wcrxlp editorial collective

Bernanke's Exit Strategy: Not Likely Any Time Soon

"Unambiguously clear" and "I do not think it allows any wiggle room for any interpretation?"

What?

Ben Bernanke is a June Taylor dancer compared to past Fed chairmen.

"My colleagues at the Federal Researve and I believe that accommodative policies..." This is unambiguous?

"Will likely be warranted..." No wiggle there.

"For an extended period of time." You can bank on that.

Mark your calendars with that deadline.

Inflation Scorecard: Is Reflation Upon Us?

Laura Frank's Bexley CPI is an accurate picture of retail prices in Bexley. For sure, the BLS numbers are not an accurate measure of retail prices in Bexley.

Laura's report informs local shoppers about price changes in a real (Bexley) market place.

There is no relationship between what the BLS reports and what Bexley shoppers actually experience. Laura's report deals with reality, not with statistical fictions.


On Sep 19 10:10 AM The Recusant wrote:

> Bexley, Ohio happens to be one of the most wealthy communities in
> Ohio located on the southwestern edge of Columbus. The CPI coming
> from Bexley is not done statistically correct in covering all the
> areas that the national CPI contains and is not an average of prices
> found in an average Ohio or national community. It is only an indicator
> of Bexley's local prices. Although the US Bureau of Labor Statistics'
> CPI is unlikely to show the actual inflation rate in the nation,
> the Bexley CPI would be even less accurate as an indicator of inflation.

Inflation Scorecard: Is Reflation Upon Us?

Laura Franks' Bexley (OH) CPI reports a 14% retail price increase for 3rd Quarter, 2009.

Her report covers retail prices in a small Ohio municipality.

agentofcurrency.blogsp...

There Are No Good Choices for the Fed

Mr. Mauldin writes: "I am much more interested in learning what the Fed and Congress will actually do and then shaping my portfolio accordingly."

Compared to Congress, the Fed is transparent. Fed data is fairly descriptive of the part of the picture that the Fed is interested in.

To learn what Congress will do is impossible.

Learning what Congress has already done is the deeper mystery. The amount of money taken, directed, re-directed, forgotten and lost by that deliberative body is incalculable.

For portfolio structure and allocation, Laura Frank's Bexley CPI has more useful data than anything the Congressional Budget Office publishes.

I'm curious about what data and information sources Mr. Mauldin uses for figuring out what Congress will do.

Nonetheless, Mr. Mauldin series of articles is very helpful.

Is It a Stock Market Rally or a Dollar Devaluation?

A cheapening US dollar makes US exports more competitive.

The only area of the globe that needs US products and services is Asia. The S&P is just anticipating Asian demand responding to a cheaper US dollar.

As ancient Baby Boomers delay retirement to keep working, and Boomer progeny try to enter the work force, there will be more downward pressure on US wages.

Congress will continue putting downward pressure on US salaries.

Even the prices for US design, engineering, production, logistics, marketing, financial and professional services are becoming competitive.

When the dust settle, the US will be almost able to compete on labor costs with China.

The downward pressure on US wages and salaries will reduce federal tax receipts which will worry China even more.

I’d like to see a David Goldman chart showing the comparable correlation between the Euro and the S&P.

Treasuries: A Very Bearish Development

It's a bet by Commerzbank that there will be a lot of over-valued Euros to sell into nervous dollars.

Obama's Big Win at G20: Europeans Lose Control of IMF

Vuke advice is best.

Check the IMF website: imf.org

Wade through the IMF declarations about transparency.

At some point you'll find the IMF financial statements. They really are there.

Read and understand the IMF financial statements.

If you don't have the time, just look at the IMF general department "assets."

At the top of the list of assets, instead of "cash" you'll see "currencies" which is subcategorized with such enticing labels as "usable currencies" and "other currencies."

Not "cash." Then you'll wonder why "currencies" and not "cash."

Then you'll be reassured when you see "gold" listed as an asset.

But then you realize "gold" is only a small percentage of the assets that are "currencies" (2%). But then again, "gold" is an important asset based on its relative size to the non-currency assets (30%) at the IMF.

"Investments" are also listed as a general asset class. No detail is given in the footnotes other than the reassurance for readers that what are probably government bonds do not include "asset-backed securities."

Vuke described the IMF as a shell. He's probably right but the amount of gold on the IMF balance sheet qualifies the IMF as very expensive tortoise shell.

Proposed Solution for Toxic Assets Plaguing Banks

Aristophanes gets my "thumbs up" for his proposal to use community banks to evaluate and manage the CMO run-off.

"Break the contracts, evaluate, sell, ban."

But why restrict community banks to the toxic assets?

If the community banks buy the poisoned-apples, why not let the community banks also cherry-pick some of the good assets held by the loser banks.

How the Crash Will Reshape America

Fake cities? Nonsensical existence?

Florida's actual words "Sun-belt fake cities, like Phoenix and Las Vegas, will pay the price for their nonsensical existence."

I prefer thinking about the fake finance that built these cities. Too many really smart people trying to make a lotta money on the same pieces of paper.

Is anybody really surprised that the really smart people produced paper that had no relationship to reality?

Indecipherable paper that was bought and sold by really smart people.

God preserve us all from the nonsense created by the Meritocracy.

Resuscitating Keynes: Oh No, Not Again!

Wolf says things are complicated but then offers simple solutions.

Simple solutions that work briefly and then cause larger, different problems.

Wolf thinks that people will submit to his will. And then his diktats will make everything okay and the people will be happy.

I shiver thinking what my life will be under his commands.

The Economic Meltdown: Dismantling, Yes; Doom, No

Ashkan---

A quote from Lenin. How preposterous. How out of date.

For that mass murderer to call the Romanovs a "filthy blood-stained cart" is like the "pot calling the kettle black."

WWI accelerating something? The “great accelerator?”

Think of the political and economic impact of that war.

16 million deaths and 21 million wounded.

We are supposed to believe that amount of carnage accelerated something?

The war depopulated Europe and the US of young men. It killed native young men who were conscripted from the colonial empires.

Surely WWI accelerated the growth of sorrow but a depopulation on that scale did not accelerate economic behavior.

Nor did sorrow on that scale accelerate any political behavior.

Sometimes I think the Roaring Twenties were just an attempt to numb the emotional pain of WWI.

Think of the WWI reparation payments. And we should believe that reparations were part of a historic acceleration of something. The debt burden of the reparation demands did not accelerate anything.

And consider the rise of authoritarian governments in Europe, North America and South America. Those governments accelerated what exactly?

The march into the Great Depression perhaps?

Lenin is discredited. Reasoning from his thoughts gets us nowhere.

I'm tempted to mention the "ash can of history." But that is too obvious and Mr. Karbasfrooshan might take it personally.

Historic Volatility - and Concentration of Stock Ownership

And so, all of the institutions haven't figured out how to profit from volatility? Even unprecedented volatility? I think that is unlikely.

How to Spend $700B and Actually Solve the Problem

There are three thousand community banks that are capital starved or near capital starved.

When Wall Street absorbs the $700 billion, Main Street banks will pay dearly to maintain their capital ratios.

It makes more sense to distribute the $700 billion to American community banks so they can lend for local transactions or use it to recapitalize Wall Street.

What's Wrong with the Trickle-Down Bailout?

There are three thousand community banks that are capital starved or near capital starved.

When Wall Street absorbs the $700 billion, Main Street banks will pay dearly to maintain their capital ratios.

It makes more sense to distribute the $700 billion to American community banks so they can lend for local transactions or use it to recapitalize Wall Street.

Congress: Please, Don't Rush the Bailout Plan

There are three thousand community banks that are capital starved or near capital starved.

When Wall Street absorbs the $700 billion, Main Street banks will pay dearly to maintain their capital ratios.

It makes more sense to distribute the $700 billion to American community banks so they can lend for local transactions or use it to recapitalize Wall Street.