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  • Nothing Good Will Come of Bankers Being in Control [View article]
    moonbat was writing some verse,
    'Bout the economy getting much worse,
    Mr. Greenspan he clothed,
    With the blame, so he loathed,
    Instead of resorting to curse.
    Oct 23, 2008. 04:51 PM | Likes Like |Link to Comment
  • The Physics of Money [View article]
    Money tends to swirl the fastest just before it goes down the drain.
    Oct 23, 2008. 04:43 PM | Likes Like |Link to Comment
  • Thursday Outlook: Commodities, Emerging Markets [View article]
    Good picture of Uncle Buck threatening to shave his neice's head if she doesn't go bowling with him.

    Outstanding movie for those who haven't seen it.

    "Uncle Buck" starring John Candy, MaCaulay Culkin, and Laurie Metcalf
    Oct 23, 2008. 04:40 PM | Likes Like |Link to Comment
  • Nothing Good Will Come of Bankers Being in Control [View article]

    You should put in as your website. You keep referring everyone to Rothbard's books.

    I figure if I can get anyone interested enough to start following it's worth putting it out there. Can't hurt.
    Oct 23, 2008. 04:29 PM | Likes Like |Link to Comment
  • Nothing Good Will Come of Bankers Being in Control [View article]
    Ron Paul is the man for that very reason. Character and Honesty go a long way.

    That's why I planned to write him in for President in 2004. My plan failed when I discovered (in the voting booth) that there wasn't a spot on the ballot for a write-in. I'm sure that my vote for the wishy-washy libertarian party candidate must have impacted the election results in unforeseen ways.

    The 2008 primary showed that the system is rotten to the core and unlikely to be fixed any time soon, at least not pleasantly.

    What will be more interesting is how many seats in the House or Senate are filled by Ron Paul disciples. Will the root sprout branches and leaves?
    Oct 23, 2008. 04:26 PM | Likes Like |Link to Comment
  • Nothing Good Will Come of Bankers Being in Control [View article]
    Correction (maybe). It may have been the board of JP Morgan and not Goldman.
    Oct 23, 2008. 03:56 PM | Likes Like |Link to Comment
  • Nothing Good Will Come of Bankers Being in Control [View article]
    Yes. I have that book at home and have wondered many many times what happened. I am currently working my way through Greenspan's book "The Age of Turbulence" to see what insight it may bring.

    It appears to me that even though Greenspan understood the theory, he got caught up in the details of implementing government policy in order to 'get ahead'. Apparently he never got to the point where he just stopped and said "What are we DOING?" because he believed he could get 'close enough' via pulling monetary levers.

    Looks like political expediency trumped youthful ideals over the long run.

    I also discovered that Greenspan was on the board of Goldman before becoming FED Chairman. Interesting, no?
    Oct 23, 2008. 03:56 PM | Likes Like |Link to Comment
  • Valuations Provide a Brightside - RBC Analyst [View article]
    No thought given to the anticipated plunge in earnings over the next 6 months from the just-beginning recession?

    I'm thinking that might have just a bit of an impact on where prices go from here.
    Oct 23, 2008. 03:45 PM | Likes Like |Link to Comment
  • Nothing Good Will Come of Bankers Being in Control [View article]
    "Start-ups/inventors won't be able to afford the funding even if they found the cure for cancer." Glen!

    Loans aren't the only way to expand businesses. Startups could sell part of the business to others in order to raise money. That's what venture capitalists do now.

    If you find the 'one pill cure for cancer' and can't arrange to borrow money to set up shop, you can sell 49% to moonbat for 100 oz of gold, open up, and make $1 Billion in profits the first year. You get to keep $510 Million and moonbat gets the other $480 Million (after he spends $9 Million on gold, firearms, ammo, soap, rice, beans, booze, and cigarettes and sends me my $1 Million investment advisory fee).

    That might seem like you're paying a whole lot more than borrowing at 8% would be, but it's really not. If you borrow and your business fails, you still have to pay back the loan. If you fail after selling to moonbat you don't owe anything. Since moonbat is risking the loss of his entire investment, he will expect a much larger return than 8% on his money.

    In order to get anything out of your business idea you might have to agree to share the profits with a funding source that has access to accumulated savings and is willing to risk them.

    In a free market there's always a way to get a profitable (ie. demand supplying) business running provided there are savings available to support the effort.

    Technology improvements will shift the profitability dynamic between business firms or products by lowering the costs of production. This will allow the improving business to offer the good at a lower cost to the public (while increasing profit margins) and gaining market share thereby increasing total profit.

    If this is the case, the business can estimate how much more money it will have available for loan payments and how high an interest rate it can afford for a loan to make the improvements. If the productivity increase is large enough, the business may be able to afford to out-bid others for the available savings to fund the improvements.
    Oct 23, 2008. 03:31 PM | Likes Like |Link to Comment
  • Nothing Good Will Come of Bankers Being in Control [View article]
    Bullet + "whacked out junkie" = dead junkie.

    Problem solved.

    Remove the ability of banks to leverage the money supply. Make people compete to get the loans of whatever actual savings are available. That will raise interest rates (more borrowers for small amount of savings will bid interest rates higher) and force businesses with lower profit margins to not borrow. They don't generate enough free cash to service the loan at higher interest rates.

    The most profitable businesses (ie. the ones with the most consumer demand) will be able to afford to pay higher interest rates in order to get use of the limited savings.

    Presto. Savings are automatically deployed to the businesses with the most sought after products. Others go without until more savings are generated. Businesses with the most valued products expand, those with less desired products can't expand without an increase in savings.

    Growth is stable until public tastes change and/or other products become more "valued".
    Oct 23, 2008. 02:01 PM | Likes Like |Link to Comment
  • Strategies to End the Crisis [View article]
    “Beyond that, demand for goods and services in the United States and Europe are being driven down by the undervalued currencies and massive purchases of dollars and euros by China, oil exporters like Saudi Arabia, and other emerging economies. “

    I’m not sure whether this means:

    1) Demand for US goods is lower because foreign goods are cheaper; OR
    2) Demand for Chinese goods is lower due to undervalued foreign currencies.

    The sentence is ambiguous in this respect.

    Number 2) doesn’t even make sense as lower foreign currencies translate into more purchasing power for the dollar and hence lower pricing on foreign goods. This would tend to increase demand for foreign goods as any Microeconomics textbook will tell you.

    Number 1) at least makes sense from an economic standpoint. With lower prices on imports people will buy those before they buy higher priced US made goods. While that may be bad for US manufacturers, it is good for the consumer. After all, isn’t it better to buy the same item at a 25% savings than to pay the higher price? What the author overlooks is WHY US made goods are more expensive than foreign made goods which need to be shipped half way around the world to compete in the local marketplace.

    “[Foreign governments’] huge trade surpluses translate into trade deficits in the United States and Europe and the need for massive borrowing to keep up demand for goods and services in Western economies. That caused the housing bubble and over borrowing in the first place”

    This makes absolutely no sense. The reason the foreign countries have surpluses is because Americans buy more of their products. Of course their trade surplus “translates” into our trade deficit. It has to. One party’s surplus is the counter party’s deficit. How that caused a “need for massive borrowing” is beyond me.

    What it did was put massive amounts of US currency in the hands of foreigners. They had to do something with it, so they CHOSE to buy US debt when the US offered to borrow it on the market.

    Foreign governments could have CHOSEN to buy other things instead and the US would still be borrowing “massive” amounts of money. The borrowing has nothing to do with trade deficits, the deficits only served to provide a means for the foreigners to be able to lend to the US when they asked for a loan.

    How either US borrowing or foreign lending led to the housing bubble is beyond me. I thought we borrowed because the gub'mint spent too much.

    I would expect better from someone with a PhD in economics.
    Oct 23, 2008. 01:47 PM | Likes Like |Link to Comment
  • Hank Paulson, Revisionist [View article]
    Looks like Felix is adopting the memes of moonbat and myself. Even someone with a financials background like Felix can read between the lines of cr@p these guys are spouting and determine that it doesn't pass the smell test.

    Good article Felix. Welcome to the Dark Side.
    Oct 23, 2008. 01:10 PM | Likes Like |Link to Comment
  • Inflation: One Worry to Cross Off the List [View article]
    I'm sure none of this could be explained by the massive 'flight to quality' in Treasury debt driving yields to never before seen lows.

    Couldn't be. It must be inflation expectations.
    Oct 23, 2008. 12:26 PM | Likes Like |Link to Comment
  • Thursday Outlook: Commodities, Emerging Markets [View article]
    Paulson, Bernanke, and central bankers the world over have been in a state of 'sheer panic' for nearly a month now trying to maintain the facade of normalcy in the markets by hook or by crook.

    What is finally happening is that the market is beginning to realize that is the case.

    Naturally the gub'mint's reaction will be to change the rules yet again by closing the markets.

    How long after that might they have to close the banks?

    Hmmm ... can't buy or sell paper assets for a indeterminant time, maybe people will start wishing they had gold or silver in their hands?

    Just a thought.
    Oct 23, 2008. 12:16 PM | Likes Like |Link to Comment
  • The Sting of American Capitalism [View article]
    Maybe I should consider shaving my moustache?
    Oct 23, 2008. 12:10 PM | Likes Like |Link to Comment