Andrew Hughes

How the World Almost Came to an End on September 18, 2008

Quite a revelation indeed but it begs some questions.
Is Kanjorski telling the truth ? The thieves in Washington and Wall St. are looking to cover their behinds after been correctly accused of wholesale Grand Larceny.

When predictions of doom and disaster are uttered by the same people who created this doom and disaster, I'd be inclined to take it with a huge grain of salt and then ask myself why they are in such a hurry.

As for the culprit being "Someone", that does not fly as even in 2001 monitoring of trades and withdrawals were being monitored in realtime utilizing "Promis" data mining software. If, indeed, these billions were being scooped out of accounts their identity would be known. They have already discovered the identities of those who were placing all those Put options on American Airlines and a host of other stocks in early September, 2001 that were subsequently hammered after 9/11.

U.S. Debt Default, Dollar Collapse Altogether Likely

Well argued James. The Chinese have become more pragmatic with regard to Treasuries and have their own problems to deal with. The recent Treasuries auction, I believe, only confirms that Uncle Sam's debtors are beginning to choke on the debt they already have. There have been numerous articles on a Treasury pop that have so far been greeted with general disbelief but reality is setting in and it will become more difficult for mainstream financial journalism to spin their way out of this mess.
As far as confiscation of Gold is concerned, there is a rapidly growing market worldwide for physical gold as a store of value and on examination of U.S. Government actions so far in the economic crisis, it would not be surprising in the least if there was a 1933 redux.

The Obama Stimulus Plan: Why I'm Concerned

Well argued points John. Looking at the ever changing contents of the stimulus plan, I keep on getting the feeling that it has been assembled to impress the public rather than make any actual economic sense. It's Keynesian opium for the masses to lull them in to believing that Government is actually fiscally responsible. Looking at what has happened on the Bailout front so far, this has already been proved to be a myth.
The Chinese have their own backyard to look after and have been steadily pulling back from any guarantee that they will continue to fund the crap game that passes for responsible economic policy in the U.S..
Looking at what has transpired to date, one can only assume that the intention has been to transfer the wealth of the population to the banking and corporate elite. Period.
What needs to be factored in to any analysis of Stimulus packages or Bank Bailouts to better interpret them are the underlying components of Geopolitics, the steadily nurtured plethora of executive orders, policies that have not been reversed by the current administration (Predatory lending, Gramm-Leach-Bliley Act), the window dressing of expressing opprobium at the bonuses on Wall St. commensurate with any lack of any real engagement with reforming the financial regulatory framework.
The bigger picture needs to be looked at. Let's face it; what has been done to date has been a complete failure as far as repairing the economy is concerned.
The arguments are completely logical and we would have to assume that the Economic Dream team must be aware also so the big question that needs to be asked more than any other is Why ?

Derivatives and Bank Collapse - The Scam That Went Largely Unreported

Excellent point. With regard to an International Clearing House, that's exactly what needs to be done. It is the most logical way to defuse the derivatives bomb. The question that arises though is why was this not done previously as a top priority to ensure that any Tarp funds injected in to the banks would actually have a positive effect.
No sane investor is going to pump capital in to a bank without inspecting it's balance sheet and credit exposure.
With the OCC data out in the open, any further capital injection or purchase of "bad assets" without bringing the data and the balance sheets to the table and dealing with the neutralization of the derivative instruments only amounts to either incompetence on a monumental scale or, more likely, a deliberate fleecing of the taxpayer.

How Do You Recapitalize $1.8 Trillion in Bank Loan Losses?

"The tragic history of financial crises is a history of failures by governments to act with the speed and force commensurate with the severity of the crisis."

I think what Geithner meant to say was ..

"The real history of financial crises is a history of SUCCESSES by governments who acted with speed and force to inflate severe and unsustainable bubbles that lead to crises for the taxpayers"

Banks: Nationalize, Cleanse and Get It Over With

Over $8 Trillion has been used to prop up a Banking sector that created it's own destruction. Loving free markets is not just for the good times. If they have bankrupted themselves, let them fail. With regard to holding toxic assets in a "Bad Bank", all that would achieve is postponing the problem to a future date. The Banking sector needs to be cleansed of it's unhinged casino mentality once and for all. The policies of the Fed and Treasury have so far achieved only one thing. Taxpayer funds that could have been put to real use have been squandered in the greatest transfer of wealth in History. The sad thing is the incoming Administration seems hell bent on continuing this lunacy.

Is the Second Great Depression Imminent?

Peak Oil has been on the investigative horizon for quite a while now. Mike Ruppert of Fromthewilderness.com did some excellent research which is still available on the website. The one aspect that needs to be carefully thought through is the alternative energy scenario. Hydrogen costs more energy in production than it delivers to the end user. Etahanol cannot replace oil as a means of transportation fuel because it would take too much land away from food production. But the really important point to remember is that Oil derived products comprise a huge percentage of the raw materials that run the modern economy. Plastics, fertilizers, insecticides. Bottom line, if we did not have Oil tomorrow, all industrial production would stop, people would starve. There should have been much more serious research done to pre-empt a supply shortage but not enough has been done. Whether Peak oil has arrived or is on the short or long term horizon, should not deter the urgent investment in realistic alternatives. The golden rule here is simply that energy creation is just a part of the whole system. Any development has to take in to account the effect it has on all parts of this sytem.

The Economic Policies of Failure

Nicely argued Nicholas. The fact that an overinflated economy cannot tolerate a liquidity / credit reduction explains exactly where we are now. The only resolution I can see is not repeating the same process over again. But, as we have seen from the TARP, injecting liquidity in to an already overleveraged system cannot cover the basics nor repair the damage caused. The way forward involves returning to a more sustainable model where balance sheets reflect Real value and where the Financial sector is brought to heel. Unhinged speculation by the latter must be cleansed from the system.

Preview from Europe: Huge Job Losses Spark Market Rally

Good and timely reference to Ireland, I already wrote ( meltdown101.livejourna... ) about Mr Cowen and his belief in Loaves and fishes forever and for everybody. Someone should buy him a calculator for Christmas .
With regard to Mr Obama's Economic stimulus plan, I am inclined to defer to Peter Schiff's analysis that the last thing the U.S. needs is more debt. Also, it seems to me , from observing the markets over the last few months, that as soon as they see greenbacks from Henry, Fiat or not, they whoop it up and ignore what's happening outside the window in the real world.

Wall Street Breakfast: Must-Know News

With Consumer spending in freefall, credit card debt spiralling upwards along with unemployment, who is GM going to sell cars to even if they survive long enough to retool and reorganise ? If they get their bailout and eliminate all unnecessary costs, reduce workers wages, pensions etc. and make it , still standing, to end of 2009, the last thing on consumers' minds will be an overexpensive hybrid like a Torus lookalike.

U.S. Dollar: The Next Bubble to Pop

Concisely Put Jake. U.S. creditors are getting nervous as they have their own problems to be dealing with and waiting for Paulson and Co to arrive in the land of the living has a finite timeline. Obama's confidence in the generosity of these same creditors to finance his "stimulus plan" might be very well misplaced. It's time for the U.S. economy to get off the bottle and go in to rehab. No amount of energy efficient lightbulbs is going to fix the American economy.

Credit Crisis Watch: Are the Markets Thawing?

Very timely analysis Prieur. Knee jerk reactions by the markets seem to come right after any piece of news from the Treasuries of various countries. But with the underlying Economic indices becoming steadily worse by the day, reality has to set in at some stage. The easing of credit has to rely on the creditworthiness of the borrower, not the willingness of the lender. This latter scenario has been the cause of so much destruction to date. Creditworthiness is decreasing with every extra person on an unemployment line and every other firm gone to the wall. Until this fall has bottomed, I can't see any Bank easing access to credit without exposing themselves to even more defaults.