FINALLY performance is what people will get paid on. Why did it take so long to get to this?
Our new socialist congress is finally going to level the playing field for that small percentage of people at the very top, and why not?
Most all of the rest of us have always worked on a performance basis. Did you ever pay a plumber that did not fix your pipes but wanted his money so he could leave? Do you pay for undelivered goods, or heating repairs where the guy never shows up?
Here is the way this should unfold. Any company that takes the publics money i.e. has shareholders, or any company that takes government contracts, or any company that takes government subsides of any kind, should have a limited compensation amount for their upper level employees.
They should start off with salary caps of $250,000, and then come commissions, bonuses, stock options etc. all of those will be based on performance only.
So here are a few examples of how this would work.
An actor working for a publicly traded studio would get $250,000 for each movie. If the movie was a box office hit he or she would get a bonus. It the movie was a dud they would get nothing beyond the $250,000.
All sports players that worked for publicly held sports teams, or played in stadiums where tax payer money had been used to build the stadium, would get so much per game up to $250,000 per year, and so much of a bonus if they won their games.
Farmers big and small that receive government subsidies, or have public shareholders, are subject to the same rules.
Naturally all the car companies, the car parts suppliers, etc.
In just a few short years we will have this entire thing straighten out, and people will finally get paid what they deserve across all lines.
As a final note I think it will be interesting to watch companies like Goldman Sachs conform to the new rules. I am sure deep in their hearts this is what they have always wanted. There is no doubt the upper management of that company were always closet socialists, just look at their political donations for last year.
Heavy Hitters Goldman Sachs: Recipients Select Cycle: 2008
The wealthiest people I have ever known are Democrats.
Is there a guilt thing going on?
Why do Wealthy Jewish people predominently vote Democrat? Why do black people predominently vote democrat?
Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
Last year, I asked TWO of my employees who they preferred. Neither can vote. Both said the Democratic candidate. I asked them why? Neither could answer.
<< <i>FINALLY performance is what people will get paid on. Why did it take so long to get to this?
Our new socialist congress is finally going to level the playing field for that small percentage of people at the very top, and why not?
Most all of the rest of us have always worked on a performance basis. Did you ever pay a plumber that did not fix your pipes but wanted his money so he could leave? Do you pay for undelivered goods, or heating repairs where the guy never shows up?
Here is the way this should unfold. Any company that takes the publics money i.e. has shareholders, or any company that takes government contracts, or any company that takes government subsides of any kind, should have a limited compensation amount for their upper level employees.
They should start off with salary caps of $250,000, and then come commissions, bonuses, stock options etc. all of those will be based on performance only.
So here are a few examples of how this would work.
An actor working for a publicly traded studio would get $250,000 for each movie. If the movie was a box office hit he or she would get a bonus. It the movie was a dud they would get nothing beyond the $250,000.
All sports players that worked for publicly held sports teams, or played in stadiums where tax payer money had been used to build the stadium, would get so much per game up to $250,000 per year, and so much of a bonus if they won their games.
Farmers big and small that receive government subsidies, or have public shareholders, are subject to the same rules.
Naturally all the car companies, the car parts suppliers, etc.
In just a few short years we will have this entire thing straighten out, and people will finally get paid what they deserve across all lines.
As a final note I think it will be interesting to watch companies like Goldman Sachs conform to the new rules. I am sure deep in their hearts this is what they have always wanted. There is no doubt the upper management of that company were always closet socialists, just look at their political donations for last year.
Heavy Hitters Goldman Sachs: Recipients Select Cycle: 2008
This is the right idea but why cap their pay at $250,000. Are these the only people capable of ruining the country and sending jobs overseas. I bet 99 out of a 100 eight year olds can drive a company into bankruptcy* or make a really crappy movie. The rea- son I bring it up is the mess in education. School boards in many cases deserve no mon- ey at all. They can't even get half the students in their districts learnt to read and right.
I'd wager if their compensation was limited to $2.50 until they they figured out a way to do their jobs right there would be kids reading and writing in six weeks. Why pay any- thing at all for abject and utter failure. We pay more than any other country for just about the worst schools in the world.
GOLDSAINT -- I'm know this question sounds dense, but ... are you being facetious in the post above regarding limiting compensation to $ 250,000 + bonuses ?
<< <i>As a final note I think it will be interesting to watch companies like Goldman Sachs conform to the new rules. I am sure deep in their hearts this is what they have always wanted. There is no doubt the upper management of that company were always closet socialists, just look at their political donations for last year. >>
Im sure they would conform to these rules as well as they conform to all the insider trading, market manipulation, collusion and other rules and laws they have followed so well.
As far as political contributions I think the money they give to holders of public office would often be better classified as compensation to employees currently infiltrating government positions.
I was out watering some new plantings in the front yard today. Neighbors from a couple houses down, across the street stopped by to say hello and while we were chatting, an unfamiliar car pulled up in front of the house directly across the street from our house. The fellow driving got out of the car and had a small brown envelope in one hand and a small camera in the other. He went to the house across the street from ours and stuck the envelope in the door, then took pictures of the place.
I said " Looks like you're bringing bad news!". He said, "Not really, I'm the warning guy". The guy across the street is buried in that house having bought it at the absolute top of the market. He lost his job 6 months ago and we all know where this ones going. So I asked the guy if it's going into foreclosure and he said it'll take a year but yes. I said oh great, just what we need is another foreclosure on the block, just as we're planning on listing our house for sale as we just bought another house in Sarasota, ......( to be closer to NGC........kidding, because it's a great house at a great price ).
He went on to tell me he's working 7 days a week and that he's leaving 600-700 foreclosure warnings on peoples doors.......a MONTH !
There are single family houses in this town, which is a quaint old Florida type town on the west coast of Fla, that are listed for less than a RV. Single family houses in the $35,000-$50,000. We just bought one that was built in 2002 at a cost of close to 500K, which was long before the idiocy took over and we're paying a fraction for it. At the top it was probably $750K, maybe more. A house I sold for $450K in 2001 that I lost 100K on at the height was supposedly 1.8 Million. LOL, I couldn't get 500K for it after spending 200K in renovations including 80 grand on the kitchen and it was supposedly 1.8 Million at one point?
Meanwhile for 50 G's you can own a single family getaway house in Port Charlotte Fla, between Sarasota and Ft Myers. For 100K you can buy a pretty decent 2 or 3 bedroom house here on 1/4 acre lot with lots of Palm trees, orange, tangerine, bannana's right on your property. Waterfront houses that were well over a million bucks with access to the Gulf of Mexico are listed in the $300's to $400's. How much lower can it go? With the amount of foreclosures and people walking away from their responsibilities, I think it's going to go even lower.
And the same things that helped destroy the economy to begin with, the printing, the taxing, the borrowing the spending, the new administration is making the old admin look conservative............and we all know that they were anything BUT conservative.
mrearlygold, fascinating story from the Florida perspective. The type of boom and bust you are seeing all around you is not evident in rural Pennsylvania. We never saw very much of the 2003-2007 housing boom.
<< <i>mrearlygold, that was a good story, good perspective. I felt I was there.
Yes Sir post of the daY! >>
GS, that's a good idea....to have a post of the day, week, month and year. Thought provoking, content, insight, story, info, predictions, bafoonery......
Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain.
I will take $1,000,000 worth of mortgages for $10,000, and I would like to borrow the money non-recourse at 1%.
Ya lets do it, lets clean up those toxic assets.
New York Times
WASHINGTON — The Treasury Department is expected to unveil early next week its long-delayed plan to buy as much as $1 trillion in troubled mortgages and related assets from financial institutions.
The plan is likely to offer generous subsidies, in the form of low-interest loans, to coax investors to form partnerships with the government to buy toxic assets from banks.
To help protect taxpayers, who would pay for the bulk of the purchases, the plan calls for auctioning assets to the highest bidders.
<< <i>Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain. >>
You can pull it off as long as you can find new villians to demonize while claiming that your policies are the only solution. Just pick the right target (Pres Bush, Limbaugh, CEOs, banks, Wall Street, AIG, Others To Be Announced, etc.) and add pinch of class envy. You can distract the poor from their own problems along with the unmet election year promises of the party they blindly support.
Certainly politicians still have a way to go as their control of the media is not yet complete. Stalin clearly was the expert. He nimbly conjured up counter-revolutionary plots as needed to mask the evil of Soviet Communism. His targets included white guards, aristocratic emigres, Trotskyites, Bukharites, Mensheviks and fascist spies. Stalin had well staged show trials - we have accusatory hearings on Capital Hill.
<< <i>mrearlygold, fascinating story from the Florida perspective. The type of boom and bust you are seeing all around you is not evident in rural Pennsylvania. We never saw very much of the 2003-2007 housing boom. >>
Well I'm not familiar with "rural" PA but I do know a little about some parts of PA because we considered ( I considered which my Wife shot down to which I am thankful that a sharper mind prevailed on that one! ) . Wayne Cnty for example. Neat area and just a bit too far for the "commuters" to travel to norther Jersey or NYC for work. Oh some people try but after a real short while that feeling changes. Place there called the "Hideout" which I am pretty familiar with and also have a friend who owns a place there. That place absolutely experienced the boom and is now experiencing the bust. Little houses that were 70-80 Grand shot up to over 200K. How ridiculous is that? Try to sell one of those now. Is it as bad as South Florida?
Not yet but it's in that direction.
Many people claimed that NYC real estate was "immune" because of foreign investment. Before that it was immune because of Wall street investment. Before that it was supply and demand. I was up last year and walking down Sullivan st in the village, across the street where Googies USED to be ( I didn't know it was closed! ) there's a realtor and I saw little 1 bedroom apartments being advertised in the Village for a Million bucks. Are you kidding me? Try selling one of those for a million now.
Think this is just Fla or California, most places are experiencing a slow down or a decline and I would submit that we are nowhere near the bottom. Look at places like Michigan , Ohio. Once upon a time when we got a lead from someone in the midwest there was a good chance that person was in some way involved in manufacturing automobiles, or something. Now what? Many are fleeing. Many fled and came to SW Fla. There's a guy here on the forum in Naples I believe who said once that Midwest Money built the west coast of Fla. I agree for the most part just like Northeast Money built the east coast of Fla. Where's that money now?
Here's a podcase by Gerald Calente. It's only 12 minutes long and it's a good one. Look this guy up if you don't know who he is or decide to dismiss him . I also like Peter Schiff and would absolutelt support that guy if he was running for office.
<< <i>Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain. >>
Maybe because after 8 years of a Republican White House they saw only the rich get stupid richer while the average public got robbed by the Wall Street elite. This isnt about socialism or capitalism, this was about the Republican administration doing nothing while all the major banks in the country got robbed by thier friends. Where was the oversight, oh thats right on fully paid junkets.
This was the first time I voted for democrat president in 30 years (and I was sick doing it) but I didn't want another 4 years of Republican led graft and corruption. Republicans got what they earned and were all gonna be scewed for it.
<< <i> as long as you can find new villians to demonize >>
You dont need to look for demons, when the last group in charge robs you blind you replace them.
<< <i>Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain. >>
Maybe because after 8 years of a Republican White House they saw only the rich get stupid richer while the average public got robbed by the Wall Street elite. This isnt about socialism or capitalism, this was about the Republican administration doing nothing while all the major banks in the country got robbed by thier friends. Where was the oversight, oh thats right on fully paid junkets.
This was the first time I voted for democrat president in 30 years (and I was sick doing it) but I didn't want another 4 years of Republican led graft and corruption. Republicans got what they earned and were all gonna be scewed for it.
<< <i> as long as you can find new villians to demonize >>
You dont need to look for demons, when the last group in charge robs you blind you replace them. >>
Yup, sure, with either more of the same or worse. Now if that makes sense to anyone, let the chips fall where they may.
<< <i>mrearlygold, fascinating story from the Florida perspective. The type of boom and bust you are seeing all around you is not evident in rural Pennsylvania. We never saw very much of the 2003-2007 housing boom. >>
Well I'm not familiar with "rural" PA but I do know a little about some parts of PA because we considered ( I considered which my Wife shot down to which I am thankful that a sharper mind prevailed on that one! ) . Wayne Cnty for example. Neat area and just a bit too far for the "commuters" to travel to norther Jersey or NYC for work. Oh some people try but after a real short while that feeling changes. Place there called the "Hideout" which I am pretty familiar with and also have a friend who owns a place there. That place absolutely experienced the boom and is now experiencing the bust. Little houses that were 70-80 Grand shot up to over 200K. How ridiculous is that? Try to sell one of those now. Is it as bad as South Florida?
Not yet but it's in that direction.
Many people claimed that NYC real estate was "immune" because of foreign investment. Before that it was immune because of Wall street investment. Before that it was supply and demand. I was up last year and walking down Sullivan st in the village, across the street where Googies USED to be ( I didn't know it was closed! ) there's a realtor and I saw little 1 bedroom apartments being advertised in the Village for a Million bucks. Are you kidding me? Try selling one of those for a million now.
Think this is just Fla or California, most places are experiencing a slow down or a decline and I would submit that we are nowhere near the bottom. Look at places like Michigan , Ohio. Once upon a time when we got a lead from someone in the midwest there was a good chance that person was in some way involved in manufacturing automobiles, or something. Now what? Many are fleeing. Many fled and came to SW Fla. There's a guy here on the forum in Naples I believe who said once that Midwest Money built the west coast of Fla. I agree for the most part just like Northeast Money built the east coast of Fla. Where's that money now?
Here's a podcase by Gerald Calente. It's only 12 minutes long and it's a good one. Look this guy up if you don't know who he is or decide to dismiss him . I also like Peter Schiff and would absolutelt support that guy if he was running for office.
mrearlygold, you are correct about eastern Penna along the Delaware River. Wayne County, Pike County and Monroe County have all been profoundly impacted by the NYC market. Those counties have seen the boom and bust fueled by commuters willing to trek to work in NJ and NYC. Rural Pennsylvania to the north and west of Interstates 80 and 81 is fortunately still too far from NYC. That large rural region's economy is still based on stolid but more solid agriculture, lumbering and manufacturing.
This trillion dollar bad bank or toxic cesspool doesn't do anything to solve the problem other than find the hook to hang the bill on....and that hook is the taxpayer. Isn't that what just happened? And the market goes up because of a short term knee jerk reaction to make money by traders. Traders on the floor still feel that by early summer we are back down to testing the lows set way back in early March. This is just musical chairs....the trend is the trend until proven otherwise.
An interesting read about how AIG's Joe Cassano and his off shoot of the AIG insurance company took down the company as well as most of the Western World. If you can't tolerate a few inappropriate "expletive deleteds" then please pass on this 8 page article. Yeah, it's from RS but it's the content that counts. The article explains how each step of regulation was slowly lifted (or ignored) to make all this happen. Please note that the DEMs had every bit as much a role in making this happen. If not for the Rubin, Summers, and Clinton team in the late 1990's none of this may have happened. Sen. Phil Gramm (TX), who in 1999 was the head of the Senate Banking Committee, played one of key roles in deregulation when he pushed through the Gramm-Leach-Biley act of 1999 which repealed portions of Glass-Steagal. This allowed investment and commercial banks to mix and become mega-giants. Needless to say, he received millions in campaign contributions for his assistance. While he did spend his formative years as a democratic congressman, he spent the last 19 years as a republican. I believe he is currently reaping his rewards as a key player in UBS.
Just like when gold peaked on Feb 20th the Aden Sisters had just come out with another bullish article. And like clockwork they put one out this afternoon.....and gold fell from $952 to $939 last I looked (lol). But unexpected was that most gold stocks ended up slightly higher today even with gold falling. Note that Freeport McMoran (TCX) continues on a tear as one of the world's leading copper producers. The Aden sisters (or should I say the "amen sisters") have had uncanny timing the past several years of being the last ones to post on gold's bullishness, and to signal a corrective move. But at least they seem to have gotten the Dow and USDollar moves correct. The previously declared dead Euro seems ready to head back into the 1.40's. Silver still hanging in there though and copper (another inflation sniffer) went to another high today. Platinum and Palladium higher from Friday as well. Look like all the "fear" is gone and time to invest in re-inflation. 10 and 30 yr bond yields also slowly going back up from last week's plunge.
First time I've seen JS post on the possible derivatives "solution" of calling them all null and void. He feels we've already gone $10 TRILL too far into this mess.
Under the law the ONLY way to cancel contracts is the US government declaring by Presidential Order an Economic Emergency, an act he will not do. An Economic Emergency Declaration is when there is no solution, and is considered a Draconian surrender to circumstances.
First time I've seen JS post on the possible derivatives "solution" of calling them all null and void
Bandwagon jumper.
Mining stocks had a terrible day, all things considered. A 6-8% up day and GDX is up 0.5%??!! FCX has possibly 10% further upside. Then its dead. I feel comfortable with my GDX short placed on Friday, unless its up 5% tomorrow.
A somewhat long, but very interesting reading that explains how the gold shorts have become trapped with their short positions. BTW, the article states that the shorts were not participating in a manipulation, but rather a coverup, and in the process became trapped.
Also a good explanation on gold carry trade, credit swaps, CDOs, CPDOs and other derivatives. Not a very cheerful outlook, especially if the 15x increase in US monetary base takes place.
I was looking at the major institutional gold stock buying/selling on March 18th when gold was pummeled in the morning then rose immediately following the FED's announcement. The only major bank really on the scene was JPM. They apparently were on both sides as they sold off some heavy positions on miners like Barrick but bought heavy into stalwarts Goldcorp and Newmont. Other than the obvious re-balancing of positions, I can only guess that they bought Nem, GG, BVN, and AU cheap in the morning and sold off a bunch of everything else in the afternoon once it went up (GFI, IAG, GSS, AEM, EGO, ABX, KGC).
Talk about not finding buyers for debt.....Great Britain is having a very difficult time.........
Failed gilt auction stokes fears over UK economy - Daily Telegraph
Daily Telegraph reports the UK Debt Management Office attracted just 1.67 bln pounds in bids for its sale of 1.75 bln pounds of 2049 gilts this morning, its first uncovered auction of conventional gilts since 1995. The cover of just 0.93 times is believed to be the lowest in history and far worse than the 0.99 times in 1995. The average cover of the last three auctions was 2.1 times. Failure raises fears that the govt may not be able to secure the billions of pounds its needs from the markets to fund its record fiscal deficit without paying far more for the money, and reflects concerns about UK economic stability... Politicians have raised concerns that an uncovered gilt auction could lead to a cut in the sovereign credit rating, which could have devastating consequences for the national debt -- due to hit a record 1 trillion pounds - as the interest bill would soar.
"I still find it amazing how quickly the world economy came to a virtual standstill."
Yes, a very interesting phenomenon. The system was wound so tightly in an effort to wring every last cent out of an already maxed out US consumer and using that income as a way to pump up asset fund paper values well beyond any credible justification. The main problem was people were projecting strong growth at the top while the assuming the health of the prey propulation was stable and prospering...at least, that's what it looked like on paper. We here had noticed the disconnect a while back, well before anyone put it in the media but you can be sure folk that were working the deals must have had questions about the sustainability of the model but they plowed ahead anyway with their paper derivatives based on the continued spending and increasing indebetness of the mullets as the managers collected their bonuses and vacationed in Costa Rica; life was good for the paper boys, life was good for the mullets, it was all good.
They assumed the mullets could handle the toxic mortgages that were slipped to them, like someone slipping a date rap e drug in their drink while the hapless consumees listen to the live music of their own success. The model was flawed and people knew this but they kept piping the sunshine into the living rooms of the new middle class. They blew sunshine into the credit cards also, upping the limits so everyone could spend more while slipping in some 29.9% interest rates and other corporate friendly onerous small print terms...hoping to boost the corporate projected income on paper but they knew, they were just hanging paper; no way the consumers could handle the load. New car, new house, new stuff, cash in hand...same ol' job with the same lame pay and benefits; how could it possibly work? But, methinks what turned the worm is the $4 gas. Once a little pressure was put on the US consumer, the game was up; he couldn't pay in cash. Then the ARM resets started and then the house of cards began to cave and the rest is in the history books. The whole thing didn't take 90 days and spread across the globe like a tsunami of cash destruction. The US consumer was shouldering the world aided by the paper boys spreading their joy like confetti falling from a pinata and everyone in the world was lapping at the pool happiness and prosperity.
Those that realized that the model was unsustainable kept stashing cash, slashing personal debt, hoarding metal and hard assets...we talked about it here, we took comfort in the strategy and the recognition, we preached it to those that would listen but it was already too late to turn the herd. But, no one is laughing just because they saw it coming, everyone got cut a little...a quick flick of a butterfly knife as the blade bumps along the rib cage. "There is no joy in Mudville-the mighty Casey has struck out."
Cohodk, that UK gilt sell through rate is still >95%. I think any major auction house, regardless of what they sell, would be thrilled to get such a % today....govt's included.
Nichols updates us for the first time since February after calling for a March low. He now points out that the monthly gold fractal is at a point of energy that we've only seen twice in the past 3-1/2 years. Each of those previous times lead to major moves in gold to peaks of $730 in April 2006 and $1033 in March 2009. His basic point is that there is a large amount of gold energy to dissipate in the near future and each successive bounce off previous hard supports (such as $880 for example) only builds more energy. The chart also shows that the present 2009 position is actually stronger than the late 2007 position that took us to >$1000 that first time in March 2008. This is not good news for maintaining the status quo of the $800-$950 "trading range." To add further fuel to this equation, many of the gold stocks exceeded their Feb highs today as did the broader etf GDX. All this while gold is "weak." Note that gold stocks lead gold in Feb's run up.
Almost EVERY Govt auction has been over subscribed. In fact, I cant remember any that wasnt. Just look at the story, the previous low was 99% back in 1995. The last few have had 2x the demand for the offering.
I love todays headlines....backtracking and whipsaws....
1. 1:38 PM IMF head says does not believe dollar's days as reserve currency are over, Chinese don't think it either - Reuters 2. 1:20PM IMF Head says crisis may renew interest for new reserve currency - DJ 3. 10:15 AM Geithner says dollar remains world's reserve currency, likely to remain so for long time - Reuters 4. 9:56AM Geithner says "quite open" to China's suggestion of moving toward SDR-linked currency system - Reuters
How are they supposed to instill confidence when they contradict themself in the space of a few minutes?
Failure raises fears that the govt may not be able to secure the billions of pounds its needs from the markets to fund its record fiscal deficit without paying far more for the money,"
Dave this is what we need here, but rather some auctions that nobody comes to.
There is nothing that says the dollar cannot remain the reserve currency, but it is not written that anyone has to buy any more debt. If our lein holders want to stenghten the dollar all they have to do is buy NO more debt.
It is one thing for the socialists to produce trillions in dollars in plans, but something else to find enough suckers to be lenders.
I wonder how long it will take the debt suckers to figure that out?
<< <i>"I still find it amazing how quickly the world economy came to a virtual standstill."
Yes, a very interesting phenomenon. The system was wound so tightly in an effort to wring every last cent out of an already maxed out US consumer and using that income as a way to pump up asset fund paper values well beyond any credible justification. The main problem was people were projecting strong growth at the top while the assuming the health of the prey propulation was stable and prospering...at least, that's what it looked like on paper. We here had noticed the disconnect a while back, well before anyone put it in the media but you can be sure folk that were working the deals must have had questions about the sustainability of the model but they plowed ahead anyway with their paper derivatives based on the continued spending and increasing indebetness of the mullets as the managers collected their bonuses and vacationed in Costa Rica; life was good for the paper boys, life was good for the mullets, it was all good.
They assumed the mullets could handle the toxic mortgages that were slipped to them, like someone slipping a date rap e drug in their drink while the hapless consumees listen to the live music of their own success. The model was flawed and people knew this but they kept piping the sunshine into the living rooms of the new middle class. They blew sunshine into the credit cards also, upping the limits so everyone could spend more while slipping in some 29.9% interest rates and other corporate friendly onerous small print terms...hoping to boost the corporate projected income on paper but they knew, they were just hanging paper; no way the consumers could handle the load. New car, new house, new stuff, cash in hand...same ol' job with the same lame pay and benefits; how could it possibly work? But, methinks what turned the worm is the $4 gas. Once a little pressure was put on the US consumer, the game was up; he couldn't pay in cash. Then the ARM resets started and then the house of cards began to cave and the rest is in the history books. The whole thing didn't take 90 days and spread across the globe like a tsunami of cash destruction. The US consumer was shouldering the world aided by the paper boys spreading their joy like confetti falling from a pinata and everyone in the world was lapping at the pool happiness and prosperity.
Those that realized that the model was unsustainable kept stashing cash, slashing personal debt, hoarding metal and hard assets...we talked about it here, we took comfort in the strategy and the recognition, we preached it to those that would listen but it was already too late to turn the herd. But, no one is laughing just because they saw it coming, everyone got cut a little...a quick flick of a butterfly knife as the blade bumps along the rib cage. "There is no joy in Mudville-the mighty Casey has struck out." >>
It looks like Tim "eraserhead" Geithner felt a little to comfortable among his Council on Foreign Relations peers when he let out that he is considering alternatives to the dollar. Later, he recanted and he machine-like stated that he was for a strong dollar. These GS guys are so predictable.
I guess the race is on...who will inherit the earth and with what currency.
A brief exerpt from Rob Kirby's latest article. I didn't realize until today that one of the 3 banks that went under last Friday was the US Central Federal Credit Union. It apparently failed it's "stress test."
.... let us also not forget last Friday night’s [Mar. 20] takeover [or mugging, perhaps?] by the FDIC of U.S. Central Federal Credit Union, a huge wholesale credit union with about $34 billion in assets based in Lenexa, Kansas. This institution provides settlement services to 100 percent of corporate credit unions and 93 percent of all U.S. credit unions. At minimum, this means that local Credit Unions all over the U.S. [one of the only credible alternatives to money center banks] will now be facing higher costs according to Reuters:
“The immediate costs of the takeover are coming out of a $7 billion industry-maintained insurance fund, but will mean higher premiums levied on retail credit unions.”
The reason offered for regulators taking control of this wholesale credit union [and in turn burdening the ENTIRE credit union system] is alleged to have been that it failed a regulatory mandated “financial stress test”. If U.S. Central Federal Credit Union failed their financial stress test; the cadavers of Citibank and B of A must already be undergoing autopsies at the county morgue.
Interesting how anything that competes with, threatens, or offers an alternative to the Federal Reserve controlled financial system [like community banking] dies or is threatened but AIG lives!!!
How are they supposed to instill confidence when they contradict themself in the space of a few minutes?
Maybe it's their Alexander Haig Moment - "I'm in control here."
Interesting how anything that competes with, threatens, or offers an alternative to the Federal Reserve controlled financial system [like community banking] dies or is threatened but AIG lives!!!
Absolutely right.
Q: Are You Printing Money? Bernanke: Not Literally
It is very difficult for me to read those types of articles when it mentions things that are not facts and very sensationalist. When i read about Hersh and his paid for speech mentioning Cheney's Assasination Squad crap when he is known to lie during speeches versus what he writes down on paper... the rest of the article needs to be verified and cannot be trusted to use as toilet paper.
It is too bad the author goes into those realms and taints the whole thing. I am not saying it is all false... but once that line is crossed the rest is tainted.
It is very difficult for me to read those types of articles when it mentions things that are not facts and very sensationalist. When i read about Hersh and his paid for speech mentioning Cheney's Assasination Squad crap when he is known to lie during speeches versus what he writes down on paper... the rest of the article needs to be verified and cannot be trusted to use as toilet paper.
It is too bad the author goes into those realms and taints the whole thing. I am not saying it is all false... but once that line is crossed the rest is tainted. >>
Agreed but even if there is just a little truth to it....it is very disturbing.
Rob Kirby has been digging up dirt on TPTB for years and publishing it. His track record has proven his accuracy over time. Again, I'll take his word as well as Schiff, Sinclair, Middleton, and others before I swallow the party line coming from the FED or Treasury.
But I'm sorry if Kirby's article was offensive to you fc, but often times the truth hurts. Too bad we didn't get more of this out into the public 3-5 years ago when something could have been done about it. Do you really think that our credit unions are carrying more junk on or off their balance sheets compared to Citi, JPM, GS and are legitimately more at risk than those companies? Even if the truth does hurt today, it's still not the whole truth by any stretch. And you won't be reading the full story on all these shenanigans until years down the road.
Commentary from Briefing.com on todays economic report......
The February personal income and spending report was a mixed bag with income reported to have declined -0.2% (consensus -0.1%) and spending reported to have increased 0.2% (consensus 0.2%). In turn, personal income for January was revised lower to 0.2% from 0.4% while personal spending in January was revised higher to 1.0% from 0.6%... With respect to February, the core component of wage and salary disbursements dropped -0.4%. Declines were also seen in proprietors' income (-0.1%), rental income (-0.2%), and personal income receipts on assets (-1.3%). The main offset was a 0.8% increase in personal current transfer receipts... Real disposable income (after taxes) declined -0.4%, which isn't a terrific sign since real disposable income is the main driver of spending. Even so, spending on nondurable goods (+0.8%) and services (+0.1%) helped offset a 1.3% decline in spending on durable goods to produce the overall 0.2% increase in personal spending for the month... However, real PCE, which is the main component in GDP forecasts, declined -0.2% after a 0.7% increase in January. This could raise some concerns about the recent signs of improvement in retail sales being just a temporary improvement from a near lockdown state in the fourth quarter rather than marking a convincing turn in consumer spending behavior
My comments....Spending increases while income decreases. Only in America. Thank God for credit cards!!
Comments
6 Figures to Delivering Pizza
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
PEOPLE ARE NOT ABLE TO COMPREHEND THE MAGNITUDES.
Camelot
FINALLY performance is what people will get paid on. Why did it take so long to get to this?
Our new socialist congress is finally going to level the playing field for that small percentage of people at the very top, and why not?
Most all of the rest of us have always worked on a performance basis. Did you ever pay a plumber that did not fix your pipes but wanted his money so he could leave? Do you pay for undelivered goods, or heating repairs where the guy never shows up?
Here is the way this should unfold. Any company that takes the publics money i.e. has shareholders, or any company that takes government contracts, or any company that takes government subsides of any kind, should have a limited compensation amount for their upper level employees.
They should start off with salary caps of $250,000, and then come commissions, bonuses, stock options etc. all of those will be based on performance only.
So here are a few examples of how this would work.
An actor working for a publicly traded studio would get $250,000 for each movie. If the movie was a box office hit he or she would get a bonus. It the movie was a dud they would get nothing beyond the $250,000.
All sports players that worked for publicly held sports teams, or played in stadiums where tax payer money had been used to build the stadium, would get so much per game up to $250,000 per year, and so much of a bonus if they won their games.
Farmers big and small that receive government subsidies, or have public shareholders, are subject to the same rules.
Naturally all the car companies, the car parts suppliers, etc.
In just a few short years we will have this entire thing straighten out, and people will finally get paid what they deserve across all lines.
As a final note I think it will be interesting to watch companies like Goldman Sachs conform to the new rules. I am sure deep in their hearts this is what they have always wanted. There is no doubt the upper management of that company were always closet socialists, just look at their political donations for last year.
Heavy Hitters
Goldman Sachs: Recipients
Select Cycle: 2008
Money to Congress: 2008 Cycle
Dems: Dems: $2,497,544 $2,497,544
Repubs: Repubs: $769,971 $769,971
Others: Independents: $0 $0
Is there a guilt thing going on?
Why do Wealthy Jewish people predominently vote Democrat? Why do black people predominently vote democrat?
Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
Last year, I asked TWO of my employees who they preferred. Neither can vote. Both said the Democratic candidate. I asked them why? Neither could answer.
<< <i>FINALLY performance is what people will get paid on. Why did it take so long to get to this?
Our new socialist congress is finally going to level the playing field for that small percentage of people at the very top, and why not?
Most all of the rest of us have always worked on a performance basis. Did you ever pay a plumber that did not fix your pipes but wanted his money so he could leave? Do you pay for undelivered goods, or heating repairs where the guy never shows up?
Here is the way this should unfold. Any company that takes the publics money i.e. has shareholders, or any company that takes government contracts, or any company that takes government subsides of any kind, should have a limited compensation amount for their upper level employees.
They should start off with salary caps of $250,000, and then come commissions, bonuses, stock options etc. all of those will be based on performance only.
So here are a few examples of how this would work.
An actor working for a publicly traded studio would get $250,000 for each movie. If the movie was a box office hit he or she would get a bonus. It the movie was a dud they would get nothing beyond the $250,000.
All sports players that worked for publicly held sports teams, or played in stadiums where tax payer money had been used to build the stadium, would get so much per game up to $250,000 per year, and so much of a bonus if they won their games.
Farmers big and small that receive government subsidies, or have public shareholders, are subject to the same rules.
Naturally all the car companies, the car parts suppliers, etc.
In just a few short years we will have this entire thing straighten out, and people will finally get paid what they deserve across all lines.
As a final note I think it will be interesting to watch companies like Goldman Sachs conform to the new rules. I am sure deep in their hearts this is what they have always wanted. There is no doubt the upper management of that company were always closet socialists, just look at their political donations for last year.
Heavy Hitters
Goldman Sachs: Recipients
Select Cycle: 2008
Money to Congress: 2008 Cycle
Dems: Dems: $2,497,544 $2,497,544
Repubs: Repubs: $769,971 $769,971
Others: Independents: $0 $0 >>
Pay for performance??!!! When do we get our money back from our representives? Lets tax them at 90%.
Knowledge is the enemy of fear
capable of ruining the country and sending jobs overseas. I bet 99 out of a 100 eight
year olds can drive a company into bankruptcy* or make a really crappy movie. The rea-
son I bring it up is the mess in education. School boards in many cases deserve no mon-
ey at all. They can't even get half the students in their districts learnt to read and right.
I'd wager if their compensation was limited to $2.50 until they they figured out a way to
do their jobs right there would be kids reading and writing in six weeks. Why pay any-
thing at all for abject and utter failure. We pay more than any other country for just
about the worst schools in the world.
*given sufficient time
Yes, but somtimes we get headed down a road and find we can not get off!
Look at the "Great Society"
A good read of gold stocks vs. gold bullion and commodities based on their performance since 1921.
roadrunner
should be made to live in Bangladesh during
the monsoon season with a second home
in Cuckamonga,CA.
Camelot
<< <i>As a final note I think it will be interesting to watch companies like Goldman Sachs conform to the new rules. I am sure deep in their hearts this is what they have always wanted. There is no doubt the upper management of that company were always closet socialists, just look at their political donations for last year. >>
Im sure they would conform to these rules as well as they conform to all the insider trading, market manipulation, collusion and other rules and laws they have followed so well.
As far as political contributions I think the money they give to holders of public office would often be better classified as compensation to employees currently infiltrating government positions.
I said " Looks like you're bringing bad news!". He said, "Not really, I'm the warning guy". The guy across the street is buried in that house having bought it at the absolute top of the market. He lost his job 6 months ago and we all know where this ones going. So I asked the guy if it's going into foreclosure and he said it'll take a year but yes. I said oh great, just what we need is another foreclosure on the block, just as we're planning on listing our house for sale as we just bought another house in Sarasota, ......( to be closer to NGC........kidding, because it's a great house at a great price ).
He went on to tell me he's working 7 days a week and that he's leaving 600-700 foreclosure warnings on peoples doors.......a MONTH !
There are single family houses in this town, which is a quaint old Florida type town on the west coast of Fla, that are listed for less than a RV. Single family houses in the $35,000-$50,000. We just bought one that was built in 2002 at a cost of close to 500K, which was long before the idiocy took over and we're paying a fraction for it. At the top it was probably $750K, maybe more. A house I sold for $450K in 2001 that I lost 100K on at the height was supposedly 1.8 Million. LOL, I couldn't get 500K for it after spending 200K in renovations including 80 grand on the kitchen and it was supposedly 1.8 Million at one point?
Meanwhile for 50 G's you can own a single family getaway house in Port Charlotte Fla, between Sarasota and Ft Myers. For 100K you can buy a pretty decent 2 or 3 bedroom house here on 1/4 acre lot with lots of Palm trees, orange, tangerine, bannana's right on your property. Waterfront houses that were well over a million bucks with access to the Gulf of Mexico are listed in the $300's to $400's. How much lower can it go? With the amount of foreclosures and people walking away from their responsibilities, I think it's going to go even lower.
And the same things that helped destroy the economy to begin with, the printing, the taxing, the borrowing the spending, the new administration is making the old admin look conservative............and we all know that they were anything BUT conservative.
What a shame.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
Yes Sir post of the daY!
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
<< <i>mrearlygold, that was a good story, good perspective. I felt I was there.
Yes Sir post of the daY! >>
GS, that's a good idea....to have a post of the day, week, month and year. Thought provoking, content, insight, story, info, predictions, bafoonery......
Ren
Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain.
I will take $1,000,000 worth of mortgages for $10,000,
and I would like to borrow the money non-recourse at 1%.
Ya lets do it, lets clean up those toxic assets.
New York Times
WASHINGTON — The Treasury Department is expected to unveil early next week its long-delayed plan to buy as much as $1 trillion in troubled mortgages and related assets from financial institutions.
The plan is likely to offer generous subsidies, in the form of low-interest loans, to coax investors to form partnerships with the government to buy toxic assets from banks.
To help protect taxpayers, who would pay for the bulk of the purchases, the plan calls for auctioning assets to the highest bidders.
<< <i>Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain. >>
You can pull it off as long as you can find new villians to demonize while claiming that your policies are the only solution. Just pick the right target (Pres Bush, Limbaugh, CEOs, banks, Wall Street, AIG, Others To Be Announced, etc.) and add pinch of class envy. You can distract the poor from their own problems along with the unmet election year promises of the party they blindly support.
Certainly politicians still have a way to go as their control of the media is not yet complete. Stalin clearly was the expert. He nimbly conjured up counter-revolutionary plots as needed to mask the evil of Soviet Communism. His targets included white guards, aristocratic emigres, Trotskyites, Bukharites, Mensheviks and fascist spies. Stalin had well staged show trials - we have accusatory hearings on Capital Hill.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
<< <i>Yepper, Mrearly, POTD. >>
Thank you all very much. This has never happened before and it makes me feel:
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>mrearlygold, fascinating story from the Florida perspective. The type of boom and bust you are seeing all around you is not evident in rural Pennsylvania. We never saw very much of the 2003-2007 housing boom. >>
Well I'm not familiar with "rural" PA but I do know a little about some parts of PA because we considered ( I considered which my Wife shot down to which I am thankful that a sharper mind prevailed on that one! ) . Wayne Cnty for example. Neat area and just a bit too far for the "commuters" to travel to norther Jersey or NYC for work. Oh some people try but after a real short while that feeling changes. Place there called the "Hideout" which I am pretty familiar with and also have a friend who owns a place there. That place absolutely experienced the boom and is now experiencing the bust. Little houses that were 70-80 Grand shot up to over 200K. How ridiculous is that? Try to sell one of those now. Is it as bad as South Florida?
Not yet but it's in that direction.
Many people claimed that NYC real estate was "immune" because of foreign investment. Before that it was immune because of Wall street investment. Before that it was supply and demand. I was up last year and walking down Sullivan st in the village, across the street where Googies USED to be ( I didn't know it was closed!
Think this is just Fla or California, most places are experiencing a slow down or a decline and I would submit that we are nowhere near the bottom. Look at places like Michigan , Ohio. Once upon a time when we got a lead from someone in the midwest there was a good chance that person was in some way involved in manufacturing automobiles, or something. Now what? Many are fleeing. Many fled and came to SW Fla. There's a guy here on the forum in Naples I believe who said once that Midwest Money built the west coast of Fla. I agree for the most part just like Northeast Money built the east coast of Fla. Where's that money now?
Here's a podcase by Gerald Calente. It's only 12 minutes long and it's a good one. Look this guy up if you don't know who he is or decide to dismiss him . I also like Peter Schiff and would absolutelt support that guy if he was running for office.
Heres Celente on wikpedia
Calente profile
Calente Podcast This weekend on $2,000 Gold and more:
Calente on $2,000 Gold
We've never seen anything like this in world history.
More on Calente at Trend Research
TREND RESEARCH
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain. >>
Maybe because after 8 years of a Republican White House they saw only the rich get stupid richer while the average public got robbed by the Wall Street elite. This isnt about socialism or capitalism, this was about the Republican administration doing nothing while all the major banks in the country got robbed by thier friends. Where was the oversight, oh thats right on fully paid junkets.
This was the first time I voted for democrat president in 30 years (and I was sick doing it) but I didn't want another 4 years of Republican led graft and corruption. Republicans got what they earned and were all gonna be scewed for it.
<< <i> as long as you can find new villians to demonize >>
You dont need to look for demons, when the last group in charge robs you blind you replace them.
<< <i>
<< <i>Vote any way you wish but I have yet to understand why a poor person, voting Democratic for 50 years and still poor would continue with that voting preference.
I've always wondered about that. Isn't that the definition of insanity. The voting results stay the same and yet these voters still complain. >>
Maybe because after 8 years of a Republican White House they saw only the rich get stupid richer while the average public got robbed by the Wall Street elite. This isnt about socialism or capitalism, this was about the Republican administration doing nothing while all the major banks in the country got robbed by thier friends. Where was the oversight, oh thats right on fully paid junkets.
This was the first time I voted for democrat president in 30 years (and I was sick doing it) but I didn't want another 4 years of Republican led graft and corruption. Republicans got what they earned and were all gonna be scewed for it.
<< <i> as long as you can find new villians to demonize >>
You dont need to look for demons, when the last group in charge robs you blind you replace them. >>
Yup, sure, with either more of the same or worse. Now if that makes sense to anyone, let the chips fall where they may.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>
<< <i>mrearlygold, fascinating story from the Florida perspective. The type of boom and bust you are seeing all around you is not evident in rural Pennsylvania. We never saw very much of the 2003-2007 housing boom. >>
Well I'm not familiar with "rural" PA but I do know a little about some parts of PA because we considered ( I considered which my Wife shot down to which I am thankful that a sharper mind prevailed on that one! ) . Wayne Cnty for example. Neat area and just a bit too far for the "commuters" to travel to norther Jersey or NYC for work. Oh some people try but after a real short while that feeling changes. Place there called the "Hideout" which I am pretty familiar with and also have a friend who owns a place there. That place absolutely experienced the boom and is now experiencing the bust. Little houses that were 70-80 Grand shot up to over 200K. How ridiculous is that? Try to sell one of those now. Is it as bad as South Florida?
Not yet but it's in that direction.
Many people claimed that NYC real estate was "immune" because of foreign investment. Before that it was immune because of Wall street investment. Before that it was supply and demand. I was up last year and walking down Sullivan st in the village, across the street where Googies USED to be ( I didn't know it was closed!
Think this is just Fla or California, most places are experiencing a slow down or a decline and I would submit that we are nowhere near the bottom. Look at places like Michigan , Ohio. Once upon a time when we got a lead from someone in the midwest there was a good chance that person was in some way involved in manufacturing automobiles, or something. Now what? Many are fleeing. Many fled and came to SW Fla. There's a guy here on the forum in Naples I believe who said once that Midwest Money built the west coast of Fla. I agree for the most part just like Northeast Money built the east coast of Fla. Where's that money now?
Here's a podcase by Gerald Calente. It's only 12 minutes long and it's a good one. Look this guy up if you don't know who he is or decide to dismiss him . I also like Peter Schiff and would absolutelt support that guy if he was running for office.
Heres Celente on wikpedia
Calente profile
Calente Podcast This weekend on $2,000 Gold and more:
Calente on $2,000 Gold
We've never seen anything like this in world history.
More on Calente at Trend Research
TREND RESEARCH >>
mrearlygold, you are correct about eastern Penna along the Delaware River. Wayne County, Pike County and Monroe County have all been profoundly impacted by the NYC market. Those counties have seen the boom and bust fueled by commuters willing to trek to work in NJ and NYC. Rural Pennsylvania to the north and west of Interstates 80 and 81 is fortunately still too far from NYC. That large rural region's economy is still based on stolid but more solid agriculture, lumbering and manufacturing.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
Comrade Ren
An interesting read about how AIG's Joe Cassano and his off shoot of the AIG insurance company took down the company as well as most of the Western World. If you can't tolerate a few inappropriate "expletive deleteds" then please pass on this 8 page article. Yeah, it's from RS but it's the content that counts. The article explains how each step of regulation was slowly lifted (or ignored) to make all this happen. Please note that the DEMs had every bit as much a role in making this happen. If not for the Rubin, Summers, and Clinton team in the late 1990's none of this may have happened. Sen. Phil Gramm (TX), who in 1999 was the head of the Senate Banking Committee, played one of key roles in deregulation when he pushed through the Gramm-Leach-Biley act of 1999 which repealed portions of Glass-Steagal. This allowed investment and commercial banks to mix and become mega-giants. Needless to say, he received millions in campaign contributions for his assistance. While he did spend his formative years as a democratic congressman, he spent the last 19 years as a republican. I believe he is currently reaping his rewards as a key player in UBS.
Aden Sisters tank gold by posting another article
Just like when gold peaked on Feb 20th the Aden Sisters had just come out with another bullish article. And like clockwork they put one out this afternoon.....and gold fell from $952 to $939 last I looked (lol). But unexpected was that most gold stocks ended up slightly higher today even with gold falling. Note that Freeport McMoran (TCX) continues on a tear as one of the world's leading copper producers. The Aden sisters (or should I say the "amen sisters") have had uncanny timing the past several years of being the last ones to post on gold's bullishness, and to signal a corrective move. But at least they seem to have gotten the Dow and USDollar moves correct. The previously declared dead Euro seems ready to head back into the 1.40's. Silver still hanging in there though and copper (another inflation sniffer) went to another high today. Platinum and Palladium higher from Friday as well. Look like all the "fear" is gone and time to invest in re-inflation. 10 and 30 yr bond yields also slowly going back up from last week's plunge.
First time I've seen JS post on the possible derivatives "solution" of calling them all null and void. He feels we've already gone $10 TRILL too far into this mess.
Under the law the ONLY way to cancel contracts is the US government declaring by Presidential Order an Economic Emergency, an act he will not do. An Economic Emergency Declaration is when there is no solution, and is considered a Draconian surrender to circumstances.
roadrunner
You don't pay you mortgage then
Guido comes over to your house
and splains things to you.
Camelot
Bandwagon jumper.
Mining stocks had a terrible day, all things considered. A 6-8% up day and GDX is up 0.5%??!! FCX has possibly 10% further upside. Then its dead. I feel comfortable with my GDX short placed on Friday, unless its up 5% tomorrow.
Knowledge is the enemy of fear
Also a good explanation on gold carry trade, credit swaps, CDOs, CPDOs and other derivatives. Not a very cheerful outlook, especially if the 15x increase in US monetary base takes place.
Fed Planning Inflation
Link to major institutional buying/selling
roadrunner
Japan exports to the U.S. tumbled an unprecedented 58.4 percent
I still find it amazing how quickly the world economy came to a virtual standstill.
Knowledge is the enemy of fear
Failed gilt auction stokes fears over UK economy - Daily Telegraph
Daily Telegraph reports the UK Debt Management Office attracted just 1.67 bln pounds in bids for its sale of 1.75 bln pounds of 2049 gilts this morning, its first uncovered auction of conventional gilts since 1995. The cover of just 0.93 times is believed to be the lowest in history and far worse than the 0.99 times in 1995. The average cover of the last three auctions was 2.1 times. Failure raises fears that the govt may not be able to secure the billions of pounds its needs from the markets to fund its record fiscal deficit without paying far more for the money, and reflects concerns about UK economic stability... Politicians have raised concerns that an uncovered gilt auction could lead to a cut in the sovereign credit rating, which could have devastating consequences for the national debt -- due to hit a record 1 trillion pounds - as the interest bill would soar.
Knowledge is the enemy of fear
Yes, a very interesting phenomenon. The system was wound so tightly in an effort to wring every last cent out of an already maxed out US consumer and using that income as a way to pump up asset fund paper values well beyond any credible justification. The main problem was people were projecting strong growth at the top while the assuming the health of the prey propulation was stable and prospering...at least, that's what it looked like on paper. We here had noticed the disconnect a while back, well before anyone put it in the media but you can be sure folk that were working the deals must have had questions about the sustainability of the model but they plowed ahead anyway with their paper derivatives based on the continued spending and increasing indebetness of the mullets as the managers collected their bonuses and vacationed in Costa Rica; life was good for the paper boys, life was good for the mullets, it was all good.
They assumed the mullets could handle the toxic mortgages that were slipped to them, like someone slipping a date rap e drug in their drink while the hapless consumees listen to the live music of their own success. The model was flawed and people knew this but they kept piping the sunshine into the living rooms of the new middle class. They blew sunshine into the credit cards also, upping the limits so everyone could spend more while slipping in some 29.9% interest rates and other corporate friendly onerous small print terms...hoping to boost the corporate projected income on paper but they knew, they were just hanging paper; no way the consumers could handle the load. New car, new house, new stuff, cash in hand...same ol' job with the same lame pay and benefits; how could it possibly work? But, methinks what turned the worm is the $4 gas. Once a little pressure was put on the US consumer, the game was up; he couldn't pay in cash. Then the ARM resets started and then the house of cards began to cave and the rest is in the history books. The whole thing didn't take 90 days and spread across the globe like a tsunami of cash destruction. The US consumer was shouldering the world aided by the paper boys spreading their joy like confetti falling from a pinata and everyone in the world was lapping at the pool happiness and prosperity.
Those that realized that the model was unsustainable kept stashing cash, slashing personal debt, hoarding metal and hard assets...we talked about it here, we took comfort in the strategy and the recognition, we preached it to those that would listen but it was already too late to turn the herd. But, no one is laughing just because they saw it coming, everyone got cut a little...a quick flick of a butterfly knife as the blade bumps along the rib cage. "There is no joy in Mudville-the mighty Casey has struck out."
Gold fractal analysis update - David Nichols
Nichols updates us for the first time since February after calling for a March low. He now points out that the monthly gold fractal is at a point of energy that we've only seen twice in the past 3-1/2 years. Each of those previous times lead to major moves in gold to peaks of $730 in April 2006 and $1033 in March 2009. His basic point is that there is a large amount of gold energy to dissipate in the near future and each successive bounce off previous hard supports (such as $880 for example) only builds more energy. The chart also shows that the present 2009 position is actually stronger than the late 2007 position that took us to >$1000 that first time in March 2008. This is not good news for maintaining the status quo of the $800-$950 "trading range." To add further fuel to this equation, many of the gold stocks exceeded their Feb highs today as did the broader etf GDX. All this while gold is "weak." Note that gold stocks lead gold in Feb's run up.
roadrunner
Almost EVERY Govt auction has been over subscribed. In fact, I cant remember any that wasnt. Just look at the story, the previous low was 99% back in 1995. The last few have had 2x the demand for the offering.
I love todays headlines....backtracking and whipsaws....
1. 1:38 PM IMF head says does not believe dollar's days as reserve currency are over, Chinese don't think it either - Reuters
2. 1:20PM IMF Head says crisis may renew interest for new reserve currency - DJ
3. 10:15 AM Geithner says dollar remains world's reserve currency, likely to remain so for long time - Reuters
4. 9:56AM Geithner says "quite open" to China's suggestion of moving toward SDR-linked currency system - Reuters
How are they supposed to instill confidence when they contradict themself in the space of a few minutes?
SKF be very very good to me.
Knowledge is the enemy of fear
Dave this is what we need here, but rather some auctions that nobody comes to.
There is nothing that says the dollar cannot remain the reserve currency, but it is not written that anyone has to buy any more debt. If our lein holders want to stenghten the dollar all they have to do is buy NO more debt.
It is one thing for the socialists to produce trillions in dollars in plans, but something else to find enough suckers to be lenders.
I wonder how long it will take the debt suckers to figure that out?
<< <i>"I still find it amazing how quickly the world economy came to a virtual standstill."
Yes, a very interesting phenomenon. The system was wound so tightly in an effort to wring every last cent out of an already maxed out US consumer and using that income as a way to pump up asset fund paper values well beyond any credible justification. The main problem was people were projecting strong growth at the top while the assuming the health of the prey propulation was stable and prospering...at least, that's what it looked like on paper. We here had noticed the disconnect a while back, well before anyone put it in the media but you can be sure folk that were working the deals must have had questions about the sustainability of the model but they plowed ahead anyway with their paper derivatives based on the continued spending and increasing indebetness of the mullets as the managers collected their bonuses and vacationed in Costa Rica; life was good for the paper boys, life was good for the mullets, it was all good.
They assumed the mullets could handle the toxic mortgages that were slipped to them, like someone slipping a date rap e drug in their drink while the hapless consumees listen to the live music of their own success. The model was flawed and people knew this but they kept piping the sunshine into the living rooms of the new middle class. They blew sunshine into the credit cards also, upping the limits so everyone could spend more while slipping in some 29.9% interest rates and other corporate friendly onerous small print terms...hoping to boost the corporate projected income on paper but they knew, they were just hanging paper; no way the consumers could handle the load. New car, new house, new stuff, cash in hand...same ol' job with the same lame pay and benefits; how could it possibly work? But, methinks what turned the worm is the $4 gas. Once a little pressure was put on the US consumer, the game was up; he couldn't pay in cash. Then the ARM resets started and then the house of cards began to cave and the rest is in the history books. The whole thing didn't take 90 days and spread across the globe like a tsunami of cash destruction. The US consumer was shouldering the world aided by the paper boys spreading their joy like confetti falling from a pinata and everyone in the world was lapping at the pool happiness and prosperity.
Those that realized that the model was unsustainable kept stashing cash, slashing personal debt, hoarding metal and hard assets...we talked about it here, we took comfort in the strategy and the recognition, we preached it to those that would listen but it was already too late to turn the herd. But, no one is laughing just because they saw it coming, everyone got cut a little...a quick flick of a butterfly knife as the blade bumps along the rib cage. "There is no joy in Mudville-the mighty Casey has struck out." >>
This is so well written.
Chance favors the prepared mind.
I guess the race is on...who will inherit the earth and with what currency.
Comrade Renski
.... let us also not forget last Friday night’s [Mar. 20] takeover [or mugging, perhaps?] by the FDIC of U.S. Central Federal Credit Union, a huge wholesale credit union with about $34 billion in assets based in Lenexa, Kansas. This institution provides settlement services to 100 percent of corporate credit unions and 93 percent of all U.S. credit unions. At minimum, this means that local Credit Unions all over the U.S. [one of the only credible alternatives to money center banks] will now be facing higher costs according to Reuters:
“The immediate costs of the takeover are coming out of a $7 billion industry-maintained insurance fund, but will mean higher premiums levied on retail credit unions.”
The reason offered for regulators taking control of this wholesale credit union [and in turn burdening the ENTIRE credit union system] is alleged to have been that it failed a regulatory mandated “financial stress test”. If U.S. Central Federal Credit Union failed their financial stress test; the cadavers of Citibank and B of A must already be undergoing autopsies at the county morgue.
Interesting how anything that competes with, threatens, or offers an alternative to the Federal Reserve controlled financial system [like community banking] dies or is threatened but AIG lives!!!
Full article:
Derelicts on the Dole - Rob Kirby
roadrunner
Maybe it's their Alexander Haig Moment - "I'm in control here."
Interesting how anything that competes with, threatens, or offers an alternative to the Federal Reserve controlled financial system [like community banking] dies or is threatened but AIG lives!!!
Absolutely right.
I knew it would happen.
<< <i>
Full article:
Derelicts on the Dole - Rob Kirby
roadrunner >>
That's a very disturbing article!
<< <i>
<< <i>
Full article:
Derelicts on the Dole - Rob Kirby
roadrunner >>
That's a very disturbing article! >>
It is very difficult for me to read those types of articles when it mentions
things that are not facts and very sensationalist. When i read about
Hersh and his paid for speech mentioning Cheney's Assasination Squad
crap when he is known to lie during speeches versus what he writes
down on paper... the rest of the article needs to be verified and cannot
be trusted to use as toilet paper.
It is too bad the author goes into those realms and taints the whole
thing. I am not saying it is all false... but once that line is crossed the
rest is tainted.
<< <i>
<< <i>
<< <i>
Full article:
Derelicts on the Dole - Rob Kirby
roadrunner >>
That's a very disturbing article! >>
It is very difficult for me to read those types of articles when it mentions
things that are not facts and very sensationalist. When i read about
Hersh and his paid for speech mentioning Cheney's Assasination Squad
crap when he is known to lie during speeches versus what he writes
down on paper... the rest of the article needs to be verified and cannot
be trusted to use as toilet paper.
It is too bad the author goes into those realms and taints the whole
thing. I am not saying it is all false... but once that line is crossed the
rest is tainted. >>
Agreed but even if there is just a little truth to it....it is very disturbing.
But I'm sorry if Kirby's article was offensive to you fc, but often times the truth hurts. Too bad we didn't get more of this out into the public 3-5 years ago when something could have been done about it. Do you really think that our credit unions are carrying more junk on or off their balance sheets compared to Citi, JPM, GS and are legitimately more at risk than those companies? Even if the truth does hurt today, it's still not the whole truth by any stretch. And you won't be reading the full story on all these shenanigans until years down the road.
roadrunner
The February personal income and spending report was a mixed bag with income reported to have declined -0.2% (consensus -0.1%) and spending reported to have increased 0.2% (consensus 0.2%). In turn, personal income for January was revised lower to 0.2% from 0.4% while personal spending in January was revised higher to 1.0% from 0.6%... With respect to February, the core component of wage and salary disbursements dropped -0.4%. Declines were also seen in proprietors' income (-0.1%), rental income (-0.2%), and personal income receipts on assets (-1.3%). The main offset was a 0.8% increase in personal current transfer receipts... Real disposable income (after taxes) declined -0.4%, which isn't a terrific sign since real disposable income is the main driver of spending. Even so, spending on nondurable goods (+0.8%) and services (+0.1%) helped offset a 1.3% decline in spending on durable goods to produce the overall 0.2% increase in personal spending for the month... However, real PCE, which is the main component in GDP forecasts, declined -0.2% after a 0.7% increase in January. This could raise some concerns about the recent signs of improvement in retail sales being just a temporary improvement from a near lockdown state in the fourth quarter rather than marking a convincing turn in consumer spending behavior
My comments....Spending increases while income decreases. Only in America. Thank God for credit cards!!
Knowledge is the enemy of fear
Credit Nation. Eroding savings via inflation. Serfdom. What's the difference?
I knew it would happen.