<< <i>A couple of interesting things today first this,
BERG v. OBAMA ; WE THE PEOPLE - USA TODAY FULL PAGE Article 26kb
Two BREAKING NEWS DEVELOPMENTS - BERG v. OBAMA ; WE THE PEOPLE - USA TODAY FULL PAGE Article
Pass this one on far and wide. Its the truth. Produce or withdraw. Friday, November 7, 2008 BREAKING: Two Developments NUMBER ONE
If The Supreme Court Decides...?
At this point, Supreme Court Justice David Souter's Clerk informed Philip J. Berg, the lawyer who brought the case against Obama, that his petition for an injunction to stay the November 4th election was denied, but the Clerk also required the defendants to respond to the Writ of Certiorari (which requires the concurrence of four Justices) by December 1. At that time, Mr. Obama must present to the Court an authentic birth certificate, after which Mr. Berg will respond.
If Obama fails to do that, it is sure to inspire the skepticism of the Justices, who are unaccustomed to being defied. They will have to decide what to do about a president-elect who refuses to prove his natural-born citizenship.
"I can see a unanimous Court (en banc) decertifying the election if Obama refuses to produce his birth certificate," says Raymond S. Kraft, an attorney and writer. "They cannot do otherwise without abandoning all credibility as guardians of the Constitution. Even the most liberal justices, however loathe they may to do this, still consider themselves guardians of the Constitution. The Court is very jealous of its power - even over presidents, even over presidents-elect."
Also remember that on December 13, the Electoral College meets to casts its votes. If it has been determined that Mr. Obama is an illegal alien and therefore ineligible to become President of the United States , the Electors will be duty-bound to honor the Constitution. >>
In addition, 24 of the electors in the Electoral College have also filed suit.
It's far from a laughing matter.
Deadhorse, where did you find the 24 electorates filing suit?
I've be following this since the summer and find it fascinating.
Being naturalized myself and having adopted two children with "certificates of living birth" I've had a lot of dealings with the state department to become a legal citizen. The process is so long and painful it's no wonder people come here illegally.
<< <i>I never hear of manipulation when the price goes up. No sir. That is fundamentals. When it goes down it is manipulation. >>
You want to see manipulation up?
Just wait till the Decmeber COMEX futures are due. Are they going to let their baskets go at around $10 when the investors know it's worth 40% more in the real world? India would pay 60% more just to get it and they'd gladly pay the shipping.
Watch and see what happens with the upturn in silver and gold to a lesser degree in the next three weeks+. It will again get tomahawked in mid-December.
Several of us old timers, barbaric, wannabe gurus,(have I correctly counted up your degrading names for us?) have watched this phenomona many times before.
When that happens are you going to call it upward manipulation, which it is, or are you going to have another excuse?
I'm calling it well in advance, I could be wrong, but I'm willing to put it up in public. I'll fade the heat if I am wrong, but rest assured I never brag on a public forum when I am correct.
A lesson that probably should be taken to heart by some of our younger "instant gurus".
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>Deadhorse, where did you find the 24 electorates filing suit? >>
I hosestly don't remember. It came out last week in a story relating to Berg's lawsuit.
I found it very interesting as it seems this thing now has real legs. Electors coming before the Supreme Court is a first in US history.
No idea where the funds are goming from, that wasn't stated. Could be Berg's lawyers taking it pro bono, I just don't know.
Could have been the WSJ, IBD or a few other sources.
It sure didn't come from the MSM!!
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>I never hear of manipulation when the price goes up. No sir. That is fundamentals. When it goes down it is manipulation. >>
You want to see manipulation up?
Just wait till the Decmeber COMEX futures are due. Are they going to let their baskets go at around $10 when the investors know it's worth 40% more in the real world? India would pay 60% more just to get it and they'd gladly pay the shipping.
Watch and see what happens with the upturn in silver and gold to a lesser degree in the next three weeks+. It will again get tomahawked in mid-December.
Several of us old timers, barbaric, wannabe gurus,(have I correctly counted up your degrading names for us?) have watched this phenomona many times before.
When that happens are you going to call it upward manipulation, which it is, or are you going to have another excuse?
I'm calling it well in advance, I could be wrong, but I'm willing to put it up in public. I'll fade the heat if I am wrong, but rest assured I never brag on a public forum when I am correct.
A lesson that probably should be taken to heart by some of our younger "instant gurus". >>
I can only make the claim to wannabe as far as degrading names go and I think it is quite accurate. I fall into the same category myself I just tend to use facts to back up my guesses instead of mythical tales of manipulation and conspiracy.
1. oil is 57 bucks a barrel. 2. all other commodities have fallen. 3. industry is cratering thus demand has fallen sharply. 4. outlook for the short term is bearish due to the economy. 5. deflation appears to be taking place instead of inflation for now. 6. etc..
All explain why gold and silver have fallen and probably need more time to recover. I do not go around on a chat board preaching tin foil hat tales. Saying these things means you lose a lot of credibility in my mind. Thus wannabe is appropriate. Other posters try to come up with more factual explanations but they get drowned in the sheer amount of gold bug theories.
Gold having a run up over the last seven years gives the gold bugs a lot of credibility right now is many people's eyes but to me that is not good enough. Many folks figured that PMs were due for a run and bailed when it appeared to be the right time. All the while gold pundits were calling for new extreme highs and were so wrong it is painful to think about.
What good is this awesome bump up you speak of, lets say to 900 gold and 15 silver... when they sold at more then that? To me that is the sign of a dead cat bounce and when it falls again it will slowly beat out the bullishness of speculators who think gold/silver can be a quick way to doubling your money. Maybe in a few years new highs will be tested again but I doubt it. The big money will look for greener pastures as they always tend to do once they bail.
As for not bragging who cares? Your posts tend to show your confidence and you often mention how well you have done. I do not go around and say you brag. How pointless. Once again trying to make the messenger seem "bad" while ignoring the message. But of course... i realize nothing I can possibly say will change your mind. This all goes with being a PM-bug. I understand that.
So, to summarize, a little bump up short term still does not get PMs back to where they were just a few months ago thus your point is moot. It does not represent a new bull market in gold and a sign for new all time highs. The economy is bad and could probably get worse and still not set gold on fire which is the whole basic premise behind the plan as i understand it around here.
For gold and silver to gain a great upward momentum would mean the dollar would have to fail.....and if the dollar was to fail the world would be sent into the greatest depression like none of us have seen and hope we don't see...the world is to heavily populated now....before all would get out of hand I would like the Leaders of our Nation to isolate us from the rest of the world.....for the world to fail in such magnitude would cause total world disorder and as the worlds guardian would not be able to handle!!!! Total chaos, it is starting now....massive layoffs and what are these people going to do? What are we going to do? I have a feeling it is bigger than any of us can imagine!
Decisions have to be made and they have to be the right ones because there is no margin of error left. People are scared out here...No one ever thought that we could ever fail! We wouldn't have if there had been people in charge who knew what they were doing....and not deregulated the banks ,financial institutions and let them do anything they wanted!!!
<< <i>For gold and silver to gain a great upward momentum would mean the dollar would have to fail..! >>
I didn't mention a great upward turn. I simply said that we have traditionally seen an upward turn over the years at the end of November. That isn't going to be the failure of the dollar, not by any means. Silver and gold investment markets are simply too small to have such an effect.
It has happened for years and years and if one wanted to point to a reason, the Decemeber futures for the COMEX seems more likely than anything else.
This year the reasons for that seem stronger than ever due to the decoupling of the paper price versus the physical price.
This seems to have been lost on the previous poster who tends to post small books anymore.
This forum has lost it's decorum and it's sad to see. The PM discussions used to be a matter of opinons and sharing articles, lately it's become far too personal for my tastes. Nor does anyone like to have words put into thier mouth as has been done to me as well. It's just not worth my time to get into a p**sing contest.
Anyone who doesn't see the inflationalry cycles coming our way simply isn't paying attention. My belief is that we will begin seeing that by March of '09 and that will restore the legs to this PM bull. Not immediately, but the groundswell will be there.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
This forum has lost it's decorum and it's sad to see. The PM discussions used to be a matter of opinons and sharing articles, lately it's become far too personal for my tastes. Nor does anyone like to have words put into thier mouth as has been done to me as well. It's just not worth my time to get into a p**sing contest.
D,
that is exactly my thought this morning. And the reason we don't have an OF anymore. As the talk of D&G continues I fear that emotions will run amuck.
This forum has lost it's decorum and it's sad to see. The PM discussions used to be a matter of opinons and sharing articles, lately it's become far too personal for my tastes. Nor does anyone like to have words put into thier mouth as has been done to me as well. It's just not worth my time to get into a p**sing contest.
Anyone who doesn't see the inflationalry cycles coming our way simply isn't paying attention.
DH, I've been pondering all this, and I've got some observations. If I were 33, the bulk of my investing experience would be limited to the past 8 years, tops. That excludes a great amount of history where inflation was more visible than it was since before the changes in the inflation indices during the Clinton administration.
If I were 33, with such a minimal amount of experience in work, paying taxes, feeling the effects of economic policies, I would have no personal feeling for the Clinton, Bush I, Reagan, Carter or other eras, in terms of economics or precious metals. I wouldn't KNOW how things came down, much less UNDERSTAND them.
My economic observations would be based mainly on an economy which has been manipulated using derivatives. Thus, whatever I heard from anyone who might have had some first hand exposure to anything else would be of less impact in my thinking. My world would be based on fantasy finance, and I would never have seen a recession. Well, with the layoffs and major business failures being announced daily - we are seeing the impacts of a recession now. And I fear that it's only started.
If I were particularly ignorant, and blind to anything that happened before I came of age, I would ridicule anyone who had the benefit of those first hand experiences. To go a step further, I wouldn't bother to read history or to draw any lessons from it. Instead of contributing to a discussion, I'd make sure to try to boost my own standing by implying stupidity on the part of anyone who disagreed with me and I would mock people who invested using any kind of long term strategy based on fundamentals. Debate is fine - it's the mocking attitude that needs to stop.
DH - it is probably harder to break through the fog of misinformation these days. Fortunately, most of the "younger" contributors here actually do absorb what some of the more experienced folks have been pointing out.
We've been living in a fantasy economy that's been dependent upon consumption of stuff that we never needed. The fuel for the fantasy economy has been massive creation of fantasy dollars (i.e., derivatives). Now, they are disappearing and are being replaced with real dollars that are being ***given*** to private banks who are just accepting them as ***profit***.
Obviously, something's got to give, and I have no doubt that something will. Unfortunately, people who came of age in the fantasy economy have a much harder time seeing what is real. Some do, and some don't.
Would I like to be 33 again? You bet! But when I see posts on a daily basis that are completely oblivious to anyone and anything besides the poster himself, I just have to shake my head. The fact is that at some point, he will "get" it whether he wants to or not. Reality has a way of impinging on fantasy when it comes to money.
Q: Are You Printing Money? Bernanke: Not Literally
"Obviously, something's got to give, and I have no doubt that something will. Unfortunately, people who came of age in the fantasy economy have a much harder time seeing what is real. Some do, and some don't."
I have to agree totally. We the evolution of the digital age, we now have an economy that borders on fantasy. Reality has blended with fantasy. There are online fantasy world computer games where one must purchase items with real money to use in the game. And on the opposite end, with a few keystrokes, one can create 'wealth?' that are represented only by little bits and bytes and nothing solid to back it. Naked shorts, derivatives, etc. The real world has blended into the fantasy world, and many do not know the difference.
We have had some discussions before on what the next 'bubble' will be that will burst. Well, IMO one strong possibility will be this world of mixing fantasy and reality. It very well may be that a good portion of this digital fantasy world will come crashing down, at least in financial matters (and the PM shorts etc). Eventually, people will realize that being represented merely by 'blips' stored on magnetic media with nothing to back it, is hardly any different that fantasy football. Wealth can be destroyed by a keystroke, and you can lose the game. Except.... when you lose this game, you can be in big trouble with your family's health and safety and well being.
Now, when I say that the 'bubble' of financial fantasy and reality may burst, I do not mean that computers will no longer be used for financial transactions, records, etc. Not by a long shot.... the digital age is here to stay and perform a very useful function for the financial industry. Rather, the 'bubble' to burst would be the one where 'imaginary' products are produced with a few keystrokes which then disrupt the entire marketplace.
When you look around in the real world, there are standards on which everything is based. If you look at the scientific world, for instance, the weights on which all scientific research is based, are actual physical weights that are very carefully stored and protected, as the standards. Likewise, in the financial world, it used to be that money was based on the standard of actual physical gold to back it. And as we know that is no longer the case. But eventually, if this 'bubble' does break, then perhaps we will eventually develop a standard of some sort that will be tha anchor of the financial world, whether is be gold, real estate, or whatever (as long as it is a physical base).
Or.... I can be totally offbase, and the opposite will happen..... that fantasy and reality blend even more, and eventually there will be NO DIFFERENCE........
Hard core socialists. There are millions of them that are salivating at the destruction of capitalism. I have some uber-liberal friends that are gloating. They say, look, capitalism doesn't work. I argue back that we have not had true capitalism for decades in this country. I don't know when social-capitalism started, maybe with the bailout of Chrysler in the 80's. "W" has greatly accelerated social-capitalism. I don't think it would ever enter the minds of the uber-libs that they should actually thank "W" for paving the way to their cause.
I look at GM at less than 3 bucks and I think wow, what an opportunity. But I'm confused because I don't know how to invest in a country that is converting to a new ideology. Is investing in bailout-companies an investment? When everything is bailed out what is there to invest in, or is that an archaic thought in the New Order.
Just read what Ttown posted...............guys if Barry Sotero aka Barack Hussein Obama is shown to be not born in the US, will he be president or disqualified? Will someone pull strings to get him in or ????
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I understand your position on tin foil hat conspiracies and how it makes people lose credibility. I take every conspiracy theory with a grain of salt...and I used to not believe in them at all. However, if you watch this market for extended periods of time, there are serious questions that arise and market movements that do not make sense.
Conversely, strange market movements in a crazy markets does not necessarily mean that there is manipulation and fraud. We MUST look at the facts and evaluate for ourselves.
From a fact standpoint I think that we can agree that:
1. The gold and silver markets are small relative to the money that is out there. 2. It is in the best interest of banks hurting for capital for gold and silver to be low. 3. The derivative books of major banks (GS and JPM) are huge....on the order of tens of trillions of dollars. 4. Banks want to make money 5. The various programs in place (TARP etc) have not been used as promised by Secretary of Treasury. 6. By lowering interest rates to 1% and most likely lower, the Fed does not want people to save...they want money to go elsewhere. 7. Foreign governments have bought US debt for a long period of time to support their own economic growth 8. Our economy is much more dependant on the banking and service sectors and consumption spending than it was 10, 20, 30, 40, and 50 years ago. 9. Real production of goods has consistently shrunk over the past 30 years. 10. Government statistics are misleading and created differently than 40 years ago. (See BLS, Birth/death, Disinfranchised workers, Inflation deflators, GDP) 11. Most financial news organizations have a vested interest in promoting confidence via their broadcasts. 12. A majority of americans dont have the time nor inclination to dig into the facts...they let the major news organizations do that for them.
Do you disagree with ANY of those facts? If so, then let's have a debate on each one in turn. If not, then put on your detective hat for a second. You have motive, proven intent with at the very worst, circumstantial evidence that at least gives some credence to the manipulation of gold, silver, the bond market and the stock market on more than one occasion.
Simply saying that conspiracy theories make someone less than credible is not good enough. Give facts on the other side of the argument (of which there are legitimate counterpoints btw).
Please think about the above topics, but I'll leave you with one final point. One year ago, if you talked about a probable banking collapse and impending depression, you were labeled an alarmist....a chicken little....or worse. Today, those same people are now talking about manipulation and fraud in the system as little facts come to the forefront.
Let's stop talking in anecdotes....more in facts.... and then the discussion on this board will get away from personal attacks from both sides of the debate.
IF Barack is disqualified from holding office, what will be the effect on the national economy? PMs in paticular. I'm afraid that this discussion is getting a little to political for the mods to let it continue and I would like some opinions on my question before it gets bammed. Thanks guys
Like I said several months ago, "hold on boys its going to get rough. "
If Obama is proven not to be a natural born US citizen and not allowed to become president there will be rioting. Imagine the LA riots in every city in the country. It would be a disaster. PMs, guns and food would be the only things of value anymore.
I know there are many conspiracy theories of market manipulation, but aside from those theories, may I ask a question that I really just don't understand.
With gold prices falling, why is there such a shortage of the metal for immediate delivery? Supply and demand would suggest that the price would rise if there is a shortage of the metal for immediate delivery. Maybe there is a simple reason, but this simple guy does not get it. Any thoughts, ideas?
<< <i>If Obama is proven not to be a natural born US citizen and not allowed to become president there will be rioting. Imagine the LA riots in every city in the country. It would be a disaster. PMs, guns and food would be the only things of value anymore. >>
This is the US Supreme Court and they obviously think there is something to it.
They have demanded the writ of ceritori be answered by no later than 12-1-08.
Are we a nation of laws or not?
Is the US Constitution sacrosanct or not?
Threats of violence have never swayed the American public from being a nation of laws. In fact, history has shown that it more often than not brings us together.
We jail rioters and we shoot those who present violent threats.
And we move on, just as we always have.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>I know there are many conspiracy theories of market manipulation, but aside from those theories, may I ask a question that I really just don't understand.
With gold prices falling, why is there such a shortage of the metal for immediate delivery? Supply and demand would suggest that the price would rise if there is a shortage of the metal for immediate delivery. Maybe there is a simple reason, but this simple guy does not get it. Any thoughts, ideas? >>
Since you have ruled out manipulation as an answer, I don't think anyone can answer your question properly, since that's the answer.
Perhaps one of our younger know it alls can try some sort of nonsensical reply, but it will just be that, nonsense.
You've already answered your own question.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Bailout bill may move from $850 BILLION to $1 TRILLION.
It seems Hanky Panky snuck in a little bennie for the bankers in the bailout bill. Effectively it repealed a 22 year old tax code item in section 382 that the banks have been trying to repeal for years. Under the guise of the immediacy of passing the bail out bill, this was snuck in. Repeal of that item allows banks acquiring other firms/banks to use the newly acquired losses of that entity to reduce their tax bill. Estimates say this may add up to a windfall of up to $140BILL to the banks that recently acquired other firms. It can explain how Wells Fargo was so eager to get Wachovia when they themselves were insolvent. They could have saved BILLIONS in taxes by the acquisition. It's now "good" business to acquire dead assets to save on taxes...especially when your insolvent already!
It would take Congress or the Treasury to repeal the provision. And neither is likely since the banks are already squawking that they can't afford to pay those taxes, plus what Congress-person wants to step forward and take partial credit for killing the economy further? More more details see link on the jsmineset.com website below.
I'm not saying it is justified to riot, just saying it will happen. I will not be out there rioting, I will be at home protecting my family from said hooligans.
We are a nation of laws until those laws become inconvenient for TPTB. Laws are for the "little people". Yes I really am that cynical. If you are not you haven't been paying attention to what our politicians and CEOs have been doing to us for the last 20 years.
<< <i>I'm not saying it is justified to riot, just saying it will happen. I will not be out there rioting, I will be at home protecting my family from said hooligans.
We are a nation of laws until those laws become inconvenient for TPTB. Laws are for the "little people". Yes I really am that cynical. If you are not you haven't been paying attention to what our politicians and CEOs have been doing to us for the last 20 years. >>
Laws are not just for little people. That's an insult to me on many levels.
The US Constitution is not changed because it becomes inconvenient.
Should that happen, forget riots and expect civil war.
I feel sorry for someone who has been beaten down to the point of cynicism when it come to things of this level.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Perhaps one of our younger know it alls can try some sort of nonsensical reply, but it will just be that, nonsense.
Speculation bouncing all over the place with a pre-ordained end in mind.
Wonder who pays his salary? Such propagandists abound these days. He could get a job at Kitco.
The truth will be a financial disaster for such individuals and they are scrambling to put the day of reckoning off.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
This is an incredibly insightful (and scary) article... thanks for posting it.
"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)
The revised Treasury plan may be a better way to go. This way the banks can deal with delinquent borrowers themselves. The Federal government really does not have an organization in place to do work-outs with borrowers. Several large banks, Citi, Wells Fargo, BofA, have announced that they will be working with delinquent mortgage borrowers rather than foreclosing. This is a much better plan than exacerbating the problem by more foreclosures. To the extent the banks are only servicing loans for investment pools, they may have to hammer on their investors to go along with the work-outs.
American Express is now a bank holding company, which will allow it to borrow from the Fed to replace the liquidity it lost when the market for pooled credit card debt securities dried up.
But just how much longer the Fed can finance the mortgage and credit card industry remains to be seen. I suppose the Treasury can put a night shift on line to run the printing presses.
An interesting documentary of a Salomon Brothers trader back in 1986-1989 who basically figured out the derivatives scam very early on. Some interesting views on how everyone, at every level went along with the scam.
Warren Buffet, who they called an idiot during the tech boom, warned on it, and similarly warned long before any of this even hinted at surfacing on derivatives saying "he didn't understand them" and "he was staying out of them".
<< <i>Warren Buffet, who they called an idiot during the tech boom, warned on it, and similarly warned long before any of this even hinted at surfacing on derivatives saying "he didn't understand them" and "he was staying out of them". >>
In retrospect Buffett also said he missed the biggest opportunity on the tech boom, although at least he was honest. I didn't understand it either.
Opportunity being based on betting on the herd independent of fundamentals is not really opportunity, it's a trap. He recognizes that. If you always play the game of which way the wind blows with nothing substantial behind it to try and capitalize on the foolishness of others, eventually the fool will be you.
An interesting documentary of a Salomon Brothers trader back in 1986-1989 who basically figured out the derivatives scam very early on. Some interesting views on how everyone, at every level went along with the scam. >>
This is so maddening.
Any culture, any society which exists in order to destroy jobs, destroy suppliers, customers and pensions, which destroys everything in its wake in order to enrich a few insiders and send jobs abroad is insane. This has been going on for decades and people haven't complained. We vote for the same politicians and send them back to Washington as a lifetime job. We wave goodbye to our wealth and jobs as they sail out of port.
This wouldn't have been so disastrous if we hadn't simultaneously allowed our schools to teach how not to read and write; how not to think. Now we're in a situation which will require a lot of time and work to undo. And all of this just to heap untold millions on the thieves who will soon enough find that it's not worth much and all their wealth has little value if there's no place to spend it and nowhere to spend it from.
Derivatives may be a cause of the problem but to a very real degree they are a symp- tom as well. What reasonable person would buy and sell products that require a com- puter to value? Who in his right mind would take on unknown risk for unknown reward?
Why are you disappointed? Why have you lost confidence? The Treasury simply realized that their original concept simply was not practicable.
If the Treasury purchased the bad loans, who would service them? Who would enforce them? Who would negotiate work-outs? The Treasury does not have the systems and people in place to do that. They would have to out-source that work back to the banks, at an added cost. And ultimately, the loan servicers would have no economic incentive to consummate work-outs that would likely result in the borrowers being able to service the debt, remain in their homes in the case of residential mortgages, and the Treasury being paid back on the obligations it purchased. In short, the whole concept just would not work. By leaving the loans in the hands of the banks, which have the means of servicing and managing the loans, there will be a better outcome, In the meantime, the Treasury can inject capital into the banking system by taking an equity stake that can be sold at a future date so that the Treasury can realize a return on its investment. Sorry if that disappoints the banks, or their shareholders. The rest of the market has over-reacted in its typical knee jerk fashion.
I am disappointed because the markets are not being allowed to work themselves out. All this money being printed is just going into a black hole in banks balance sheets. It will never come into the economy because it is just fill. There will be no inflation and no economic growth. Banks still do not have money with which to make loans and consumers really dont want the loans anyway.
I have lost confidence because the rules are being changed too frequently. If I dont understand how the game is going to be run, then I will not play. Many players are sitting this out and will not come back to the table until the rules are more concrete.
The purpose of the infusion of capital into banks through equity purchases is to provide liquidity that was lost when the banks were unable to borrow against or sell interests in their loan portfolios. In theory, the injection of capital will not just clean up their balance sheets, it will provide cash for loans. Now there are still problems to solve. As Cohodk mentioned even if the banks are infused with cash, no one wants to borrow any way. And it is not enough to just inject cash, there needs to be a continuous source of funding to refill the coffers after the banks lend out the money—which is what the mortgage backed securities markets were doing before they collapsed. The Treasury is working up plans to re-energize that market, but it is not certain how to do that. One proposal is for the Treasury to accept mortgages and collateralized mortgage obligations as collateral for loans—thereby replacing the banks and investment banks as the source of liquidity to refuel the bank’s coffers. A risk/problem for the Treasury is how to evaluate and value the loan/loan pool securities offered as collateral and how to make sure that the banks don’t revert back to making loans to borrowers who/that are bad credit risks. In the current economy, not too many firms are looking for loans to expand their business—they are actually in the process of cutting back—but there is a need for financing to re-finance loans that are maturing, and companies that are experiencing cash flow problems are/will soon be searching for capital to stay afloat.
If struggling companies comprise a major part of the demand for new loans, and the Treasury is going to be the source of liquidity for banks by lending against the bank’s loan portfolio, there is a danger that the Treasury will wind up lending against a portfolio of new bad loan--this of course assumes that the banks would be willing to make risky new loans on belief that the Treasury won’t put them under by calling their loans when they become due.
The other danger is that the banks will act like the conservative lenders of old and just won’t lend. Remember the old addage--banks are only willing to lend to those who don't need to borrow. So the liquidity crunch will continue even though the banks have money. That new money injected into banks by the Treasury will end up going right back to the Treasury when the banks use it buy T-bills and notes to generate a return on their capital.
I have a question, seems like there are a lot of smart folks posting on this thread so maybe someone can help me. I can kind of understand why the US is having such economic problems, but why are other countries like China, Germany, England, to name just a few that I've heard about, having trouble with their economies also?
If this article has any merit, then why is the price of Gold not reflecting this large purchase? Or is this just another attempt to manipulate the Gold speculators?
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
Comments
<< <i>
<< <i>A couple of interesting things today first this,
BERG v. OBAMA ; WE THE PEOPLE - USA TODAY FULL PAGE Article 26kb
Two BREAKING NEWS DEVELOPMENTS - BERG v. OBAMA ; WE THE PEOPLE - USA TODAY FULL PAGE Article
Pass this one on far and wide. Its the truth. Produce or withdraw.
Friday, November 7, 2008
BREAKING: Two Developments
NUMBER ONE
If The Supreme Court Decides...?
At this point, Supreme Court Justice David Souter's Clerk informed Philip J. Berg, the lawyer who brought the case against Obama, that his petition for an injunction to stay the November 4th election was denied, but the Clerk also required the defendants to respond to the Writ of Certiorari (which requires the concurrence of four Justices) by December 1. At that time, Mr. Obama must present to the Court an authentic birth certificate, after which Mr. Berg will respond.
If Obama fails to do that, it is sure to inspire the skepticism of the Justices, who are unaccustomed to being defied. They will have to decide what to do about a president-elect who refuses to prove his natural-born citizenship.
"I can see a unanimous Court (en banc) decertifying the election if Obama refuses to produce his birth certificate," says Raymond S. Kraft, an attorney and writer. "They cannot do otherwise without abandoning all credibility as guardians of the Constitution. Even the most liberal justices, however loathe they may to do this, still consider themselves guardians of the Constitution. The Court is very jealous of its power - even over presidents, even over presidents-elect."
Also remember that on December 13, the Electoral College meets to casts its votes. If it has been determined that Mr. Obama is an illegal alien and therefore ineligible to become President of the United States , the Electors will be duty-bound to honor the Constitution. >>
In addition, 24 of the electors in the Electoral College have also filed suit.
It's far from a laughing matter.
Deadhorse, where did you find the 24 electorates filing suit?
I've be following this since the summer and find it fascinating.
Being naturalized myself and having adopted two children with "certificates of living birth" I've had a lot of dealings with the state department to become a legal citizen. The process is so long and painful it's no wonder people come here illegally.
Ren
<< <i>I never hear of manipulation when the price goes up. No sir. That is
fundamentals. When it goes down it is manipulation. >>
You want to see manipulation up?
Just wait till the Decmeber COMEX futures are due. Are they going to let their baskets go at around $10 when the investors know it's worth 40% more in the real world? India would pay 60% more just to get it and they'd gladly pay the shipping.
Watch and see what happens with the upturn in silver and gold to a lesser degree in the next three weeks+. It will again get tomahawked in mid-December.
Several of us old timers, barbaric, wannabe gurus,(have I correctly counted up your degrading names for us?) have watched this phenomona many times before.
When that happens are you going to call it upward manipulation, which it is, or are you going to have another excuse?
I'm calling it well in advance, I could be wrong, but I'm willing to put it up in public. I'll fade the heat if I am wrong, but rest assured I never brag on a public forum when I am correct.
A lesson that probably should be taken to heart by some of our younger "instant gurus".
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>Deadhorse, where did you find the 24 electorates filing suit? >>
I hosestly don't remember. It came out last week in a story relating to Berg's lawsuit.
I found it very interesting as it seems this thing now has real legs. Electors coming before the Supreme Court is a first in US history.
No idea where the funds are goming from, that wasn't stated. Could be Berg's lawyers taking it pro bono, I just don't know.
Could have been the WSJ, IBD or a few other sources.
It sure didn't come from the MSM!!
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>
<< <i>I never hear of manipulation when the price goes up. No sir. That is
fundamentals. When it goes down it is manipulation. >>
You want to see manipulation up?
Just wait till the Decmeber COMEX futures are due. Are they going to let their baskets go at around $10 when the investors know it's worth 40% more in the real world? India would pay 60% more just to get it and they'd gladly pay the shipping.
Watch and see what happens with the upturn in silver and gold to a lesser degree in the next three weeks+. It will again get tomahawked in mid-December.
Several of us old timers, barbaric, wannabe gurus,(have I correctly counted up your degrading names for us?) have watched this phenomona many times before.
When that happens are you going to call it upward manipulation, which it is, or are you going to have another excuse?
I'm calling it well in advance, I could be wrong, but I'm willing to put it up in public. I'll fade the heat if I am wrong, but rest assured I never brag on a public forum when I am correct.
A lesson that probably should be taken to heart by some of our younger "instant gurus". >>
I can only make the claim to wannabe as far as degrading names go
and I think it is quite accurate. I fall into the same category myself I
just tend to use facts to back up my guesses instead of mythical tales
of manipulation and conspiracy.
1. oil is 57 bucks a barrel.
2. all other commodities have fallen.
3. industry is cratering thus demand has fallen sharply.
4. outlook for the short term is bearish due to the economy.
5. deflation appears to be taking place instead of inflation for now.
6. etc..
All explain why gold and silver have fallen and probably need more
time to recover. I do not go around on a chat board preaching tin foil
hat tales. Saying these things means you lose a lot of credibility in my mind. Thus wannabe is appropriate. Other posters try to come up
with more factual explanations but they get drowned in the sheer
amount of gold bug theories.
Gold having a run up over the last seven years gives the gold bugs
a lot of credibility right now is many people's eyes but to me that is
not good enough. Many folks figured that PMs were due for a run
and bailed when it appeared to be the right time. All the while gold
pundits were calling for new extreme highs and were so wrong it is
painful to think about.
What good is this awesome bump up you speak of, lets say to 900
gold and 15 silver... when they sold at more then that? To me that
is the sign of a dead cat bounce and when it falls again it will slowly
beat out the bullishness of speculators who think gold/silver can be
a quick way to doubling your money. Maybe in a few years new highs
will be tested again but I doubt it. The big money will look for greener
pastures as they always tend to do once they bail.
As for not bragging who cares? Your posts tend to show your confidence and
you often mention how well you have done. I do not go around and
say you brag. How pointless. Once again trying to make the messenger
seem "bad" while ignoring the message. But of course... i realize nothing
I can possibly say will change your mind. This all goes with being
a PM-bug. I understand that.
So, to summarize, a little bump up short term still does not get PMs
back to where they were just a few months ago thus your point
is moot. It does not represent a new bull market in gold and a sign
for new all time highs. The economy is bad and could probably get worse
and still not set gold on fire which is the whole basic premise behind
the plan as i understand it around here.
would like the Leaders of our Nation to isolate us from the rest of the world.....for the world to fail in such magnitude would cause total world disorder and as the worlds guardian would not be able to handle!!!! Total chaos, it is starting now....massive layoffs and what are these people going to do? What are we going to do? I have a feeling it is bigger than any of us can imagine!
Decisions have to be made and they have to be the right ones because there is no margin of error left. People are scared out here...No one ever thought that we could ever fail! We wouldn't have if there had been people in charge who knew what they were doing....and not deregulated the banks ,financial institutions and let them do anything they wanted!!!
<< <i>our younger "instant gurus". >>
Mr Deadhorse, can you tell me who these younger instant gurus you are talking about????I want to learn from them!
Many members on this forum that now it cannot fit in my signature. Please ask for entire list.
<< <i>For gold and silver to gain a great upward momentum would mean the dollar would have to fail..! >>
I didn't mention a great upward turn. I simply said that we have traditionally seen an upward turn over the years at the end of November. That isn't going to be the failure of the dollar, not by any means. Silver and gold investment markets are simply too small to have such an effect.
It has happened for years and years and if one wanted to point to a reason, the Decemeber futures for the COMEX seems more likely than anything else.
This year the reasons for that seem stronger than ever due to the decoupling of the paper price versus the physical price.
This seems to have been lost on the previous poster who tends to post small books anymore.
This forum has lost it's decorum and it's sad to see. The PM discussions used to be a matter of opinons and sharing articles, lately it's become far too personal for my tastes. Nor does anyone like to have words put into thier mouth as has been done to me as well. It's just not worth my time to get into a p**sing contest.
Anyone who doesn't see the inflationalry cycles coming our way simply isn't paying attention. My belief is that we will begin seeing that by March of '09 and that will restore the legs to this PM bull. Not immediately, but the groundswell will be there.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
This forum has lost it's decorum and it's sad to see. The PM discussions used to be a matter of opinons and sharing articles, lately it's become far too personal for my tastes. Nor does anyone like to have words put into thier mouth as has been done to me as well. It's just not worth my time to get into a p**sing contest.
D,
that is exactly my thought this morning. And the reason we don't have an OF anymore. As the talk of D&G continues I fear that emotions will run amuck.
R
Anyone who doesn't see the inflationalry cycles coming our way simply isn't paying attention.
DH, I've been pondering all this, and I've got some observations. If I were 33, the bulk of my investing experience would be limited to the past 8 years, tops. That excludes a great amount of history where inflation was more visible than it was since before the changes in the inflation indices during the Clinton administration.
If I were 33, with such a minimal amount of experience in work, paying taxes, feeling the effects of economic policies, I would have no personal feeling for the Clinton, Bush I, Reagan, Carter or other eras, in terms of economics or precious metals. I wouldn't KNOW how things came down, much less UNDERSTAND them.
My economic observations would be based mainly on an economy which has been manipulated using derivatives. Thus, whatever I heard from anyone who might have had some first hand exposure to anything else would be of less impact in my thinking. My world would be based on fantasy finance, and I would never have seen a recession. Well, with the layoffs and major business failures being announced daily - we are seeing the impacts of a recession now. And I fear that it's only started.
If I were particularly ignorant, and blind to anything that happened before I came of age, I would ridicule anyone who had the benefit of those first hand experiences. To go a step further, I wouldn't bother to read history or to draw any lessons from it. Instead of contributing to a discussion, I'd make sure to try to boost my own standing by implying stupidity on the part of anyone who disagreed with me and I would mock people who invested using any kind of long term strategy based on fundamentals. Debate is fine - it's the mocking attitude that needs to stop.
DH - it is probably harder to break through the fog of misinformation these days. Fortunately, most of the "younger" contributors here actually do absorb what some of the more experienced folks have been pointing out.
We've been living in a fantasy economy that's been dependent upon consumption of stuff that we never needed. The fuel for the fantasy economy has been massive creation of fantasy dollars (i.e., derivatives). Now, they are disappearing and are being replaced with real dollars that are being ***given*** to private banks who are just accepting them as ***profit***.
Obviously, something's got to give, and I have no doubt that something will. Unfortunately, people who came of age in the fantasy economy have a much harder time seeing what is real. Some do, and some don't.
Would I like to be 33 again? You bet! But when I see posts on a daily basis that are completely oblivious to anyone and anything besides the poster himself, I just have to shake my head. The fact is that at some point, he will "get" it whether he wants to or not. Reality has a way of impinging on fantasy when it comes to money.
I knew it would happen.
I have to agree totally. We the evolution of the digital age, we now have an economy that borders on fantasy. Reality has blended with fantasy. There are online fantasy world computer games where one must purchase items with real money to use in the game. And on the opposite end, with a few keystrokes, one can create 'wealth?' that are represented only by little bits and bytes and nothing solid to back it. Naked shorts, derivatives, etc. The real world has blended into the fantasy world, and many do not know the difference.
We have had some discussions before on what the next 'bubble' will be that will burst. Well, IMO one strong possibility will be this world of mixing fantasy and reality. It very well may be that a good portion of this digital fantasy world will come crashing down, at least in financial matters (and the PM shorts etc). Eventually, people will realize that being represented merely by 'blips' stored on magnetic media with nothing to back it, is hardly any different that fantasy football. Wealth can be destroyed by a keystroke, and you can lose the game. Except.... when you lose this game, you can be in big trouble with your family's health and safety and well being.
Now, when I say that the 'bubble' of financial fantasy and reality may burst, I do not mean that computers will no longer be used for financial transactions, records, etc. Not by a long shot.... the digital age is here to stay and perform a very useful function for the financial industry. Rather, the 'bubble' to burst would be the one where 'imaginary' products are produced with a few keystrokes which then disrupt the entire marketplace.
When you look around in the real world, there are standards on which everything is based. If you look at the scientific world, for instance, the weights on which all scientific research is based, are actual physical weights that are very carefully stored and protected, as the standards. Likewise, in the financial world, it used to be that money was based on the standard of actual physical gold to back it. And as we know that is no longer the case. But eventually, if this 'bubble' does break, then perhaps we will eventually develop a standard of some sort that will be tha anchor of the financial world, whether is be gold, real estate, or whatever (as long as it is a physical base).
Or.... I can be totally offbase, and the opposite will happen..... that fantasy and reality blend even more, and eventually there will be NO DIFFERENCE........
Hard core socialists. There are millions of them that are salivating at the destruction of capitalism. I have some uber-liberal friends that are gloating. They say, look, capitalism doesn't work. I argue back that we have not had true capitalism for decades in this country. I don't know when social-capitalism started, maybe with the bailout of Chrysler in the 80's. "W" has greatly accelerated social-capitalism. I don't think it would ever enter the minds of the uber-libs that they should actually thank "W" for paving the way to their cause.
I look at GM at less than 3 bucks and I think wow, what an opportunity. But I'm confused because I don't know how to invest in a country that is converting to a new ideology. Is investing in bailout-companies an investment? When everything is bailed out what is there to invest in, or is that an archaic thought in the New Order.
Thought, out.
Ren
Follow-up story: Mombasa Imam who confirmed Obama’s birth place arrives in the UK
Many members on this forum that now it cannot fit in my signature. Please ask for entire list.
I understand your position on tin foil hat conspiracies and how it makes people lose credibility. I take every conspiracy theory with a grain of salt...and I used to not believe in them at all. However, if you watch this market for extended periods of time, there are serious questions that arise and market movements that do not make sense.
Conversely, strange market movements in a crazy markets does not necessarily mean that there is manipulation and fraud. We MUST look at the facts and evaluate for ourselves.
From a fact standpoint I think that we can agree that:
1. The gold and silver markets are small relative to the money that is out there.
2. It is in the best interest of banks hurting for capital for gold and silver to be low.
3. The derivative books of major banks (GS and JPM) are huge....on the order of tens of trillions of dollars.
4. Banks want to make money
5. The various programs in place (TARP etc) have not been used as promised by Secretary of Treasury.
6. By lowering interest rates to 1% and most likely lower, the Fed does not want people to save...they want money to go elsewhere.
7. Foreign governments have bought US debt for a long period of time to support their own economic growth
8. Our economy is much more dependant on the banking and service sectors and consumption spending than it was 10, 20, 30, 40, and 50 years ago.
9. Real production of goods has consistently shrunk over the past 30 years.
10. Government statistics are misleading and created differently than 40 years ago. (See BLS, Birth/death, Disinfranchised workers, Inflation deflators, GDP)
11. Most financial news organizations have a vested interest in promoting confidence via their broadcasts.
12. A majority of americans dont have the time nor inclination to dig into the facts...they let the major news organizations do that for them.
Do you disagree with ANY of those facts? If so, then let's have a debate on each one in turn.
If not, then put on your detective hat for a second. You have motive, proven intent with at the very worst, circumstantial evidence that at least gives some credence to the manipulation of gold, silver, the bond market and the stock market on more than one occasion.
Simply saying that conspiracy theories make someone less than credible is not good enough. Give facts on the other side of the argument (of which there are legitimate counterpoints btw).
Please think about the above topics, but I'll leave you with one final point. One year ago, if you talked about a probable banking collapse and impending depression, you were labeled an alarmist....a chicken little....or worse. Today, those same people are now talking about manipulation and fraud in the system as little facts come to the forefront.
Let's stop talking in anecdotes....more in facts.... and then the discussion on this board will get away from personal attacks from both sides of the debate.
siliconvalleycoins.com
I'm afraid that this discussion is getting a little to political for the mods to let it continue and I would like some opinions on my question before it gets bammed.
Thanks guys
Like I said several months ago, "hold on boys its going to get rough. "
With gold prices falling, why is there such a shortage of the metal for immediate delivery? Supply and demand would suggest that the price would rise if there is a shortage of the metal for immediate delivery. Maybe there is a simple reason, but this simple guy does not get it. Any thoughts, ideas?
<< <i>If Obama is proven not to be a natural born US citizen and not allowed to become president there will be rioting. Imagine the LA riots in every city in the country. It would be a disaster. PMs, guns and food would be the only things of value anymore. >>
This is the US Supreme Court and they obviously think there is something to it.
They have demanded the writ of ceritori be answered by no later than 12-1-08.
Are we a nation of laws or not?
Is the US Constitution sacrosanct or not?
Threats of violence have never swayed the American public from being a nation of laws. In fact, history has shown that it more often than not brings us together.
We jail rioters and we shoot those who present violent threats.
And we move on, just as we always have.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>I know there are many conspiracy theories of market manipulation, but aside from those theories, may I ask a question that I really just don't understand.
With gold prices falling, why is there such a shortage of the metal for immediate delivery? Supply and demand would suggest that the price would rise if there is a shortage of the metal for immediate delivery. Maybe there is a simple reason, but this simple guy does not get it. Any thoughts, ideas? >>
Since you have ruled out manipulation as an answer, I don't think anyone can answer your question properly, since that's the answer.
Perhaps one of our younger know it alls can try some sort of nonsensical reply, but it will just be that, nonsense.
You've already answered your own question.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Jesus, get over it and drop the conspiracy theories.
It seems Hanky Panky snuck in a little bennie for the bankers in the bailout bill. Effectively it repealed a 22 year old tax code item in section 382 that the banks have been trying to repeal for years. Under the guise of the immediacy of passing the bail out bill, this was snuck in. Repeal of that item allows banks acquiring other firms/banks to use the newly acquired losses of that entity to reduce their tax bill. Estimates say this may add up to a windfall of up to $140BILL to the banks that recently acquired other firms. It can explain how Wells Fargo was so eager to get Wachovia when they themselves were insolvent. They could have saved BILLIONS in taxes by the acquisition. It's now "good" business to acquire dead assets to save on taxes...especially when your insolvent already!
It would take Congress or the Treasury to repeal the provision. And neither is likely since the banks are already squawking that they can't afford to pay those taxes, plus what Congress-person wants to step forward and take partial credit for killing the economy further? More more details see link on the jsmineset.com website below.
roadrunner
We are a nation of laws until those laws become inconvenient for TPTB. Laws are for the "little people". Yes I really am that cynical. If you are not you haven't been paying attention to what our politicians and CEOs have been doing to us for the last 20 years.
<< <i>Obama born in Hawaii
xxxxx, get over it and drop the conspiracy theories. >>
Thanks for the link.
It's all very entertaining.
I will be interested to what the Supreme Court has to say December 1.
Now back to our thread which is already in progress...
Ren
<< <i>I'm not saying it is justified to riot, just saying it will happen. I will not be out there rioting, I will be at home protecting my family from said hooligans.
We are a nation of laws until those laws become inconvenient for TPTB. Laws are for the "little people". Yes I really am that cynical. If you are not you haven't been paying attention to what our politicians and CEOs have been doing to us for the last 20 years. >>
Laws are not just for little people. That's an insult to me on many levels.
The US Constitution is not changed because it becomes inconvenient.
Should that happen, forget riots and expect civil war.
I feel sorry for someone who has been beaten down to the point of cynicism when it come to things of this level.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>The Great Gold, Silver Price Manipulation Conspiracy Explained >>
Well, I warned you;
Perhaps one of our younger know it alls can try some sort of nonsensical reply, but it will just be that, nonsense.
Speculation bouncing all over the place with a pre-ordained end in mind.
Wonder who pays his salary? Such propagandists abound these days. He could get a job at Kitco.
The truth will be a financial disaster for such individuals and they are scrambling to put the day of reckoning off.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Obama to Inherit ‘New Global Order’ from Bush
<< <i>Uncle Sam's Credit Line Running Out? >>
This is an incredibly insightful (and scary) article... thanks for posting it.
American Express is now a bank holding company, which will allow it to borrow from the Fed to replace the liquidity it lost when the market for pooled credit card debt securities dried up.
But just how much longer the Fed can finance the mortgage and credit card industry remains to be seen. I suppose the Treasury can put a night shift on line to run the printing presses.
CG
An interesting documentary of a Salomon Brothers trader back in 1986-1989 who basically figured out the derivatives scam very early on. Some interesting views on how everyone, at every level went along with the scam.
roadrunner
<< <i>Warren Buffet, who they called an idiot during the tech boom, warned on it, and similarly warned long before any of this even hinted at surfacing on derivatives saying "he didn't understand them" and "he was staying out of them". >>
In retrospect Buffett also said he missed the biggest opportunity on the tech boom, although at least he was honest. I didn't understand it either.
<< <i>Confessions of a Wall Street trader - the early days
An interesting documentary of a Salomon Brothers trader back in 1986-1989 who basically figured out the derivatives scam very early on. Some interesting views on how everyone, at every level went along with the scam.
>>
This is so maddening.
Any culture, any society which exists in order to destroy jobs, destroy suppliers,
customers and pensions, which destroys everything in its wake in order to enrich
a few insiders and send jobs abroad is insane. This has been going on for decades
and people haven't complained. We vote for the same politicians and send them
back to Washington as a lifetime job. We wave goodbye to our wealth and jobs as
they sail out of port.
This wouldn't have been so disastrous if we hadn't simultaneously allowed our schools
to teach how not to read and write; how not to think. Now we're in a situation which
will require a lot of time and work to undo. And all of this just to heap untold millions
on the thieves who will soon enough find that it's not worth much and all their wealth
has little value if there's no place to spend it and nowhere to spend it from.
Derivatives may be a cause of the problem but to a very real degree they are a symp-
tom as well. What reasonable person would buy and sell products that require a com-
puter to value? Who in his right mind would take on unknown risk for unknown reward?
<< <i>Paulson backs off asset plan; crisis deals at risk >>
I must say I am very disappointed with this. The most important concept of a banking system is confidence. I have just lost all of mine.
Knowledge is the enemy of fear
Knowledge is the enemy of fear
If the Treasury purchased the bad loans, who would service them? Who would enforce them? Who would negotiate work-outs? The Treasury does not have the systems and people in place to do that. They would have to out-source that work back to the banks, at an added cost. And ultimately, the loan servicers would have no economic incentive to consummate work-outs that would likely result in the borrowers being able to service the debt, remain in their homes in the case of residential mortgages, and the Treasury being paid back on the obligations it purchased. In short, the whole concept just would not work. By leaving the loans in the hands of the banks, which have the means of servicing and managing the loans, there will be a better outcome, In the meantime, the Treasury can inject capital into the banking system by taking an equity stake that can be sold at a future date so that the Treasury can realize a return on its investment. Sorry if that disappoints the banks, or their shareholders. The rest of the market has over-reacted in its typical knee jerk fashion.
CG
I have lost confidence because the rules are being changed too frequently. If I dont understand how the game is going to be run, then I will not play. Many players are sitting this out and will not come back to the table until the rules are more concrete.
Knowledge is the enemy of fear
I do not see a direct lending corrallation nor even a mild one. How does this create new loans?
Is it to create the appearance of solvency so the banks will be willing to trust each others stability?
If struggling companies comprise a major part of the demand for new loans, and the Treasury is going to be the source of liquidity for banks by lending against the bank’s loan portfolio, there is a danger that the Treasury will wind up lending against a portfolio of new bad loan--this of course assumes that the banks would be willing to make risky new loans on belief that the Treasury won’t put them under by calling their loans when they become due.
The other danger is that the banks will act like the conservative lenders of old and just won’t lend. Remember the old addage--banks are only willing to lend to those who don't need to borrow. So the liquidity crunch will continue even though the banks have money. That new money injected into banks by the Treasury will end up going right back to the Treasury when the banks use it buy T-bills and notes to generate a return on their capital.
CG
I can kind of understand why the US is having such economic problems, but why are other countries like China, Germany, England, to name just a few that I've heard about, having trouble with their economies also?
Stupid list…. Mistlin
<< <i>Saudi Arabia buys $3.5bn of gold in two weeks >>
If this article has any merit, then why is the price of Gold not reflecting this large purchase? Or is this just another attempt to manipulate the Gold speculators?