Roadrunner that is so true, the money will not be there to buy it back and the time is near. ...they think they can make it up in taxes from people who are not working or make minimum wage....the people running these cities and states and the nation are totally nuts! They think they can keep giving freeebies to the world and keep taxing but those days will soon be over.
America has been RAPED and RAPED time and time again and just can't take anymore! This Country will look totally different this time next year. Your heating bill is to go up by 52% come winter time, how many people are going to be able to afford the luxury of heat!
<< <i>Fanny and Freddie are carrying a debt level that would require downgrading their bonds 5 levels. They won't be able to raise the tens of Billions needed to cover that. In other words a govt takeover of them seems very plausible with shareholders being left holding the bag.
In 1990, after a huge economic boom in Japan, a Japanese company bought Pebble Beach golf course for $1 billion and everyone decried "America ia for sale. This is outrageous."
10 years later the golf course was back in American hands at a 20% discount. How dumb we Americans are.
Now today we have this story...New York's Chrysler Building Bought by Abu Dhabi Fund . And I am sure we will again hear, "America is for sale. This is outrageous."
Amazing how history repeats. I just wonder how much the discount will be when we buy it back in 10 years?
US Corporations and banks had the money nearly 20 yrs ago to pull off those tricks. Since the advent of the miracle banking economy in the 1990's there will be nothing left that Americans can afford to buy back. Once sold off over the next few years, those assets will be staying with non-Americans. America is for sale to keep paying off the debt of our banks and corporations. This next time there will be no money left to buy anything back (piles of US fiat won't be of much help). The nations (and Bilderbergs) holding the gold, oil, and natural resources will be calling the shots.
roadrunner >>
There is no such thing as, "This time is different". And you are assuming commodity prices will remain high and higher forever. There has never been a commodity bubble that has lasted forever. This time will be no different. Similiar stories of the USA's demise were spread in the last "real" recession in 1991-92. The term "commodity" is used for good reason.
The best cure for high prices is high prices as it always leads to demand destruction and alternative materials. ALWAYS. Gold may for some time become the "currency" of choice, and those who have it will be rewarded, but it will fail soon thereafter. There will never be an economy based on a gold standard as there is not enough gold to go around, unless the global economy shrinks to a fraction of a fraction of its current size, and for this to occur 5 billion people will need to be erased. And if that happens it wont make a damn whether you own gold or not.
The question I ask is..... are the commodities truely in a bubble?
I'm not positive that they are in a bubble (bubble to me implies baseless speculation). I think it still remains to be seen if they are in a bubble, or if it is a for real supply and demand driven scenario.
Regardless of whether it is a bubble or not, if the price of oil comes back down, the rest will follow.
No one here on the forum, including myself has ever said that commodities will rise forever or even for 10-20 years. Where you get that idea is beyond me. What will happen is that gold and commodities will out perform stocks for the next 3-5 years...and it won't be close. What happens after 2013-2015 is anyone's call as to where the chips fall with the bankers and their $1,000 TRILLION in derivatives. Do we get a depression or major recession following the stagflation/hyperinflationary run...and how severe will they be? How far each goes determines how (or if) we recover. What I do think will happen is that hard assets and commodities will experience a new-found appreciation not seen since 1981. And the after-effects of 1971-2013 world-wide fiat will remain with us for a generation after that before the bad taste is fully rinsed out (ie just like the distaste for stocks from 1930-1950). I know this is hard to understand for the under 40-45 crowd who only know perpetually rising stocks, rising 401k's, rising housing prices, and cheap goods/gas/services/commodities. Right now these folks are scratching their heads as to when in 2008 or 2009 that the stock market heads back to 15,000+ because this "commodity" bubble is cramping their life styles.
There is also no guarantee that gold will fall apart after the pending collapse/major devaluation of fiat. Something has to support the next currency. You are assuming that the past 37 years of a pure fiat experiment is the road-map for the next 37 or next 370 years. I say we haven't even seen the next phase as it has never occured in US history....though it has ended very badly for every other leading world power that went down that path. Of that fact we can be certain. Fiat ends badly...always...because it heads to utter worthlessness. There is nothing new under the sun wrt that.
First we rode the backs of Asia and the 3rd world from 1980-1995 to keep our solid life styles intact with little inflation. That inflation staying overseas was predicated on those nations not competing with us. Those days are ending. Then from 1995-2005 we blasted the money supply at 10% per year average. And since then we are approaching 20% per year. The rest of the world is doing much the same. The 100 year wealth transfer to the bankers a that began in 1913 is nearing completion.
Yeah, most commodities will eventually hit bubble stage but not until the banking system and our currency is made right. How many years will that take to sort out the $1 QUAD in derivatives? So far we've probably laundered about 1% of that through the FED and it's buddies as well as losses to investors, cities, and nations. Much work to do. Until then, the commodities "bubble" will expand to keep the currency honest.
If nothing is new with where we've taken our financial system to (ie there is nothing new here), and the solution is right around the corner with the next stock boomlet, please provide a similar time in US history where this occurred. Considering that gold partially backed the currency prior to 1971, and fully backed it prior to 1913, and we had a huge manufacturing and agricultural base prior to 1970, the choices seem pretty limited to me. The only choices being made seem to be get the bankers out of Dodge before the sheeple know they've left.
It does not matter whether a City is a Financial center or Manufacturing Meca...taxes have to be payed, transportation cost have to be met and you still have to pay your taxes and heating bills and your morgage...its all the same, people trying to exist...where you can not make ends meet, the people and Corporations will look for some other place to park!
I think in a short amount of time the Government is expecting an exodus of many Non born Americans...I hope it is the case...but they will keep the Mexicans! Reflecting back to yesterdays change in laws regarding removing monies and assets abroad.
I wonder how long it will be before most people become aware of this new law! I think it will be a financial burden cleansing.
Trouble brewing! It just amazes me how many cameras have been placed along the streets of Chicago and the Suburbs...Big Brother has truly moved in and is watching every move. I believe this to be a good thing to an extent as gangs are rampant here....but then are the gangs what they are interested in mainly or is it our society as a whole..How many people are they going to need to watch all those cameras...if you make an illegal right turn on a red light you won't know about it until you receive a ticket two weeks later in the mail! I like the Idea of the cameras for now...but as soon as our troubled times are over, I would like them removed.
Chicago's easy-cheezy to make ends meet, outrageous sales taxes or no (no sales taxes on coins in IL, btw.) Public transportation of all sorts (ESPECIALLY compared to Detroit!) makes it easy to get around on the cheap. Lotsa bike paths, too. Property taxes are what they are, but are also Fed deductions (I "payed" my taxes last year just fine.) Heating bills? Turn down the thermostat a bit. Sheesh! No more or less difficult to live around here than in any number of places. Have a super day! :-)
“And you are assuming commodity prices will remain high and higher forever.”
“The question I ask is..... are the commodities truely in a bubble?”
How much of the current price increases in commodities are bubbles no one knows, but it seems likely that all commodities will continue to rise as long as the World governments are free to print all the fiat currencies they like in order to fill their socialist mandates.
In addition to government printing of paper we now have a global banking system that has also been allowed to print with abandon all the valueless instruments they choose. I believe this has also happened in order to support worldwide socialist/communists systems that could no longer be funded from real tax revenues.
When the United States had real silver quarters the price of gas was 25 cents a gallon. Now that a quarter of an ounce of silver is worth $4.50 gas is also $4.50 a gallon.
It is not that commodity prices that going to the moon it is the worthless paper money that is going to H*LL.
We are reaping the rewards of a long multi decade period of global socialist/communistic governments and that period must end or the economies of the world will fail one by one. Until that happens commodities will seek new levels to continue to adjust for the printing press.
Trillions of dollars will continue to be lost by investors who invest in paper assets back by nothing while those that invest in hard assets and companies that deal in hard assets will at least preserve their capitol.
It is not necessary for any government to go on a gold standard in order to have a sound currency, but it is necessary for that government to be bound by laws that prohibit the wholesale printing of that currency.
Until such time as we in the United States have a total collapse of our system nothing is going to change and each of us should be ready for that collapse.
This collapse will not be the end of the world, and Americans will not leave in droves with their money, they HAVE NO WHERE TO GO. There are no safe havens on the planet earth at this time.
I don't want to go anywhere else! I love my country and I want it to be the best the world has to offer...I was born here, my forefathers have been here since the 1600's....I am even of American Indian decent....My forefathers are the ones who made this country what it is or was! I want to know when all of this changed, when did we become the suckers to the world! All we have to do is get rid of the infestation which is sucking the very life out of us, make those who come here work just like everyone else with out the help of Social Security, Medicaid, Food Stamps and 5 years of non taxing! This is what has put a strain on us, among all the freebies given the world in so called times of need when we need it right here for our own people! We have starving people here in this country and more will soon follow, why is it that our government will feed a foreign country before it feeds its own? Why does big brother feel the need to watch us 24/7? I know of foreign born Americans (people who live here without citizenship's) who have lived here for 30, 40 years without becoming American citizens, who make money and travel once a year to the Motherland with money tucked under their arms...it makes me sick knowing what they are doing, and up until two days ago I could not do anything about it, for there was no law against it...But today is a new day! Finally the government has woken up to the fact and say they are going to take action, still I wonder how they are going to surveill these actions, for unreported cash has no trail. If foreigners want to stay in American then become an American with the same privileges as an American...no workie no 5 years of non Taxes no Medicare until you retire no Social Security and No Food Stamps! My forefathers came here with nothing, they worked with their bare hands to help build this nation into what it is or was at one time the Greatest Nation on Earth, they didn't get a free ride! Yes it hurts my feelings to think of what we had and what it has become, a new breeding ground for the Third World! To cancel out all the Trillions of American dollars that have been Taken from this country and sit in foreign banks or used to buy properties in the Motherland. Let the Currency Fail, I will welcome it!
<< <i>“ they HAVE NO WHERE TO GO. There are no safe havens on the planet earth at this time." >>
History teaches us that when people have no where to go, and no safe haven...they create a 'safe haven'...often violently and in opposition to existing powers.
Mark Piersall Random Collector www.marksmedals.com
I think the difference in our thoughts is that you are including gold in the commodity basket, whereas I do not. Demand for gold is based on emotion and emotion is not easily destroyed.
Corn, lead, copper, wheat, rice, zinc, oil, ect, are commodities in which demand can erode in the blink of an eye or new supply can be put on the market within 1 year. Prices for these either are or have been clearly in bubble stage. Economies which are based on these commodities will suffer greatly. As these economies collapse so will their underlying currencies and an alternative will be sought out--probably gold. The US dollar, UK pound, and Euro are certainly not seen favorably and have created demand for gold which has held strong.
I believe you and I both have the same assumptions for the price of gold, but we vastly differ on the reasons for its movement.
Safe havens, yes there is...it is what some used during the Great Depression, and it was a legal way and can still be used today....but there will be a war between the haves and have nots. It will get real nasty so prepare to defend yourself!
Safe Haven as far as keeping from bodily harm...best thing to do is group...no real shelter from that unless you build a fort underground.
<< <i>“ they HAVE NO WHERE TO GO. There are no safe havens on the planet earth at this time." >>
History teaches us that when people have no where to go, and no safe haven...they create a 'safe haven'...often violently and in opposition to existing powers. >>
Well, it happened once and then within 100 years started to shed those original ideas.
comparing the price of oil, USD index (there wasn't the same one or anyting back then?) inflation and gold???
so many htings have changed with how the data is computed and possibly procured and manipulated. it's all above my head yet, i guess i'm looking for someone to say....that it is not comparable or it is comparable and what if any weight can be placed on the comparison??
just opinions are okay from the sage here, even a quip from Bear is respected of course.
“I don't want to go anywhere else! I love my country and I want it to be the best the world has to offer...I was born here, my forefathers have been here since the 1600's..………..”
dlimb2 This should be the post of the day!
The United States is still the very best place on the planet to be alive, and it will continue to be as we lose our complacency and get back to business.
Our single only problem the last few decades is that we did so well as a nation, and we are so giving a people, that we forgot how our great country got to where it is.
Peoples lives are busy, and we expected our elected leaders to take care of things, we got complacent and they are now out of control.
Most of us are asleep at the wheel, but a wakeup call is coming, and when it does there will be Hades to pay.
We here in this thread and many others across the nation are beginning to wake up, the crisis of mismanagement is beginning to effect peoples daily lives and when the people become fully alert to all that has happened, big changes will be on the way!
Regarding our ability to prosper in down times, GS...not a problem. We are very innovative as a society and eventhough maybe half of the population is on the dole, the other half (you) is likely well educated, highly motivated, and able to function competively in our current economic and social environment. Sure, it seems unfair that those that can prosper have to pay for the rest but so what, that's what we got. So we have a 30% or so tax rate on our net income, you just have to get your net down through charitable giving and other methods.
By doing charitable cash giving such as dog shelters, food programs, churches, what ever you think is a something that you like seeing prosper, we end up promoting those things we like and feel good about; it gives a sense of goodness. Forget about saving the world, forget about sending your money to foreign countries...you already do, just search US Aid to Foreign Countries, forget about spending money on political contributions...pure waste of resources. Spend your money near you where you can actually see the goodness you spread and you know what or who you are actually benefiting. If you don't have money, give a little time; time is much more valuable than money. Just remember to get your IR S letter so you get your deduction, this is not a game. We have to conserve our individual resources even more now than before. The key is that if you can't actually see your money or your time helping with your own eyes, right now, then you're doing it wrong.
Part of the evolution I forsee is that there is going to be a conspicuous division between those that can and do with those that can't and won't. By deciding how you give, you can have a very direct hand in providing for the success of those things that matter to you. Resources are going to get a lot tighter and that includes public programs. Compassion has it's place and you can decide what that place is and get a tax deduction at the same time...it's all good.
GoldSaint, it was not intended to win the post of the day, it is the truth as I see it and experience it and hope that others have seen it themselves. Yes things must change in order for the United States to return to the way our forefathers intended it to be... there has been a great deal of abuse of our monetary system and our immigration laws as well as our welfare system...if it means our monetary system fails then so be it...corrections need to be made in order to save ourselves, many will leave, that should not have been here in the first place. They will go looking for their free hand outs somewhere else, but they will not find what they have abused here...and I say good riddance! I am for Isolation of our nation in hopes of becoming independent once again...we have everything that is needed to sustain us, we need no one....we are the envy of the World...If we get much weaker, there are counties that would love to walk in an take over and that is what some here had intended while at the same time rolling our monetary and welfare system....they may have us down, but they have not broken our back! I say treat the world as they treat you! We have given enough with no Thanks...The Time is NOW...We have seen the hardest of times and withstood it, and we can again.!
Back before Sept. 11th I was in the grocery store...checking out...two females with garb were in front of me...two carts of food....they paid with Food Stamps...I was outside right after them because I only had a couple of items...a large white New SUV pulls up and they put their groceries into it and climb in...it just burned me up. Between 1999 and 2000, 70,000 foreigners had moved into my neighborhood....the day of Sept. 11th and the week to follow, FBI lead up my street by the Illinois State Police....within two weeks the man hunt was on...3 here from my area tied to Bin Laden and there are more...They are now in prison...Like I have said many times before sometimes things are not always as they seem...The week of Sept 11th was something as I live only 1 mile from their mosk(spelling)...that week told me a lot about the American Spirit...It is alive and well !
This area which I live is lined with stores owned by these people, the signs are in their native tongue, this is how I know.....yep things have gotta change and are just beginning ,may get messy but we are Americans and we got the Spirit around here!
<< <i>“I don't want to go anywhere else! I love my country and I want it to be the best the world has to offer...I was born here, my forefathers have been here since the 1600's..………..”
dlimb2 This should be the post of the day!
The United States is still the very best place on the planet to be alive, and it will continue to be as we lose our complacency and get back to business.
Our single only problem the last few decades is that we did so well as a nation, and we are so giving a people, that we forgot how our great country got to where it is.
Peoples lives are busy, and we expected our elected leaders to take care of things, we got complacent and they are now out of control.
Most of us are asleep at the wheel, but a wakeup call is coming, and when it does there will be Hades to pay.
We here in this thread and many others across the nation are beginning to wake up, the crisis of mismanagement is beginning to effect peoples daily lives and when the people become fully alert to all that has happened, big changes will be on the way! >>
interesting email received....privacy info removed by poster (me)
-----Original Message----- From: United [mailto:email@info.united.com] Sent: Thursday, July 10, 2008 11:06 AM To: (removed) Subject: An open letter to all airline customers
To ensure receipt of our emails, please add email@info.united.com to your Address Book. ============================================================ United(R) ============================================================
Last week, crude oil hit an all-time high of $146, and the skyrocketing cost of fuel is impacting our customers, our employees, the communities we serve, and the economy as a whole. United, and the majority of other major U.S. airlines, are asking our most loyal customers to join us in pushing for legislation to add more transparency and disclosure in the oil markets. Please see the attached open letter from the leaders of the U.S. airline industry.
------------------------------------------------------------ An Open letter to All Airline Customers: ------------------------------------------------------------ Our country is facing a possible sharp economic downturn because of skyrocketing oil and fuel prices, but by pulling together, we can all do something to help now.
For airlines, ultra-expensive fuel means thousands of lost jobs and severe reductions in air service to both large and small communities. To the broader economy, oil prices mean slower activity and widespread economic pain. This pain can be alleviated, and that is why we are taking the extraordinary step of writing this joint letter to our customers. Since high oil prices are partly a response to normal market forces, the nation needs to focus on increased energy supplies and conservation. However, there is another side to this story because normal market forces are being dangerously amplified by poorly regulated market speculation.
Twenty years ago, 21 percent of oil contracts were purchased by speculators who trade oil on paper with no intention of ever taking delivery. Today, oil speculators purchase 66 percent of all oil futures contracts, and that reflects just the transactions that are known. Speculators buy up large amounts of oil and then sell it to each other again and again. A barrel of oil may trade 20-plus times before it is delivered and used; the price goes up with each trade and consumers pick up the final tab. Some market experts estimate that current prices reflect as much as $30 to $60 per barrel in unnecessary speculative costs.
Over seventy years ago, Congress established regulations to control excessive, largely unchecked market speculation and manipulation. However, over the past two decades, these regulatory limits have been weakened or removed. We believe that restoring and enforcing these limits, along with several other modest measures, will provide more disclosure, transparency and sound market oversight. Together, these reforms will help cool the over-heated oil market and permit the economy to prosper.
The nation needs to pull together to reform the oil markets and solve this growing problem.
We need your help. Get more information and contact Congress by visiting StopOilSpeculationNow.com. (removed)
Robert Fornaro Chairman, President and CEO AirTran Airways
Bill Ayer Chairman, President and CEO Alaska Airlines, Inc.
Gerard J. Arpey Chairman, President and CEO American Airlines, Inc.
Lawrence W. Kellner Chairman and CEO Continental Airlines, Inc.
Richard Anderson CEO Delta Air Lines, Inc.
Mark B. Dunkerley President and CEO Hawaiian Airlines, Inc.
Dave Barger CEO JetBlue Airways Corporation
Timothy E. Hoeksema Chairman, President and CEO Midwest Airlines
Douglas M. Steenland President and CEO Northwest Airlines, Inc.
Gary Kelly Chairman and CEO Southwest Airlines Co.
Glenn F. Tilton Chairman, President and CEO United Airlines, Inc.
Douglas Parker Chairman and CEO US Airways Group, Inc.
New York Times By CHARLES DUHIGG Published: July 11, 2008
Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent.
Investors around the world own $5.2 trillion of the debt securities backed by the companies.
For homeowners and home buyers, it is likely that the decline in Fannie’s and Freddie’s stocks will result in higher interest rates on all kinds of loans.
As Fannie’s and Freddie’s stock prices decline and they are forced to issue new bonds at higher interest rates, their old bonds become worth less. And as Fannie’s and Freddie’s old bonds decline in value, the many small and regional banks holding the bonds will likely be forced to declare losses.
Finally, for taxpayers and the United States government, the risks posed by Fannie’s and Freddie’s declining share prices are potentially overwhelming.
If a bailout were to occur, it would most likely make it more expensive for the United States government to borrow money in the future, since the government’s potential obligations, which currently stand at about $9 trillion, would rise by an additional $5 trillion.
Maybe I'm wrong, but aren't the airlines themselves among the "speculators"? I know they do it for business reasons such as to minimize the risk of fuel price increases, but they certainly buy and sell oil futures. The increase from 21% of contracts to 66% that they cite may be due in part to increased demand due to more airline travel. That's good for them, and if anything, they have deregulation to thank for that.
Yes interest rates will probably go higher. And they should. We have been at historically low levels for too long. Thank you Mr. Greenspan. It wont be the end of the USA as interest rates across the globe will also rise by a comensurate amount.
Separately China yesterday announced plans to cut aluminum production to save energy. Perhaps an attempt to clean the air before the olympics, but equally likely that they are tired of subsidizing oil. We were worried about the Chinese having too money, well they are spending it trying to keep their economy going. Chinese citizens may be in for quite a shock in the next 6 months. If oil closes lower today, I believe it will be the end of the rally, barring international conflict. These prices are unsustainable.
the content not the validity ie (urban legend stuff) >>
The part that makes me nervous is the fact they could get all the CEOs to sign a single document, given the incredibly competitive landscape of American Aviation...I wonder what else they agree on en masse?
Last week, crude oil hit an all-time high of $146, and the skyrocketing cost of fuel is impacting our customers, our employees, the communities we serve, and the economy as a whole. United, and the majority of other major U.S. airlines, are asking our most loyal customers to join us in pushing for legislation to add more transparency and disclosure in the oil markets. Please see the attached open letter from the leaders of the U.S. airlineindustry.
They're barking up the wrong tree. Whether you call them speculators, investors, or patriots the cause is solely from the actions of the FED and congress in how they have managed the money supply, credit, and federal "handouts." How about more transparency with the FED, SEC, congress and their favored-son banks, brokerages, and corporations? Did anyone ever think that increasing the money supply by 13X since 1982 would eventually lead to higher prices? Or how about increasing recorded derivatives from under $10 TRILL to over $1,000 TRILLION in a few short years might just cause a negative economic backlash someday?
If you fix that, the rest will fall back in line...eventually.
Separately China yesterday announced plans to cut aluminum production to save energy. Perhaps an attempt to clean the air before the olympics, but equally likely that they are tired of subsidizing oil. We were worried about the Chinese having too money, well they are spending it trying to keep their economy going. Chinese citizens may be in for quite a shock in the next 6 months. If oil closes lower today, I believe it will be the end of the rally, barring international conflict. These prices are unsustainable. >>
Interesting.
Aluminum is more reflective of energy costs than any other commodity except, perhaps, oil and coal. A very large portion of the cost to make an aluminum product is energy. Its price increase to date has really been pretty tame considering. $1.50 / Lb might seem high for aluminum but this stuff is light and a pound goes a very long way.
From what I can see is that oil is the only sure game in town for punters. Maybe a little metal and commodities action but most players are certainly including oil in their investment playing. Money doesn't wait, it's going to go where it can do the most good so call it speculation, call it investing, call it portfolio management, it's being played all over the world and there isn't anything any congress or airline mogul can do about it, money doesn't wait.
the content not the validity ie (urban legend stuff) >>
The part that makes me nervous is the fact they could get all the CEOs to sign a single document, given the incredibly competitive landscape of American Aviation...I wonder what else they agree on en masse? >>
USA will be flying Emirates Air, next year for all international flights
<< <i>the cause is solely from the actions of the FED and congress in how they have managed the money supply, credit, and federal "handouts." >>
I'd also place some blame on those who soldout to the idiot environmental wackos who don't want nuclear, don't want oil drilling, won't let us build another dam , no "coal to oil" and then file lawsuits when they put up solar and wind farms in the desert because they "disturb" the creatures.
If we let this group run the show we will be living back in caves.....those of us that are still alive.
The Germans ran an entire war machine on synthetic oil 60 years ago and we are are held hostage by a bunch of countries that hate us.
The environmentalists need to be told that it's great to be saving the environment, but it's time look out for mankind first.
Actually, I believe a lot of the 'environmental' movement is composed of individuals that are not necessarily trying to save the environment, but rather trying to 'cripple' the US and try to bring the country down..... I think the people of this country need to be opening their eyes.
I believe a lot of the 'environmental' movement is composed of individuals that are not necessarily trying to save the environment, but rather trying to 'cripple' the US and try to bring the country down..... I think the people of this country need to be opening their eyes.
So it seems. And you have to ask just how they got so much power.
Q: Are You Printing Money? Bernanke: Not Literally
The federal government took control of Pasadena-based IndyMac Bank on Friday in what regulators called the second-largest bank failure in U.S. history.
Citing a massive run on deposits at the $32-billion bank, regulators shut its main branch three hours early, leaving customers stunned and upset. One woman leaned on the locked doors, pleading with an employee inside: "Please, please, I want to take out a portion." All she could do was read a two-page notice taped to the door.
Federal authorities said, based on a preliminary analysis, the takeover of IndyMac would cost the FDIC between $4 billion and $8 billion.
The federal government took control of Pasadena-based IndyMac Bank on Friday in what regulators called the second-largest bank failure in U.S. history.
Citing a massive run on deposits at the $32-billion bank, regulators shut its main branch three hours early, leaving customers stunned and upset. One woman leaned on the locked doors, pleading with an employee inside: "Please, please, I want to take out a portion." All she could do was read a two-page notice taped to the door.
Federal authorities said, based on a preliminary analysis, the takeover of IndyMac would cost the FDIC between $4 billion and $8 billion.
One of the best reads of the year imo. Normally aticles that mention anything about bond yields makes my head spin. But this one concisely dissects our current economic issues and includes the "why" as well. Jim Willie comes up with some interesting conclusions along the way. Some of that analysis finally made sense to things I had been seeing for a long time but never quite understood the "why" of it. A must 15 minute read as to how we put ourselves here and why it's going to continue for the foreseeable future as bond yields stay low.
A short summary of the first 7000 posts and it concentrates more on the FED, banks, and our linkage with the world than it does on bond yields.
"The top five foreign holders of Freddie and Fannie long-term debt are China, Japan, the Cayman Islands, Luxembourg, and Belgium. In total foreign investors hold over $1.3 trillion in these agency bonds, according to the U.S. Treasury's most recent "Report on Foreign Portfolio Holdings of U.S. Securities."
"The prospectus for every GSE bond clearly states that it is not backed by the United States government. That's why investors holding agency bonds already receive a significant risk premium over Treasuries."
We should all be outraged if our taxpayers are forced to bail out foreign governments.
"Men who had never shown any ability to make or increase fortunes for themselves abounded in brilliant plans for creating and increasing wealth for the country at large." Fiat Money Inflation in France, Andrew Dickson White (1912)
Comments
America has been RAPED and RAPED time and time again and just can't take anymore! This Country will look totally different this time next year. Your heating bill is to go up by 52% come winter time, how many people are going to be able to afford the luxury of heat!
<< <i>Fanny and Freddie are carrying a debt level that would require downgrading their bonds 5 levels. They won't be able to raise the tens of Billions needed to cover that. In other words a govt takeover of them seems very plausible with shareholders being left holding the bag.
In 1990, after a huge economic boom in Japan, a Japanese company bought Pebble Beach golf course for $1 billion and everyone decried "America ia for sale. This is outrageous."
10 years later the golf course was back in American hands at a 20% discount. How dumb we Americans are.
Now today we have this story...New York's Chrysler Building Bought by Abu Dhabi Fund . And I am sure we will again hear, "America is for sale. This is outrageous."
Amazing how history repeats. I just wonder how much the discount will be when we buy it back in 10 years?
US Corporations and banks had the money nearly 20 yrs ago to pull off those tricks. Since the advent of the miracle banking economy in the 1990's there will be nothing left that Americans can afford to buy back. Once sold off over the next few years, those assets will be staying with non-Americans. America is for sale to keep paying off the debt of our banks and corporations. This next time there will be no money left to buy anything back (piles of US fiat won't be of much help). The nations (and Bilderbergs) holding the gold, oil, and natural resources will be calling the shots.
roadrunner >>
There is no such thing as, "This time is different". And you are assuming commodity prices will remain high and higher forever. There has never been a commodity bubble that has lasted forever. This time will be no different. Similiar stories of the USA's demise were spread in the last "real" recession in 1991-92. The term "commodity" is used for good reason.
The best cure for high prices is high prices as it always leads to demand destruction and alternative materials. ALWAYS. Gold may for some time become the "currency" of choice, and those who have it will be rewarded, but it will fail soon thereafter. There will never be an economy based on a gold standard as there is not enough gold to go around, unless the global economy shrinks to a fraction of a fraction of its current size, and for this to occur 5 billion people will need to be erased. And if that happens it wont make a damn whether you own gold or not.
Knowledge is the enemy of fear
I'm not positive that they are in a bubble (bubble to me implies baseless speculation). I think it still remains to be seen if they are in a bubble, or if it is a for real supply and demand driven scenario.
Regardless of whether it is a bubble or not, if the price of oil comes back down, the rest will follow.
How far each goes determines how (or if) we recover. What I do think will happen is that hard assets and commodities will experience a new-found appreciation not seen since 1981. And the after-effects of 1971-2013 world-wide fiat will remain with us for a generation after that before the bad taste is fully rinsed out (ie just like the distaste for stocks from 1930-1950). I know this is hard to understand for the under 40-45 crowd who only know perpetually rising stocks, rising 401k's, rising housing prices, and cheap goods/gas/services/commodities. Right now these folks are scratching their heads as to when in 2008 or 2009 that the stock market heads back to 15,000+ because this "commodity" bubble is cramping their life styles.
There is also no guarantee that gold will fall apart after the pending collapse/major devaluation of fiat. Something has to support the next currency. You are assuming that the past 37 years of a pure fiat experiment is the road-map for the next 37 or next 370 years. I say we haven't even seen the next phase as it has never occured in US history....though it has ended very badly for every other leading world power that went down that path. Of that fact we can be certain. Fiat ends badly...always...because it heads to utter worthlessness. There is nothing new under the sun wrt that.
First we rode the backs of Asia and the 3rd world from 1980-1995 to keep our solid life styles intact with little inflation. That inflation staying overseas was predicated on those nations not competing with us. Those days are ending. Then from 1995-2005 we blasted the money supply at 10% per year average. And since then we are approaching 20% per year. The rest of the world is doing much the same. The 100 year wealth transfer to the bankers a that began in 1913 is nearing completion.
Yeah, most commodities will eventually hit bubble stage but not until the banking system and our currency is made right. How many years will that take to sort out the $1 QUAD in derivatives? So far we've probably laundered about 1% of that through the FED and it's buddies as well as losses to investors, cities, and nations. Much work to do. Until then, the commodities "bubble" will expand to keep the currency honest.
If nothing is new with where we've taken our financial system to (ie there is nothing new here), and the solution is right around the corner with the next stock boomlet, please provide a similar time in US history where this occurred. Considering that gold partially backed the currency prior to 1971, and fully backed it prior to 1913, and we had a huge manufacturing and agricultural base prior to 1970, the choices seem pretty limited to me. The only choices being made seem to be get the bankers out of Dodge before the sheeple know they've left.
roadrunner
America and China: The Eagle and the Dragon-
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
are trying to contain the potential disaster or at least delay it untill
the big boys have unloaded there cough. cough investments on the
suckers of the world. The problem with this idea is that the USA no longer
has the wealth for a full bale out and the world is becoming leery of pouring
good money after bad. I do believe that one quadrillion in financial instruments of
dubious quality and unknown underlying value ,is proving just a tad too big to sweep
under the rug. If I am right, then the very worst is yet to come. I truly hope that I am
totally wrong and that everything does work out as I am getting too old to sell apples
on a street corner.
Camelot
I wonder how long it will be before most people become aware of this new law! I think it will be a financial burden cleansing.
When the easy money is gone, the party is over.
<< <i> the Government is expecting an exodus of many Non born Americans >>
Where are these fetuses in utero going to go and how will they get there?
<< <i> I hope it is the case >>
Why do you hate Americans who haven't even been born yet?
<< <i>.but they will keep the Mexicans! >>
Are these born Mexicans or unborn Mexicans?
How will the exodus of these non-borns effect the price of gold and silver? This is too deep for me.
CG
“And you are assuming commodity prices will remain high and higher forever.”
“The question I ask is..... are the commodities truely in a bubble?”
How much of the current price increases in commodities are bubbles no one knows, but it seems likely that all commodities will continue to rise as long as the World governments are free to print all the fiat currencies they like in order to fill their socialist mandates.
In addition to government printing of paper we now have a global banking system that has also been allowed to print with abandon all the valueless instruments they choose. I believe this has also happened in order to support worldwide socialist/communists systems that could no longer be funded from real tax revenues.
When the United States had real silver quarters the price of gas was 25 cents a gallon. Now that a quarter of an ounce of silver is worth $4.50 gas is also $4.50 a gallon.
It is not that commodity prices that going to the moon it is the worthless paper money that is going to H*LL.
We are reaping the rewards of a long multi decade period of global socialist/communistic governments and that period must end or the economies of the world will fail one by one. Until that happens commodities will seek new levels to continue to adjust for the printing press.
Trillions of dollars will continue to be lost by investors who invest in paper assets back by nothing while those that invest in hard assets and companies that deal in hard assets will at least preserve their capitol.
It is not necessary for any government to go on a gold standard in order to have a sound currency, but it is necessary for that government to be bound by laws that prohibit the wholesale printing of that currency.
Until such time as we in the United States have a total collapse of our system nothing is going to change and each of us should be ready for that collapse.
This collapse will not be the end of the world, and Americans will not leave in droves with their money, they HAVE NO WHERE TO GO. There are no safe havens on the planet earth at this time.
My forefathers came here with nothing, they worked with their bare hands to help build this nation into what it is or was at one time the Greatest Nation on Earth, they didn't get a free ride! Yes it hurts my feelings to think of what we had and what it has become, a new breeding ground for the Third World! To cancel out all the Trillions of American dollars that have been Taken from this country and sit in foreign banks or used to buy properties in the Motherland. Let the Currency Fail, I will welcome it!
<< <i>“ they HAVE NO WHERE TO GO. There are no safe havens on the planet earth at this time." >>
History teaches us that when people have no where to go, and no safe haven...they create a 'safe haven'...often violently and in opposition to existing powers.
Random Collector
www.marksmedals.com
I think the difference in our thoughts is that you are including gold in the commodity basket, whereas I do not. Demand for gold is based on emotion and emotion is not easily destroyed.
Corn, lead, copper, wheat, rice, zinc, oil, ect, are commodities in which demand can erode in the blink of an eye or new supply can be put on the market within 1 year. Prices for these either are or have been clearly in bubble stage. Economies which are based on these commodities will suffer greatly. As these economies collapse so will their underlying currencies and an alternative will be sought out--probably gold. The US dollar, UK pound, and Euro are certainly not seen favorably and have created demand for gold which has held strong.
I believe you and I both have the same assumptions for the price of gold, but we vastly differ on the reasons for its movement.
Knowledge is the enemy of fear
Safe Haven as far as keeping from bodily harm...best thing to do is group...no real shelter from that unless you build a fort underground.
<< <i>
<< <i>“ they HAVE NO WHERE TO GO. There are no safe havens on the planet earth at this time." >>
History teaches us that when people have no where to go, and no safe haven...they create a 'safe haven'...often violently and in opposition to existing powers. >>
Well, it happened once and then within 100 years started to shed those original ideas.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>Mr. Earlygold...nice article on dragon and eagle. >>
Interesting differences aren't they?
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
comparing the price of oil, USD index (there wasn't the same one or anyting back then?) inflation and gold???
so many htings have changed with how the data is computed and possibly procured and manipulated. it's all above my head yet, i guess i'm looking for someone to say....that it is not comparable or it is comparable and what if any weight can be placed on the comparison??
just opinions are okay from the sage here, even a quip from Bear
gold
widely used inflation gauge. The actual numbers dont really matter, but rather the direction and speed of direction
dollar index
Knowledge is the enemy of fear
“I don't want to go anywhere else! I love my country and I want it to be the best the world has to offer...I was born here, my forefathers have been here since the 1600's..………..”
dlimb2
This should be the post of the day!
The United States is still the very best place on the planet to be alive, and it will continue to be as we lose our complacency and get back to business.
Our single only problem the last few decades is that we did so well as a nation, and we are so giving a people, that we forgot how our great country got to where it is.
Peoples lives are busy, and we expected our elected leaders to take care of things, we got complacent and they are now out of control.
Most of us are asleep at the wheel, but a wakeup call is coming, and when it does there will be Hades to pay.
We here in this thread and many others across the nation are beginning to wake up, the crisis of mismanagement is beginning to effect peoples daily lives and when the people become fully alert to all that has happened, big changes will be on the way!
Regarding our ability to prosper in down times, GS...not a problem. We are very innovative as a society and eventhough maybe half of the population is on the dole, the other half (you) is likely well educated, highly motivated, and able to function competively in our current economic and social environment. Sure, it seems unfair that those that can prosper have to pay for the rest but so what, that's what we got. So we have a 30% or so tax rate on our net income, you just have to get your net down through charitable giving and other methods.
By doing charitable cash giving such as dog shelters, food programs, churches, what ever you think is a something that you like seeing prosper, we end up promoting those things we like and feel good about; it gives a sense of goodness. Forget about saving the world, forget about sending your money to foreign countries...you already do, just search US Aid to Foreign Countries, forget about spending money on political contributions...pure waste of resources. Spend your money near you where you can actually see the goodness you spread and you know what or who you are actually benefiting. If you don't have money, give a little time; time is much more valuable than money. Just remember to get your IR S letter so you get your deduction, this is not a game. We have to conserve our individual resources even more now than before. The key is that if you can't actually see your money or your time helping with your own eyes, right now, then you're doing it wrong.
Part of the evolution I forsee is that there is going to be a conspicuous division between those that can and do with those that can't and won't. By deciding how you give, you can have a very direct hand in providing for the success of those things that matter to you. Resources are going to get a lot tighter and that includes public programs. Compassion has it's place and you can decide what that place is and get a tax deduction at the same time...it's all good.
This area which I live is lined with stores owned by these people, the signs are in their native tongue, this is how I know.....yep things have gotta change and are just beginning ,may get messy but we are Americans and we got the Spirit around here!
<< <i>“I don't want to go anywhere else! I love my country and I want it to be the best the world has to offer...I was born here, my forefathers have been here since the 1600's..………..”
dlimb2
This should be the post of the day!
The United States is still the very best place on the planet to be alive, and it will continue to be as we lose our complacency and get back to business.
Our single only problem the last few decades is that we did so well as a nation, and we are so giving a people, that we forgot how our great country got to where it is.
Peoples lives are busy, and we expected our elected leaders to take care of things, we got complacent and they are now out of control.
Most of us are asleep at the wheel, but a wakeup call is coming, and when it does there will be Hades to pay.
We here in this thread and many others across the nation are beginning to wake up, the crisis of mismanagement is beginning to effect peoples daily lives and when the people become fully alert to all that has happened, big changes will be on the way! >>
Very well said. I hope you're right!
-----Original Message-----
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An open letter to all airline customers
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Dear XXXXXXXXX, (removed)
Last week, crude oil hit an all-time high of $146, and the skyrocketing
cost of fuel is impacting our customers, our employees, the communities
we serve, and the economy as a whole. United, and the majority of other
major U.S.
airlines, are asking our most loyal customers to join us in pushing for
legislation to add more transparency and disclosure in the oil markets.
Please see the attached open letter from the leaders of the U.S.
airline
industry.
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An Open letter to All Airline Customers:
------------------------------------------------------------
Our country is facing a possible sharp economic downturn because of
skyrocketing oil and fuel prices, but by pulling together, we can all
do
something to help now.
For airlines, ultra-expensive fuel means thousands of lost jobs and
severe reductions in air service to both large and small communities.
To
the broader economy, oil prices mean slower activity and widespread
economic pain.
This pain can be alleviated, and that is why we are taking the
extraordinary step of writing this joint letter to our customers. Since
high oil prices are partly a response to normal market forces, the
nation needs to focus on increased energy supplies and conservation.
However, there is another side to this story because normal market
forces are being dangerously amplified by poorly regulated market
speculation.
Twenty years ago, 21 percent of oil contracts were purchased by
speculators who trade oil on paper with no intention of ever taking
delivery. Today, oil speculators purchase 66 percent of all oil futures
contracts, and that reflects just the transactions that are known.
Speculators buy up large amounts of oil and then sell it to each other
again and again. A barrel of oil may trade 20-plus times before it is
delivered and used; the price goes up with each trade and consumers
pick
up the final tab. Some market experts estimate that current prices
reflect as much as $30 to $60 per barrel in unnecessary speculative
costs.
Over seventy years ago, Congress established regulations to control
excessive, largely unchecked market speculation and manipulation.
However, over the past two decades, these regulatory limits have been
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The nation needs to pull together to reform the oil markets and solve
this growing problem.
We need your help. Get more information and contact Congress by
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New York Times
By CHARLES DUHIGG
Published: July 11, 2008
Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent.
Investors around the world own $5.2 trillion of the debt securities backed by the companies.
For homeowners and home buyers, it is likely that the decline in Fannie’s and Freddie’s stocks will result in higher interest rates on all kinds of loans.
As Fannie’s and Freddie’s stock prices decline and they are forced to issue new bonds at higher interest rates, their old bonds become worth less. And as Fannie’s and Freddie’s old bonds decline in value, the many small and regional banks holding the bonds will likely be forced to declare losses.
Finally, for taxpayers and the United States government, the risks posed by Fannie’s and Freddie’s declining share prices are potentially overwhelming.
If a bailout were to occur, it would most likely make it more expensive for the United States government to borrow money in the future, since the government’s potential obligations, which currently stand at about $9 trillion, would rise by an additional $5 trillion.
Maybe I'm wrong, but aren't the airlines themselves among the "speculators"? I know they do it for business reasons such as to minimize the risk of fuel price increases, but they certainly buy and sell oil futures. The increase from 21% of contracts to 66% that they cite may be due in part to increased demand due to more airline travel. That's good for them, and if anything, they have deregulation to thank for that.
That letter is a bunch of BS.
Goldsaint,
Yes interest rates will probably go higher. And they should. We have been at historically low levels for too long. Thank you Mr. Greenspan. It wont be the end of the USA as interest rates across the globe will also rise by a comensurate amount.
Separately China yesterday announced plans to cut aluminum production to save energy. Perhaps an attempt to clean the air before the olympics, but equally likely that they are tired of subsidizing oil. We were worried about the Chinese having too money, well they are spending it trying to keep their economy going. Chinese citizens may be in for quite a shock in the next 6 months. If oil closes lower today, I believe it will be the end of the rally, barring international conflict. These prices are unsustainable.
Knowledge is the enemy of fear
<< <i>57unloaded,
That letter is a bunch of BS.
>>
the content not the validity ie (urban legend stuff)
<< <i>
<< <i>57unloaded,
That letter is a bunch of BS.
>>
the content not the validity ie (urban legend stuff) >>
The part that makes me nervous is the fact they could get all the CEOs to sign a single document, given the incredibly competitive landscape of American Aviation...I wonder what else they agree on en masse?
cost of fuel is impacting our customers, our employees, the communities
we serve, and the economy as a whole. United, and the majority of other
major U.S. airlines, are asking our most loyal customers to join us in pushing for
legislation to add more transparency and disclosure in the oil markets.
Please see the attached open letter from the leaders of the U.S.
airlineindustry.
They're barking up the wrong tree. Whether you call them speculators, investors, or patriots the cause is solely from the actions of the FED and congress in how they have managed the money supply, credit, and federal "handouts." How about more transparency with the FED, SEC, congress and their favored-son banks, brokerages, and corporations? Did anyone ever think that increasing the money supply by 13X since 1982 would eventually lead to higher prices? Or how about increasing recorded derivatives from under $10 TRILL to over $1,000 TRILLION in a few short years might just cause a negative economic backlash someday?
If you fix that, the rest will fall back in line...eventually.
roadrunner
<< <i>
Separately China yesterday announced plans to cut aluminum production to save energy. Perhaps an attempt to clean the air before the olympics, but equally likely that they are tired of subsidizing oil. We were worried about the Chinese having too money, well they are spending it trying to keep their economy going. Chinese citizens may be in for quite a shock in the next 6 months. If oil closes lower today, I believe it will be the end of the rally, barring international conflict. These prices are unsustainable. >>
Interesting.
Aluminum is more reflective of energy costs than any other commodity except, perhaps,
oil and coal. A very large portion of the cost to make an aluminum product is energy. Its
price increase to date has really been pretty tame considering. $1.50 / Lb might seem
high for aluminum but this stuff is light and a pound goes a very long way.
<< <i>
<< <i>
<< <i>57unloaded,
That letter is a bunch of BS.
>>
the content not the validity ie (urban legend stuff) >>
The part that makes me nervous is the fact they could get all the CEOs to sign a single document, given the incredibly competitive landscape of American Aviation...I wonder what else they agree on en masse? >>
USA will be flying Emirates Air, next year for all international flights
but the stewardesses are really hot!
<< <i>
USA will be flying Emirates Air, next year for all international flights
but the stewardesses are really hot! >>
Yeah....OK
My icon IS my coin. It is a gem 1949 FBL Franklin.
I'm likin' the second one in on the right.
<< <i>USA will be flying Emirates Air, next year for all international flights
but the stewardesses are really hot! >>
If you had to wear all that stuff to conceal yourself in a hot Middle East summer, you'd be hot, too.
<< <i>"Yeah....OK"
I'm likin' the second one in on the right. >>
i know you didn't mean this but i want the one on the far right
<< <i>the cause is solely from the actions of the FED and congress in how they have managed the money supply, credit, and federal "handouts." >>
I'd also place some blame on those who soldout to the idiot environmental wackos who don't want nuclear, don't want oil drilling, won't let us build another dam , no "coal to oil" and then file lawsuits when they put up solar and wind farms in the desert because they "disturb" the creatures.
If we let this group run the show we will be living back in caves.....those of us that are still alive.
The Germans ran an entire war machine on synthetic oil 60 years ago and we are are held hostage by a bunch of countries that hate us.
This is crazy.
Actually, I believe a lot of the 'environmental' movement is composed of individuals that are not necessarily trying to save the environment, but rather trying to 'cripple' the US and try to bring the country down..... I think the people of this country need to be opening their eyes.
So it seems. And you have to ask just how they got so much power.
I knew it would happen.
The federal government took control of Pasadena-based IndyMac Bank on Friday in what regulators called the second-largest bank failure in U.S. history.
Citing a massive run on deposits at the $32-billion bank, regulators shut its main branch three hours early, leaving customers stunned and upset. One woman leaned on the locked doors, pleading with an employee inside: "Please, please, I want to take out a portion." All she could do was read a two-page notice taped to the door.
Federal authorities said, based on a preliminary analysis, the takeover of IndyMac would cost the FDIC between $4 billion and $8 billion.
IndyMac Bank seized by federal regulators
<< <i>Bank run, anyone?
The federal government took control of Pasadena-based IndyMac Bank on Friday in what regulators called the second-largest bank failure in U.S. history.
Citing a massive run on deposits at the $32-billion bank, regulators shut its main branch three hours early, leaving customers stunned and upset. One woman leaned on the locked doors, pleading with an employee inside: "Please, please, I want to take out a portion." All she could do was read a two-page notice taped to the door.
Federal authorities said, based on a preliminary analysis, the takeover of IndyMac would cost the FDIC between $4 billion and $8 billion.
IndyMac Bank seized by federal regulators >>
Somebody on Nighline just said to not worry about any of that. That Freddie and Fannie are TOO BIG to fail.
They're down what, 80% in a year? To big to fail?
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
One of the best reads of the year imo. Normally aticles that mention anything about bond yields makes my head spin. But this one concisely dissects our current economic issues and includes the "why" as well. Jim Willie comes up with some interesting conclusions along the way. Some of that analysis finally made sense to things I had been seeing for a long time but never quite understood the "why" of it. A must 15 minute read as to how we put ourselves here and why it's going to continue for the foreseeable future as bond yields stay low.
A short summary of the first 7000 posts and it concentrates more on the FED, banks, and our linkage with the world than it does on bond yields.
roadrunner
"The top five foreign holders of Freddie and Fannie long-term debt are China, Japan, the Cayman Islands, Luxembourg, and Belgium. In total foreign investors hold over $1.3 trillion in these agency bonds, according to the U.S. Treasury's most recent "Report on Foreign Portfolio Holdings of U.S. Securities."
"The prospectus for every GSE bond clearly states that it is not backed by the United States government. That's why investors holding agency bonds already receive a significant risk premium over Treasuries."
We should all be outraged if our taxpayers are forced to bail out foreign governments.