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Global Markets in Review: In the Clutches of Uncertainty

The US will not blow a lot of countries into the stone age. Because it is akin to killing the goose that lays the golden egg. You can forget China (we need to keep those American factories in Taiwan/China/etc profitable so they can continue to exploit foreign labor and disenfranchise American labor -facilitating the concentration of wealth to the connected and incompetent.

There doesn't need to be an 'alpha' male of currencies. Simply put -there just needs to be a lack of interest in the illusion of hegemonic theory. In fact- there is a lot of movement underway to trade in regional currencies in South American and Asia. The only reason it isn't happening in the GCCs is because we are very careful to prop up dictatorships of nincompoops (usually hereditary-to ensure a more nincompooped line thank to in-breeding). At some point -these countries will have suppressed their populations a bit too much with their camel prod carrying police (think taser) and addiction to an entitlement lifestyle which necessarily forces one to be encumbered with wholesale hypocrisy. But at some point -sheer economic necessity and the fear of being overthrown will cause them (like Saddam) to be disloyal to their 'master'.

The writing is on the wall-as surely as it was for Britain. The Western era has ended in a brief 4-5 hundred year span. Perhaps it may be the Chinese in the interim- however- I think in the long run -the indigenous socialist movements of South America and the countries vast resource and relative under-population will be the start of the new era-starting around 2125- but the date for the beginning of the end is 2012-as was prophesied.

Turning Japanese: The Audacity of Reality (Part 3 of 3)

"This article cites that for those who know HOW to save, the balance is much higher:"

financialweek.com/...

This was published in July 2007 -which is before the great plunge of 40% -so take 40% of 120 K -and basically each of those guys lost 48K -it all depends -because if the 401Ks were in Finance and Autos - then it could be 96K of losses -so 50K may not be that far off.

I know I went from 75K to 25K in just one mutual find. Which explains my interest -'all of a sudden'.

Solving the Bank Crisis: More TARPs Are Not the Answer

Thanks but I thought the CDS stuff was atleast 600 trillion - I read somewhere that JPChase had the most on their books. Will try to get the source.

The only other point is -that some sort of 'ownership' copromise could have been worked out -there by saving our future generations tax burdens on the interest.

Solving the Bank Crisis: More TARPs Are Not the Answer

Dear Mr. Lounsbury:

As you may be aware -'market value' is a rather relative terms -and better metrics of a 'worth' of a company are out there. For example - if these balance sheets were truly divulged under an independent and international arbitor (oh say - a committee formed by Sovereign Wealth funds, countries with surplus and countries that need help in the banking center) - a reasonable valuation could be reached.

There are plenty of articles that suggest (Roubini) that these banks are indeed insolvent. So why would one pay -'market value' for a bank that has potential liablities of 100 trillion (if you count CDS, etc). In short - a true balance sheet evaluation will show that these banks are worthless.

However-even if what you say is true. Say Japan used 50 billion to buy out whole - the two banks in question. They should be allowed to file chapter 11 bankruptcy and wipe out all debts that they could, re-structure the company etc. This is how it is done in developed nations when the IMF comes in with its Washington Consensus.

In short - it is not impossible for Japan/China/GCC to do so. In fact -Saudi Arabia could easily raise 100billion in CASH- and buy out all 3 automakers and the banks. But let's be realistic - the government which blithely encourages 'foreign' investment when it comes to US companies in developing world -suddenly balks when its their turn to take their own medicine.

It is capital-ism. He who has the capital IS! So why should the american taxpayer be on the hook? Look at Allawi- he was allowed to buy preferred shares but not given a seat on the board? Do you mean to tell me that if he was Hank Greenberg -he would not be given a seat on the board or Ivan Boesky? The hypocisy is so thick -that one can't see whats in front of them it appears.

Personally -I could care less if my boss is Shinzu MAtsumura, Jay Gandhi, Wu din Ping or Ivan Putin. I also don't think my children or grandchildren don't care -why should we subsidize incompetence when there are buyers out there. It is the buyers responsibility after that as to what to do with the bad assets. If they choose to write them down, recll loans to corporations, not fund reckless corporate paper -so be it. If they choose to lay off 30,000 workers and 2000 upper echelon workers -well- thats WHY you get paid the big bucks -cuz you neva know.

Turning Japanese: The Audacity of Reality (Part 3 of 3)

I agree with BS Detector-Shedlock has no clue what a socialist country really is-look at Sweden, Russia and Venezuela and see what their debt ratio is!!
Socialism should be seen as having corporations paying for the externalities they use funded by the public to be more competitive (roads, airports, trains -infrastructure, political stability, law enforcement)- it is undeniable they all add value and profit to any businesses bottom line and so they must repay the public coffers -which they benefit from and pay their fair share. Instead -it is the US/ so-called capitalist countries that subsidize business profits by removing the burden of taxation from corporations that benefit from the public good and encourage a poor business model.

How many US cars does the state,county, federal and local agencies purchase/lease for decades solely because they are American? This hidden reserve of massive sales ensures continued poor management as profits are locked in and accountability and competitiveness decline to incompetence and false confidence. How many civil and criminal suits against corporations are over-turned or not given true justice because we mistakenly believe the 'business of america is business'. Causing again poorer corporate governance, structure, and competitiveness because their mismanagement will be subsdized by a co-opted government which ensures them that being competitive is not as important as being connected. How many fake patents will be churned for small incremental not patentable steps of other nations discoveries (HIV test) for the benefit of US corporations to hegemonize profits they don't deserve!

As for the homeowners- why shouldn't they be helped out? Why must Halliburton, Blackwater, McDonnel Douglass, Ford,GM, Chrysler etc be awarded fat contracts on the taxpayer dime which ultimately leave this country bereft of its true life blood - a hard working, ambitious middle class to support the insouciant, lazy upper class who receive education, opportunity and over-compensation as did the nobility in centuries past!?

America stands for the opportunity based on merit- but most importantly the ability to survive in dignity and a higher living standard. This is how -the US is able to siphon off the best minds of the world for decades. Engineers, doctors, PhD's all who by merit are in the top .001 percent of their countries come to the US precisely for this very reason. If the support of the middle class standard of living is gone -you can kiss the innovation of the US goodbye. With out the fulfilled promise of opportunity to live better if you work hard - this country can kiss its future goodbye.

Homeownership has been proven to be an effective wealth builder for lower/middle income people and this is what America is about. Not those barren intellectuals who by immersing themselves in unproven premises and pseudo-science use ideology to mount specious arguments that buttress a priveldged lifestyle and become a flawed intelligentsia to ensure there current standard of living. Only in capitalist countries do you find the effect of increasing education leading to an increase in moral turpitude. Who needs this kind of education?

Bill Gates won't have 30K to buy DOS from a Chinese programmer -because the Chinese programmer will be in Russia or China or India. NASA won't have legions of Indian/Chinese/African minds because they won't be here. Silicon Valley would not exist.


The US must realize that its secret to survival is to be the most effective and existing government that represents the ideals of the people's struggle. If it continues on the path of exceptionalism, war and elitism- it is doomed. Because its best and brightest citizens will become and have become the product of a polluted system where being educating only ensures that the citizen participates i the cannabilization of his own country. Look at Wall Street, Medicine, Corporations and sadly the Armed forces.

The Protestant Work Ethic has been replaced by the Judaic interest ethic. It is the culture and values that provides the foundation of leadership and a good society. How any economist, scientist or educated person can think otherwise -only goes to show -how riddled our society is poison of materialisn and we lack the anti-dote of disciple, character and most importantly critical thinking.

Solving the Bank Crisis: More TARPs Are Not the Answer

Why can not the US follow previous IMF recommendations and sell of a percentage (upto 45%) of these troubled banks to sovereign wealth funds/private investors etc and then buy up equity in the rest. Leaving bad management with say 10 percent? After all- why should the taxpayer be on the hook for all of it.

Personally I have no problem if Saudi Arabia, UAE, China, Japan, Germany, Norway etc bought upto 45 percent stakes in these banks -so that my children, my grandchildren etc can be spared from making interest payments to an insolvent Federal Reserve for decades.

I fail to see why whats good for the Goose (developed countries, Asian Crisis) is not good for the Gander. I am quite sure that China/Japan/Russia and GCC with its more than 4 trillion dollars of reserves would swoop in and buy out these banks at 40 cents on the dollar if the US government paid 85 cents on the dollar for the rest of the assets.

Essentially this means saving the taxpayer hundreds of billions of dollars in interest and principle. We lower our deficit relative to buying everything. Since they are only allowed to own 45% - they don't have the ability to 'control' the banks per se. However - they will at this rate of ownership be able to be compensated for putting in risk capital in a troubling time.