Al-USA

Trade Desk Thoughts: Hedge the Drop

Well, I was short expecting a drop, not in particular one related to the resumption, if such is occurring, of the financial crisis, but via my own market model. Nothing works all the time, but it looks like I will be enjoying this drop and will probably get a HUGE % return with my options spread.

As i write futures are 1074.7 1:31 EST, but I'm in CA so it's still early here.

Another Crisis Looms Right Around the Corner

bob adamson wrote:
"
As a foreign observer of the US scene, however, I find it regrettable that I appear to have more faith than some US citizens in the capacity of the US and its people to work together to find a way forward through the current difficulties. This was done during the Depression and WW II and other past crises and there is no reason to think it can’t be done now.
"

One can not place faith upon the elites running the USA, Mr. Adamson, simply because it is the elites themselves that caused the "financial crisis" which has now precipitated into an economic crisis for the masses of the American working/middle class.

You see, the American working/middle class has been gutted and will continue to be gutted, as per the design of the capitalist elites way back in the passage of GATT in 1994, and perhaps earlier. As is apparent now, the process of capitalist globalization was the beginning of the end for the relatively high living standards of the American masses.

Of course, the absence of increasing wages, relative to inflation, was substituted for a time by the introduction of massive credit, or debt. But the limit of credit or debt, to substitute for the lack of rising wages during the boom period of capital from roughly 1982 to 2000 has now been reached; with the inevitable crisis of capitalism, or crisis of over-production.

But don't take my word for it, get it from one disgruntled billionaire elite, privy to the plans of this elite class, years ago, when, in 1994, he said publicly that globalization would result in reduction of wages, benefits, mass unemployment and soon, increased taxes on the masses of the working/middle class.

This elite, billionaire Sir James Goldsmith laid it all out to Charlie Rose in a 1994 video, titled,

"1994 Globalization Warning"
solari.com/blog/?p=3309

This is the establishment, aka Financial Oligarchy, corrupt capitalist elites, and their political cronies, against everybody else, but principally against the American masses.

Now, a conscious policy decision was set in motion, at least as far back as 1994, to increase the profits of the capitalist elites with the purposeful end game result of persistent mass unemployment, after the massive debt/credit (which substituted for the absence of wages to increase, after inflation) was maxed out.

If you care to see how this parasitic elite class thinks of the rest of us, take a few minutes to see the 1994 video below. I could summarize in text, but getting it from the elite himself is most informative.

"1994 Globalization Warning"
solari.com/blog/?p=3309

Another Jobless Recovery, Part 2

"
What puzzles me is why anyone expects anything but a jobless recovery.
"

Well, the masses still believe that capitalism works for them. In fact, there might still be a rapidly decreasing majority that believe that capitalism is the "best" economic model out there to secure a job, feed/clothe their families, and, in general advance civilization...

The past "jobless" recoveries, but especially the current one, will, in my opinion, sooner rather than later, change the class consciousness of the masses, even despite the massive propaganda machine of the Financial Oligarchy.

When that happens, Capitalism will be under its greatest threat since the 1930's Depression. So today's capitalists should be grateful that the masses still entertain the notion of actually being able to secure a job, feed/clothe their families, and see an advancement of civilization, as they have known it under the economic model of capitalism...

Social Security: Time to Uncap FICA

There are alot of people who never paid into the system and get benefits: one example is an elderly housewife who never worked for a paycheck but qualified through her working husband.

It's also being used for disability benefits, not just for retirements. So, unless you are on the left to far left, you should have a problem with this. Personally, I would rather have socialism for the poor than the wealthy elites of Wall Street or industry...

Wall Street Is Front-Running Your Stock Orders

Very interesting article Mr. Summers. Thanks for bringing it to readers attention. Up to 70% is now HFTP...

Is the California Budget Crisis Really Over?

Good article, sad content, and the people in the picture so joyously posing in front of the cameras says it all: the massive social cuts were a victory for capital, and a tragedy for labor. Instead of raising the needed billions from the wealthy elites in California, it's taken from the interests of working/middle class, the social safety net.

To be fair, this is how capitalism is supposed to work, so, no surprise there...

California Comes to a Cowardly Compromise

Wesley Mouch wrote:
"
Question: Why do we keep electing these fools to public office? It's our own fault for the mess we're in. You get what you pay for ... or in this case, vote for.
"

Wesley Mouch is still under the illusion that we have a democracy in the USA. I refer Wesley Mouch and others of likewise persuasion to read the article, "The Quiet Coup", below.

More information below:
The Quiet (American) Coup
www.theatlantic.com/do...

Banks Counted on Looting America’s Coffers
tinyurl.com/bkezmt

"The Fed's War on the Middle Class"
mises.org/story/2983

"Economic Fascism and the Bailout Economy"
mises.org/story/3333

Employment: Minimum Wage, Maximum Stupidity

We don't have a "free market" for capitalists, so why should there be one for labor? Crony capitalism is the rule in USA, since the corrupt USA capitalist elites are afraid of the "free market" and the competition that entails they are all over Washington with their lobbying efforts trying to influence, many times successfully, legislation that will favor them, to the detriment of free markets.

Free markets might work, in theory, but then again, Communism also looks very well in theory, as someone who has read the various texts would attest.

Ultimately, capitalism, in practice, is not much more but an an economic war between the various economic classes, as Marx said, so while, in theory, increases in productivity would result in increases in the wage of labor, in practice, there is nothing to force the capitalists to follow theory, certainly not the absent "free market".

As for minimum wage jobs and productivity, I know many college graduates who have been out of work for many months now, some more than a year, and are not able to get a job, outside of minimum wage. Once again, theory is put aside by practical capitalism.

Don't get me wrong readers, I am a capitalist, and benefit from it, but I don't turn a "blind eye" to its contradictions, and I don't defend them either since I still personally know many who, having to use their labor, instead of capital, to make a living, are hurt most of the time, rather than helped, by capitalism, as practiced in the USA, certainly within the last ten years, maybe going back to 1974, when the post-WWII boom came to an end, and, coincidentally, when one average wage worker could support a family with the wife staying home to raise the kids...

I have read Mr. Shiffs' various articles on the corrupt USA capitalists and he is balanced in his views with both classes, capitalists and labor, relative to the, in my opinion, absent free market, so I value his articles, even when I disagree with them.

The Truth About Unemployment Numbers

Excellent article Mr. Goodman. Keep up the good reporting. My own economic model forecasts the floor dropping out of the economy, again, during first or second quarter 2010. If such happens, there will be no doubt that the Greater Depression will have arrived. Prepare yourself as best you are able.

On the "bright" side, even during the 1930's Great Depression there were many substantial Bear rallies of +20% or more, so, at least for the nimble, and with sad irony, I believe there will be some very good times to make very good money. Good luck to all.

Here's What World Markets Are Telling Income Investors to Do

Good article Mr. Wachtel.

Selling (shorting) put options is a good strategy but, it must be stated, there is the possibility of UNLIMITED losses, if the stock/market heads up instead, so only the very skilled options trader should attempt this. Readers, always do your homework when someone advises a particular strategy, good luck to all

Sin and Millionaire Taxes Aren't the Solution to State Deficits

Most of the wealth of the USA is concentrated in the top 1%, not the lowly millionaires. Go after the top 1%, and your problems are solved. It's all about increasing the velocity of money, remember?

Assessing the American Labor Market Collapse: What Should Our Yardstick Be?

A much needed article on the real crisis of employment, Mr. DeLong. I'm a bit surprised it only got four comments ...

Obama (Should Say) to California: Drop Dead

Ok, just to be clear, California does not have a problem, capitalism has the problem. Whatever happens, California, and its people, will still be there. Capitalism, as a viable economic model, is the one on the verge of collapse. Get it straight people.

Having said the above, a very informative article by Mr. Shiff.

Will Europe Use American Solutions for Its Rising Unemployment?

Good article Trader Mark. I also believe capitalism can thrive while benefiting the masses. Of course, the American financial Oligarchs need to be reminded of this and simply putting up a colored person for President is not going to placate the masses, in my opinion.

If unemployment is still in double digits next summer, I expect mass demonstrations on the streets and President Obama will be a first term president.

Also, during the the Depression of the 1930's the tax rate on the top 1% income earners rose to about 90% and, if capitalism is to survive the 2nd Depression or Greater Depression, I expect that will happen again.

Stocks Are Hot, But Do the Americans on Food Stamps Care?

Excellent post Trader Mark. Every time I read about the increase in the number of Americans enrolled in the food stamp program I go over my Marx. Clearly, American society is inserting the "triggers" that will lead to the next awakening of the proletariat masses: it is only a matter of time, and near time at that, sad news for the capitalist elites and capitalists in general.

I also agree about the fallacy of expecting "joe six-pack" to be able to manage, successfully, a 401k plan through the myriad "land-mines" set up by the markets when even so-called "professionals" fail to do so consistently and only thrive because of management fees. To top it off, according to the definition of the "bell-curve", half of Americans are below average intelligence so, from the start, half of the population has zero chance, in my opinion.

predictorman1000 wrote:
"I am trying to beat this problem by actively managing an IRA, but I am really going to need jacked up returns to comfortably retire in 2025."

If you are not already doing so, I recommend trading options for the IRA, assuming it is a ROTH IRA at a brokerage. Options allow a very small amount of money for a trade but can yield respectable to spectacular results. Of course, before that, you should spend a few years acquiring the skill to do so successfully or, maybe hired a trader.

The problem with hiring a trader or service is that many people lack the skill to evaluate its performance, so that is a big obstacle. But, like I said, with options, only small amounts need to be put at risk at any one time, to be able to yield respectable results. Good luck to all.