
exactly. not even a political reality. how in the world would one do it using economics in a political vacuum? freeze the population of the world at it's current level... never to rise, never to fall? sure, you may be able to establish what one dollar buys today given the number of dollars and the number of people consuming, but when the population goes up so does the value of that dollar, or vice versa. right? at mean, at it's very simplest. never mind productivity gains, evolving technology, etc, etc, etc.
You'd need something (literally a thing) to regulate the smart amoral scumbags. Unfortunately for the idealists, natural selection IS still at work. Capitalism is the only viable (realistic) economic system because of natural selection (screw or be screwed). Unfortunately, unlike sports - where each new season the teams start over again - there's no capitalism off-season for everybody to "reset" in.
Gangs control blocks, maybe a neighborhood. A gang that gains political power and grabs the levers of the state gets the really good hardware and access to agencies.
Actually, it would be quite simple. Govt issues zero-coupon bonds with a final repayment of principal that is indexed to the CPI. We sort of have that now, but there is a tax applied on 'gains' due to inflation, so you cannot preserve your purchasing power. So just make the payoffs tax-free (after all, you're just getting the real value of your original money back). I know that could be refined some, but that's the basic, very simple, idea. It wouldn't be hard to do. But a lot of people don't want it to happen.
Once the holidays are over J6P is going to sit down and figure out that he can't pay the mortgage, or no longer is willing to when he is 30%+ underwater. Some will walk away quickly, some will figure out they can scam the mod program for a good 6 months.
People in mod programs will either decide they no longer want a mod that is a 40 yr loan that is adjustable in 5 years, with all the past due added on the end - owing still more than the house is worth. Many poeople will stop playing the "I can't find the paperwork to qualify" game and walk.
There will be an increase in unemployed due to small businesses closing. Finaly giving up.
Actually, it would be quite simple. Govt issues zero-coupon bonds with a final repayment of principal that is indexed to the CPI. We sort of have that now, but there is a tax applied on 'gains' due to inflation, so you cannot preserve your purchasing power. So just make the payoffs tax-free (after all, you're just getting the real value of your original money back). I know that could be refined some, but that's the basic, very simple, idea. It wouldn't be hard to do. But a lot of people don't want it to happen.
i think i proposed something similar to this on this blog at some time... as a thought experiment.
$100.00 in 1865 had the purchasing power of $103.41 1932.
Yes, but how much "inflation" was "sucked up" in the vacuum of "the new frontier". The US is full now, the US smart amoral scumbags are as constrained as any peasant living in the most crowded places on the planet. Resources are become "limited". Unfortunately, the only "resource" left to exploit is the savings of the nation.
i think i proposed something similar to this on this blog at some time... as a thought experiment
I hope I said it was a great idea, RockyR
It is very interesting to me that this would not be hard for govt to do, and would make investing for the future much more predictable for most Americans, and ....yet will never happen because of the vested interests it would disturb.
Sorry, that won't fly. The Fed was established in 1913 and the buying power of the greenback remained pretty much static until we went off the gold standard.
"It would take $1629.85 in 2008 dollars to equal $100.00 in 1869 dollars, what the hell happened?
What taxes and debt did they have to start. how many times have we inflated to make debt disappear. Guess what we will do again? I think so but this times it will be real hard with out jobs and wage increases.
I think 2010 will be the year it hits the fan, too.
It takes fuel to sustain extend and pretend, and it takes fuel to sustain a stock market rally based only on speculation, leverage and endless cheap money.
I don't exactly know how much fuel is left. But I'm pretty sure it not a full year's worth.
In a reflection of how sure investors were that Dubai would meet these payments, the bonds were trading at a 10 percent premium to face value earlier this week. They are now trading at around half of face value.
Another 50% drop and you'll have a chance at making a killing. Dubai as an international financial center didn't make much sense as even GE is getting into Islamic finance, as a travel destination they only have 5 months of decent weather, none of which are during when Euros holiday. Logistics and a waypoint for air travelers? Sure.
I think 2010 will be the year it hits the fan, too.
It takes fuel to sustain extend and pretend, and it takes fuel to sustain a stock market rally based only on speculation, leverage and endless cheap money.
I don't exactly know how much fuel is left. But I'm pretty sure it not a full year's worth.
I agree.. Extend and pretend is running out of time.
I'm watching this ridiculous episode on 60 Minutes and it looks to be a planted anti-barbarous piece of trollop, designed to scare people into not buying any.
It takes fuel to sustain extend and pretend, and it takes fuel to sustain a stock market rally based only on speculation, leverage and endless cheap money.
I don't exactly know how much fuel is left. But I'm pretty sure it not a full year's worth.
What's going on offends my sense of morality and commonsense - it seems unsustainable and confiscatory. But if you accept that FIRE is maybe twice the size it should be, based on prior govt subsidies and regulatory support, then why can't it go back to that? After all, we could impose a VAT of 5% tomorrow, and spend it all on additional health care. It would feel big, but it could go on forever. Why can't the corresponding supports for FIRE go on forever (even if they shouldn't)?
The fuel to extend and pretend really comes from J6P. That is the guy doing the work, paying the bills, paying the taxes, driving the kids to school.
J6P is tapped out. From his own get rich quick games or playing by the rules and out of a job. And if it isn't J,it is his neighbor or brother in law. The Js who are working see the writing on the wall, life isn't as good, his kids won't have it as good. J6P is going to start looking out for himself and to do that he will figure out the has to die. Time to starve the . The only way to starve it is to stop feeding it money. So J6P is not going to continue to pay the mortgage or credit cards, the only thing he has control over.
Unfortunatly J6P doens't understand the ramifications of not feeding the in the short term either.
The fuel to extend and pretend really comes from J6P. That is the guy doing the work, paying the bills, paying the taxes, driving the kids to school.
J6P is tapped out.
Savers can be tapped next (inflation). That's worth many trillions. Lots more to go.
The only way to starve it is to stop feeding it money. So J6P is not going to continue to pay the mortgage or credit cards, the only thing he has control over.
I don't see any realization of this yet. The peasants I know are still in awe of authority and hierarchy. They know their place and fear confrontation with their betters. The nobility have it made here, right now.
$100 in 1865 = $278 in 1969 = $1630 in 2008.................................seems that from 1970s elimination of the gold standard, things went to Hell?
They know their place and fear confrontation with their betters.
I think they are getting an understanding of their place - and that they no longer have the opportinity to move up in place. They do fear losing what little they have been able to hang onto thus far. Once they see they can replace what they have for less, or aspire to less and be happy, the game is over.
Fluff piece from Wall Street / Treasury to the MSM. After the criticism he received last week when he appeared before Congress, clearly the PTB decided they didn't want to lose the guy with his hand on one of the two money spigots going directly into their pockets.
Yeah, that's what I think too. The US is exactly like the Soviet Union. Supported completely on mythology of the future and the next 5 year plan. Pretty pathetic, but as long as the peasants believe, it will hold together. I guess that's why we need that next 8 year war.
Hello Again. For those who remember earlier phases of the collapse of the decades-old, fed-sponsored credit binge, statements such as "...projects regarded as folly will not be backed but operations and investments with a strong business model will be", add logical meaning to phrases such as rational default: stop using remaining financial assets to amortize debt on worthless homes and condos.
Lame duck City Attorney Michael Aguirre will ask the City Council during a closed-door hearing today to consider hiring legal counsel to explore taking San Diego into bankruptcy.
Aguirre said Chapter 9 bankruptcy protection would allow for the reorganization of the San Diego City Employees' Retirement System, which faces mounting investment losses amid the national financial crisis.
Actuary Joseph Esuchanko told city lawmakers last week that as of Oct. 31, SDCERS had $3.78 billion in assets, compared to $6.56 billion in commitments to retirees over the coming decades.
If the actuary is correct, the shortfall in San Diego's pension fund has grown to $2.78 billion, up from $1.2 billion in 2007.
"We need someone to help us," Aguirre said.
You're the novelist. Didn't you ever read Jack London?
You failed your dog, Nova. You didn't toughen him up and teach him to fight.
A dog who holds his ground can back down just about any other animal. But even if the dog gets torn to bits, it's better to stand and fight than turn and run. It's a noble ending for a dog. A dog is a wild animal, after all.
Well, off to dinner. A fun night of doom. (Hopefully, we're wrong and the teaming masses are right. Altho, that would mean my assets are allocated incorrectly, so that means: I hope we're right and the teaming masses are wrong. Jeez, who knows...)
The difference being: The hoi ploy behind the Iron Curtain were only too happy to see communism go away, whereas our consumerati will cling to the old system, with a debt-like grip...
"so clearly more people are buying into the current situation, high prices and all."
....trying to "get theirs" whether they can afford it or not. This is SPECIFICALLY what our pi**-poor leaders ought to be ashamed about - their only concern is pumping up the flat tire to get a bit further down the road - relocated families be damned.
But Case-Shiller tells us that home prices are increasing again
Mid level homes are selling at a lower price. Most of the low end is bought and resold by investors. Mid level is still higher than low end. At least I think that is how they get their numbers.
their only concern is pumping up the flat tire to get a bit further down the road -
True, most people only want to know how much down (0 with tax credit) and how much a month (less with low interest on a house that has lost 30% of it's prior value).
They know their place and fear confrontation with their betters
Perhaps more true of Americans then some Europeans (see article below), despite the greater access to lethal weapons in the US. I think that it is all too likely that those weapons will be turned first on family (seems to be an increase in fatal domestic violence in the US & not just in military marriages), friends & perhaps close targets like employers, co-workers. Not sure the violence will be directed (or effective against) IBankers, etc., or those who might reasonably be thought to be more responsible for stagnant wages, etc., rather than, say, one's spouse & children.
At least for some Europeans, unions, &/or the strength provided by large organizations (whose primary purpose for organization isn't corporate profits), isn't as poisoned a concept/tool as it seems to be for many Americans.
Why would an investor want to buy homes anywhere in California right now?
It doesn't begin to pencil out in terms of what you get in rent, and none of it makes any sense in light of falling rents and rising vacancies, not to mention competing against Tenants Players, all the more a common sight nowadays, before their court date...
Nicely put Josap, 'Many people no longer think being "house poor" is a good way to live', and tomorrow OB and the feds, in the latest, futile effort to keep citizen frogs unaware of the consequences of staying in the slowly boiling financial pot, will publicize a list of banks with low scores on home loan modifications, as if banks with higher loan mod percentages were having any meaningful effect on the ongoing credit-home-asset price collapse, hiding in plain sight.
Why would an investor want to buy homes anywhere in California right now?
Because some "investors" have more money than brains? Those are the ones with which I have no sympathy. The people buying the overpriced homes in which to move the family due to FedGov stim hype gets my goat.
The rulers of Abu Dhabi are expected to make a statement before the markets open on whether they will bail out Dubai and which businesses and projects will be rescued.
Hopefully, the FED has taught them how to run a Sunday night intervention properly.
What? Paying attention to whether something is good business in rescuing a bank or investment?
Wait, first it was $60 billion. Then $80 billion. Now $88 billion.
Does anyone really know? And when will derivatives positions come to light?
This is all just so wonderful to watch. Especially the early "no big deal" callers.
I met a traveller from an antique land
Who said: "Two vast and trunkless legs of stone
Stand in the desert. Near them on the sand,
Half sunk, a shattered visage lies, whose frown
And wrinkled lip and sneer of cold command
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed.
And on the pedestal these words appear:
`My name is Ozymandias, King of Kings:
Look on my works, ye mighty, and despair!'
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare,
The lone and level sands stretch far away".
Mr Slippery wrote:
ask Msr Rothschild
basically they feel like Dubai was taken in by a bunch of slick talking western snake oil salesmen, they're not sure how but they don't want to pay out money unless they're getting something back, and they don't want to overpay
Most food stamps get used by children.
aleister perdurabo wrote:
Roses are red,
violets are blue.
I wish I could buy
a palm island or two.
But alas! I am stuck here all alone
in my humble ranch house that the bank really owns.
I'm looking for some good work, a house would do fine-
to remodel and fix- then sell on a dime.
But those days are past so I'll guess I'll just wait,
perhaps go back to school and
sell Real Estate!!!!
I'm accepting donations....
Better get some chainsaws and start whacking the "United" part off those United Arab Emirates signs.
The central bank did not give more details, only saying that it stood behind UAE banks and branches of foreign banks operating in the UAE, adding the country’s banking system was more sound and liquid than a year ago.
“It is important because the main concern is that there might be some panic behaviour by depositors in Dubai and by bankers who want to take deposits out of the banking system,” said John Sfakianakis, chief economist at Banque Saudi Fransi-Credit Agricole Group in Riyadh.
“This will support the liquidity and the overall soundness of the banking system in the UAE and especially in Dubai.
7DAYS - Extra cash will be available to banks
Announcements on the BBC and NPR were saying that the UAE CB was going to provide whatever "liquidity" was necessary. No hint that there might be a solvency problem. Why do these journalists call themselves independent?
One can't refer to the fact that France was occupied by Germany 1940 - 1944? You want to cut it out of the Great Internet Encyclopedia?
Can I refer to the fact that my Uncle Fritz was on trial for murder in Berlin in 1933, on a charge of having thrown a bomb into a restaurant frequented by Nazis, and that he called the prosecutor a monkey, and that he was acquitted because not all judges at that early date were Nazis?
Or that thereafter the "guys with letters on their lapels" (SD) were after him.
Or would that be Godwined?
Or should I tell you...? Never mind.
ahhhh. That sounds more like us.
I thought they might shore up ports, perhaps the new airline facilities. But banks it is.
Interactive brokers showing futures SUPER kermit, +12.36%.
Heh. As if. (The level is right, 1093.25 on the spoos).
OT- personal:
We met a Canadian college racer and her local father who showed us "secret" Blackcomb. Heavy snow...drinks last night... altitude...sitting on the blog in lieu of coaching squash...Spanky's spanked me silly. Rock and roll rocked my world.
Can't move a toe but must rally since we're meeting her older sister and drop-dead gorgeous friend for dinner and hot tub. Eat your heart out Broward and you wingnuts don't even try to union-bait me. Living the banker's dream...
Separate Arab Emirates (SAE)
Dystopic Arab Emirates (DAE)
Formerly United (FUAE)
The Emirates Formerly Known as (TEFKAUAE)
Emirates We Knew And Loved (EWKAL)
Harmonious But Separate (HBSAE)
lastly, LUAU, or Lackadaisically United Arab Umirates
the truth is that too many people have borrowed way more than can ever be paid back. The lenders are in panic mode. All the polite phraseology in the world can't fix it.
1 currency now -yogi wrote:
film at 11?
Eric wrote:
12%!!! wow. that would be something.
Basically Godwin's law is the observation that once someone brings up Nazis/Hitler, the argument is over. Not because of censorship, but there is no room for further progress. It's the stage where discussion has reduced to name calling, and all attempts to use reason will be futile.
aleister perdurabo wrote:
No argument with this, or posting it. But it's showing up about once a week from different posters. How about instituting an Ozymandius emoticon -- two stone legs, no torso. It'd be popular.
RockyR wrote:
every rally has a 'blow off' phase
NervousRex wrote:
you forgot
Lets Be Friends Arab Emirates (LBFAE)
barfly wrote:
This captures 90% of it.
I would quibble about how much can be paid back, versus how much people would prefer not to pay back. I have lived on Wonder Bread and peanut butter and milk and no heat in the middle of winter in order to meet my other bills, and that's just the start of it. Others would choose simply to say that they cannot pay.
But apart from the 10%, I agree.
The Godwin stuff has become a thought-terminating cliche. A little like the "political correctness" overreaction was used to cut off criticism of insensitive, bigoted slurs and stereotypes.
it's not winter until your kitchen dish soap freezes ; )
1 currency now -yogi wrote:
That's exactly what Hitler would have said. and you smell bad. < < good example of Godwin's law
it's not what you are arguing, it's how you are arguing. could have as easily been the "arguing like a 4 year old law"
I'm rubber you're glue, your words bounce off me and stick to you
A minute ago, the Dow Jones futures were up 31 points and the S&P futures up 3.25. That puts both indices up less than 1/3 of 1 per cent. Both look pretty much in line to me. I make a market in Dow futures.
volker the viking wrote:
that would be one helluva 'blow off'! perhaps one of the best money-making opportunities in recent history (on the way back down).
good timing for me.
traderwalt wrote:
i don't think any of us believe that 12% number was accurate.
Full Moon Dec 2--gonna be fun to watch
Blue Moon Dec 31--gonna be funner to watch
" The Godwin stuff has become a thought-terminating cliche. A little like the "political correctness" overreaction was used to cut off criticism of insensitive, bigoted slurs and stereotypes.
That's exactly what Hitler would have said. "
Not at all. Hitler would have said: Get rid of that sonofabitch.
Eric wrote:
OK, Pavel, I will resist making sharp comments about not wasting mental energy on the unlikely.
Freeing the slaves via SMS.
Home from Dubai for Eid, workers axed over SMS - India - The Times of India
Even if they don't get their back pay this is probably a good thing. The Middle East is a hellhole for imported manual laborers.
EvilHenryPaulson wrote:
and his feet stink too
burnside wrote:
Verily they say unto you. The Hyper-Capitalist version of the state "Picking Winners".
Shiekdown Street by the Grateful Dead was always one of my favorites.
Barclays is gonna be busy busy tomorrow. Hu's on line one.
eigch ess bee Sea?
and his feet stink too
It's a straight line, butt one should refrain.
Dubai residents do not have to pay for parking across the emirate until December 4, the Roads and transport Authority (RTA) has said.
The free parking move is to mark the Eid and National Day holidays, but does not include the Deira Fish Market, where motorists will still have to pay, the authority said in a statement.
Motorists were urged not to park on pavements or double park in front of other cars. A senior official warned drivers would face fines if found breaking the law.
Free parking in Dubai until Dec 4 - Transportation - ArabianBusiness.com
well, whatever is happening, asia sure likes it : up about 2%
Major World Indices - Yahoo! Finance
Uhh...this link appears to work...dunno what the cnnmoney 404 is all about
Japan Stocks Rise After Dubai Debt Concerns Ease; Kajima Gains - Bloomberg.com
"I think many people consider most of Dubai "folly"."
CR - you can probably replace Dubai with USA, at least with respect to RRE and CRE.
traderwalt wrote:
Right, I know that. That's why I said the level looked right. IB just has an incorrect close, so they're showing up 120 handles on the spoos right now. Entertaining, is all.
Of course.... "bad tick.. always goes there!"
Pavel, your Uncle Fritz sounds like he was a h*** of a man. Anything you can remember to tell about him would be greatly appreciated.
Vive la resistance!
pavel.chichikov wrote:
I'm staying up late for the video --him and the babes, her saying something that makes it all worth the effort.
aleister perdurabo wrote:
more torture vids soon to follow
iirc he coined that law after a multi-month flame fest across all the usenet culture groups which began with a post that was titled, "Is there any nation out there that actually likes the Germans".
I think the chief result was that it was pretty much established that there was a significant group out there that didn't like anybody, and that cross posting across the national culture groups was a really bad idea.
ah, Usenet in those precious few days we had before September.
Terry, it's not that bad in the U.S. - although there are definitely projects I'd consider "folly"!
best wishes
Rocky, every time I hear something wild about the stock market I want to know what's really going on. I had my quote screen open, so I posted what I saw. For the record, I believed some pretty crazy things in the past, at least for a little while.
traderwalt wrote:
Would you believe the full moon has anything to do with it?
Jackrabbit: "The industry didn't want it funded because they know that it is MUCH more likely that the resolution authority will be used if it is funded. Resolution generally means a bank is put out of business BEFORE your problems are so immense that it threatens the financial system.
Having it funded benefits the taxpayer because it makes bailouts (using taxpayer $$$) less likely. Bank executives don't want it to be funded because they are much more likely to keep their jobs in a bailout vs. resolution. (as we have seen)"
This is the theory, jackrabbit. But I have lived long enough to see some practice. I will be assuming that they will do a bailout, one way or another, regardless of prior funding.
"more torture vids soon to follow "
can't you just see some sheik cramming sand into some poor slobs mouth for boxing him in at the market?
BTW: The Wrestler is a must see movie.
Barfly, he was, and, much later, as the chief estimator for the industrial painting company that got the contracts for the subway in NY and the George Washington Bridge, he knew a lot about what went on in the construction industry. But God bless his soul, he died some years ago,and up until his death he received a sizable monthly compensation pension from the German government.
I do know that he used to walk around mid-town Manhattan with five grand in cash in his pocket, in case he needed it in the course of business.
barfly wrote:
and spanking his bare ass with a paddle that has a nail in it
Let them whither and wilt another two thousand years.
"Let them whither and wilt another two thousand years. "
like Matt Damon said in "Syriana", after the oil runs out they'll be back to cutting each other's heads off. The sooner the better.
him and the babes,
That would be Olga from the Volga. Seriously.
He was invited to spend the war in Moscow, and wisely turned down the offer. He spent the war in the States, was drafted, and then discharged for an injury received in training.
Didn't go back to Germany until the 50s.
"Would you believe the full moon has anything to do with it"?
I'm so busy howling at the moon, I haven't had time to think about it.
CalculatedRisk wrote:
O.K. - maybe just Las Vegas, then
CalculatedRisk wrote:
How many are owned by Dubai World?
volker the viking wrote:
My favorite rental 'o the week was "Drag Me to Hell," about the "nice" mortgage loan officer who brushes off a gypsy fortune-teller who comes in for a workout on her home loan and... pays the price. I truly enjoyed the part where she sacrificed her cat to get the avenging demons off her back. Worth a look if you like unholy vengeance.
volker and barfly,
ease up on the H8-ur-aid
bANK fAILURE wrote:
I have no response for this.
12/31 DJIA - 11685
Gold - 1378
MSM response - priceless
traderwalt wrote:
alas, me too. i'm learning to take the
on the internet with a grain of salt.
Ahhh.......and then there are "distasteful cartoons" that also need judicial review in Dubai.........
sorry, banksy. Got carried away there. Back to PC mode.
Gold - 1378
Another bubble?
Dubai & Vegas are interesting bookends...
Both have reached their outer limits as far as freshwater & finance sources are concerned, and both cater to fantasy, which isn't selling anymore.
Let em' burn~
pavel.chichikov wrote:
not within a nuclear detonation of a bubble
When one ounce of gold will buy the Dow is when the bottom is in. Not a moment before.
no comment
Not even an eensy teensy bubble?
pavel.chichikov wrote:
Yes. I have always wondered if gold would be "the last bubble" -- at least, in the global financial system as it's currently structured.
Edit -- as bubbles go, this one may be a weather balloon, with a lot of puffing still needed to inflate it; early days, even now. So when I say "yes" and Volcker says "not yet," we're not really disagreeing
gold will be worthless in the face of food or even water.
Patientrenter wrote:
"This is the theory, jackrabbit. But I have lived long enough to see some practice. I will be assuming that they will do a bailout, one way or another, regardless of prior funding."
Well, I acknowledged that in my reply. Why didn't you include that in the clip? (see full reply below). We agree on the fact that the government will protect the financial system, but you have ignored the larger point: that large firms and concentrated industries seek to wield their power to influence legislation in a way that is anti-competitive and benefits narrow interests.
In this case, NOT funding a resolution authority is adverse to the public interest. It doesn't really have much impact (if any) on bank investors but it does have a great impact on bank management. Management is MUCH more likely to lose their jobs if there is a resolution, wheras a bailout comes when there is an imminent threat so bank management will remain for "stability."
My previous post in full:
=================================
Patientrenter:
"The funding is a red herring. . . . They'll bail and spend regardless of whether the fund is there, and regardless of how much is in it."
We'll yes and no.
Yes, the government is going to do what it takes to protect the financial system, BUT I used it as an EXAMPLE of how industry has undue influence, and I'm not sure that your counterpoint reflects that and ...
The industry didn't want it funded because they know that it is MUCH more likely that the resolution authority will be used if it is funded. Resolution generally means a bank is put out of business BEFORE your problems are so immense that it threatens the financial system.
Having it funded benefits the taxpayer because it makes bailouts (using taxpayer $$$) less likely. Bank executives don't want it to be funded because they are much more likely to keep their jobs in a bailout vs. resolution. (as we have seen)
Gold purchase plan on track
http://www.telegraphindia.com/1091130/jsp/business/story_11801675.jsp#
barfly wrote:
but you'll be able to get some pork and beans in exchange (silver's better for small transactions)
juvie, Im glad your here.
"This is not the time for jesting; wit does not harmonize with massacres...Is this the country of philosophy and pleasure?"
-Voltaire
tu yu, Im just some, fella
......portfolio: eggs, dairy, beef, veggies, diesel, lead, silver & gold (placer not paper).
barfly wrote:
Well -- then it won't be the same financial system anymore. From my point of view gold has been a great hedge, and will remain so until it doesn't. The point is, where to get out (and what to get into). The only cynical investment I've ever made.
Tomorrow is another day - usually.
Bob Dobbs wrote:
stop it
Gold is the be all and end all, so is silver if you have it in hand.
SNAFU wrote:
Does the IMF send a Spanish Galleon with 200 tonnes of gold to India?
volker the viking wrote:
But "it" has to end first.
NOTaREALmerican wrote:
bullshit
"The point is, where to get out."
don't get out. It will always be worth whatever it is worth at the time. Depends upon how desperate you are.
arent you supposed to be going to yoga?
bANK fAILURE wrote:
On Sunday? Sunday night's there's no yoga or hotties.
,rad bANK,
They can take away our wealth and freedom, but how does one repo sarcasm?
Oh, I can edit!!!
bANK fAILURE wrote:
yer stretchin to make a point
test
barfly wrote:
We'll never get that far, but if we do we'll most likely be dead and won't care anyway.
Jackrabbit wrote:
D+
Flash! Earthbreaking News:
NEW YORK (AP) - By a wide margin, Americans consider Rush Limbaugh the nation's most influential conservative voice.
Those are the results of a poll conducted by "60 Minutes" and Vanity Fair magazine and issued Sunday. The radio host was picked by 26 percent of those who responded, followed by Fox News Channel's Glenn Beck at 11 percent. Actual politicians - former Vice President Dick Cheney and former vice presidential candidate Sarah Palin - were the choice of 10 percent each.
and we think Dubai commits folly.
....at night they send thousands of tiny little Indians with picks, shovels, & pans......scuttling the desert hills for caves, strange rock formations, and "Danger-Mine" signs..........and then disappear by sunrise..........I've seen 'em..........honest Injian!
volker: yest, I'm still learning...
Jackrabbit wrote:
I am not trying to ignore that point, Jackrabbit. I understand regulatory capture and all that, and I don't much like it.
But having said all that, we have to decide whether to set up yet another insurance fund that pays money to ventures that lost money. Should we do it? Well, if you believe that it's possible to set up insurance funds that can pay out enough to offset the occasional large losses caused by systemic risk, and you think that having risks covered by an insurance fund won't generate more bad behavior through an increase in moral hazard, then it would be a good idea. I've seen enough consequences recently of large-scale systemic risk and moral hazard to believe that our number one priority should be reducing them. You may draw different conclusions.
dum luk wrote:
Might be coming true. Euro-Dollar is taking off.
Of course it's only Sunday night.
Jackrabbit wrote:
and inventing new words
are you a low level bureaucrat in a large organization?
We Weren't Born To Follow - Bon Jovi
volker the viking wrote:
My, ornery tonight. Did Jack fopaux the forex, or something?
Volker: No I'm a top exec in Dubai
this is why you should never assign greater intelligence to the comments.
We are the people we have been waiting for,
brought to you by all the people you have been warning us about.
THAT'S what we need: Insurance that covers against bad judgment and lapses of character. Why didn't I think of that?
Jackrabbit wrote:
and I'm the Louisiana state champ for downhill snow skiing
Black Star Ranch wrote:
Isn't that what "shorting" is supposed to actually accomplish? Assuming we has a free and open market, and all the other fantasy stuff.
I'm a dog
Cactually the gold is moved from one side of a room at the Bank of England or the federal reserve bank of New York to the other, and the label is changed, being so heavy gold is costly to transport so it tends not to move.
there ain't no gold in any bank
It's the new diaspora.
I dare anybody to try and gather it up again.
Pavel. Was your Uncle SPD?
Went to Target in Burke VA. Busy as in 2005 weekend busy. Lines were 1 person deep. No large amounts of items seen purchased. The woman in front of us got mad when I started counting the number of $1 socks she bought.
Went to CA Tortilla. Sunday is Kids Eat Free Night. We usually eat there before going grocery shopping. Usual kid count 4. Tonights kid count 16 and the woman in front of us argued that her kids didn't get counted correctly.
I'd be surprised if the people who want to diversify out of dollar$ would want to leave their
in someone else's vault.
Anonymous Bosch wrote:
an Olympic event
nova wrote:
gimme my fucking taco
I suspect the arabs will determine what to bail out by which obligation has AIG on the losing end of the CDS. Share the burden with Ben & Timmay.
Electronics are always deflationary. Still, husband got a 14" emachines laptop (I guess that's an acer brand) for $279 today, including computer bag & optical plug in mouse.
Why get a netbook?
I've wondered about that too, bosch............the only time you might need it, is when everyone else will...........kinda like guns and ammo - why would anyone want to leave it off-premises?
Anonymous Bosch wrote:
Unless they are assuming the financial system won't collapse. I'd guess if India demanded real gold that might "raise some eyebrows". (Hey, yeah, uh... would you guys mind actually sending that glod too us? Naa, just my bosses boss wants it, I donno. Yeah, I know, probably nothing you know how management is.... Uh? Sure, UPS is fine. Thanks....)
Whatever it is, Japan likes it. Up 2.5%.
Off to the races once again.
If you'd like to make the barbarous a thing of the past, it's an easy task.
Simply gather every last grain of it, charter a Capesize, and dump it all into the Mariana Trench...
Go for throttle up, Challenger Deep!
Next Bailout VEGAS!!!
volker, put blonderengel on, please
Lol. NaRm.
So whadda we talking about here, 200 tons of paper gold? That's gonna take a few more conex containers.
Juvenal Delinquent wrote:
Now you're thinking like a central banker!
I just realized that an international IQ test is probably metric; a 135 kph score is like 84 mph.
NOTaREALmerican wrote:
I've read that the 200 or so tonnes that India purchased from the IMF already resided in India, so it's mostly paperwork.
However, the remaining 200 does not, and India is negotiating both to purchase it and take possession.
that kinda freaked me out.
of course it is
That explains all sorts of misconceptions.
I just realized that an international IQ test is probably metric; a 135 kph score is like 84 mph.
I didn't break a 100. I am secure in my low score.
Man oh man, the waste! All that gold plated tungsten slowly drifting down into the abyss,...
bank failure, have you ever heard blonderengel?
nova wrote:
Me two.
ahhhh
I hope not..........I like the decreased traffic - less homicidal drivers, no lines at the fast-food joints once a month when we're there.......quite seriously, LV Metro PD has lost a half dozen officers in the last 6-months......the place is turning into a free-fire zone......upscale neighborhoods with home invasions - shots fired nightly - killings on the streets.........old west kinda stuff.....the network news here reminds me of LA news before they started censoring the gang bangers.
nova wrote:
of course you are
i still read a lot of the comments.
its like a hobby.
(Iadbud)
.............\
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bANK fAILURE wrote:
like whittling walnuts
barfly wrote:
Appears to be a 27 yo German female that was recently in California on Highway 1.
MySpace - BlonderEngel - 27 - Female - DE - myspace.com/michaela_chloe
IMF does not have a vault. Their gold is mostly book entries in other peoples vaults. It would not surprise me if the gold that India bought is already in their vault. Remember, in the "official" Breton Woods days, countries settle their trade deficits by "transfering" gold. The IMF was set up to facilitate these transfer. When the U.S. went off the gold standard, the IMF was out of a job.
I am glad Volker and other smart people don't make fun of me.
NOTaREALmerican wrote:
genau
I'll bet it's because CSI started filming there.
My idea was to bail out the Gamblers. Cash4HoplessLosers. That would pump a lot of bux into the local economy if they could just an ATM for more funds. Push the C4HL card in and go right on being patriotic.
nova wrote:
why would I, you're nice, not smarmy and seem to be comfortable in your own skin
its like a hobby.
c'mon bf. You can say it. Addiction.
We all understand.
Outsider wrote:
and we're all praying for you
volker - I don't know if nova knows what smarmy means.
Adjust your vocabulary.
Thems of us what preys
Close.
But off by a few years.
seriously, how many people have read the BULK of the comments?
Who has the time as an indivdual to find the right comment to pay attention to?
who are the people paying attention to the reaction of the story and still listening for the ping signaling magic smoke?
-green shine
volker out
you dumb shits are on your own
The 'Rodney isn't a calculated risk, which is why it must be studiously avoided, nudge nudge, wink wink, say no more.
Cash4HoplessLosers
.....gee - being one-legged - a lot of that going around now....
Patientrenter:
Ordinarily I would completely agree with you. But I am one of those that believe that we shouldn't have too big to fail banks. Separate out the depository function.
If we are going to accept that some banks are too big to fail, then the resolution process should have some teeth.
I can do big vocab stuff. Google is my friend.
bANK fAILURE wrote:
Hey, they're sold by weight, not volume.
I don't pay attention, but I do get it on credit.
And with that, it's time to go polish my nightmares.
I read the bulk of the comments, but I'm only on for a few hours a week.
blonderengel, I'm a hopeless loser in the great void, but I love you. Unless, of course, you're just a volker sock puppet. But if you will, please grace us with one of your writings, old or new. TIA.
Before you go: a poem!
Enough about Me: Minimum Requirements for Getting Through the Day
Jesus, sweet and hot, and The Secret—whatever it is—fits all. If
not, pry bars and sledge hammers adjust tolerances. He serves
coffee, black with a sugar troughed to the nearly commuted, those up early
trudging past the commuter lane, cruising for porn or top of the line
queries and questions asked--is this legal… Everything we do is legal.
It’s those others, the ones with shaky business plans and several sets of books
(more than one off) and the thing we most grudge: the sexy assistant, available
for work after work and for work when no work is due and for work
because work simply is. That is the meaning of is. For all the workers
in the world, in the factories, in the fields, in windowless cubes, in offices
where people crop eight hour days (weekends included). In
pursuit of what might be a brilliant idea the sprinkler feeds the pool
and the pool is exercise central for orange coated butts and oatmeal thighs.
Lap after lap dance away watery illusion, no resistance persists—one less
insurgent seeking demolition, destruction, despair. The action is here,
in our certain arena, blared over and stared after women standing
in front of what used to be buildings, whole buildings, whole bodies. Keeping
it together, finding the pieces, down to the last molar—they last longer, longer
than bones, a kind of punishment for uppity jiggles of flesh,
not a kind punishment. We covered all that.
Jackrabbit wrote:
Are you talking theoretically or "for real"?
A possible bailout for Dubai is especially bullish for the markets because it's the largest of folly of all. If Dubai can get bailed out then anyone can get bailed out. Just don't be late to the exits, folks.
Thank you, blonderengel. I breath easier just knowing you are there.
The U.A.E.’s banking industry is already the biggest among the six Gulf Arab states including Saudi Arabia, Kuwait and Qatar, with 1.54 trillion dirhams ($418 billion) in assets, central bank data shows.
What's the burn rate on $418 billion these days?
Dubai Dubai Dooo......
p,s., My great crime is that I never saved your previous writings. I didn't know how back then.
zephyrum wrote:
[Borrowing my earlier metaphor...] So Taleb's turkey survives Thanksgiving... not realizing he's being saved for Christmas?
Jackrabbit wrote:
You are not disagreeing with me when you say that we should not have TBTF financial institutions. Nor when you say that we should have a resolution process with some teeth. Or even when you say that we should split off depositary functions.
But my point is that the proposals in Congress for tackling these issues are mostly red herrings, designed to get you and others focused away from the bigger problems. For example, we already have a resolution process with lots of sharp teeth - bankruptcy. Horrors! Oh, that's a little too tough. Really? AIG was bankrupt, and it's being wound down very, very gently. So the existing processes can achieve the full range of goals that we might want. As for TBTF, new capital requirements that are higher for larger institutions could get the results (if Congress really wanted them to). Splitting off depositary functions? Fine, let's re-enact Glass-Steagall, since some people seem to be hell-bent on that, and won't even look at the real problems until that is done. So get it over with.
But the real problem here is very, very simple: too much lending against bubble-priced assets. And it has not been recognized yet. If it were, we'd be shutting down all low money down loans, and 45% DTI loans. Instead, we've poured govt money into them.
It is more dangerous to be a great prophet or poet than to promote twenty companies for swindling simple folk out of their savings.-- George Bernard Shaw
There are no more great prophets and no significant numbers read poets. Swindling is doing just fine though
NOTaREALmerican:
For real. Legislation moving through congress accepts that some banks are TBTF and puts into place a means of resolving (closing) TBTF banks. The question that came up (a few weeks ago) was whether this authority should be funded (like the FDIC) or not funded. The industry did not want it funded and most of the committee (I believe), including the chairman was OK with that but there was a small uproar and now everyone (mostly) seems to agree that the authority should be funded.
I believe that it was previously decided that TBTF resolution power would not be given to the FDIC. ( I think it goes to a new agency or the head of a joint agency -- don't know all the details, sorry).
TJ and The Bear wrote:
if anyone can get bailed out, and all participants in the system accept it and play along, then nothing much will change from here. remember that fiat money is worth nothing, means nothing, and has a very low marginal cost of production. we really are living on a monopoly board.
it goes without saying that unconnected savers get screwed, but how many of them are there anyhow?
nova wrote:
VK:
Easy credit money leads to speculative boom.
Excess overcapacity is built, asset prices soar, general feeling of goodwill and trust. People more willing to go into debt as future looks all rosy.
Cash flow problems occur, as credit growth far outstrips wage growth.
Minsky moment reached and the greatest fool is left holding the bag, asset prices plunge due to declining liquidity as borrowers refuse to borrow due to exorbitant costs of servicing the interest.
Banks reduce lending sharply as asset price decline leads to a balance sheet recession and lots and lots of losses. Further liquidity drained from the system.
Now Government steps in to fill in the gap caused by massive deleveraging. It's sole goal is to reflate, reflate, reflate.
If the gap between debt to income is sufficiently small, the Government can kick the can down the road but once it grows larger, they can no longer do so.
Wage price deflation takes hold as the economy simply can't handle the debt. Wages fall, asset prices fall, debt burden soars as money goes down the proverbial black hole, banks collapse and government revenue and cost of servicing debt soars. Unemployment shoots up thus removing any wage pressures.
The Government has two options at this point, one is to print its way out, thus destroying its currency and isolating itself from the broader international community or it can allow massive deflation to occur through which it is not isolated and the value of its currency rises. In both scenarios the middle class is F***ED but in the deflation scenario the elites are saved.
The elites would prefer an outcome whereby there is massive deflation; as Ilargi once mentioned, if you lose 50% of your net worth but asset prices fall 80%, you're up 30%! Buying back the country for cents on the dollar is a delicious outcome and lets the game be carried on for a little while longer.
Hyperinflation carries more risk then deflation for the elite. Both pose risks to social stability and the possible collapse of society but in a deflationary collapse the elite would have more of an advantage.
Patientrenter: Amen.
OT - as opposed to all the time, effort and money being thrown away on loan mods (including the additional pressure Treasury is going to bring), or the issues potentially caused by the cram-down option, I think the approach discussed by Mish is much more efficient: Mish's Global Economic Trend Analysis: law school professor advises underwater homeowners to walk away from mortgages
The Good Son
Bobby was a good son, sought the approving nod
and when that didn’t come he kept right on
keeping on just the same. And so it went
until the day came when he questioned going home.
What was the difference, between going home versus
driving off the pier. And who would notice anyway.
Both outcomes lead to the same drowned state of affairs.
He hooked himself up with an older woman who missed
the sixties, hit the road. There was the moment
in that venture, (Bobby would never attempt an adventure)
when the road narrowed to two lanes and the Bubba
beside him decided he should go first. Bobby, for the first
time in his life, decided not to give in, not to be the good son,
the forgiving guy smiling, with a wave and a you go
right ahead frame of mind. No, today Bobby said Fuck ‘em
and laid on the gas. Of course Bubba was used
to having his way and pressed the point. Neither one gave
an inch. Bubba’s truck was bigger and stronger and faster.
He hauled ass and by-passed Bobby’s good guy little car,
slammed the brakes, which led to Bobby slamming
his. Bobby stopped inches from Bubba’s
bumper. He sat stock still while Bubba’s Pickrick Drumstick
rearranged Bobby’s fender, headlight and windshield.
The nice, older woman fell to a stroke and died
that same day. Bobby didn’t press charges. Almost
a thousand days now, Bobby’s been working on
a new way of believing whatever is in
his life. He may not have changed any more
or less than he would have otherwise, but Bobby can’t
help himself. The urge to consider the pier
makes its way back to his head. They’ve got him
on acid. The chips keep his keepers
aware of what he’s doing and where
he’s going. They turn up the static when he gets to
thinking of there, so he pastes one on--a smile
with a big baby face, whiskers and teeth. He turns
toward that which he currently calls home. His
keepers know he won’t go over the edge
but they don’t tell Bobby. It just wouldn’t be right.
adornosghost
Except this is America in the 21st century. A nation of well armed addicts who won't take kindly to their candy being taken away.
Jackrabbit wrote:
Personally, I think regulation of any kind only works if the regulators aren't working for the regulated. But, ALL government in the US - from local through the Fed's - primarily exists to aid the already connected in extracting more loot from the system. So, regulations currently exist, did exist, and will exist and will be ignored because of this.
I don't know if there is a way to fix this. It's the way the US works, it's probably the way all governments work where they the government has successful disconnected itself from "the citizens".
RockyR wrote:
Seems we heard something similar about the housing bubble, e.g. "if anyone can get financing for anything then why can't housing go up forever"? Same thing about stocks, too -- I remember quotes along the lines of "I don't see how the boom can go bust in the face of endless liquidity".
Funny how bubbles always burst, though.
nova wrote:
Good point, but most are still in the sheeple phase now. We will see if the feedbacks produce the outrage.
Terry wrote:
why not? we have to change the way we view money. we can throw gobs of it around, lose bunches of it, so long as we keep printing. as a society, we won't start to get into any real trouble until J6P decides money is no longer worth busting his ass to get. i fear there is a tipping point at which the number of people not working and spending their time playing silly paper games to get more "money" will exceed the number people actually trying to do something good with their lives by a sufficiently large margin... or at least the proportion will get so great... that we reach systemic breakdown.
we aren't there, yet. it's ok that you and i know the truth, just so long as J6P doesn't catch on. J6P, the worker, is the one we need to keep fooled.
/50% snark, or thereabouts. maybe less.
TJ and The Bear wrote:
sure. they do. but, we've done a pretty good job of pumping a new one.
note: i'm being somewhat snarky tonight. i'm pretty exhausted of the bullshit right now.
Dubai is locked in a sudden debt over time game.
I don't think there will be riots in the streets until people get organized by a messiah or two. The worse possible combination is 2 messiahs coming out at the same time
you know how many people who've said to me that everything is fixed... the crisis was overblown? i carry a towel around with me to mop up drool, i swear.
nova wrote:
beware the messiah
fear two
Terry wrote:
sm_landload (?) posted this link on here this morning. The pdf is a great read. I'm going to pass it on to the people that I know are well underwater. I assuming TPTB are gambling that most of the underwater peasants will be too embarrassed to make this into "mass movement" (they're probably right).
volker, excellent! I hope I'm not the only one paying attention. Pathos so thick you could cut it with a knife.
TJ and The Bear wrote:
It depends on your horizon. In mid-1974, the 1973 bubble had burst. By 1983, it had reflated again, never to go back down below the 1973 highs. Think in decades, not years.
thank you
keep in mind
poets are liars
A messiah that convinced people to jingle mail en masse, would be the establishment's worst nightmare...
nova wrote:
Maybe not. We get an ultra-lefty to rally his troops against an ultra-righty, then let them wipe each other out.
but really good liars~ I could listen to them all day long.
RockyR wrote:
You might have to get through another 20 years of bullshit, so snark helps.
I've done open mics all over the country.
TJ and The Bear wrote:
Always too much collateral damage (me). Plus, the aftermath is usually worse than when they started.
RockyR wrote:
And that's why it is better to make money a reliable long term store of value, instead of constantly 'goosing' the GDP numbers for next year by inflating a little today.... every day.
If we knew that $1 held for the next 30 years would buy exactly the same things it buys today, we'd all be able to plan for retirement and other future needs. Half of FIRE would collapse, because it is based on money illusion, the illusion that it is adding value when it is really eating value.
nova,
Sounds like "Burners vs. Fundies", doesn't it?
NOTaREALmerican wrote:
Just call it a "one time writeoff".
TJ and The Bear wrote:
Reality will not be so certain.
barfly wrote:
Get a subscription to CSPAN.
patientrenter wrote:
Half of FIRE has already collapsed; the rest are government-supported zombies walking around feeding on productive members of society.
volker the viking wrote:
We can give them "litmus tests", because they seem to love those.
patientrenter, LOL! Not the same. People like volker and blonderengel are magical. I particularly love her feminist perspective. Very hard edged.
patientrenter wrote:
Yeah, well, remember you said before how you didn't like people that knew nothing about economics "talking economics". The same is true of politics. The US is an illusion built on bubbles. Perhaps all societies are, who knows... But, getting to a political reality where $1 is $1 for 30 years is impossible.
TJ and The Bear wrote:
Inflation is controlled by the govt, so what you call collapse describes pre-2007 just as well as it does what's happening today.
A hard line with someone up to their eyeballs in debt? Can we get these guys to run GM and Citibank?
patientrenter wrote:
yes, yes, yes! but, how?
RockyR wrote:
Rhetorical question?
NOTaREALmerican wrote:
totally disagree
and history proves you are wrong
tj,
Yep. Street riots. Authority taking sides. Chaos. The worst possible outcome.
People wearing little badges and colors. Gangs gone political.
nova wrote:
Help me understand how this would be different.
NOTaREALmerican wrote:
exactly. not even a political reality. how in the world would one do it using economics in a political vacuum? freeze the population of the world at it's current level... never to rise, never to fall? sure, you may be able to establish what one dollar buys today given the number of dollars and the number of people consuming, but when the population goes up so does the value of that dollar, or vice versa. right? at mean, at it's very simplest. never mind productivity gains, evolving technology, etc, etc, etc.
RockyR wrote:
You'd need something (literally a thing) to regulate the smart amoral scumbags. Unfortunately for the idealists, natural selection IS still at work. Capitalism is the only viable (realistic) economic system because of natural selection (screw or be screwed). Unfortunately, unlike sports - where each new season the teams start over again - there's no capitalism off-season for everybody to "reset" in.
Help me understand how this would be different.
Gangs control blocks, maybe a neighborhood. A gang that gains political power and grabs the levers of the state gets the really good hardware and access to agencies.
TJ and The Bear wrote:
yeah. i'm totally not getting it.
RockyR wrote:
Actually, it would be quite simple. Govt issues zero-coupon bonds with a final repayment of principal that is indexed to the CPI. We sort of have that now, but there is a tax applied on 'gains' due to inflation, so you cannot preserve your purchasing power. So just make the payoffs tax-free (after all, you're just getting the real value of your original money back). I know that could be refined some, but that's the basic, very simple, idea. It wouldn't be hard to do. But a lot of people don't want it to happen.
Once the holidays are over J6P is going to sit down and figure out that he can't pay the mortgage, or no longer is willing to when he is 30%+ underwater. Some will walk away quickly, some will figure out they can scam the mod program for a good 6 months.
People in mod programs will either decide they no longer want a mod that is a 40 yr loan that is adjustable in 5 years, with all the past due added on the end - owing still more than the house is worth. Many poeople will stop playing the "I can't find the paperwork to qualify" game and walk.
There will be an increase in unemployed due to small businesses closing. Finaly giving up.
2010 will be the year it all hits the fan.
Once upon a time, prices remained pretty much the same over a long period of time...
$100.00 in 1865 had the purchasing power of $103.41 1932.
Measuring Worth - Purchasing Power of US Dollar
Juvenal Delinquent wrote:
see? Like I said.
IQ 135
patientrenter wrote:
i think i proposed something similar to this on this blog at some time... as a thought experiment.
RockyR wrote:
keep thinking, it leads to ambition
It would take $1629.85 in 2008 dollars to equal $100.00 in 1869 dollars, what the hell happened?
Juvenal Delinquent wrote:
Yes, but how much "inflation" was "sucked up" in the vacuum of "the new frontier". The US is full now, the US smart amoral scumbags are as constrained as any peasant living in the most crowded places on the planet. Resources are become "limited". Unfortunately, the only "resource" left to exploit is the savings of the nation.
"$100.00 in 1865 had the purchasing power of $103.41 1932."
then what happened?
volker the viking wrote:
production rose roughly at exactly the pace of demand? i don't guess they had credit cards.
tj,
yep. burners and fundies. The fundies lose but stay number 1 in mass graves discovered.
Juvenal Delinquent wrote:
The Federal Reserve. It was in all the papers. I'm surprised you need to ask.
volker the viking wrote:
??? Dictionary.com | Find the Meanings and Definitions of Words at Dictionary.com
oh, THAT! i used to have that.
RockyR wrote:
I hope I said it was a great idea, RockyR
It is very interesting to me that this would not be hard for govt to do, and would make investing for the future much more predictable for most Americans, and ....yet will never happen because of the vested interests it would disturb.
volker the viking wrote:
No dumbass, it was the smart amoral scumbags.
And please. STOP being so stupid.
(do you like it?)
RockyR wrote:
perhaps you will again one day
josap wrote:
You are a smart person.
volker dumb ass
volker go now
apparatchica vtv,
Sorry, that won't fly. The Fed was established in 1913 and the buying power of the greenback remained pretty much static until we went off the gold standard.
Juvenal Delinquent wrote:
Looting is easier than making. If YOU were a smart amoral scumbag, what would YOU do?
volker the viking wrote:
MONGO!
Solution: Timmay prints & Ben buys. What could be easier ?
patientrenter wrote:
i honestly don't remember. sometimes i ramble, and it's hard to understand.
"It would take $1629.85 in 2008 dollars to equal $100.00 in 1869 dollars, what the hell happened?
What taxes and debt did they have to start. how many times have we inflated to make debt disappear. Guess what we will do again? I think so but this times it will be real hard with out jobs and wage increases.
volker not dumb ass. Volker smart ass.
I think 2010 will be the year it hits the fan, too.
It takes fuel to sustain extend and pretend, and it takes fuel to sustain a stock market rally based only on speculation, leverage and endless cheap money.
I don't exactly know how much fuel is left. But I'm pretty sure it not a full year's worth.
....what was it in 1969?
rich wrote:
That's probably what some Japanese currency pessimist has been thinking for 20 years now.
TJ and The Bear wrote:
Another 50% drop and you'll have a chance at making a killing. Dubai as an international financial center didn't make much sense as even GE is getting into Islamic finance, as a travel destination they only have 5 months of decent weather, none of which are during when Euros holiday. Logistics and a waypoint for air travelers? Sure.
rich wrote:
I agree.. Extend and pretend is running out of time.
I'm watching this ridiculous episode on 60 Minutes and it looks to be a planted anti-barbarous piece of trollop, designed to scare people into not buying any.
TPTB are running scared...
what was it in 1969?
Enough for an oz.
pack of cigs
6 pack of Colt 45
1 Stones album
and $77.50 left over
4-finger-lid?
rich wrote:
What's going on offends my sense of morality and commonsense - it seems unsustainable and confiscatory. But if you accept that FIRE is maybe twice the size it should be, based on prior govt subsidies and regulatory support, then why can't it go back to that? After all, we could impose a VAT of 5% tomorrow, and spend it all on additional health care. It would feel big, but it could go on forever. Why can't the corresponding supports for FIRE go on forever (even if they shouldn't)?
Juvenal Delinquent wrote:
....weren't they all?
JD,
3 finger
$277.59 in '69
longwaver wrote:
why? what's changed?
Thank you blonderengel and volker, for your contributions tonight. Love you both.
Oh Rich. You got a dog that can take a Mountain Lion then you need to give Michael Vick a call.
The fuel to extend and pretend really comes from J6P. That is the guy doing the work, paying the bills, paying the taxes, driving the kids to school.
J6P is tapped out. From his own get rich quick games or playing by the rules and out of a job. And if it isn't J,it is his neighbor or brother in law. The Js who are working see the writing on the wall, life isn't as good, his kids won't have it as good. J6P is going to start looking out for himself and to do that he will figure out the
has to die. Time to starve the 
. The only way to starve it is to stop feeding it money. So J6P is not going to continue to pay the mortgage or credit cards, the only thing he has control over.
Unfortunatly J6P doens't understand the ramifications of not feeding the
in the short term either.
theme music - highly recommended
YouTube - Gene Burnett - Jump You F*#kers (A Song For Wall Street)
barfly wrote:
Are you sure volker is a she?
not sure, and not willing to speculate. Whatever, blonderengel is my main interest. She absolutely rocks.
josap wrote:
Savers can be tapped next (inflation). That's worth many trillions. Lots more to go.
josap wrote:
I don't see any realization of this yet. The peasants I know are still in awe of authority and hierarchy. They know their place and fear confrontation with their betters. The nobility have it made here, right now.
$100 in 1865 = $278 in 1969 = $1630 in 2008.................................seems that from 1970s elimination of the gold standard, things went to Hell?
Huckabee commuted sentence of man tied to police slayings
Write off this clown for a further political career.
GOP and Dems assclowns will continue to drive America off a cliff
Hope a populist 3rd part to come power by 2016
whoops meant 3rs party
NOTaREALmerican wrote:
I think they are getting an understanding of their place - and that they no longer have the opportinity to move up in place. They do fear losing what little they have been able to hang onto thus far. Once they see they can replace what they have for less, or aspire to less and be happy, the game is over.
Nobody really truly owned anything, except for the oligarchy with their well-hidden wealth, when the Soviet Union was suddenly no more...
History always repeats, rhyme or reason optional~
In-Geithner-We-Trust Bond Market Gets Lowest Yield (Update2) - Bloomberg.com
Fluff piece from Wall Street / Treasury to the MSM. After the criticism he received last week when he appeared before Congress, clearly the PTB decided they didn't want to lose the guy with his hand on one of the two money spigots going directly into their pockets.
.....some incident "out of the blue" will change that - afterwhich, the once peaceful will pop.
The road to hell was paved with paper.
Juvenal Delinquent wrote:
Yeah, that's what I think too. The US is exactly like the Soviet Union. Supported completely on mythology of the future and the next 5 year plan. Pretty pathetic, but as long as the peasants believe, it will hold together. I guess that's why we need that next 8 year war.
Hello Again. For those who remember earlier phases of the collapse of the decades-old, fed-sponsored credit binge, statements such as "...projects regarded as folly will not be backed but operations and investments with a strong business model will be", add logical meaning to phrases such as rational default: stop using remaining financial assets to amortize debt on worthless homes and condos.
Juvenal Delinquent wrote:
Once upon a time I had a six figure credit limit.
Speaking of bankrupt municipalities...
From a ZH article:
Decline of the City (and) State | zero hedge
peAk wrote:
Many people no longer think being "house poor" is a good way to live.
Nova,
You're the novelist. Didn't you ever read Jack London?
You failed your dog, Nova. You didn't toughen him up and teach him to fight.
A dog who holds his ground can back down just about any other animal. But even if the dog gets torn to bits, it's better to stand and fight than turn and run. It's a noble ending for a dog. A dog is a wild animal, after all.
Well, off to dinner. A fun night of doom. (Hopefully, we're wrong and the teaming masses are right. Altho, that would mean my assets are allocated incorrectly, so that means: I hope we're right and the teaming masses are wrong. Jeez, who knows...)
josap wrote:
But Case-Shiller tells us that home prices are increasing again, so clearly more people are buying into the current situation, high prices and all.
,rad NOT,
The difference being: The hoi ploy behind the Iron Curtain were only too happy to see communism go away, whereas our consumerati will cling to the old system, with a debt-like grip...
Tijuana-adjacent has a city government second to none.
"...so clearly more people are buying into the current situation, high prices and all. "
they've never seen interest rates this low, and to them, that's what matters. Bernanke's work.
....trying to "get theirs" whether they can afford it or not. This is SPECIFICALLY what our pi**-poor leaders ought to be ashamed about - their only concern is pumping up the flat tire to get a bit further down the road - relocated families be damned.
barfly wrote:
The job of a Central Bank is to make sure, when the party gets going, to keep spiking the punch.
patientrenter wrote:
Mid level homes are selling at a lower price. Most of the low end is bought and resold by investors. Mid level is still higher than low end. At least I think that is how they get their numbers.
josap wrote:
Check the actual numbers. They are increasing again.
Haven't we already established two factors that are supporting house prices at unsustainable levels:
We'll see what happens to home prices if and when these twin stimuli are removed, if ever.
(oh) 3. Backlog of foreclosures creating artificial scarcity.
That was done last year.
Black Star Ranch wrote:
True, most people only want to know how much down (0 with tax credit) and how much a month (less with low interest on a house that has lost 30% of it's prior value).
patientrenter wrote:
That is not a good sign. People cannot be that stupid. What are they thinking? Nevermind.
I give up.
Perhaps more true of Americans then some Europeans (see article below), despite the greater access to lethal weapons in the US. I think that it is all too likely that those weapons will be turned first on family (seems to be an increase in fatal domestic violence in the US & not just in military marriages), friends & perhaps close targets like employers, co-workers. Not sure the violence will be directed (or effective against) IBankers, etc., or those who might reasonably be thought to be more responsible for stagnant wages, etc., rather than, say, one's spouse & children.
Al Jazeera English - Europe - WTO protest turns violent
At least for some Europeans, unions, &/or the strength provided by large organizations (whose primary purpose for organization isn't corporate profits), isn't as poisoned a concept/tool as it seems to be for many Americans.
Why would an investor want to buy homes anywhere in California right now?
It doesn't begin to pencil out in terms of what you get in rent, and none of it makes any sense in light of falling rents and rising vacancies, not to mention competing against Tenants Players, all the more a common sight nowadays, before their court date...
Nicely put Josap, 'Many people no longer think being "house poor" is a good way to live', and tomorrow OB and the feds, in the latest, futile effort to keep citizen frogs unaware of the consequences of staying in the slowly boiling financial pot, will publicize a list of banks with low scores on home loan modifications, as if banks with higher loan mod percentages were having any meaningful effect on the ongoing credit-home-asset price collapse, hiding in plain sight.
Why would an investor want to buy homes anywhere in California right now?
Because some "investors" have more money than brains? Those are the ones with which I have no sympathy. The people buying the overpriced homes in which to move the family due to FedGov stim hype gets my goat.