jdl51

Another Crisis Looms Right Around the Corner

Reminds me of Reagan's first term, gold at all time highs, unemployment over 10.5%, soaring deficits, the worst recession in years, raising taxes on social security, getting our butts kicked in Lebanon...........

Show Me Economic Expansion, Chairman Bernanke

"With a spread of over 475 basis points between the Fed rate and the interest rate of a 30yr fixed rate mortgage, the only entity whose financial condition is improving is Wall St. investment brokerages and the big banks, which have ties to those brokerages."

30 year fixed rate is based off 10 year treasury bills, currently around 3.4%, not the Fed funds rate.

Show Me Economic Expansion, Chairman Bernanke

"If the American people ever allow private banks to control the issue
of currency, first by inflation, then by deflation, the banks and
corporations that will grow up around them will deprive the people
of all property until their children wake up homeless on the continent their fathers conquered." Thomas Jefferson

Another totally bogus quote from TJ. The old Fox method of getting your point across, repeat some lie enough times and the ignorant will take it as the truth.
www.snopes.com/quotes/...


On Nov 22 08:27 AM Rosco1776 wrote:

> The light at the end of the tunnel is only flashlights trying to
> find their way through the darkness. End the fed and get back to
> sound economic policy like our founders suggested and set up for
> us. We are a long way off the path and it's going to be a rough road
> back but if we don't get back on track soon there will be no return
> without drastic measures. Let's not let it get so bad that we need
> another revolution!
>
> "If the American people ever allow private banks to control the issue
> of currency, first by inflation, then by deflation, the banks and
> corporations that will grow up around them will deprive the people
> of all property until their children wake up homeless on the continent
> their fathers conquered." Thomas Jefferson

And Bernanke Didn't Think Unemployment Would Reach 10%

What we're seeing is the result of eight years of republicanism. Seems like most posters here think that before January 22, things were just peachy. We came within a hair of a total financial meltdown. If we had let the banking system fail, there would have been total anarchy in the streets. Businesses everywhere would have shut their doors laying off tens of millions, that would have escalated until our economy would have suffered a crash that would make the great depression look like a tea party. That is the scope of the disaster that was unfolding last fall before any action was taken. Yet there are many here who seem to think that would have been the better path, to do nothing and let the whole system collapse. I do not like the fact that we have spent hundreds of billions to prop up the banking system but the alternative was far, far worse. Anyone who doesn't think so really doesn't have a grasp of what happened a year ago and its consequences or are so blinded by ideological hate that they don't care what happens to our country.

Marc Faber: Equities Safer than Dollars

"Estimated Currency and Financial Derivatives $642.184 Trillion"

I think you misplaced the decimal here. A year ago during the meltdown, financial derivatives were around $60 trillion and some of that has been wound down. Next month, the
last Bush budget will expire. So aside from the stimulus spending this year, somewhere around $100 billion, all of the deficits accumulated since 1980, around $11 trillion, are from the last three republican presidents. The borrow and spend policies of the last three decades has nearly destroyed our economy, and may yet destroy our economy. So much for deficits don't matter.

On Sep 29 07:08 PM twitee wrote:

> For those less inclined to Scripture, we can readily turn to mathematics
> and to our instructive friend, the parabola, for clues about what
> lies ahead. Simply stated, parabolic growth rates herald major changes
> just ahead in virtually any arena of life, and the parabolic increases
> in the Federal Reserve’s creation of dollars will prove to be no
> exception.
>
> The accumulated official US Public Debt of $11.3 Trillion at May
> 2009 has grown by over $2.1 Trillion in the past twelve months alone,
> with multi-trillions more ahead and no end in sight. The immediate
> future suggests massive additional bailouts for commercial real estate,
> credit card debt portfolios and insurance companies - plus the bubbling
> up of a Witches’ Brew from hundreds of trillions of toxic OTC derivatives
> now in jeopardy - as the next major dominoes likely to fall. The
> usdebtclock.org website provides the following:
>
> US Public Debt $11.317 Trillion
> US Government Bailouts $11.650 Trillion
> Estimated Currency and Financial Derivatives $642.184 Trillion <br/>
>
>
> Note: In March 2006 the Federal Reserve discontinued its separate
> publishing of the critical M3 money supply data, and so we are left
> to the estimate the parabolic increases in the printing of money
> within the larger ‘Estimated Currency and Financial Derivatives’
> data.
>
> At some point in the near future, the market may finally acknowledge
> that the boasted about US Dollar, the Emperor, is no longer wearing
> any clothes. And for both Wall Street and the average American alike,
> the Buck may stop here...be prepared for the inevitable rise of Gold,
> Equities and any Hard asset in a long run....in a short term we are
> in the war with deflation....

Is a Crash Impending?

"How old are you? Do you remember 1982-3? 1990-1? Do you recall 1973-4?"

And then you can add 1987 and 2008. Anyone see a pattern here? They all happened under republican administrations. Since 1981 three republican administrations have added over $11 trillion to our national debt, with an average of $750 billion a year with the last administration. We're still operating under Bush's final budget until next month with over a trillion deficit and his proposed budget that he submitted in January of this year for FY 2009/2010 had a $1.2 trillion deficit. These are the facts and they are not in dispute so don't give me a thumbs down because you don't like hearing the truth. This economy was driven into the ground with the world's financial system teetering on the brink of total collapse, yet it seems the majority of posters on Seeking Alpha had the delusional expectation that the new administration would have fixed everything by now and have positive growth rates and growing employment in their first few months in office. It took Clinton six years to bring our budget into balance from a much less precarious situation. It will take much longer to dig ourselves out of the huge hole that we now find ourselves in, especially given the non cooperation and obstructionism from the party that put us there.

The IMF Sees No Green Shoots of Recovery

Yeah, before the UN was around everybody was lovie dovie.


On Apr 19 05:23 PM I am not a number.. wrote:

> The IMF is to prosperity as the UN is to world peace....

Cramer's Call: Another Rally Top Indicator?

If you are half way educated about the market, your guess is as good as anyone's. Hopefully your right guesses outnumber your wrong guesses. Cramer is entertaining and on occasion does provide some insight, but like anyone, expert or not, luck is the name of the game.

Marc Faber: 'It Will All End in Disaster'

"And the emerging national socialist reality will be much worse than you imagine, even if we don't suffer a total economic collapse. Ask the Germans or Russians who still remember what it was like if we're really going to get used to it when it happens."

Obama's proposed programs are less "socialistic" than anything in the UK or Western Europe and they were doing great until they bought into our mortgage backed securities. It was our laizzez faire capitalism that has brought them down along with us.

The Rally, When It Comes, Will Be a Doozy

I'm having a little trouble understanding the hyper-inflation talk. We've just lost a few trillion out of our economy so what we're borrowing now may not even reflate to previous levels. And in a worst case scenario, if there's no demand how could you possibly have inflation, as in the present oil situation. Demand fell, prices fell, basic economics. Basic economics also tells us that if demand for other commodites, copper, agricultural products falls, then prices have to fall. Raising prices in a climate of falling demand would be counter productive and result in even less demand. In other words, until the economy gets on a much sounder footing, inflation is not a worry. Also, if we are borrowing so much that the world starts choking on the amount of debt in the market, interest rates will rise high enough to attract lenders and drive the economy down further lowering demand.

And if we hadn't run up over $11 trillion in debt by the last three "fiscally responsible" republican administrations, think of how much better shape we would be in right now.

One other comment: For all of those screaming about socialism, please take a moment and look up the definition. No one is talking about nationalizing the means of production in this country. No one is talking about setting quotas, controlling distribution of goods, setting wages, except in the case of a handful of CEOs who have run the financial system into the ground but still think they deserve millions in compensation. Adding a couple of hundred billion to social programs to help the unemployed survive or help with healthcare is something we've done for decades. Upping the top tax rate another 6% to where that socialist Reagan set it at, is not stealing from the rich. I would benefit if the top tax rate was lower, I would benefit if the cap gains is lower, but there are many government services that I feel we should pay for and not borrow trillions upon trillions and pass it on to my grandchildren like past administrations have done.

Why the Stimulus Plan Won't Work

To the FDR bashers, look up a GDP chart during the 30's and you'll see that GDP bottomed in 1933 and rose from there until 1937 when republicans pressed for and got a decrease in spending. It then rose again for the next three years surpassing the pre depression level before even Europe's and our entrance into WWII. All we got from the Reagan/Friedman economic revolution is trillions and trillions of dollars of debt with little to show for it. SS surplus was given away in the form of tax cuts for the rich and now communist China holds our debt over our heads and could bring us to our knees overnight if they so desired. Why republicans continually think they have the answers to our financial problems when they're the ones who have brought our country to its present sorry state is beyond me.

An Economic Nightmare Before Christmas

Well, you've got to hand it to Bush and company. They've managed to nearly triple the national debt in eight years and ruin the economy to such a degree that no one can afford to buy anything resulting in the worst deflation since the 1930s. You'd think with all that spending we'd at least have something to show for it besides rusting vehicles in Iraq. So much for trickle down. Until people are willing to spend, you won't have to worry about inflation and from the looks of it, that won't be for at least a year or two at best.

Lower Markets Are Still to Come

Anyone that relies on what some commentator says on TV deserves to lose their money. I've discovered over the years that with ten different commentators/experts you'll get ten different opinions on what is happening. Basically your guess is as good as theirs. If there should be a class action lawsuit, you should probably start with the administration. It was on their watch that the banks, mortgage brokers, appraisers, securities bundlers, rating agencies, CDS markets went completely out of control. The SEC, Treasury and FED all stood by watching this disaster unfold and did nothing, not to mention the almost tripling of the national debt by this administration by the time their last budget rolls out. There's a lot of blame to go around, but the last place I'd look is a bunch of talking heads on CNBC.

The Downfall of Keynesian Economics and the U.S. (Part 3 of 3)

SWRichmond wrote:

"The ludicrous idea is the idea that government should intervene in an economy. Paulson et al are merely pursuing this idea to its logical conclusion."

The reason Paulson et al are running around going crazy now trying to put out this conflagration is because they were asleep at the switch for the past eight years while the banking system was gambling that they could win the credit default poker game. They should have regulated the credit default swap market years ago but Paulson was a big proponent of CDSs when he was at GS and therefore part of the problem. Kind of like Dick Cheney formulating energy policy. It would only benefit the oil companies. To say that intervention is the problem is ludicrous. Non intervention for the past eight years was and is the problem.

The Downfall of Keynesian Economics and the U.S. (Part 3 of 3)

Invest-in-a-farm said:
"Now: Since we have a world monetary system, the so-called IMF system today, this system is hopelessly bankrupt. The cause of the problem is not some mortgage crisis. The cause of the crisis, which broke out in July of 2007, was a result of an increase of an expansion of derivatives expansion, which now totals to obligations in excess of quadrillions of dollars! The greatest amount of this expansion occurred under the administration of the former head of the Federal Reserve System, Alan Greenspan. And we have now quadrillions of dollars of obligations, so denominated, which are self-expanding obligations. This hyper-inflationary monster is eating the world, and the only thing we can do is put it out of its misery: Put it into bankruptcy by governments, by agreements of governments, and create a new international system, which is based on credit systems, such as the Constitution of the United States provides. "

I absolutely agree with this statement. Anyone who thinks Keynesian policies caused this meltdown either has no idea of how credit default swaps work or is an apologist for the Milton Friedman school of economics. If Bush and Greenspan had regulated the CDS industry we wouldn't be in this mess. This present mess is a unique situation caused by Greenspan's low interest rate environment and institutional banks discovering credit default swaps. Credit default swaps gave the banks a false sense of security on the loans and packaged securities from these loans that banks produced. Furthermore, the CDS's weren't regulated, thanks to Phil Gramm, the incompetence of the SEC and Greenspan's blind faith in Freidmanomics, so that the liability of them wasn't reflected on banks' balance sheets. Banks were writing loans as fast as they could to generate more fees, more derivatives and not caring whether people qualified for them or not. Contrary to poplular opinion, no one forced the banking system to write no doc loans with questionable appraisals, etc., etc., they did it on their own accord thinking the housing market would always go up and make even defaults profitable. Then when the housing market inevitably went south because of the banking systems' self inflcted bad loan policies, it brought the credit default swaps into play which exposed the tens of trillions in liabilities that the banking system didn't account for. All of this has nothing to do with Keynesian economics, which actually would have been beneficial if the past three republican administrations had followed his principles instead of running up trillions and trillions in deficits in both good and bad times. Now we have had three decades of discredited Miltonian economics, it's belief that deregulation or non regulation frees markets, it's deficits don't matter humongous pile of debt, and the banks' discovery of the credit default swap "financial weapons of mass destruction" market all hitting the world financial system like a tsunami. I don't know what the final solution of the current disaster will be but if we ever get out of this mess, returning to solid Keynesian principles will hopefully be the eventual outcome.