AndrewBaker

Wall Street Breakfast: Must-Know News

After BO yesterday started taking a stance to defend him/his cronies from a double-dip recession, GS bonuses, a Fed audit and cries for the head of Geithner sound like more of the same: I wouldn't go buying any more stocks yet awhile, unless you really are a buy and hold fanatic with a minimum 10 year horizon.


On Nov 20 08:56 AM doubleguns wrote:

> GS up a creek with shareholders over bonuses, Fed audit closer and
> Timmy asked to resign.
>
> Am I dreaming? Is this for real?
>
> Maybe dreams do come true.

Wall Street Breakfast: Must-Know News

Nothing much is going to happen between now and New Year: we'll keep being told it's getting better and we know that it isn't, but unless some bad news manages to squeeze through the rose-colored sweet-spelling filters that are so much in use right now, the markets will tick along at the present level for a while longer, and the dollar will rise and fall with every economists' comment for better or worse, though trending down slowly as US economic influence wanes in the global economy. Is this a lull before the storm?

Wall Street Breakfast: Must-Know News

The dollar won't slide catastrophically because there is no other currency to replace it right now, not because it's intrinsically worth holding more than other currencies, but it will decline over time, just as the British pound did from the beginning of the last century and for most of it.

A weaker dollar helps exporters and tourism, which is good, but hinders the growth of emerging economies, which may slow them down a little, but won't stop the trend.

On balance, the US needs a weaker currency to support trade which will help real businesses recover. Not so many people will currently be insistent on spending money on foreign goods or looking to increase their overseas vacationing, so any extra cost there won't hurt much. Imports will be more costly, but the US has a wide internal market that can supply most needs anyway.

Overall, a drop in the dollar will likely be beneficial. Better that than rampant inflation which will destroy value over many years to come, and which worries me will be the result of quantitative easing. If a weaker dollar reduces that process, I will be satisfied.

Bear Verdict Should Please Wall Street

Bad judgment and greed aren't crimes: agreed, but the mentality that these people have is no better than that of a criminal, only they don't break laws that will make them that.

The difference between breaking in and stealing someone else's goods, and taking their money in, high risk gambling with it, and telling them it's been lost in a bad investment, is not one of criminal or not criminal but one of morals and ethics. These financial workers have as low if not lower morals and ethics than a criminal when it comes to regard for others and their possessions, and the effect that depriving them of such has on people and their families.

One big difference is a criminal goes to jail, whilst a stupid financier languishes in his expensive home, leaving it only to laugh all the way to the bank.

Wall Street Breakfast: Must-Know News

AIG boss says they can't retain talent under compensation restrictions? Seems to me they shouldn't want to retain the "talent" that got them into the mess they're in in the first place.

This rubbish about excessive pay to retain talent must stop: there are plenty of people out there with real talent who will work for far less than some of the pampered financial workers we've had in the past and still have now; and they are just as good, if not better, and won't constantly moan about pay and threaten to go elsewhere (though who would want them beats me).

Do a fair day's work for a fair day's pay, and then we'll soon see how quickly we can get back to a sound financial footing.

Wall Street Breakfast: Must-Know News

This latest financial crisis has made me think beyond just money and has started me considering more and living more a lifestyle where financial aspects do not rate so highly: and it's more satisfying, though hard to give up on certain behavior. One way to compensate is to deal less with and spend less time on government and regulatory requirements that frankly do me and mine no good at all and cost me time and resources that I begrudge spending on them. Less compliance with officialdom is not only rewarding in the extra time one has, but also very satisfying in itself. I commend it to everyone. Give it a try, and see how good it feels.

Wall Street Breakfast: Must-Know News

Those who can, do; those who can't, teach; and those who can't teach become politicians and grease the palms of those that live off those that can, and in return receive contributions towards election expenses and endorsements of their ability, enabling them - they hope - to stay on the political gravy train for a very long ride.

Cynical? Remember the cynics believed in virtue and shunned materialism, which is IMHO, a better philosophy and lifestyle than our glorious leaders of today demonstrate.

Wall Street Breakfast: Must-Know News

Wow, all of a sudden we are out of the recession and spurring back to growth! And if we are careful, everything will be alright.

Great news. Fantastic. Let's have a party!

Trouble is, I don't believe it: it's now obvious that the cure that has been decided upon is one where the rich and powerful first protect their own interests by whatever means they can, which includes ramping up the price of any stocks they hold and then selling them off to the great unwashed (us) at exorbitant cost, then using the money to buy tangibles that will prove inflation proof, as the next bit of this grand cure is to ensure that the value of the dollar drops greatly and inflation takes it toll on the massive debt that's everywhere and can never be paid off with real money It will work, but leave us with worthless investments and assets; but oligarchs and plutocrats will be ok, having first protected their own worth before unleashing the inflation cure upon the rest of us.

Wall Street Breakfast: Must-Know News

Manipulation is the name of the game, any which way you can do it. Whatever happened to buying something because it was worth it?

Wall Street Breakfast: Must-Know News

A basic problem is that there are too many people getting paid for doing non-jobs and non-productive jobs: the list includes many politicians, State and Federal workers, bank, insurance and financial company workers and the many media commentators who are so fond of telling us what needs to be done for the economy to improve.

Add to this the exorbitant pay that is now common in many companies for higher and highest level staff and paid on the excuse that they need to retain the best people, and it is no wonder that the greed of these non-producers has caused a downturn from which it will years to recover.

Token gestures to restrict pay for a certain group is just not enough. Pay differentials from base to peak need to be far less than they are, and based on real productiveness and genuine capability, not just paid to someone just because they've reached a level where excessive pay is the norm regardless of the quality of the person's real personal contribution.

Wall Street Breakfast: Must-Know News

Yes, the US could well lose its top credit rating. Already the dollar is showing signs of no longer being THE international currency, and other countries are looking to replace it with a composite. Commodities priced in dollars are rising in dollar terms: oil and gold being prime examples. This is because holders prefer holding these than the depreciating dollar. The stock market rise may look good in dollar terms, but it's not been that great when translated into other currencies (except perhaps the UK pound, which is suffering too).

Jobs are just not there, except made-up State and Federal ones, which can't last nor be afforded, and debts have still to be fully counted and accounted for. These will be added to by Government debt accumulated in supposedly kick-starting the economy but which will in fact drag it back down again once the stimulus stops. This must be soon, because even the US Government can't keep spending imaginary money for ever.

Maybe we should convert our assets to Yuan/Renmimbe and gold and go to live in the UK where our health care will be free: no, things aren't that bad: at least, I hope not! Convert and stay put: at the current rate, we'll be having all the foreigners we want coming to the US soon, as it'll be so cheap for them to be here.

Wall Street Breakfast: Must-Know News

So, GS doesn't do as well as expected and the Fed is now hedging on the strength of the recovery. Only, both WERE expected; or at least, expected by myself.

Shedloads of cash earning little interest on deposit has been and may continue to push the market higher, but that does not make much sense because eventually when the last person with surplus cash has bought, there will be no more buyers: then watch the fall from that lofty height!

Ok, being in stocks now can be profitable, but only if you sell out before the big drop, and it is self-evident that not everyone can do that, because almost by definition, that is when the drop will occur.

Wall Street Breakfast: Must-Know News

The "them and us" is becoming more obvious by the day. Markets are rising on hot air and statements from politicians and business leaders that are very economical with the truth, to say the least and best. Those actually investing in stocks in these markets now, which will not be those same politicians and business leaders - who are selling their stakes, as we know - will lose heavily when real values finally assert themselves, whilst our great leaders are pocketing the cash now and feathering their own nests. Perhaps they are also the ones investing in other countries' stocks and also buying commodities, because they know that the cash will be no good once they've destroyed the dollar and caused rampant inflation, which after a short period of deflation, will rise like the Zimbabwean dollar from the ashes to make the rest of us poor, having made wealthy our masters who will claim to have done so well. Third world no longer describes it properly: fourth world corruption is here and now radiating out from Washington.

Wall Street Breakfast: Must-Know News

CIT's problems are just the visible part of the debt iceberg. Whilst CIT going down will have major repercussions for many, just think what the submerged greater than 90% part will do! With AIG, Barclays and others selling off bits, and the UK government contemplating the same, it certainly lets everyone know that world debt, at least in the first world, is a major problem and will be the source of financial uncertainty and problems for many years to come.

The markets will change to reflect these problems too, so do not get carried away with this massive bear rally we've been enjoying: stick with reality no matter how hard that may be right now. The time to get back into stocks is not yet here.

Wall Street Breakfast: Must-Know News

Schizophrenia rules. Gold is soaring along with stocks, and industrial metals and oil have turned back up. What is happening?

Are we all so desperate that we will cheer any news that says it's getting better even when we know that it's not? Is there so much cash around earning nothing interest that we are prepared to buy anything and hope rather than accept a negative return once any tax and inflation has been taken into account?

The pressure to buy in and not miss "the rally" must be very high, but common sense says do not get sucked in: wait for the reversal, and then decide the way forward.