whidbey's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/68815/comments http://seekingalpha.com/article/160455-markets-macroeconomics-and-the-fed?source=feed#comment-667344 667344
It is true that things did not go well because Greenspan and a Congress wanted to spend money (Medicare part D for example, and buying union votes for sure) They were on a role and loving the political capital they thought they were building. Their miscalculation was based on not understanding free markets: Free markets go where the money is, they poured everything into debt financing because rates were low. Sell, Sell and sell more.

But they were wrong and should have known it; The government actually assumed that housing could go up forever, or a long time, and would make great social change for the good. Virtue and opportunity to make money: does it get any better?

But they made a pure miscalculation that Krugman nor, Bernanke, nor anyone saw as stupid and fatal. They missed the adage: ""nothing goes up forever"". They missed the caution "" when everything is going into one play the market has it wrong"": no market is ever dominated by one or a few investment plays. The missed the lack of credit reviews. They would not have loaned you money without knowing your assets and payment habits, but they loaned public funds it to millions that they did not know anything about.

Krugman is just a professional hack who got his job at Princeton by being a socialist economist who looks for government roles and denounces private roles. What has he offered on finding jobs (money to the Nat Endowment for the Arts?), closing zombie banks (yet to come), controlling Congressional spending (why? if it is directed to social justice), reducing debt to match tax revenues (if I have told you once I said it a thousand times: deficits don't matter!!). Paid him no mind and buy some bonds the world is going to end soon and we hope it takes Krugman with it. ]]> Tue, 08 Sep 2009 18:18:43 -0400
It is true that things did not go well because Greenspan and a Congress wanted to spend money (Medicare part D for example, and buying union votes for sure) They were on a role and loving the political capital they thought they were building. Their miscalculation was based on not understanding free markets: Free markets go where the money is, they poured everything into debt financing because rates were low. Sell, Sell and sell more.

But they were wrong and should have known it; The government actually assumed that housing could go up forever, or a long time, and would make great social change for the good. Virtue and opportunity to make money: does it get any better?

But they made a pure miscalculation that Krugman nor, Bernanke, nor anyone saw as stupid and fatal. They missed the adage: ""nothing goes up forever"". They missed the caution "" when everything is going into one play the market has it wrong"": no market is ever dominated by one or a few investment plays. The missed the lack of credit reviews. They would not have loaned you money without knowing your assets and payment habits, but they loaned public funds it to millions that they did not know anything about.

Krugman is just a professional hack who got his job at Princeton by being a socialist economist who looks for government roles and denounces private roles. What has he offered on finding jobs (money to the Nat Endowment for the Arts?), closing zombie banks (yet to come), controlling Congressional spending (why? if it is directed to social justice), reducing debt to match tax revenues (if I have told you once I said it a thousand times: deficits don't matter!!). Paid him no mind and buy some bonds the world is going to end soon and we hope it takes Krugman with it. ]]> http://seekingalpha.com/article/160112-an-insider-s-view-of-ginnie-mae-mbs?source=feed#comment-667283 667283
The problem is that not all originators exercise the same degree of care in making loans. In the end the agency is expected to supervise the standards, but we know political pressure even today is still very high and immoral. So is the last sweet pot about to go sour ? Yes, it is all rotten, and we know housing debt will consume everything eventually. The congress wants to revive a dead market. Welcome to hell where everything burns sooner or later.]]> Tue, 08 Sep 2009 17:42:24 -0400
The problem is that not all originators exercise the same degree of care in making loans. In the end the agency is expected to supervise the standards, but we know political pressure even today is still very high and immoral. So is the last sweet pot about to go sour ? Yes, it is all rotten, and we know housing debt will consume everything eventually. The congress wants to revive a dead market. Welcome to hell where everything burns sooner or later.]]> http://seekingalpha.com/article/160463-the-fha-meltdown?source=feed#comment-667229 667229 Tue, 08 Sep 2009 17:14:28 -0400 http://seekingalpha.com/article/160099-expect-unemployment-to-remain-high?source=feed#comment-667219 667219 Tue, 08 Sep 2009 17:08:17 -0400 http://seekingalpha.com/article/160471-purchasing-power-comparisons?source=feed#comment-667213 667213 Tue, 08 Sep 2009 17:05:48 -0400 http://seekingalpha.com/article/160232-3-reasons-why-gold-etfs-are-on-a-rush?source=feed#comment-667204 667204 Tue, 08 Sep 2009 17:00:35 -0400 http://seekingalpha.com/article/160424-the-case-for-moving-itunes-to-the-cloud?source=feed#comment-667198 667198 Tue, 08 Sep 2009 16:55:05 -0400 http://seekingalpha.com/article/160470-closing-update-stocks-string-together-3-straight-wins-commodities-gain?source=feed#comment-667194 667194
This is the type of indicator that tells us we are not headed toward a recovery any time soon.

The market can do as it will, but the belief we are heading into a growth in demand is silly. The stimulus and junker car programs were going in July and consumers did not spend; may have paid down some debt. The road to nowhere is long and winding and we have just started. Liquidate the dead banks and start over in banking.]]> Tue, 08 Sep 2009 16:52:20 -0400
This is the type of indicator that tells us we are not headed toward a recovery any time soon.

The market can do as it will, but the belief we are heading into a growth in demand is silly. The stimulus and junker car programs were going in July and consumers did not spend; may have paid down some debt. The road to nowhere is long and winding and we have just started. Liquidate the dead banks and start over in banking.]]> http://seekingalpha.com/article/160368-what-gold-s-breakout-means-for-stocks?source=feed#comment-666932 666932 We know this rally cannot last without permanent damage, so whatever the correlation and direction of movement we must be aware that all is for naught ultimately. The recovery is just a phase in a longer bear market and gold is a symptom of what? A better investment than equities?]]> Tue, 08 Sep 2009 14:42:49 -0400 We know this rally cannot last without permanent damage, so whatever the correlation and direction of movement we must be aware that all is for naught ultimately. The recovery is just a phase in a longer bear market and gold is a symptom of what? A better investment than equities?]]> http://seekingalpha.com/article/160396-bond-expert-tuesday-outlook?source=feed#comment-666827 666827 Tue, 08 Sep 2009 14:01:48 -0400 http://seekingalpha.com/article/160084-intel-anticipating-a-refresh-of-corporate-it-spending-cycle?source=feed#comment-666794 666794
The fact that MSFT has plans to launch its new horror show, "system 7", is no reason to buy a box to run it, unless (don't count this out) the idiots at Softy failed to make it fully backward compatible with prior MSFT OSs. The backward compatibility issue has occurred with MSFT before and we can not preclude some collusion to force the corporate markets to buy or go blind.

They are a lovely group feeding Africa and stomping on the toes of the US market. No wonder the EU/UK hate the company.]]> Tue, 08 Sep 2009 13:41:01 -0400
The fact that MSFT has plans to launch its new horror show, "system 7", is no reason to buy a box to run it, unless (don't count this out) the idiots at Softy failed to make it fully backward compatible with prior MSFT OSs. The backward compatibility issue has occurred with MSFT before and we can not preclude some collusion to force the corporate markets to buy or go blind.

They are a lovely group feeding Africa and stomping on the toes of the US market. No wonder the EU/UK hate the company.]]> http://seekingalpha.com/article/160436-the-enterprising-investors-guide-9-8-2009?source=feed#comment-666780 666780
I think you make a great case that valuations are not "normal" but due to non-operating adjustments.

What needs watching is the financial sector which is running on smoke and mirors. The earnings of the sector are not commensurate with their level of operations, and it will not be able to attract capital for the refunding that is required to remain viable. When this becomes obvious to investors, the "adjustment" starts and it will likely be based on a bitter realization what we was had by the Treasury secretary and the Fed. The bad part is the FDIC is not ready for the new demands and may terrorize millions of small depositors. ]]> Tue, 08 Sep 2009 13:34:00 -0400
I think you make a great case that valuations are not "normal" but due to non-operating adjustments.

What needs watching is the financial sector which is running on smoke and mirors. The earnings of the sector are not commensurate with their level of operations, and it will not be able to attract capital for the refunding that is required to remain viable. When this becomes obvious to investors, the "adjustment" starts and it will likely be based on a bitter realization what we was had by the Treasury secretary and the Fed. The bad part is the FDIC is not ready for the new demands and may terrorize millions of small depositors. ]]> http://seekingalpha.com/article/160401-graham-corporation-ready-to-skyrocket?source=feed#comment-666759 666759
GHM maybe a great stock, but right now it appears to have been abandoned. When and in what circumstances to you see the Rocket taking off? Or is this a one time appearance on SA. I think the latter. ]]> Tue, 08 Sep 2009 13:23:26 -0400
GHM maybe a great stock, but right now it appears to have been abandoned. When and in what circumstances to you see the Rocket taking off? Or is this a one time appearance on SA. I think the latter. ]]> http://seekingalpha.com/article/160430-five-charts-to-rule-them-all?source=feed#comment-666744 666744
You bet it is not a science, it isn't even supported by historical market prices movements. The five charts you selected are trend-less and you can stare at them until you are cross eyed, but there is little if any correlation obvious. I think your toy is busted, and you haven't caught on yet. ]]> Tue, 08 Sep 2009 13:15:36 -0400
You bet it is not a science, it isn't even supported by historical market prices movements. The five charts you selected are trend-less and you can stare at them until you are cross eyed, but there is little if any correlation obvious. I think your toy is busted, and you haven't caught on yet. ]]> http://seekingalpha.com/article/160438-tuesday-fx-view-dollar-kicks-around-in-the-dust?source=feed#comment-666727 666727
It appears to me that we are having second thoughts about stimulus of any kind, but have no choice since the banks are loaded with junk and consumers are largely unwilling to spend.
We are threatened by deficits based on new public programs.

Something go on in the gold markets??

Gold prices are a speculation by many on the fact the government has no economic program to allow the unloading of bad credits and the rectification of the banks. The speculation is on failure becoming the dominant feature of our economy.]]> Tue, 08 Sep 2009 13:06:12 -0400
It appears to me that we are having second thoughts about stimulus of any kind, but have no choice since the banks are loaded with junk and consumers are largely unwilling to spend.
We are threatened by deficits based on new public programs.

Something go on in the gold markets??

Gold prices are a speculation by many on the fact the government has no economic program to allow the unloading of bad credits and the rectification of the banks. The speculation is on failure becoming the dominant feature of our economy.]]> http://seekingalpha.com/article/159633-a-warning-to-america-from-the-east?source=feed#comment-665656 665656
Who are these men who control the world? Have such power and in effect rule the world. Surely such people would be in the forefront of cleaning up the system. We need to know more, if this report is to be trusted, or taken as true.]]> Mon, 07 Sep 2009 21:25:33 -0400
Who are these men who control the world? Have such power and in effect rule the world. Surely such people would be in the forefront of cleaning up the system. We need to know more, if this report is to be trusted, or taken as true.]]> http://seekingalpha.com/article/159793-china-and-india-canaries-in-the-coal-mine?source=feed#comment-665603 665603
What we have yet to recognize in the US is that our domestic demand, except possibly for oil and some metals, is going to fall for at least another six months (and recover very slowly). By then the emerging markets will be in serious straits. I think this points to deflation, worldwide. We need to be very careful about incurring further domestic debt for obvious reasons. Deflations are contagious.]]> Mon, 07 Sep 2009 20:04:13 -0400
What we have yet to recognize in the US is that our domestic demand, except possibly for oil and some metals, is going to fall for at least another six months (and recover very slowly). By then the emerging markets will be in serious straits. I think this points to deflation, worldwide. We need to be very careful about incurring further domestic debt for obvious reasons. Deflations are contagious.]]> http://seekingalpha.com/article/160257-capitalism-socialism-and-10-year-returns-of-country-etfs?source=feed#comment-665543 665543
Personally I am at a lose as to why one would think that tax rates affect equity prices over time. Equity prices are loosely correlated with earnings of corporations, but sales are not
a driver of earnings simply because margins are not well correlated with sales. The real effect of tax rates is their effect on the quantity of goods consumed per household. India is a case in point I think. A low income society consumes less. No question that corporate taxes are paid by consumers, but the distributional and wealth effects are seen at the household levels.

I like your question and you did well on a first cut showing what is going on in the aggregates. Thank you.]]> Mon, 07 Sep 2009 18:30:11 -0400
Personally I am at a lose as to why one would think that tax rates affect equity prices over time. Equity prices are loosely correlated with earnings of corporations, but sales are not
a driver of earnings simply because margins are not well correlated with sales. The real effect of tax rates is their effect on the quantity of goods consumed per household. India is a case in point I think. A low income society consumes less. No question that corporate taxes are paid by consumers, but the distributional and wealth effects are seen at the household levels.

I like your question and you did well on a first cut showing what is going on in the aggregates. Thank you.]]> http://seekingalpha.com/article/160246-profiting-from-the-tapped-out-consumer?source=feed#comment-665531 665531
The implications of a GDP reduced by 3% for consumers, maybe 5% for Capex, and maybe stable health care expenditure is just horrendous for final demand, tax revenues, loan demand at banks, and all that is derived from each of the above end uses. Jobs will not come back to 2007 levels for years, decades. I suspect we have another further major market decline in train, it might even reach deflation levels. Not pretty, but also something to plan for too. ]]> Mon, 07 Sep 2009 18:17:12 -0400
The implications of a GDP reduced by 3% for consumers, maybe 5% for Capex, and maybe stable health care expenditure is just horrendous for final demand, tax revenues, loan demand at banks, and all that is derived from each of the above end uses. Jobs will not come back to 2007 levels for years, decades. I suspect we have another further major market decline in train, it might even reach deflation levels. Not pretty, but also something to plan for too. ]]> http://seekingalpha.com/article/160259-are-risk-assets-on-the-verge-of-melting-up?source=feed#comment-665493 665493 Mon, 07 Sep 2009 16:54:30 -0400 http://seekingalpha.com/article/160262-gold-is-still-the-opportunity-of-a-lifetime?source=feed#comment-665471 665471
A deflationary depression is as probable as anything on the horizon. It will involve the fact that most private and public debt will not be repaid and finally the public and our creditors understand. The paper the debt represents will be found to be useless, worthless and the stuffing for zombie banks.

The depression will bring confusion, a shortage of money and a threat to survival of us all. But if we come out the other side, clear the shock waves of bankruptcy, we will see the government attempt Keynesian inflation of the money supply.

They may confiscate gold if they dare which will not be allowed, but inflation will start once the useless debt is re-categorized junk. At that point owning physical gold may be the key to survival and preservation of assets. So I agree, hold some metal, and some paper gold right through the depression. It will go down, but much less than other asset classes. Gold is not only timely, it is a necessity.]]> Mon, 07 Sep 2009 16:22:20 -0400
A deflationary depression is as probable as anything on the horizon. It will involve the fact that most private and public debt will not be repaid and finally the public and our creditors understand. The paper the debt represents will be found to be useless, worthless and the stuffing for zombie banks.

The depression will bring confusion, a shortage of money and a threat to survival of us all. But if we come out the other side, clear the shock waves of bankruptcy, we will see the government attempt Keynesian inflation of the money supply.

They may confiscate gold if they dare which will not be allowed, but inflation will start once the useless debt is re-categorized junk. At that point owning physical gold may be the key to survival and preservation of assets. So I agree, hold some metal, and some paper gold right through the depression. It will go down, but much less than other asset classes. Gold is not only timely, it is a necessity.]]> http://seekingalpha.com/article/160264-why-economists-messed-up?source=feed#comment-665428 665428
Math may oversimplify economic analysis, but your assertion of missing" messy truths", is a joke. Who says? Give us an example of messy truth generally acknowledged. Surely you can do better than that. Is it Just a cover for your preconceptions?

Excess confidence in the Financial markets is hard to judge. "Excess" is not exactly precise. And you failed to mention that had the markets been free of regulation, much of the distortion you now regret might not have happened. We call that humility. Try some. I could carry that much further, but your use of Excess must show that you do see some Confidence in market processes is justified. Which exactly? Don't join the dark side because you feel magnanimous towards the current attacks on market processes. The attacks are wrong for the most part.

The limits of Macroeconomics are all to obvious since aside from some national accounting framework, it mostly a religion with few strictures. I am always sure that my doctoral students who are power Hungary will gravitate in that direction since in macro opinion is everything and interest in rigor just insecurity, e.g. Krugman. Macro is still a science aborning and Ben B's interests ought to be of great concern since he is a banker for the most part, not a political economist, or is that questionable?

My experience in Washington as an economist was always a let down since consistency and adherence to rigorous analysis was never popular, and where compromise, wink and nod (the short run) was everything. Don't discard behavioral economics, but remember it was first called sociology, and still probably should be called sociology. ]]> Mon, 07 Sep 2009 15:25:04 -0400
Math may oversimplify economic analysis, but your assertion of missing" messy truths", is a joke. Who says? Give us an example of messy truth generally acknowledged. Surely you can do better than that. Is it Just a cover for your preconceptions?

Excess confidence in the Financial markets is hard to judge. "Excess" is not exactly precise. And you failed to mention that had the markets been free of regulation, much of the distortion you now regret might not have happened. We call that humility. Try some. I could carry that much further, but your use of Excess must show that you do see some Confidence in market processes is justified. Which exactly? Don't join the dark side because you feel magnanimous towards the current attacks on market processes. The attacks are wrong for the most part.

The limits of Macroeconomics are all to obvious since aside from some national accounting framework, it mostly a religion with few strictures. I am always sure that my doctoral students who are power Hungary will gravitate in that direction since in macro opinion is everything and interest in rigor just insecurity, e.g. Krugman. Macro is still a science aborning and Ben B's interests ought to be of great concern since he is a banker for the most part, not a political economist, or is that questionable?

My experience in Washington as an economist was always a let down since consistency and adherence to rigorous analysis was never popular, and where compromise, wink and nod (the short run) was everything. Don't discard behavioral economics, but remember it was first called sociology, and still probably should be called sociology. ]]> http://seekingalpha.com/article/160285-essay-on-macroeconomics-where-krugman-fails?source=feed#comment-665401 665401
Krugman is harmless since he lives among the socialists at Princeton who as a group favor any government action, and criticize any private actions in the market. It is the mantra of the economics department. At root the department harbor deep fears that private capitalists may actually have gotten something to work better than the Fabian socialists of 1850. They waste no time attempting to prove that government and people like themselves are better than any market for the important social decisions. And they are wrong. That is all. ]]> Mon, 07 Sep 2009 14:56:14 -0400
Krugman is harmless since he lives among the socialists at Princeton who as a group favor any government action, and criticize any private actions in the market. It is the mantra of the economics department. At root the department harbor deep fears that private capitalists may actually have gotten something to work better than the Fabian socialists of 1850. They waste no time attempting to prove that government and people like themselves are better than any market for the important social decisions. And they are wrong. That is all. ]]> http://seekingalpha.com/article/160277-joe-klein-is-wrong-about-krugman-s-numbers?source=feed#comment-665387 665387
" Paul's was not an attempt to take some numbers from one survey and some from another to make a political position look good, but rather to do the reverse: to combine the numbers from two different surveys in a consistent and coherent way."

The intent is all in the eye of the beholder. By the way, why all the water carrying for Krugman? He is not running for office is he, and his views on labor and employment are history, so what is your gig all about? Just rattling your cage? ]]> Mon, 07 Sep 2009 14:41:39 -0400
" Paul's was not an attempt to take some numbers from one survey and some from another to make a political position look good, but rather to do the reverse: to combine the numbers from two different surveys in a consistent and coherent way."

The intent is all in the eye of the beholder. By the way, why all the water carrying for Krugman? He is not running for office is he, and his views on labor and employment are history, so what is your gig all about? Just rattling your cage? ]]> http://seekingalpha.com/article/160161-correlation-between-average-weekly-hours-retail-sales-as-fraction-of-disposable-income?source=feed#comment-664583 664583 What follows? Anything?]]> Sun, 06 Sep 2009 19:24:53 -0400 What follows? Anything?]]> http://seekingalpha.com/article/160188-unemployment-casts-a-long-shadow-over-economic-recovery?source=feed#comment-664544 664544
The numbers are god awful, but that is hardly news. What matters is what is done. We need action on jobs now.]]> Sun, 06 Sep 2009 19:14:14 -0400
The numbers are god awful, but that is hardly news. What matters is what is done. We need action on jobs now.]]> http://seekingalpha.com/article/160228-john-fund-warns-about-america-s-perilous-future?source=feed#comment-664529 664529
The sole way out of the thicket is to cut taxes and hope for a major surge in output. That leaves only the problem of who buys it.

Keep going, you might get there. ]]> Sun, 06 Sep 2009 19:01:36 -0400
The sole way out of the thicket is to cut taxes and hope for a major surge in output. That leaves only the problem of who buys it.

Keep going, you might get there. ]]> http://seekingalpha.com/article/160169-top-10-components-of-the-dow-jones-u-s-economic-stimulus-index?source=feed#comment-664521 664521 Sun, 06 Sep 2009 18:46:54 -0400 http://seekingalpha.com/article/160218-deficit-spending-is-fueling-the-recovery?source=feed#comment-664514 664514
Your work has been marred for some time by your bias, which appears to be combative support for Obama. Second rate work by any test. ]]> Sun, 06 Sep 2009 18:37:20 -0400
Your work has been marred for some time by your bias, which appears to be combative support for Obama. Second rate work by any test. ]]> http://seekingalpha.com/article/159843-the-journey-into-deflation?source=feed#comment-663407 663407
Instead consumers look at their incomes and more to the point, their "permanent income hypothesis". How much permanent income do I expect over the relevant horizon? Most consumers are income oriented and not too well aware of prices paid in the broad sense over any given time period. But very interesting. ]]> Sat, 05 Sep 2009 17:40:51 -0400
Instead consumers look at their incomes and more to the point, their "permanent income hypothesis". How much permanent income do I expect over the relevant horizon? Most consumers are income oriented and not too well aware of prices paid in the broad sense over any given time period. But very interesting. ]]>