Jason Rines (iThinkBig)

On Financial Bloggers Meeting with Treasury Department

I see with the above spamming comment SA has not figured out how to block spammers. I offered, many times to help SA. I am done trying.

As for the bloggers, kudos to them for giving it the old college try. Let's see Treasury bring in a couple of other heavyweights, like Karl Denninger, John Lounsbury and Jim Quinn. There is no plan B, because these people will attempt to silence the rape victim now. History does rythme.

It is not they do not care per se, they just care more about themselves than the people that put them into power. So those who are last in the ivory towers to fall and come crashing down realize it is all now too late, that damn pride it always cometh before the fall.

Buffett's Big Rail Buy: What It Means for Berkshire Shareholders

The star power is not what many of us are analyzing here. Most of us seem to be taking a rational view of the USA's short and medium term future.


On Nov 04 02:36 PM bottoms-up wrote:

> I noticed that I got of thumbs down for coming down on the untouchable
> Sir Buffett of Omaha.
>
> I guess all of you can come down on rating agencies that may take
> his AAA rating away:
>
> www.bloomberg.com/apps...;sid=aTI6ak3w6s0Y
>
>
> Remember, sacred cows make the best burger, and I don't mean Omaha
> Steaks.. In business, if you follow anyone or anything as though
> they are a deity or rock star, you'll get what's coming to you.

Buffett's Big Rail Buy: What It Means for Berkshire Shareholders

Perhaps two can play the Ayn Rand game. Someone always needs to be John Gault. I don't think one could make up what is occurring in history right now. I am long America but short current US government. I do not believe WB would be in a position to state the same publically on the second line of that sentence but I would just be speculating.


On Nov 03 02:15 PM Socialism cannot compete! wrote:

> Only problem with this "energy play" -- the coal pipeline -- is that
> this Admarxistration does *not* like coal. Should be buying nuclear
> or something else instead. Unless...Buffett is doing this to create
> anti-Cap & Tax leverage against the neo-Coms??? Now *that* would
> be interesting!!! Last I checked, Warren was pretty liberal. Wonder
> if he's changing stripes...perhaps his capitalist self has woken
> to the realization that the liberals and their socialist policies
> are anti-freedom and anti-capitalism??? Things are getting very interesting
> indeed.

Buffett's Big Rail Buy: What It Means for Berkshire Shareholders

HA! You beat me to the punchline John. The dollar is being devalued. Imports like oil are going to become less economical. If the USA begins a real recovery, it is highly unlikely to be before 2013 and oil will continue to rise in-between meaning trickle down inflation into everything and making rail transport that much more important. Since early 2008 I keep referring to this year for myriads of reasons for the next sustainable bull, try a search here at SA under my screen name but the net out is a tepid but sustainable bull formation that year.

Let's say the bad becomes worse based on Washington policies. People will still need to eat meaning rail assets become extremely valuable.

WB loses if the US government decides to throw the industrialists to the wolves as other Fascist or Communist governments did in the past. In that extreme case, we ALL lose. But if I am WB I sleep well at night on this deal.


On Nov 03 01:27 PM John Lounsbury wrote:

> I think Buffet is making an energy play. He has been more and more
> an energy investor in recent years. Remember his 300% plus gain over
> a couple of years with Petro China? Utilities and pipelines are part
> of the energy investment picture. BNI is part of the same strategy,
> in this case he is buying a coal "pipeline".
>
> I bought BNI in early 2005 in the 40's and got stopped out within
> a few months for a gain of about 12%. This is one case where stop
> loss risk control proved counter productive.

America, The Nanny State

Surely, one of the oldest debates Socrates referenced is whom gets the right to control the fruits of anothers labor. Currently, one group is acting as a mob. If individuals being held up at the point of a gun (government) decide they won't participate the outcome is all but left to decide who dies in either confiscation of private property or defending it.

The State usually wins that fight at first but the outcome of the productive refusing to work for the non-productive is:

a) The State collapses and a new State is formed.
b) The State is overthrown in revolution, a new State is formed.
c) The State is conquered from without.
d) The State is conquered from within.

Choice D is what is occurring in my humble opinion. Government with Czars and nationalizing industries, giving one group with political connections the dwindling resources on the backs of other is know as FASCISM. Such a phase does not last long and becomes a final form of this particular form of oligarchy, probably Communism.

The shelf life of Communism is 40 years, the productive can only be forced through imprisonment or death to produce for so long.

As per speculation point D is happening, followed most likely by B and then the American public will have to directly deal with C.

On Nov 02 11:54 AM AxIt wrote:

> This short sentence says everything. Don't hide youself in lenghty
> explanations with numbers, statistics and supposedly clever interpretations
> of the US constitution. This is just a "take your hands off my money
> or l'll shoot you with my gun" debate. Nothing else. All the rest
> is philosophy.
>
> On Nov 02 09:24 AM James Quinn wrote:

Cap and Trade Would Sink the U.S. Economy

I really am liking your net-out commentary Leftfield.


On Oct 29 12:46 PM Leftfield wrote:

> Efficiency would be promoted with a simple tax on fuel. Of course,
> the actual idea is more government revenue and control. And, a simple
> tax would result in an enormous backlash. (It might be sellable
> by ELIMINATING another of our eggregious taxes).
> No, better to couch a complicated new burden in terms of saving the
> planet, reward Wall St. and cronies with a new trading vehicle and
> give Washington enormous new power and control.
> Nothing these people do is simple, straightforward or honest anymore.
> What are they hiding? Check out the idea of CO2 sequestration, an
> extra crackpot facet of their plan they dream of.

Consumer Confidence Is a Lagging Indicator: Expect Post-Recession Gloom Through 2010

Mark Perry, your economic reporting in 2008 was wrong. Your assessment that the depression is ending is wrong too. Commodities rose in 1935-1937 crushing the consumer further even while GDP appeared to rise. That is why there will be a double dip which search here reveals I had called for since fall of 2008 and REPEATEDLY. I care about the guy on the street Mark. You are an incompetent bufoon. I alone stopped in here to tell you that.

GDP Is 'Better'

No thanks, no more Czars. Sorry folks, we are a banana republic now. Our national interests are no longer determined by the American people.


On Oct 29 01:29 PM aldol wrote:

> Data from this blog are pretty compelling. This administration may
> end up contributing to a crisis of major proportions.
> I am hopeful that, in the final analysis, the result of the crisis
> will ultimately be the cleaning up of corruption within the political
> class and the re-dimensioning of the relative weights of the rent
> exacting sectors of the economy versus the sectors that add true
> value.
> Although cleaning up corruption seems to be a task of unimaginable
> complexity, it may be, in fact relatively easy.
> Perhaps simple solutions such as a corruption czar and a line item
> veto, can accomplish the unthinkable.
> Let's see what the Va and NJ races will tell us about voters sentiment
> .

World Recovery Is in the Hands of OPEC

That comment is like comparing coke and pepsi? Which one do you like better? The progression of US politics was socialism, now Fascism, soon to be Communism, Despotism and the cycle will end in Capitalism and a true new spirit of hope.


On Oct 25 07:21 PM The Geoffster wrote:

> Eliminate the leftists and you wouldn't have to steal anyone's oil
> fields. We have vast untapped oil reserves in the U.S. We have massive
> coal deposits. We could light the world with nuclear energy. All
> of this would provide cheap fuel while alternatives are developed
> but the left wants to cripple America as a world power.

We're Living Through the Best of Times

Oh I can't help it. 'It was the best of times, it was the worst of times.'


On Oct 25 05:51 PM Albertarocks wrote:

> On Oct 25 10:16 AM Dave Wrixon wrote:

We're Living Through the Best of Times

I voted up "for it is better to have it and not need it then need it and not have it" - Ben Franklin

The situation this man was kind enough to take his time and write, is reflective of the Ruble crashing in 1998. America will get through it but it is common for people to think such things could never happen to them. The odds are, they will happen to you and if not you then your kids.

On Oct 25 03:33 PM cdur wrote:

> sorry, but : "Stop smoking the carpet.... you're stone..!!"
>
> and read more about what will happens:
> www.silverbearcafe.com...
>
> best regards from France

We're Living Through the Best of Times

Very insightful Leftfield. The producers in the US market have been pretty much beat on for eight years with little or no reward. Slaves will work for a roof and food for a time, until they decide it isn't worth it and stop producing. IE: Soviet Union, Cuba etc. Each government type has it's own fatality sequence, Democracy being 200 years, Despotism 20 and Communism 40.

About the article. One observation I have noticed recently is a visible increase in near-retired individuals whom have parked some cash and have begun a bit of roving soul searching. Meaning your not alone John. Perhaps such sabbaticals will reveal some answers.

As to this being an adventure, money is not happiness but does provide this sort of freedom of mobility. The Gen X'ers and Millenials will not have this kind of mobility for soul searching, more like an adventure in austerity and fight for God given rights such as freedom of speech and to not be looted at will, hopefully not having to literally fight the enemy within but near certainly will be fighting the enemy without. No, I prefer to have started my career in the 1970s but a good argument can be made about refinement by fire or that which doesn't kill us makes us stronger.

As for being an eternal optimist and how great life will be in 20 years, I agree. But the long dark night WILL get longer. The reason is evolution and those who resist believing they will live forever vs. those who eventual evolve past them.

The book referenced as an important read sounds like a decent recommendation. For those who want the net-out, it is called a climactic end to current centralization, a big decentralization process. What emerges afterward is the era of holographic thinking vs. current 2D or 3D thinking. It will be the era of quantum computing, the ability to assign septillions of historic data points with real-time data points and forecast the weather 50 years out at 97% accuracy. Large human beaurocracies will not be needed nor appreciated as all people on earth will represent themselves individually and vote collectively. That would mean slower advances but far more stable advances. Oh how the current lords of the universe must hate that thought!

So, I am an eternal optimist, but a realist when it comes to the heavy lifting, blood, sweat and tears the next twelve years will bring. Unlike the guy in London staring at thralls of people whisking by, the probable outcome is a guy rebuilding a new city ten miles from London or any other capitol in the world. The former being leveled by a final destructive world war. Makes sense outside of fear mongering or data analytics of geopolitical scenerios. First there was villages, then city states, nations, blocs of nations now down to East and West. Nothing refined ever occurs in this universe without some form of violent collision. It is not some fanciful hope of anarchy, but realism that propels my thinking.


On Oct 25 01:07 PM Leftfield wrote:

> Dave Wrixon opined accurately in another comment today that the Americans
> of today aren't those who rose to past challenges. I will add that
> the government of today, voted in by these Americans, is an enormous
> threat also, far larger and more intrusive than in past challenging
> times.
> Since your first loss is your best loss, the refusal to face reality
> during the '08 meltdown, rather, to add public debt to cure the problems
> brought on by excessive debt and leverage, for favored recipients
> threatens to lock in rule by a small upper class.
> Freedom is precious and I wouldn't take what's left of it for granted
> nor assume benevolence by our leaders (trust them). Toiling as a
> slave for the plantation owner takes "the gumption to get on with
> it" without much reward in this life.

Sell-Off in U.S. Treasury-Land

Yes, but I expect one more big sucker rally on treasuries after the 2010 mid-term elections. As to your point about paper, I remember my Grandmother's advice whom lived during the Great Depression:
"Contracts are only worth the paper they are written on". It was almost 40 years since the 1929 crash before she bought stock again and it was in oil.


On Oct 26 01:42 PM Socialism cannot compete! wrote:

> The move to hard goods and commodities begins in earnest soon...and
> will coincide with a *real* drop in stocks and treasuries, as cyclingscholar
> suggests. The propped-up economy illusion is about to end, and people
> will want things of use and value in their hands, not pieces of paper
> of any kind.

Dollar Forced to Abdicate Its Throne

As ugly as this assessment is, it rings of truth. Read the outline I created as to how to kickstart the innovation and manufacturing engine after the article and Larry Summers mention of a new social contract: ragingdebate.com/econo...

The answer to the equation of your excellent outline of what should occur is still Washington and NYC politics. No job creation effort now means serious civil unrest in the near future, NOT our grandkids.

However, the facts on the ground on the decision-making are more then a little disturbing: 40 Czars in Washington, declaring H1 virus a 'national emergency' with a couple thousand deaths (less then most other strains of the flu), Bernanke and Geithner both testifying to Congress months ago they are willing to abandon the dollar in lieu of international currencies, international treaties that supercede the US Constitution and much more suggest to me the decision making has been centered around a command economy and suppression or complete aborgation of Constitutional rights. In other words, Communism as the model in the medium term.

That would be not only bad for investors and the population, but for the entire world. Americans in general can accept working hard for less, hell that has been the tale for most families since 2001. But the loss of the opportunity to benefit would mean more then just a bit of unrest if you catch my drift. The American people always act as a sleeping giant, this time being awoke from the monster within.

Attempted silencing of the rape victim utilizing foreign nations as thugs for hire will yield highly unpredictable results. Awful for American citizens at first, worst for the world at large, horrific for those making such decisions.


On Oct 25 06:32 PM derryl wrote:

> For centuries gold was the international reserve currency and gold
> worked very well to ensure trade imbalances were quickly corrected.
> To import you had to pay from your limited stock of gold. If a nation
> imported too much it would run short of gold and would be unable
> to continue trade deficits for the simple reason that it had no more
> international money--gold--to pay for imports. To get some gold back
> you had to export more than you imported for awhile, so trade imbalances
> were more or less self correcting.
>
> Over the centuries wars temporarily shook nations off the gold standard
> and then the Depression shook many nations off the gold standard
> at once and in 1946 Bretton Woods restored a modified gold-dollar
> standard where US dollars were to be the new international money
> but those dollars were convertible to gold bullion at $35 per ounce.
> By 1971, needing extra money to finance the Viet Nam war, Nixon abolished
> convertibility of the US dollar. The US would no longer redeem the
> dollars other nations held for gold.
>
> Since 1971 the world has still been using the dollar as its international
> money but by delinking the US dollar from US holdings of gold Nixon
> set free the US printing presses and unleashed a tsunami of dollars
> into the world. That process has continued more or less unabated
> to this day.
>
> A consequence of having the right to simply create the world's money
> is that the creator nation enjoys the benefit of buying foreign stuff
> with that money rather than having to produce and trade real goods
> (this is called "seigniorage", but it is usually applied to governments
> who have the power to blithely print and spend money into their domestic
> economy to curry political support, devaluing the currency, rather
> than face reality and finance spending with unpopular taxes). This
> became imperative after the first oil shock of 1973 which roughly
> coincided with peak domestic US oil production as the US needed lots
> of dollars to pay for more expensive oil imports.
>
> For over 35 years America has been buying oil from the world and
> paying with freshly created US dollars. For the past 10 years America
> has similarly been buying Asian consumer goods with newly created
> dollars. The origin of about 75% of those newly created dollars is
> US mortgages. So US real estate prices are the underpinning of the
> asset value of US dollars on banks' balance sheets. It's clear why
> the Fed and administration are so desperate to reflate US real estate
> prices.
>
> Collectively these money-printing import purchases add up to become
> America's accumulated trade deficit with the rest of the world as
> is measured by the quantity of dollars the world outside of America
> presently holds, in the neighborhood of $5-7 trillion. To restore
> the US dollar as an international currency of "value", the US would
> have to produce $5-7 trillion worth of goods and services to sell
> to the world in order to redeem all those dollars (or sell half of
> all US real estate to foreigners, an obvious non-starter). One way
> or another America currently owes the world roughly $6 trillion worth
> of "stuff".
>
> To make good on this goods-debt Americans would have to vastly expand
> production for export and vastly decrease imports and domestic consumption.
> To sell competitively on global markets US wages and other costs
> of production would have to plummet relative to costs in other countries.
> This can be achieved by allowing the fx value of the US dollar to
> fall to very low levels.
>
> But Americans would suffer very serious standard of living declines,
> as they worked harder and produced more but consumed less, a double
> hit on standard of living. US real estate prices would not have to
> plummet under this scenario so the banking system would not have
> to go insolvent. Within the US prices and wage levels could remain
> nominally the same as they are now. It is the foreign exchange value
> of the dollar that is declining, not the domestic value of the dollar.
>
>
> But the price of all imports, including oil and all other industrial
> inputs that the US imports, would skyrocket. Imported flat screen
> TVs would be back to $5000+. KIA cars from South Korea would cost
> $50K. Chevies would still sell for $20k because they are made in
> the US and don't suffer the fx differential of imports. US mining
> and manufacturing would make a big comeback because Americans could
> no longer afford to buy imports but could afford to buy domestic
> production in a weak dollar environment.
>
> Peter is right that a weak currency is no prize for any nation. You
> have to work harder and live poorer. The countries who currently
> have trillions of your dollars enjoy all the benefits of your work
> as they get to consume what you produce rather than vice versa as
> it has been for so long. You give them goods. They give you your
> dollars back. You get out of foreign debt this way, humiliating as
> it may be to your squandered great power status.
>
> But it gets your domestic industries and employment working again
> and it will eventually get you out of debt. It can even restore your
> great power status, a status that you are earning again by producing
> trade goods that the world wants rather than printing money.
>
> Meanwhile a return to gold as the world's international money would
> prevent this kind of massive trade imbalance from happening again.
> There would still be imbalances, but they would be short term and
> self correcting via the discipline of gold.

The Cheap Dollar: Great News for Everyone Else

I really enjoy your work Mr. Butter. Economic destruction or call it wealth transfer of such scale is always followed by physical effects of the cause. Apply that thinking to foreigners being the major creditors of the American people.

The world does not want a US population that has had to destroy the enemies within both politically and foreign mercenaries on the soil. That kind of momentum will not stop at American borders. The hubris of most world leaders in this game is that they think containment is always possible when it reality it never is. Take care and drop by my site sometime.

I look at my work as damage control so that there might be some people left on earth.


On Oct 22 02:20 AM Andrew Butter wrote:

> Thanks for the detailed comment, I shall read it carefully, my reaction:
>
>
> I'm not saying that the emergency measures that were taken to mitigate
> the damage from the incompetence of the previous seven years that
> caused the catastrophe were not necessary.
>
> I'm simply saying that enough is enough, and what I sense is simply
> more bubbles which ultimately destroy economic value.
>
> It's the same mistake Greenspan made after Dot.com + 9/11
>
> I also don't buy the idea that the "bail-outs" + stimulus are doing
> much to help the US economy, it's just damage control meanwhile millions
> are being put out of work because small businesses can't get credit,
> smaller banks are failing and more will fail because none of the
> bail out money is going to them, and why, because they could not
> blackmail the government with a $50 trillion (it's not $20 trillion)
> derivatives nuclear bomb.
>
> Yes you are right, the urgency of the bail-outs was all about the
> derivatives nuclear bomb, I pointed that out last September
>
> www.marketoracle.co.uk...
>
> And the result will be...bigger banks, that are even more to big
> to fail.
>
> What just happened was the shadow banks created a nuclear bomb, then
> they went to the government saying "if you don't hand over huge amounts
> of cash we will detonate it and blow up the world financial system",
> and the government caved in.
>
> You can call that what you want, one word is terrorism.