kaskoosek

Inflation Worries: Here's What We Can Learn from Japan

Foreigners are holders of US debt. Stark contrast from Japan.

The US can devalue its currency, without the drawbacks of an uprising.

Should the Federal Reserve Be Doing More?

Crowded trades?

The most crowded trade is the US dollar.

Geithner's Words Lack Substance

More money pumped into the economy means more money to buy goods.

More consumption means more imports without actually producing stuff.

If money wasn't printed, then the populace is forced to produce something in exchange for these imports. You will directly have no current account deficit.

Equities Update: After 2 Down Days, A Rally

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Hands Off Goldman Bonuses

Banks should not be private companies, since they have a government garnered ability to create money out of thin air. All other corporations do not have this privilege.

This gives the government, the ability to do what it seeks fit. Dismantle them or tax them. If they cry foul then simply remove their permit to print money, in addition to the depositor insurance.

The Dollar: A Strong Buy

I love dollar bulls. The only argument they have is the technical side.

Current account deficit has already increased significantly in the summer.

Government stimulus is never ending.

Lack of political will to stop money printing.

If some one is deeply in debt and can not default, the easy route is to devalue the debt away.

All of these are signs that the dollar is eventually toast.

Money Supply: The Myth of Hyperinflation

Hyperinflation is a myth???

That is impossible, because many countries have experienced it in the past.

China to Buy Up to $50 Billion in IMF SDRs

I love your analogy.

Stay Away from AIG - Barron's

In a hyper inflationary environment. This stocks seems like a bargain due to the high level of debt and low bankruptcy concerns. The company is not going bankrupt, because it is backed by the government, so with a long term horizon and even with a low probability of success this doesn't seem like a very bad play.

Even modest inflation might do the trick, as the value of debt declines relative to assets held on book.


On Aug 29 06:39 PM Ames Tiedeman wrote:

> Stay as far away from this name as possible. It has been bid up by
> uneducated retail investors and short covering. Do the math. Negative
> tangible equity means the common is worth ZERO!

How The Federal Reserve Is Monetizing Debt

One word, we are going to return to that "barbaric relic". Actually two words. But to an important subject, I think we already seeing the alternative and it is actually equity markets. I'd much rather hold real assets in the form of equities. No need for currency to hold my savings.

But if we are talking in the form of debt, then I would assume there will no longer be any debt for the near future that is.


On Aug 26 07:36 AM Bruce Krasting wrote:

> Nice article. Excellent graphics. A few comments:
>
> The deal to buy Agency MBS was not a slight of hand as you suggest.
> The Asian Central Banks put a gun to Bernanke last year and said,
> "Buy this stuff back at par or we will never buy a dime of T notes
> again."
>
> So Paulson/Bernanke said, "Okay, but you have to agree that for every
> dollar of Agency junk we take back you have to take an equal (or
> greater) amount of Treasury paper.
>
> So that was the deal.
>
> The purchases of Agency Paper are being funded by the excess reserves
> that the Fed has created. This is why the Fed started paying interest
> on reserves. So that it would attract sufficient money to allow it
> to buy up all of the junk. (This is the QE process)
>
> On the dollar. You make a pretty good case for a flow of funds that
> argues for a lower dollar. That may happen, but it is not a sure
> thing. The dollar has had an uphill battle on the fundamentals for
> decades. We have always run a current account deficit that had to
> be financed by 'willing' foreign central banks. Because of the weak
> economy our imports are down and the traded deficit has actually
> improved a bit.
>
> There are two factors for the dollar. Flow of funds and sentiment.
> The flow of funds is an important element in the equation but in
> the short term is overshadowed by sentiment which is not negative
> today. This is a reflection of the Store of Wealth factor for any
> reserve currency. Which currency is the best Store of Wealth? That
> is a hard question to answer. They all stink. The Euro has a huge
> set of problems. Possibly more significant than we face. The Yen
> looks like a standout in that but who cares? It is a very expensive
> currency today and on an economic Store of Wealth Basis is probably
> worth 110 vs 95.
>
> So the % looks stable because there is no legit alternative. Keep
> in mind that to be a reserve currency you must have lots of debt
> for those reserves to be invested in. So while the third tier currencies
> (A$,C$,Sterling and CHF) may look attractive it is unlikely that
> they will get much in the way of reserve diversification.
>
> We are going to get a run on the dollar at some point as a result
> of all of what has been done. But I would not bet on it happening
> anytime soon. Things have to get much worse in the USA for that to
> happen. It also has to evolve that some of the alternatives to the
> dollar truly start to look better.

S&P / Case-Shiller Home Price Numbers

This is the place for people to put their savings, now that everyone knows that the dollar is toast in the long run.


On Aug 25 03:31 PM Bill L. wrote:

> You can't spend your house, it is not an asset meant for speculation,
> it's so you can live in it. The number one thing when buying a house
> should be, "can I afford this monthly payment?" -Not "will this double
> or triple?" Until people get this out of their heads, I'm afraid
> the housing woes will persist.

Has the Dollar Hit a Major Bottom?

www.itulip.com/forums/...

Run on the Dollar: What It Could Mean for the Yen

This is a very important.

It effects foreign companies which have debt dominated in the local currency.

However I believe that in the long run when the dollar crashes, every other central bank would start buying foreign assets with their local currencies. This would most likely cause worldwide inflation, similar to what happened in 2008.

That is why CAD is not a safe haven, while gold and silver are.

Nintendo Needs To Reach Out to Shareholders

The P/E ratio currently is at 19. This isn't a cheap stock.

In my opinion the forecasts for growth are a bit inflated. I personally would expect their earning to decrease and not increase as the market is becoming more and more saturated. I know this a bit hard for you to swallow, but this seems to be the truth based on the recent decline in prices.