HARM

The Shallowest Generation

<i>"The boomers footed the multi trillion dollar bill to waged a decades long cold war against the greatest evil empire empire in history - and won - saving the world from communist enslavement and bringing freedom to Eastern Europe and Russia,. WW2 pales in comparison.

Baby boomers have footed the bill for trillions of dollars in US foreign aid for decades - tell me what other country has done even a fraction of that?

Baby boomers have paid for the 'war on poverty' by the Great Society - just look at the great standard of living the 'poor' people have in this country. As one person in India trying to get into the US said "I want to live in a country where the poor people are fat".

This hardly sounds like selfishness to me."</i>


Oh, Lordy... so many fictions, where to start?

Boomers did not actually *pay* for any of the above, which is one of the reasons why per-capita government and personal debt levels are at all-time highs, as the author has already pointed out.

Aid to the poor --aka old school "socialism"-- went out of vogue during the Reagan Administration ('Welfare Cadillac Queens' and whatnot) and social program defunding accelerated under following administrations including Clinton's (welfare reform). Unfortunately, corporate socialism and unchecked military spending more than made up for any savings, by a huge margin.

As a Gen-Xer, I have been geniunely "poor", as in one unemployment or min-wage paycheck away from homelessness --and not for laziness, lack of skills, education or willingness to take menial jobs, either. I doubt many non-blue collar/minority Boomers can relate, hence the warped view of the "great standard of living" U.S. poor supposedly enjoy.

Boomers were born into an America of broadly shared prosperity, virtually free higher education, cheap housing and medical care, high manufacturing output, a large trade surplus, an expanding middle class, and an almost debt-free government.

Boomers are leaving my (and future generations) with prosperity for the very few, sky-high college costs mostly financed with debt, a massive housing bubble, the most expensive per-capita medical costs ever, a shrinking manufacturing base, an enormous trade deficit, a shrinking middle class, and government in hock to the tune of $11 Trillion + $53Trillion more in future unfunded liabilities.

I wish I had written this article. Kudos to the author for a job well done, and the courage to tell it like it really is, without pulling any punches.

The Next Bubble?

"There is no intrinsic value for gold."

Actually, not true. Quite a few practical uses for gold, including non-corrosive electrical contacts (your PC likely has quite a few of them). By contrast, there truly is no "intrinsic value" for fiat currency --aside from the value of the paper it is printed on.

In any case, it's not the "practical uses" for gold that has fueled its meteoric rise over the past 6 years. It is gold's perceived value as an inflationary hedge and "safe haven" for preserving your purchasing power during financial crises --such as the one we're experiencing now.

You cannot easily "debase" gold by "printing" a lot more of it at will. It has to be mined, and cannot be produced everywhere on earth. It's recent rise reflects (well justified) insecurity about the financial system and fiat currency, not speculators' sudden interest in the metal. Its inherent scarcity renders it enemy #1 of inflationists and monetarist gamblers everywhere, which is a good reason why prudent investors should always have some.

Warren Buffett on Goldman Sachs and the Financial Bailout Package

johndough110,

Wow, thanks for the reality check. I had no idea that you had the gift of flawless prescience --which you obviously possess, or you could in *no way* be 100% sure that Paulson's naked bailout for his rich buddies will "save" the economy. Or be 100% sure that *not* passing it will result in "bread lines" and consequences "much worse than any of us can imagine" (no fear-mongering going on here!).

I mean, it would obviously be the End of the World if reckless greedbags actually had to suffer the consequences of their own bad decisions, right? I mean that's soooo capitalistic (vs. the reverse-socialism, a.k.a. feudalism, so in vogue these days).

And thanks for reminding me that --more than anything else-- what Americans need right now is *more leverage*. God forbid Bernie & Hank's endless cheap-money spigot ever get turned off and debt-addicted spendthrifts have to start (*gasp*) living witin their means! No HELOC-bought plasma, matching his'n'her gov't subsidized Hummers, $0-down neg-am NINJAs (The horror...).

Oh, and you are *so* right about Buffett. The world's richest man is really "sticking his neck out" risking... basically pocket change for him. Foolish of me to take umbrage at the fact he's trying to profit by basically blackmailing and then raping the U.S. taxpayer.

Shame on me, I guess.

Warren Buffett on Goldman Sachs and the Financial Bailout Package

Oh, wait --I forgot. Buffett and his shareholders will earn gazzillions with his cynical (yet, like, totally shrewd) deal by inciting panic and economically blackmailing people like me. That excuses everything --he's totally a totally cool "alpha" male. My bad...

Warren Buffett on Goldman Sachs and the Financial Bailout Package

Wow, I just lost a great deal of respect for Buffett after reading that. At the end of the day, he's just another ruthless corporate merc, *demanding* (not asking) for his bailout windfall profits from taxpayers. Reverse Robin Hood --with Dr. Evil-style economic blackmail thrown in for good measure ("Bail us out right now or we'll destroy the economy for everyone!").

At the end of the day, he's just another narcissistic, greedy thug with zero concept of kinship with or loyalty to regular, working-class Americans. Just like every other Wall Street greedbag. Sad.

The "Worst Is Over" Crowd Is In for a Shock

The Phonie/Fraudie takeover was not intended to "save the US economy". It was only intended to "save" the people that really count --the Wall Street elite. At the expense of everyone else.

"In America, the only respectable form of socialism is socialism for the rich."
--John Kenneth Galbraith

Jeremy Grantham: Global Incompetence Is 'Officially' Scary

REMAIN CALM, people! All is well...

Reports of a housing-led solvency/banking crisis are greatly exaggerated! Pay no attention to that Fed Chairman & Treasury Secretary behind the curtain! There is no GSE/Wall Street bailout financed by taxpayers... repeat: there is NO BAILOUT!

Keep spending people! Living beyond your means is as PATRIOTIC as apple pie. Bin Laden WANTS us to stop consuming.

DEBT IS WEALTH
SLAVERY IS FREEDOM
IGNORANCE IS STREGNTH

Is the Great Moderation in Danger?

Stephen Cecchetti is of course speaking for the richest of the very rich, when he calls Easy Al & Heli-Ben's cheap money Fed, and the numerous asset bubbles it spawned, "better monetary policy".

And for the rest of us...? More --not less-- price volatility in housing, food, energy, and many other basic commodities, and a rapidly depreciating currency. Plus, an economy that functions more and more like a "winner-take-all" casino every day, which "efficiently" redistributes wealth from the bottom 90% to the top 10% --with the lion's share going to the uppermost 2%.

"financial innovations such as securitization that let consumers and businesses smooth spending"

Yeah, those subprime mortgage-backed securities and various other wondrous Wall Street "innovations" have really "smoothed out" the housing market. My local markets here (CA) are so "smooth", the median HH income cannot come even close to buying a median priced house with a sane mortgage, and foreclosure sales now outpace regular sales in many counties.

And the risks these "innovations" have caused to the entire banking system are now so large that the Fed & Congress are now openly bailing out large, well connected investment firms: Bear Stearns, TAF, Super-SIVs, new Jumbo $730k GSE loan limit, dirt-cheap 'overnight lending' rates, etc.

God Bless those Wall Street Masters of the Universe!

What Credit Crunch?

So... let me get this straight: the fact that Americans are hopelessly debt-addicted (and many are now technically insolvent due housing bubble implosion) is *good news* because... up until now, there's always been another cheap-money pimp around the corner willing to give the debt-junkie his next "fix".

If this is "good" news, please spare me the bad news.

Recession? Maybe; Crisis? I Don't Think So

I agree with the premise that what we're seeing is the market rationally reacting to the massive housing/credit bubble of the last 7 years. However, to dismiss the macroeconomic Tsunami facing us as "not a crisis" completely ignores the SCALE of today's bubble and correction cycle as compared to previous cycles.

We've seen an additional $6 Trillion in mortgage debt alone added in those 7 years, and a MEW-driven consumption economy develop. Even if a relatively small % of that evaporates, it's going to leave a nasty mark.

The Fed Can't Save Us from World Food Shortages

<i>this is why I argue the Fed just needs to forget about inflation (it is powerless to stop the trends behind it)</i>

Ok, I get the gist or your argument here, but since when has the Fed been trying to *stop* inflation? Stop it? Hell, they're COUNTING on it! The Fed is pumping cheap money like mad (lowering FF & discount rates, "injecting" $billions of USD into the banking system) all in the --probably vain-- attempt to prevent DEflation, especially in housing and stock prices.

Forget all that "strong dollar" lip-service nonsense. The Fed *wants* high inflation, so they can deflate/devalue away all that foreign & government debt, plus massive future Medicare & SS obligations that can never be repaid.

Once the price of a loaf of bread hts $200, the Fed "might" consider raising rates a quarter-point. Or, maybe not...

Freud, the Fed, and a Box of Chocolates

Nice metaphor (and extremely apt). May have to borrow this one for later use.

Larry Summers: Odds Now Favor a 2008 Recession

<i>While there is little new factually, per se...</i>

No kidding. Like anyone with half a brain and one eye open couldn't have seen a housing-led recession coming over a year ago. Housing ATM is shutting down with MEW just off all-time historic highs, average homeowner equity at an all-time low (despite prices *still* being near their all-time peak), savings rate below zero, banks suddenly requiring more than "fog-a-mirror" before they fork over millions of American pesos.

Who'd a thunk a recession could be in our future? Looks like a 'Goldilocks' economy to me.

Avoid the U.S. Until the Subprime Mess Really Hits the Fan

Every time you say you dont believe in real estate, a Realtor® dies. All you need is trust and a little bit of pixie dust!

Foreign Investment in the U.S.: Is Bernanke Facing a Death Spiral?

--"Pepple Beach"
+"Pebble Beach"

Must remember to spellcheck.