Dave Wrixon

The Greatest Depression Is Coming

This is bound to happen. High debt means higher taxation. This will make the USA uncompetitive as a base. Most Multinationals already have their assets and workers scattered around the globe. Many even have off-shore stock listings. Why would they bring their profits "home" just to get hammered by tax. These organizations by definition have no fixed allegiances.


On Oct 17 07:18 AM Philly Jim wrote:

> The real economic disaster will come when Boeing, Lockheed Martin,
> Raytheon, SAIC, Exxon, Chevron, GE and other U.S. conglomerates follow
> in Halliburton's steps and relocate elsewhere. Elsewhere, is offering
> attractive incentives for talented and productive individuals and
> companies, not to mention better living conditions. Who would have
> ever imagined finding better living conditions outside of the U.S.A.?

Coming Soon: Banking Crisis of Historic Proportions

Good Article, but aren't you really telling us what a lot already knew that the US is insolvent at all levels. The banks have bad loans because the consumer is tapped out and the US Government is cannot really do much more because it cannot tax the consumer more because that would just sink the whole ship. The whole edifice is at breaking point, and the only thing supporting it is a web of lies.

Is a Crash Impending?

At least China has some economic fundamentals. I would sooner take my cash to Vegas than Manhattan.

The Greatest Depression Is Coming

So basically, if you just give the consumer enough money then everything will be alright?

But wait a minute. Wasn't that the GWB philosophy that got us into this mess?


On Oct 17 07:32 AM LilBob wrote:

> To me this is fear mongering, brought on by a lack of willingness
> to understand what's really going on in the economy. During the
> Bush administration we had an increase in the concentration of capital
> in the hands of the wealthiest Americans, just like we saw in this
> country during the "Robber Baron" age from roughly 1895 to the early
> 1930s. In a capitalist economy, there are two kinds of capital:
> investor capital and consumer capital-we can also refer to these
> two types of capital as supply capital and demand capital. When
> capital becomes too highly concentrated in the hands of investors
> while working class wages stagnate, we end up with a situation where
> sales decline generally while new more aggressive investment schemes
> are fabricated to create the illusion of increasing wealth for the
> investment class. The only solution to this problem is for social
> phenomenon that increase consumer capital-restore the consumer base-thereby
> making it possible for businesses to keep their doors open. The
> reason we are in a recession is because of several years of misperception
> on the part of the American public-people believed that their wealth
> was increasing and loaded up on debt when their actual wealth-as
> measured in wages and ability (from say, job benefits) to access
> critical services (such as health care) was in steep decline. <br/>
>
> As long as there is a willingness to accept the reality of our situation,
> and to address the underlying root causes of the predicament, then
> any disaster may be averted.

A Socratic Dialogue: Fearing the Collapse of U.S. Treasury Bond Prices

Nice, theoretical argument, but I am afraid that our Greek Philosophers have forgotten that we can no longer regard the US financial system as a closed loop. The importance of European Hedge Funds has already been hinted at and these pale into insignificance against the Sovereign Investment Funds that have been totally ignored.

The bottom line is that the recent tendency for most investment capital to hit the Silk Road is only going to accelerate. Stimulus in the US economy will not create conducive conditions for productive investment. All that is going down is that a largely ignorant electorate are being bribed by debt secured against the sweat of their grandchildren.

PIMCO's Bill Gross Sees a Bleak Future

Well, Bill Gross is gradually waking up to reality, although I would suggest he is still wildly optimistic.

Why Another Stock Market Collapse Could Be Imminent

Why do you think Autumn is called Fall?

No One Saw This Economic Crisis Coming?

A point I have made many times before. Who cares what the IMF think. When there opinion would have been of use they were asleep at the Wheel. Where was Bernanke, or Summer or Little Timmy?

Somebody who seen this coming must have a better perspective of the possible scenarios in front of us. Somebody with a track record of calling it right should have been put in charge, rather than those with their own political agendas and commercial interests.


On Jul 12 05:22 AM Steven Hansen wrote:

> we are faced today with a president surrounded by economic advisors
> who all think the same. no presidential advisor foresaw the crisis
> coming.
>
> if they did not see this crisis coming, i have no confidence they
> can steer us out.

China Is Now in Firm Control of U.S. Debt Markets

I think the problem is that China regards the Fed intervention with distrust. The Fed is effectively trying to distort the yields on Treasury Bonds. This is clearly designed to help the Federal Government finance its debts, but obviously somebody else has to pay. And that means Bond investors. Clearly China effectively view the Feds intervention as Schill Bidding, and with some justification. Would you bid in an Auction that you knew was rigged against you?

As the Fed is targeting the Long Maturities, it is hardly surprising that China has shifted to the shorter maturities. S&Ps Triple A ratings are looking more ludicrous by the day.

A conspiricist might even consider that China is setting up an alignment of maturing bonds to break the bank. Perhaps that would be stretching things a little, but a World dominated by a dollar trading system serves nobodies interest outside the US. Of course China would like to see that system ended. The question is are they happy to see a natural progression or are they prepared to tear down the walls of the temple to bring it about.

Economic Double-Dip? Try a Triple

I tend to agree that the US never really emerged from the 2001 recession but simply covered up the weakness with fiscal and monetary expansion. When this charade wore thin and resulted in a second collapse, they simply opened the sluice gates once more to keep the turbines running near full speed. However, one needs to face up to the fact that unless consumption is reduced to allow the reservoir to replenish, it eventually it will run dry and the turbines will simply stop.

I disagree that we are looking at a triple dip. The third leg is likely to prove a much more catastrophic event. To the extent that the talkingheads like Krugman are likely to disassociate it with what passed before.

Japan: Possible Culprit to Drive U.S. Interest Rates Higher

Look, the Credit Crisis came about because the return on capital was not worth the risk. Bernanke "solved" that problem by putting the Fed Rate at Zero, but nobody apart from the Big Banks are getting cheap money from the Fed and they are simply lending it back to where it came from at a healthy profit for doing bugger all.

It is obvious to all but an imbecile that US interest rates need to rise considerably. Don't blame Japan, unless it for setting a bad example with their bubbles and the misguided Zero Interest Rate Policy and Quantitative Easing. It didn't save them and they started in a much healthier position than the US.

Celebrating the 'Recovery': I'm Disgusted

Obama believes in the Tooth Fairy!


On Aug 24 12:12 PM conceptwizard wrote:


> The Obama administration believe that setting these rules aside and
> allowing the assets to increase in value after the recovery, that
> the assets will be worth more.
>
> We are not dealing with reality, there is more pain to come.
>

Give Obama 40 More Years in Office!

“If my proposals are adopted, then not only are we cutting the deficit in half compared to where it would be if we didn’t do anything......"

This is carefully worded double speak. What he is actually saying is that the deficit is going to skyrocket, but we can come up with some hypothetical projections that show an alternative strategy might have been even worse. Yes, that is what he has been saying, but how many American actually received that message?

The Worst Isn't Over Yet

The iceberg is now a stern of the Titanic. The gash in the side is being evaluated and the engine room is bailing out the bilges. Nothing to worry about, return to the party.

Upside GDP Surprise: Misleading

What astonishes me is that only a few individuals in the whole of the US can see what should be blindingly obvious, but congratulations for being one of the independently minded few.