Tony Soprano

Jim Grant on Fed Monetary Policy

America is the best place to invest. Do not under estimate, its people and government.

America has no equal.

Market Outlook: Watch Out, the Signs Can Be Deceiving

Mr. Michael Panzner talks about another leg down. Others are saying there will be a reflex rally. Those are general market predictions and fairly easy to make. What I would like to see Mr. Michael Panzner do is make a prediction as to how far down this leg will be. At this point, the longs don't care. Time and history are on their side.

Market Outlook: Watch Out, the Signs Can Be Deceiving

Since there is so much angst directed toward the Fed and the US Government, I decided to list some events, not all of them, that had dramatic ramifications on lives, cost and the psychology of our country. I started in 1906 because it’s just a little over a hundred years. Some of the events were world wide but still had a cause and effect on America and the world. As I compiled the list, I could not help but feel the great sacrifices that many American’s have made and what a resilient country, economy and government we have in American that stretches the entire globe.

The 1906 San Francisco Earthquake and fire, registered 8.25 on the Richter scale; estimates range from 700 to 3,000 dead or missing, approximately 225,000 injuries and $400,000,000 in 1906 dollars.

Recession, May 1907-June 1908, 13 mo

Model T, 1908, came into popular usage

Recession Jan. 1910-Jan. 1912, 24 months

Completion of the Panama Canal, 1914 – 27,500 workers are estimated to have died

Recession Jan. 1913-Dec. 1914 23 months

World War I -- 116,708 killed – 33 billion

Spanish influenza, 1918, killed over 500,000 people in the worst single U.S. epidemic.

Recession Aug. 1918-March 1919 7 months

The first radio news program was broadcast August 31, 1920, in Detroit, Michigan

Recession Jan. 1920-July 1921, 18 months

Recession May 1923-July 1924 14 months

Recession Oct. 1926-Nov. 1927 13 months

Bell Labs gave important demonstration of television April 7, 1927

The Great Mississippi Flood of 1927, flooded 27,000 square miles, 246 killed

The Great Depression, Black Tuesday, crop prices fell by 40 to 60 percent, after the panic of 1929, and during the first 10 months of 1930, 744 US banks failed. (In all, 9,000 banks failed during the 1930s). By 1933, depositors had lost $140 billion in deposits.

The Dirty Thirties, longest drought of 20th century. Peak periods were 1930, 1934, 1936, 1939, and 1940. The dust bowl covered 50 million acres in the south-central plains during the winter of 1935-1936.
Labor Day Hurricane of 1935, 400 killed

Recession May 1937-June 1938 13 months

World War II – 408,306 killed – 360 billion

Wartime Controls: 1941-1945 rationed consumer items ranging from sugar to gasoline

The United States developed the first atomic weapons during World War II

Recession Feb. 1945-Oct. 1945 8 months

The UN was founded in 1945 to replace the League of Nations

The Marshall Plan, July 1947 – 13 billion in economic and technical assistance were given to help the recovery of the European countries

On 16 December 1947, William Shockley, John Bardeen and Walter Brattain succeeded in building the first practical point-contact transistor at Bell Labs

Cable television, formerly known as Community Antenna Television or CATV, was born in the mountains of Pennsylvania in 1948.

Israel declares independence, May 14, 1948,

Berlin's Crisis (June 24, 1948 to May 11, 1949) was one of the first major crises of the new Cold War

Recession Nov. 1948-Oct. 1949 11 months

The Soviet Union tested its first nuclear weapon ( Joe-1 ) in 1949

Chiang Kai-shek moves his government from communist China to Taipei, Taiwan (formerly Formosa), where he formally resumed his duties as president on March 1, 1950.

Korean War, July 1951 - July 1953 – 33,000 killed in action

The United Kingdom tested its first nuclear weapon ( Hurricane ) in 1952

Recession July 1953-May 1954 10 months

The Supreme Court rules on the landmark case Brown v. Board of Education of Topeka, Kans., unanimously agreeing that segregation in public schools is unconstitutional – May 17, 1954.

The Suez Crisis of 1956 – was a military attack on Egypt by Britain, France, and Israel beginning on 29 October 1956.
Recession Aug. 1957-April 1958 8 months

Alaska becomes 49th state of the U.S. on January 3, 1959

Hawaii becomes 50th state of the U.S. on August 21, 1959

U–2 Incident of 1960 occurred when an American U–2 spy plane was shot down over the Soviet Union

France tested its first nuclear weapon in 1960 ( Gerboise Bleue )

Recession April 1960-Feb. 1961 10 months

The Cold War, some estimates shows $8 trillion was spent, worldwide, on nuclear and other weapons between 1945 and 1996

The Cuban Missile Crisis, Oct. 1962

Martin Luther King is arrested and jailed during anti-segregation protests in Birmingham, Ala.; April 16, 1963.

Vietnam War, 1963 – 47,378 killed in action

200,000 people join the March on Washington. Congregating at the Lincoln Memorial, participants listen as Martin Luther King delivers his famous I Have a Dream speech. Aug 28, 1963.

The murder of JFK, 1963 Nov

Good Friday Earthquake (1964) In Alaska, it was the fourth biggest earthquake recorded

The Gulf of Tonkin Incident, Aug 1964

China tested its first nuclear weapon in 1964

President Johnson signs the Civil Rights Act of 1964.

Malcolm X, black nationalist and founder of the Organization of Afro-American Unity, is shot to death – Feb 21, 1965

1967 Arab-Israeli War – was fought between Israel and Arab neighbors Egypt, Jordan, and Syria. The nations of Iraq, Saudi Arabia, Kuwait and Algeria also contributed troops and arms to the Arab forces.

The murder of Dr King, April 1968 and Bobby Kennedy, June 1968

The city riots of April, 1968 – 30 cities affected

President Johnson signs the Civil Rights Act of 1968, prohibiting discrimination in the sale, rental, and financing of housing.

Hurricane Camille, Aug 1969, 259 killed

Recession Dec. 1969-Nov. 1970 11 months

Stagflation of the 1970s began

Nixon first imposed wage and price controls on August 15, 1971

World Trade Center ribbon cutting ceremony was on April 4, 1973

1973 Arab-Israeli War or Yom Kippur War – a surprise joint attack by Egypt and Syria on the Jewish holiday of Yom Kippur.

Oil Embargo, Oct 1973 long gas lines

Recession Nov. 1973-March 1975 16 months

Articles of Impeachment of Nixon started
(Approved by a vote of 27-11 by the House Judiciary Committee on Saturday, July 27, 1974.)

India's first nuclear test occurred on the 18th of May, 1974

Deregulation: 1974-1992 this era began when Nixon left office

Home computers start to enter retail markets, in 1977, and becoming common during the 1980s

Bell Labs launches first commercial cellular network in Chicago – 1978

Three Mile Island nuclear power plant crisis, March 1979

The Carter Administration decides to come to the aid of Chrysler Corp, 1979

Mount St. Helens eruption 1980

The US Savings and Loan crisis of the 1980s begins, more than 1,000 savings and loan institutions failed.

Recession Jan. 1980-July 1980 6 months

Prime reached unbelievable 20% in January 1981,

AIDS was first reported June 5, 1981 by the government – It is thought that more than one million people are living with HIV in the USA and that more than half a million have died after developing AIDS.

Recession July 1981-Nov. 1982 16 months

California earthquake 1983

The 87 market crash - Black Monday

Pakistan acquires the ability to carry out a nuclear explosion in 1987

California earthquake, 1989

Recession July 1990-March 1991 8 months

Iraq invaded Kuwait on August 2, 1990

Nikkei stock index crashed by over 30,000 points, the average home near Tokyo cost well over $2 million before the crash in 1989

The Persian Gulf War, 1991 or Desert Storm Jan 1991

Hurricane Andrew 1992 very destructive United States hurricane

World Trade Center bombing, February 26, 1993

The Great USA Flood of 1993

The 1995 bailout of Mexico

East Asian Financial Crisis was a period of financial crisis that gripped much of Asia beginning in the summer of (July) 1997

Intervention in the Former Yugoslavia – March 24-June 10, 1999, NATO bombing of FR Yugoslavia

The International Monetary Fund approves an immediate $5.3bil emergency payment for Brazil to rescue its economy, Dec 1998

IMF protects US banks in Russian bailout, July 1998, Russia receives $22.6 billion in loans

Dot Com Bubble, climaxed on March 10th, 2000 with the NASDAQ peaking at 5132.52

9/11 Attack, 2,974 people died

Recession March 2001-Nov. 2001 8 months, Airline Industry Collapsed

Enron bankruptcy in late 2001, employed 22,000

WorldCom, July 21, 2002, filed for Chapter 11
Iraq War, March 19, 2003 – 4,000 dead

Hurricane Katrina, late August 2005, 1,836 people lost their lives

Start of the Great Housing Recession/Depression or Sub-prime Recession, date to be determined.

Main Street Sacrificed to the Gods of Wall Street

Since there is so much angst directed toward the Fed and the US Government, I decided to listed some events, not all of them, that had dramatic ramifications on lives, cost and the psychology of our country. I started in 1906 because it’s just a little over a hundred years. As I compiled the list, I could not help but feel the great sacrifices that many American’s have made and what a resilient country, economy and government we have in American.

The 1906 San Francisco Earthquake and fire, registered 8.25 on the Richter scale; estimates range from 700 to 3,000 dead or missing, approximately 225,000 injuries and $400,000,000 in 1906 dollars.

Recession, May 1907-June 1908, 13 mo

Recession Jan. 1910-Jan. 1912, 24 months

Completion of the Panama Canal, 1914 – 27,500 workers are estimated to have died

Recession Jan. 1913-Dec. 1914 23 months

World War I -- 116,708 killed – 33 billion

Spanish influenza, 1918, killed over 500,000 people in the worst single U.S. epidemic.

Recession Aug. 1918-March 1919 7 months

Recession Jan. 1920-July 1921, 18 months

Recession May 1923-July 1924 14 months

Recession Oct. 1926-Nov. 1927 13 months

The Great Mississippi Flood of 1927, flooded 27,000 square miles, 246 killed

The Great Depression, Black Tuesday, crop prices fell by 40 to 60 percent, after the panic of 1929, and during the first 10 months of 1930, 744 US banks failed. (In all, 9,000 banks failed during the 1930s). By 1933, depositors had lost $140 billion in deposits.

The Dirty Thirties, longest drought of 20th century. Peak periods were 1930, 1934, 1936, 1939, and 1940. The dust bowl covered 50 million acres in the south-central plains during the winter of 1935-1936.

Labor Day Hurricane of 1935, 400 killed

Recession May 1937-June 1938 13 months

World War II – 408,306 killed – 360 billion

Wartime Controls: 1941-1945 rationed consumer items ranging from sugar to gasoline

Recession Feb. 1945-Oct. 1945 8 months

The Marshall Plan, July 1947 – 13 billion in economic and technical assistance were given to help the recovery of the European countries

Recession Nov. 1948-Oct. 1949 11 months

Korean War, July 1951 - July 1953 – 33,000 killed in action

Recession July 1953-May 1954 10 months

Recession Aug. 1957-April 1958 8 months

Recession April 1960-Feb. 1961 10 months

The Cold War, some estimates shows $8 trillion was spent, worldwide, on nuclear and other weapons between 1945 and 1996

The Cuban Missile Crisis, Oct. 1962

Good Friday Earthquake (1964) In Alaska, it was the fourth biggest earthquake recorded

Vietnam War, 1963 – 47,378 killed in action

The murder of JFK, 1963 Nov

The Gulf of Tonkin Incident, Aug 1964

The murder of Dr King, April 1968 and Bobby Kennedy, June 1968

The city riots of April, 1968 – 30 cities affected

Hurricane Camille, Aug 1969, 259 killed

Recession Dec. 1969-Nov. 1970 11 months

Stagflation of the 1970s began

Nixon first imposed wage and price controls on August 15, 1971

Oil Embargo, Oct 1973 long gas lines

Recession Nov. 1973-March 1975 16 months

Articles of Impeachment of Nixon started
(Approved by a vote of 27-11 by the House Judiciary Committee on Saturday, July 27, 1974.)

Deregulation: 1974-1992 this era began when Nixon left office

Three Mile Island nuclear power plant crisis, March 1979

Mount St. Helens eruption 1980

Recession Jan. 1980-July 1980 6 months

Prime reached unbelievable 20% in January 1981,

AIDS was first reported June 5, 1981 by the government – It is thought that more than one million people are living with HIV in the USA and that more than half a million have died after developing AIDS.

Recession July 1981-Nov. 1982 16 months

California earthquake 1983

The 87 market crash - Black Monday

California earthquake, 1989

Recession July 1990-March 1991 8 months

Iraq invaded Kuwait on August 2, 1990

The Persian Gulf War, 1991 or Desert Storm Jan 1991

Hurricane Andrew 1992 very destructive United States hurricane

The Great USA Flood of 1993

Intervention in the Former Yugoslavia,

Dot Com Bubble, climaxed on March 10th, 2000 with the NASDAQ peaking at 5132.52

9/11 Attack, 2,974 people died

Recession March 2001-Nov. 2001 8 months, Airline Industry Collapsed

Enron bankruptcy in late 2001, employed 22,000

WorldCom, July 21, 2002, filed for Chapter 11
Iraq War, March 19, 2003 – 4,000 dead

Hurricane Katrina, late August 2005, 1,836 people lost their lives

Start of the Great Housing Recession or Sub-prime Recession 2006 or 07, 08? Date to be determined.

Fed Rate Cut: What Happens When We Get to Zero?

Since there is so much angst directed toward the Fed and the US Government, I decided to listed some events, not all of them, that had dramatic ramifications on lives, cost and the psychology of our country. I started in 1906 because it’s just a little over a hundred years. As I compiled the list, I could not help but feel the great sacrifices that many American’s have made and what a resilient country, economy and government we have in American.

The 1906 San Francisco Earthquake and fire, registered 8.25 on the Richter scale; estimates range from 700 to 3,000 dead or missing, approximately 225,000 injuries and $400,000,000 in 1906 dollars.

Recession, May 1907-June 1908, 13 mo

Recession Jan. 1910-Jan. 1912, 24 months

Completion of the Panama Canal, 1914 – 27,500 workers are estimated to have died

Recession Jan. 1913-Dec. 1914 23 months

World War I -- 116,708 killed – 33 billion

Spanish influenza, 1918, killed over 500,000 people in the worst single U.S. epidemic.

Recession Aug. 1918-March 1919 7 months

Recession Jan. 1920-July 1921, 18 months

Recession May 1923-July 1924 14 months

Recession Oct. 1926-Nov. 1927 13 months

The Great Mississippi Flood of 1927, flooded 27,000 square miles, 246 killed

The Great Depression, Black Tuesday, crop prices fell by 40 to 60 percent, after the panic of 1929, and during the first 10 months of 1930, 744 US banks failed. (In all, 9,000 banks failed during the 1930s). By 1933, depositors had lost $140 billion in deposits.

The Dirty Thirties, longest drought of 20th century. Peak periods were 1930, 1934, 1936, 1939, and 1940. The "dust bowl" covered 50 million acres in the south-central plains during the winter of 1935-1936.

Labor Day Hurricane of 1935, 400 killed

Recession May 1937-June 1938 13 months

World War II – 408,306 killed – 360 billion

Wartime Controls: 1941-1945 rationed consumer items ranging from sugar to gasoline

Recession Feb. 1945-Oct. 1945 8 months

The Marshall Plan, July 1947 – 13 billion in economic and technical assistance were given to help the recovery of the European countries

Recession Nov. 1948-Oct. 1949 11 months

Korean War, July 1951 - July 1953 – 33,000 killed in action

Recession July 1953-May 1954 10 months

Recession Aug. 1957-April 1958 8 months

Recession April 1960-Feb. 1961 10 months

The Cold War, some estimates shows $8 trillion was spent, worldwide, on nuclear and other weapons between 1945 and 1996

The Cuban Missile Crisis, Oct. 1962

Good Friday Earthquake (1964) In Alaska, it was the fourth biggest earthquake recorded

Vietnam War, 1963 – 47,378 killed in action

The murder of JFK, 1963 Nov

The Gulf of Tonkin Incident, Aug 1964

The murder of Dr King, April 1968 and Bobby Kennedy, June 1968

The city riots of April, 1968 – 30 cities affected

Hurricane Camille, Aug 1969, 259 killed

Recession Dec. 1969-Nov. 1970 11 months

Stagflation of the 1970s began

Nixon first imposed wage and price controls on August 15, 1971

Oil Embargo, Oct 1973 long gas lines

Recession Nov. 1973-March 1975 16 months

Articles of Impeachment of Nixon started
(Approved by a vote of 27-11 by the House Judiciary Committee on Saturday, July 27, 1974.)

Deregulation: 1974-1992 this era began when Nixon left office

Three Mile Island nuclear power plant crisis, March 1979

Mount St. Helens eruption 1980

Recession Jan. 1980-July 1980 6 months

Prime reached unbelievable 20% in January 1981,

AIDS was first reported June 5, 1981 by the government – It is thought that more than one million people are living with HIV in the USA and that more than half a million have died after developing AIDS.

Recession July 1981-Nov. 1982 16 months

California earthquake 1983

The 87 market crash - Black Monday

California earthquake, 1989

Recession July 1990-March 1991 8 months

Iraq invaded Kuwait on August 2, 1990

The Persian Gulf War, 1991 or Desert Storm Jan 1991

Hurricane Andrew 1992 very destructive United States hurricane

The Great USA Flood of 1993

Intervention in the Former Yugoslavia,

Dot Com Bubble, climaxed on March 10th, 2000 with the NASDAQ peaking at 5132.52

9/11 Attack, 2,974 people died

Recession March 2001-Nov. 2001 8 months, Airline Industry Collapsed

Enron bankruptcy in late 2001, employed 22,000

WorldCom, July 21, 2002, filed for Chapter 11

Iraq War, March 19, 2003 – 4,000 dead

Hurricane Katrina, late August 2005, 1,836 people lost their lives

Start of the Great Housing Recession or Sub-prime Recession 2006 or 07, 08? Date to be determined.

Did the Fed and GSEs Avert a Crisis?

Since there is so much angst directed toward the Fed and the US Government, I decided to listed some events, not all of them, that had dramatic ramifications on lives, cost and the psychology of our country. I started in 1906 because it’s just a little over a hundred years. As I compiled the list, I could not help but feel the great sacrifices that many American’s have made and what a resilient country, economy and government we have in American.

The 1906 San Francisco Earthquake and fire, registered 8.25 on the Richter scale; estimates range from 700 to 3,000 dead or missing, approximately 225,000 injuries and $400,000,000 in 1906 dollars.

Recession, May 1907-June 1908, 13 mo

Recession Jan. 1910-Jan. 1912, 24 months

Completion of the Panama Canal, 1914 – 27,500 workers are estimated to have died

Recession Jan. 1913-Dec. 1914 23 months

World War I -- 116,708 killed – 33 billion

Spanish influenza, 1918, killed over 500,000 people in the worst single U.S. epidemic.

Recession Aug. 1918-March 1919 7 months

Recession Jan. 1920-July 1921, 18 months

Recession May 1923-July 1924 14 months

Recession Oct. 1926-Nov. 1927 13 months

The Great Mississippi Flood of 1927, flooded 27,000 square miles, 246 killed

The Great Depression, Black Tuesday, crop prices fell by 40 to 60 percent, after the panic of 1929, and during the first 10 months of 1930, 744 US banks failed. (In all, 9,000 banks failed during the 1930s). By 1933, depositors had lost $140 billion in deposits.

The Dirty Thirties, longest drought of 20th century. Peak periods were 1930, 1934, 1936, 1939, and 1940. The "dust bowl" covered 50 million acres in the south-central plains during the winter of 1935-1936.

Labor Day Hurricane of 1935, 400 killed

Recession May 1937-June 1938 13 months

World War II – 408,306 killed – 360 billion

Wartime Controls: 1941-1945 rationed consumer items ranging from sugar to gasoline

Recession Feb. 1945-Oct. 1945 8 months

The Marshall Plan, July 1947 – 13 billion in economic and technical assistance were given to help the recovery of the European countries

Recession Nov. 1948-Oct. 1949 11 months

Korean War, July 1951 - July 1953 – 33,000 killed in action

Recession July 1953-May 1954 10 months

Recession Aug. 1957-April 1958 8 months

Recession April 1960-Feb. 1961 10 months

The Cold War, some estimates shows $8 trillion was spent, worldwide, on nuclear and other weapons between 1945 and 1996

The Cuban Missile Crisis, Oct. 1962

Good Friday Earthquake (1964) In Alaska, it was the fourth biggest earthquake recorded

Vietnam War, 1963 – 47,378 killed in action

The murder of JFK, 1963 Nov

The Gulf of Tonkin Incident, Aug 1964

The murder of Dr King, April 1968 and Bobby Kennedy, June 1968

The city riots of April, 1968 – 30 cities affected

Hurricane Camille, Aug 1969, 259 killed

Recession Dec. 1969-Nov. 1970 11 months

Stagflation of the 1970s began

Nixon first imposed wage and price controls on August 15, 1971

Oil Embargo, Oct 1973 long gas lines

Recession Nov. 1973-March 1975 16 months

Articles of Impeachment of Nixon started
(Approved by a vote of 27-11 by the House Judiciary Committee on Saturday, July 27, 1974.)

Deregulation: 1974-1992 this era began when Nixon left office

Three Mile Island nuclear power plant crisis, March 1979

Mount St. Helens eruption 1980

Recession Jan. 1980-July 1980 6 months

Prime reached unbelievable 20% in January 1981,

AIDS was first reported June 5, 1981 by the government – It is thought that more than one million people are living with HIV in the USA and that more than half a million have died after developing AIDS.

Recession July 1981-Nov. 1982 16 months

California earthquake 1983

The 87 market crash - Black Monday

California earthquake, 1989

Recession July 1990-March 1991 8 months

Iraq invaded Kuwait on August 2, 1990

The Persian Gulf War, 1991 or Desert Storm Jan 1991

Hurricane Andrew 1992 very destructive United States hurricane

The Great USA Flood of 1993

Intervention in the Former Yugoslavia,

Dot Com Bubble, climaxed on March 10th, 2000 with the NASDAQ peaking at 5132.52

9/11 Attack, 2,974 people died

Recession March 2001-Nov. 2001 8 months, Airline Industry Collapsed

Enron bankruptcy in late 2001, employed 22,000

WorldCom, July 21, 2002, filed for Chapter 11

Iraq War, March 19, 2003 – 4,000 dead

Hurricane Katrina, late August 2005, 1,836 people lost their lives

Start of the Great Housing Recession or Sub-prime Recession 2006 or 07, 08? Date to be determined.

It's Not a Crisis, But a Chaotic Calamity

Articles like this are getting long in the tooth. Most of the publisher's to this site are bearish.

The above piece is long and confusing. In my opinion, the short of it (no pun intended) is that we will prevail. We have the best government in the world. Every time our govt has intervened in some crisis it has worked and that goes all the way back to 1914.

Jim Rogers will have to take a sleeping pill tonight. He is so angry at the Fed. The weak dollar will mean that China, (Jim Rogers dream country) will sell fewer goods to us. That will slow their economy. China already has high inflation. Commodities dropped like a bric today. (no pun intended) China could burst. They have problems, in Tibet, more pollution than septic tank, very high inflation and more govt intervention than Al Gore, Ralph Nader, or Ted Kennedy could dream up in ten thousand years.

Gartman today on Fast Money said he is now long of JP Morgan – a bank stock. For those of you who don't know him he has been short of stocks and long of gold for a good while. But he has reversed his position.

Warning Signs of a Modern Depression: See 1990 Japan

Not the same comparison and it's no longer about denial.

The US and other world countries will help to fix this issue. The bears are saying that this is an unsurmountable problem. No! Difficult Yes. Never ending No!

Watching the Fed as Records Continue to Be Broken

To the author:

Forget all this short, and call, and put stuff. You are young and I am old and I say this with great conviction: buy long now. It’s a great, great time to do it. If the market dips again you should buy long again and stay long a long time. YOU WILL NOT REGRET IT.

Let the bulk of your money work for you like a locomotive. It takes a good while for a long train to stop and the same is true when starting. The train is powerful and will pull you a long way. When it stops again or slows down again and it will, you will still be further along in your journey.

I am not saying that you can't make money in what you are doing but you are working ten times harder than what is necessary. You yourself pointed out how you missed some profits with Bear. Its difficult to short. If you really must do it keep just a small portion of your funds exposed and let the locomotive really do the very big and very hard work for you.

______________________...

A must read it was published today:

"Bear Stearns Bailout Was `Finger in the Dike,' Historians Say
By Elliot Blair Smith" Bloomberg.com

It points out how every single Fed or Treasury intervention has worked going back to 1914. We have one hell of a brilliant system. Never, ever, sell America short.

Why the U.S Dollar Won't Die

A very good article. This site is usually very negative on the dollar and the Fed.

It's normal for the currency of a country that is about to go into a recession to decline in value.

Jim Roger's is paranoid over the decline of the dollar. He is one of the premiere critics of the Fed. Why is so critical to the point of paranoia?

Jim has a large position in the yuan. The falling dollar makes Chinese goods more expensive. Jim is afraid the China bubble will burst. There is trouble in Tibet. Athletes are starting to boycott the Olympic games because of pollution. Inflation in China is more than twice that of the US. The US consumer has become suspicious of what China is putting into there products. China has yet to let their currency trade freely in the markets. This is deplorable and we are so critical of our own Fed.

I believe the bubble in China will burst. The twenty year cycle in commodities will fail. This twenty year cycle is unsustainable because of inflation. Also, that was a different time and a different age. Because there are more people does not mean that it will be sustainable for twenty years. Many more people demanding goods will speed the cycle. Making the price of costly goods unsustainable. Other developing countries will feel the affects as well. Commodities will fall. The dollar will rise and Jim Rogers will lose money.

The Fed will still have to fight the fight with inflation. But with relief in price of commodities it will be easier than what the doom sayers are predicting.

Providing Aid to the Disabled

More negative palaver and its about what? Something we don't already know?

This is old news from old and yellowed newspapers and yellowed bloggers.

If the market takes a dip or plunge. Buy!

Futures Down Triple Digits on Hedge Fund Collapse

Barry, if you don't mind me saying that you are a bear and that you are a pregnant bear. And other bears out there are pregnant as well. Soon the world will be run over by bears and their cubs. THIS IS VERY BULLISH!

We have had three world downturns and they all have faltered. Call it a triple bottom? THIS IS VERY BULLISH!

Members on this site are using word and phrases like: death of a thousand cuts, world wide despair, fear fueling more fear and so on. THIS IS VERY BULLISH!

Foreign investors will show up at our doorstep. This not Armageddon and they know it. They will start buying while the dollar is low. Later this year or early in 09 the dollar will rebound and investors around the world will be praising America. THIS IS VERY BULLISH!

The commodities bubble will burst. This will be Armageddon but not for the consumer. The frozen consumer will defrost. Coins will be jingling again. THIS IS VERY BULLISH!

Later in 08 housing starts will show faint signs of leveling off. By Mid 09 housing will be fully stable. Large plumes of dust from new home construction sites will appear on the horizon. THIS IS VERY BULLISH!

As you see Barry, your string is getting short and good luck with all those cups they will be very hungry.

Some Fascinating Facts About Fed Injections

Two analogies or stories reflecting our financial crisis.

First story:

"Here is an analogy ...your teenager has maxed out their credit cards and is to a point they can no longer make payments. You step in as a co-signer and get the limits on the cards doubled.

Is this the right decision? This is what the Fed did for the banks yesterday." from Mr NoFate
______________________...

Second story:

"The son does use a credit card but instead of spending it on himself he wants to lend out the money and become loan shark. His idea is to lend out as much money that he can. In the mean time people that he is lending out to all live on an island. The island depends on a dike system to keep the island from going underwater. The dikes take an enormous amount of power to run. The islanders are taxed a lot to keep the power going..

The loan business is slow starting and the son wants it to grow much faster. His rich daddy is still backing him up and thinks his son is remarkable. The son's new business plan offers loan owners interest in a new waterfront country club if they barrow more. They see it as a steal and it makes them feel rich so they barrow more. His new business plan is a success for many years. The new country club is well under construction. Most of the people on the island are happy and think they have it made. The son pockets a good deal of wealth but he always wants more and more.

As more time passes, the cost of the power to run the dikes starts to increase rapidly. Sadly some of the islanders become sick. The doctors on the island suspect the Avian virus. Some even die and others cannot work. Unemployment starts to rise dramatically and the power for the dikes continues to rise.

Not all of the islanders owe money to the son. Many are still wealthy and never liked what the son has done and they are very much concerned about the rising cost to power for the dikes. More time passes and construction cost for the country club increases as well. Construction on the project starts to slow down. Many on the island start to become angry.

Taxes receipts to pay for the power for the dikes starts to diminish. Some of the islanders want to raise taxes to pay for the power. The islanders that are sick are not paying taxes. A meeting is called. The meeting is a failure and the son goes into hiding. However, the islanders come up with another plan but still many on the island do not like the newer plan as well

The newer plan requires the islanders to barrow more money but from the mainland. The wealthy on the island do not like this plan because it will require them to pay more taxes in the future. However, some of the middle class people on the island become restless and crime increases.

The islanders are at a serious crossroad. Damned if they do and damned if they don’t. Many on the island say the island will sink completely underwater if new monies are not borrowed. Others do not agree and feel the island will be on okay without the additional debt."

I’m not going to finish this story. I will let your imagination do the rest.

But my point is we can let GM or Ford go under and we will still have cars built. However, we cannot take this chance with the banks. Banks are the corner stone, hence the island metaphor, of our capitalism. If the banks sink we all sink. We cannot afford to take the slightest chance that this will spread further and sink us all. At the same time it’s a shame that a lot of our mortgage companies, brokerages firms and money center banks let this happen.

Wednesday Outlook: Moral Hazard Be Damned

Mr. Fry,

Never ever, underestimate America, its people, its government, its ideas and its place in the world.

Wednesday Outlook: Moral Hazard Be Damned

Mr. Fry,

Strong talks needs a strong reply. I SAY BUNK TO YOU!

I'm glad that you will pay and I will gladly pay. Even though the game is NOT over and the Fed could even make money on this swap. But even if they don't it's better than having a meltdown.

Trying to intimidate readers that "you" will pay is a cheap shot. You assume that there will be a cost, when, as I mentioned above, that there may not be a negative cost. Finally, like myself, I will gladly pay the cost to avoid a meltdown.

You should stick to your charts where the data is absolute. When you try to discuss a fundamental point please consider all sides of the discussion. Never, ever, assume that you can point your finger at your readers and intimidate them into believing your assumption is absolute without providing or at least thinking about a counter point of view. No one likes a one sided bias argument.

Thanks for your blog. We do need to be mindful of the high cost of government and who and how much we have to pay.