wobatus

Is the U.S. Dollar Headed for a Mighty Crash? Part I

ah yes, the inscrutable, long term oriented chinese. How far ahead was Chiang thinking?


On May 21 12:51 PM Donald Ingram wrote:

> You are correct.
>
> The Chinese plan in generational terms. In other words they want
> what will be good for their grandchildren, not as here in the West
> where long term planning is deciding what will be served for dinner
> Sunday! Also the Chinese practice patience, they have had thousands
> of years of practice at that!
>
> On May 21 12:19 PM User 417846 wrote:

Is the U.S. Dollar Headed for a Mighty Crash? Part I

And who will buy China's goods if that happens? How will they feed their masses? Just a thought.


On May 21 11:32 AM User 353732 wrote:

> It is an article of faith amongst currency and govt. debt analysts
> that China , Russia , others, will not risk the loss of prinicipal
> by refusing to buy further US govt debt much less selling some existing
> holdings.
> However, suppose in a couple of years China, Russia ,some others
> after accumulating hundreds of billions of dollars in commodities(ores,
> industrial and precious metals, uranium, coal, oil , even soy beans
> and grain depending on the country involved) decide to start selling
> US debt, creating a a formidable bear market in Treasuries and agency
> debt. Would they not make the calculation that a bear market in US
> /Agencydebt would mean spiking yields and inflation, leading to a
> huge and almost frantic global flight to commodities. The resulting
> surge in commodity prices would result in spectacular inventory gains
> for these countries which would mitigate even if not completly offset
> the capital loss on their US govt debt. The relatively small net
> loss may be a price worth paying.
> The truly dangerous time for the US, i think, is not 2009, but a
> couple of years out when China et. al have put in place the coomodity
> reserve basis for a strategic exit from US govt debt. This is just
> a scenario but one that should not be dismissed without some reflection.
>
> Sadly ,even if we in the USA knew with high assurance that this "strategic
> switch" was being contemplated by China et. al there is nothing we
> would do to prevent it. Such is the tragedy of debt addiction and
> loss of national will. Instant gratification and denial have now
> become the walls and bars of self made prison.
>
> Let us hope the Chinese, et. al lack the analytical sophistication
> and execution capacity to successfully engineer the strategic switch.
>

Plunge Protection Team Attacks BofA: This Ends Now

Yeah. Once you look, it is hard not be in pain. Understood.

Carpe diem, gather ye rosebuds...


On May 01 03:14 PM PainfullyAware wrote:

> I do wish that I was less aware; it would be less painful.
>
> However, Safety Is A Function Of Awareness.
>
> Those who refuse to discuss the proximity of Lions become "Big Kitty
> Snacks".
>
> I am not Cynical - I am Concerned.
>
> Apathy Has Brought Us To Our Current Situation. There is nothing
> like being uncomfortable to pique interest in public affairs. We
> Are Definitely Going To Get "Change".

Plunge Protection Team Attacks BofA: This Ends Now

Sorry, meant to say, of course, that fruits of growth was not universally available to all. Probably obvious from the context. And please excuse my mis-spellings and perhaps not being focused on topic.

Were economic swings in the past caused by government intervention? Lack of trust in government? Which came first, the lack of trust or the panics? How did the gold standard effect that? Or fiat currency, free banking, whatever? Was a large belly, watch fob and mutton-chops really the byword of succesful masculine fashion?

Was the greater growth stretch because of certain policies? Which factors were most important? Did man reach a tipping point in certain areas of industry, etc., in certain locales? Did you ever read Guns Germs and Steel? Does the law of large numbers make large growth rates unsustainable over time?

Can any Met pitch wortha damn beyond Johan Santana?

On May 01 10:46 AM wobatus wrote:

> I want to get back to this but tone it down. Prior to the New Deal,
> or the market crash, whenever, or prior to the Fed, whenever we are
> discussing, say 19th century to 1907 panic, we had great growth,
> but huge cycles. Caused or not caused by government intervention,
> or a certain type of intervention (I know someone has put forth the
> point ALL cycles are caused by the government intervening), whatever.
>
>
> Certainly, during a lot of that time, one has a hard time denying
> the fruits of overall expansion were universally open to all (I am
> not saying they weren't universally shared, we take that as a given).
> I mean, we had slavery racticed pretty much everywhere, and not stamped
> out mostly in the U.S. until the second half of the 19th century.
>
>
> Even tehreafter, many lived in virtual peonage, and not just the
> serfs of russia, but many people here as well. Women couldn't vote.
> The franchise was denied to many others.
>
> Many advanced by dint of smarts, hard work, some luck. many did not,
> and were to a large extent locked in place.
>
> Now, these are separate arguments, political rights versus economic
> freedom. I don't think the distinction was quite as broad to a laborer
> in 1900, a coalminer in West Virginia, a railsplitter, yada yada.
>
>
> Right or wrong (and not meaning to get back to gold, really), you
> had bryan's supporters feeling oppressed by the eastern money men,
> and the gold standard, as keeping them down.
>
> You had finacial panics. You had overall expansion over time, but
> huge, and hugely painful downturns, and for some it may have seemed
> almost impossible to come up out of the dregs. Like that black tenant
> farmer in Hard Times I mentioned. Of course, to move away from that
> legacy, it was damn hard for some white tenant farmers as well.<br/>
>
> And even if it is ALL caused by government intervention, certainly,
> there are different kinds of government intervention. What caused
> the tulip bubble and panic. or the panics after the civil war, or
> 1907, or now, may be caused by different things the government does.
>
>
> So. We vote them out. We look to change things. This author advocates
> commissions, inquiries or prosecutions of Paulsen, Bernanke, Goldman's
> trading, etc. maybe that is time and money well spent. Personally,
> I like Bernanke and think he is well-meaning. I could be very wrong.
> I may be naive, but probably less so than some of you may think.
>
>
> Get everything out and open and under the clear blue sky and we can
> all discuss and debate and decide where we go from here and how to
> get out of this mess. Because it probably isn't easy. Well, maybe
> some of you do have the solutions. I am open to listening. :)
>
> Take care all. I enjoy this kind of discussion, acknowledging that
> sometimes be a little flip.
>
> Best of luck in markets and life.
>
>

Plunge Protection Team Attacks BofA: This Ends Now

I want to get back to this but tone it down. Prior to the New Deal, or the market crash, whenever, or prior to the Fed, whenever we are discussing, say 19th century to 1907 panic, we had great growth, but huge cycles. Caused or not caused by government intervention, or a certain type of intervention (I know someone has put forth the point ALL cycles are caused by the government intervening), whatever.

Certainly, during a lot of that time, one has a hard time denying the fruits of overall expansion were universally open to all (I am not saying they weren't universally shared, we take that as a given). I mean, we had slavery racticed pretty much everywhere, and not stamped out mostly in the U.S. until the second half of the 19th century.

Even tehreafter, many lived in virtual peonage, and not just the serfs of russia, but many people here as well. Women couldn't vote. The franchise was denied to many others.

Many advanced by dint of smarts, hard work, some luck. many did not, and were to a large extent locked in place.

Now, these are separate arguments, political rights versus economic freedom. I don't think the distinction was quite as broad to a laborer in 1900, a coalminer in West Virginia, a railsplitter, yada yada.

Right or wrong (and not meaning to get back to gold, really), you had bryan's supporters feeling oppressed by the eastern money men, and the gold standard, as keeping them down.

You had finacial panics. You had overall expansion over time, but huge, and hugely painful downturns, and for some it may have seemed almost impossible to come up out of the dregs. Like that black tenant farmer in Hard Times I mentioned. Of course, to move away from that legacy, it was damn hard for some white tenant farmers as well.

And even if it is ALL caused by government intervention, certainly, there are different kinds of government intervention. What caused the tulip bubble and panic. or the panics after the civil war, or 1907, or now, may be caused by different things the government does.

So. We vote them out. We look to change things. This author advocates commissions, inquiries or prosecutions of Paulsen, Bernanke, Goldman's trading, etc. maybe that is time and money well spent. Personally, I like Bernanke and think he is well-meaning. I could be very wrong. I may be naive, but probably less so than some of you may think.

Get everything out and open and under the clear blue sky and we can all discuss and debate and decide where we go from here and how to get out of this mess. Because it probably isn't easy. Well, maybe some of you do have the solutions. I am open to listening. :)

Take care all. I enjoy this kind of discussion, acknowledging that sometimes be a little flip.

Best of luck in markets and life.




On Apr 30 12:35 PM wobatus wrote:

> The period was also one where certain folks were perpetually disadvantaged.
> That's why you had a lot of wobblies etc. supporting bryan and free
> silver (don't crucify me on a cross of gold, etc.).
>
> If you read Hard Times by Studs Terkel, there's a passage where a
> black tenant farmer talks about the Depression. He says something
> along the lines of, we just called it hard times. That's the way
> things always were. Just that it started hitting the well off white
> folks, and they called it a Great Depression.
>
> Thos panics use to mean depravation, degradation and poverty. The
> wild swings may have led to an overall rise in wealth, but unfortunately,
> not a lot of trickle down for some.
>
> There is no denying that the money supply did shrink by 25%, and
> that the fed was liquidationist to a great extent. This was not just
> caused by fear of government confiscation. Too much of it came before.
>
>
> If one leaves things perfectly laissez faire, and just ride the boom
> and bust and don't bring the lowest rung into the system and along
> for the ride, believeing they have a stake and a benefit, then you'll
> have breakdown and you can end up like russia did. They'll come and
> take it, right or wrong.
>
> Anyway, i get far afield here.
>
> On Apr 30 10:42 AM Carlos Lam wrote:

Plunge Protection Team Attacks BofA: This Ends Now

Are you saying, in the Hobbesian state of nature, there would be no business cycle? Would there be a lot of business being conducted?


On Apr 30 08:08 PM Glen L. wrote:

> In the previous comment I meant to say that Zimbabwe poor are paying
> just about the same for a loaf of bread as we do in America. Gold
> has universal value.
>
> Further comment on Mr. Goodman's article, which has mostly been ignored
> in the gold bug vs. fiat bug debate:
>
> I broadly concur with his historical and macro economic analysis.
> However, I don't think it's correct to say that the people losing
> faith with the institutions was or is the exact cause of the Depression
> or any other severe economic downturn you care to mention. The cause
> of each and every expansionary phase of the business cycle was government
> intervention in the marketplace (this is even true of the tulip mania
> in Holland almost 400 years ago), and the collapse of the expansionary
> bubble is just the natural, inevitable market reaction. Therefore,
> it matters not whether the people have or haven't faith in the governments
> or banks or tulipmongers, what goes up must come down, i.e. back
> to equilibrium. The crucial point for everyone to understand now
> is that worldwide catastrophes like the Depression and the current
> fiasco happen when government (and its central bank cohort) try to
> intercede to mitigate the effects, i.e. prevent the deflation of
> the bubble or attempt to reflate it.
>
> The Great Depression would have been an ordinary depression (the
> old word for recession, which replaced the older term "panic") without
> the massive interventions of both Hoover and Roosevelt, and would
> likely have ended within a year or two, like all preceding downturns
> in American history. (Those who bring up American history prior to
> 1929 to claim that the business cycle is a fault of capitalism always
> fail to mention the fact that previous downturns were always brief).
> But the nanny-state politicians tried one bogus market intervention
> after another, and the US suffered its worst economy ever, lasting
> until 1946. Now we see Obama and the Congress repeating the mistakes
> of Bush, as FDR repeated Hoover's mistakes, compounding them by another
> order of magnitude, and gambling America's future away with my money
> and yours.
>
> Americans' loss of faith in their government was caused by the Depression,
> rather than the other way around.

Plunge Protection Team Attacks BofA: This Ends Now

I think most americans are angry. I know I am. Grrrr. At politicians. At the fed. At other voters. At illegal immigrants. At the money-changers. I am mad at Bush. I am mad at Obama. I am mad at the sub-prime mortage originators, the brokers, the folks that were too ignorant and spent beyond their means and got mortgages for huge properties they couldn't afford while i lived within my means, and now they are getting bailed out. I am mad at unions, especially the job-bank guys at the auto companies, but pretty much all of them. I am mad at excessive executive pay. I am mad at institutional shareholders that let all this go on and didn't care and were lousy stewards of capital. I am mad about corporate governance. I am angry at lazy boards made up of politically-correct appointees or cynosures of do-nothing. I am furious about the Community Reinvestment Act. I am apoplectic at the huge percentage of government workers per every private sector actor. I am REALLY mad at islamic fundamentalist terrorists. In fact, I am pretty pissed-off at all killers and murderers, from Colombine to Kandahar. I am at my wits end with idealogues. I have had it up to here with trimmers. I am mad at the self-righteous divine or godless.

Seriously, I am angry, and most folks I know are. But not always.


On Apr 30 10:42 PM metastar wrote:

> Wow, you're one angry dude! Its good to see. It's only because you
> walk with eyes opened. If more Americans were angry we would actually
> have some hope for real meaningful change. Now that's what animal
> spirits mean to me.

Plunge Protection Team Attacks BofA: This Ends Now

Oh, i understand they can get ensconsed, that there is corruption, manipulation, etc. I also think voters and citizens have some responsibility for how things get the way they are. And i think sometimes the cynical should try being a step beyond cynical. You may be less aware than you think. Certain in less pain. :)

I am teasing.

Take care. All the best.


On Apr 30 09:12 PM PainfullyAware wrote:

>
> On Apr 30 12:16 PM wobatus wrote:

Plunge Protection Team Attacks BofA: This Ends Now

Yeah yeah, i know. Don't think i don't know how to read. :)

On Apr 30 09:29 PM PainfullyAware wrote:

> On Apr 30 03:16 PM wobatus wrote:

Plunge Protection Team Attacks BofA: This Ends Now

Dave, you make me laugh.

I love the "because it is beautiful and people love it" arguments. And of course, folks do.

Is there enough of it, now and being found, for the increasing amounts of things, people, etc. to spend it on? Would you have constant DE-flation if that were the standard? And wouldn't that likewise cause problems, planning wise?

Just tossing that out there.

Next, all fiat currencies end, and all empires end. And gold is still there. But during times when civilization breaks down, your gold may but also may not protect you. maerauding bands may come take it, or existence all around you may be such that gold isn't buying the material comforts it did when society functioned.

A functioning society is worth a lot. :)


On May 01 01:10 AM Dave Wrixon wrote:

> Sure, when America gets into the same mess as Zimbabwe, and note
> the when not an if, then you will be able to buy bread with Gold.
> But by then the US will account for less than 1% of the World Economy,
> so who gives a damn?

Plunge Protection Team Attacks BofA: This Ends Now

If it was all Hoover and Roosevelt, why was it pretty much across the industrialized world?


On Apr 30 08:08 PM Glen L. wrote:

> In the previous comment I meant to say that Zimbabwe poor are paying
> just about the same for a loaf of bread as we do in America. Gold
> has universal value.
>
> Further comment on Mr. Goodman's article, which has mostly been ignored
> in the gold bug vs. fiat bug debate:
>
> I broadly concur with his historical and macro economic analysis.
> However, I don't think it's correct to say that the people losing
> faith with the institutions was or is the exact cause of the Depression
> or any other severe economic downturn you care to mention. The cause
> of each and every expansionary phase of the business cycle was government
> intervention in the marketplace (this is even true of the tulip mania
> in Holland almost 400 years ago), and the collapse of the expansionary
> bubble is just the natural, inevitable market reaction. Therefore,
> it matters not whether the people have or haven't faith in the governments
> or banks or tulipmongers, what goes up must come down, i.e. back
> to equilibrium. The crucial point for everyone to understand now
> is that worldwide catastrophes like the Depression and the current
> fiasco happen when government (and its central bank cohort) try to
> intercede to mitigate the effects, i.e. prevent the deflation of
> the bubble or attempt to reflate it.
>
> The Great Depression would have been an ordinary depression (the
> old word for recession, which replaced the older term "panic") without
> the massive interventions of both Hoover and Roosevelt, and would
> likely have ended within a year or two, like all preceding downturns
> in American history. (Those who bring up American history prior to
> 1929 to claim that the business cycle is a fault of capitalism always
> fail to mention the fact that previous downturns were always brief).
> But the nanny-state politicians tried one bogus market intervention
> after another, and the US suffered its worst economy ever, lasting
> until 1946. Now we see Obama and the Congress repeating the mistakes
> of Bush, as FDR repeated Hoover's mistakes, compounding them by another
> order of magnitude, and gambling America's future away with my money
> and yours.
>
> Americans' loss of faith in their government was caused by the Depression,
> rather than the other way around.

Plunge Protection Team Attacks BofA: This Ends Now

Oh please, that was funny. You don't know the song: "Lawyers Guns and Money"? Oh well, I made myself laugh at least.


On Apr 30 05:49 PM wobatus wrote:

> Was that a Waren Zevon song? :)

Plunge Protection Team Attacks BofA: This Ends Now

Yeah, i know the reasons. Good points. In this day and age you can have a commodity basket. Uh oh, more derivatives. :)

Even with wheat futures (all the wheat this fine land can produce for 100 years), you can have droughts and land can go infertile. Someone could poison your land.

I still get stuck on the why, even with the attributes you cite.

But you are right, it is what it is and has been that way for millenia. People are stubborn. :)


On Apr 30 03:57 PM Carlos Lam wrote:

> On Apr 30 12:25 PM wobatus wrote:

Plunge Protection Team Attacks BofA: This Ends Now

Was that a Waren Zevon song? :)


On Apr 30 04:51 PM doubleguns wrote:

> Food, guns and ammo when gold becomes worthless.

Plunge Protection Team Attacks BofA: This Ends Now

What i find funny, gedankonomist, is that you got negative recs for what you said, too. I mean, it is hard to quibble with what you said. It's true.

I know Goring had a big collection of paintings and champagne, burgundy and bordeaux. I wonder how much gold he had. :)

Anyway, I rec'd your post.

have a good one.


On Apr 30 12:45 PM Gedankonomist wrote:

> Well, why do people pay millions for pretty paintings? Thousands
> for a bottle of champagne? They aren't useful for much. Or buy a
> huge oversized truck when a much smaller vehicle will do? Why do
> pro sports players get paid so much?
>
> The market is what it is.
>
> On Apr 30 12:25 PM wobatus wrote: