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Dec 6th, 2017
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Joined: Aug 2004
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It's the Despair Quotient! Carpal Tunnel
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It's the Despair Quotient! Carpal Tunnel
Joined: Aug 2004
Posts: 17,177 Likes: 254 |
This thread needs to be brought roaring back thanks to the latest news from the Fed. The Federal Reserve has finally answered several of my burning questions, chief among which, "why are they now secreting the M3 figures after 90 plus years of publishing them out in the open?" Looks like my suspicions as to why have been confirmed. The Fed made the M3 figures secret because they didn't want anyone to know how much extra they were printing, but now it doesn't matter anymore, because the Fed has decided to turn the United States into Weimar Germany. Fed Begins Massive Monetization of U.S. Government Debt During the Ford administration we had those stupid WIN buttons (whip inflation now) and that was when inflation was at 21 percent and the economy was shrinking at a 6% per annum rate as a result. When this effort is even partially implemented (let’s say – just 20% of the National debt), it will lead to inflation of the order of 60-80%. The monetization of the US Debt is in fact the single most important and dangerous act ever committed by a Government Agency. It will lead, through the necessary printing of unsecured currency (or Reserve Notes – which in fact are a form of unsecured debt themselves) to hyperinflation which will lead to the destruction of the economic foundations of this nation. This is the beginning of the end. Once this step is taken (something which every Fed Chairman in history – including Bernaenke – the current Chairman, has said should NEVER, EVER be done), we will have effectively started us on the same path as the Weimer Republic. Anyone remember where that led? Oh yeah, don't forget to blame Obama for this! 
"The Best of the Leon Russell Festivals" DVD
deepfreezefilms.com
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Anyone remember where that led? A better fiscal quarter and income statement for the arms industry?
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' [b]Default Gets Another Look Amid Bailout[/b]As another European country edges toward a multibillion-dollar bailout, a number of economists say there is only one way to make creditors share the pain: default.
So far, Germany's guarantees of Irish and Greek debt have been cost free. German yields remain very low. But come the inevitable Greek and Irish defaults, Germany's bond market will also start to suffer.
In Dublin, officials from the International Monetary Fund, European Union and United Kingdom are negotiating a rescue package that is likely to require the Irish government to further squeeze pensions and paychecks but pay off bondholders of Irish banks, whose debts the government guaranteed.
Such a lopsided outcome—which has been repeated since the Latin America debt crises of the 1980s—enrages many voters and signals to investors that there is no price to pay for risky lending because international institutions will always bail them out.
Instead, say economists, lenders should be required to take hits on their investments as a way to reduce a government's bills and to force lenders to be more careful about where to invest their money next time because they will realize the IMF and others won't guarantee they will be paid in full.
"The most important effect is that (a country's) debts won't build up so much," said Harvard economist Kenneth Rogoff, who has chronicled centuries of sovereign defaults.
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' [b]Forget Ireland, Spain is the real nightmare[/b] Now that the second charter member of the PIGS has turned into a reluctant recipient of EU-IMF largesse, the question is not whether there will be more bailouts, because they are inevitable.
The whole Irish exercise is not about rescuing Ireland’s public finances, but restoring confidence in the bond market and saving the hides of all the European banks on the hook if the Irish banks go bust.
Portugal will be the next domino. The surest sign came from Portuguese Prime Minister Jose Socrates himself, When he emphatically declared on Monday that his country doesn’t need a bailout....
What really worries the eurocrats is not small Ireland or Portugal, but much larger Spain. And anyone expecting these aid packages to soothe the bond vigilantes hasn’t seen anything yet....
Throw in the fact that the fiscal situation in Greece is actually deteriorating and the Greeks may not qualify for the next tranche of their financial aid, and what seemed like a serious threat to the euro zone’s survival turns out to be only the tip of the iceberg.
And Spain could turn out to be the sovereign equivalent of the Titanic.
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' European Debt Crisis Will Be 'Slow-Motion Wreck'[/b]The CEO of the world's largest bond manager said balance sheet issues will cause Europe to be "a slow-motion wreck" that will cause crises in "Ireland, then Portugal, then Spain, then Belgium, then Italy."
"The first rule of crisis management hasn't been met by the Europeans: and that is to get ahead of the crisis ... "As long as they're being seen as reactive, we're going to have a slow-motion wreck going on in Europe....
[b]The problems in Europe have roiled world markets and essentially counteracted the Federal Reserve's moves to pump money into the economy by buying Treasurys.
Instead of the dollar weakening that would be expected to follow the Fed's $600 billion quantitative easing action, the US currency has strengthened against the euro. That in turn has pressured US stocks, which opened lower Tuesday.
Last edited by numan; 12/02/10 08:24 PM.
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' Here is the situation that is shaking Europe: Eurozone Government Deficits As a Proportion of GDP 2009[/b]The figure for the United States is: [b] 44% !If the US dollar loses its status as the world oil currency, it is so screwed!
Last edited by numan; 12/02/10 10:06 PM.
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Are you certain that 44 percent figure is correct? For FY 2009 the US GDP was about $14 trillion. 44 percent of that is $6.2 trillion. The US government's budget for the same year was $3.5 trillion. I don't see how a deficit can exceed the budget. Particularly since the tax revenues were about $2.1 trillion. The budget deficit for FY 2009 was about $1.4 trillion. As a percentage of GDP that comes out pretty darned close to 10 percent, not 44 percent. I used the wiki article on US federal budget for all of the figures above except for the GDP, which I got from google search "united states gdp" and google obligingly gave me a nice chart for the very first hit.
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.
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' [b]Mired in a Colossal Muddle -- US Economy Remains Stuck in Long-Term Slump[/b]So, why aren't businesses investing?
Because working people are underwater on their mortgages, maxed out on their credit cards, and overdue on their bills. There's no reason to build more capacity when consumers are struggling just to stay afloat. But that creates a big problem for the economy, because new investment is crucial to keeping things running smoothly....
Consumers and households are still deleveraging, housing prices are falling and unemployment is stuck at 9 percent with 16.5 percent underemployed. Private sector debt is still at historic levels and will have to come down further. If that process is not eased by increasing the government's budget deficits, then economy will shrink even more and lapse back into recession. Capitalism is between a rock and a hard place just as much as it was during the Great Depression. Much better to see the assets of the Super-Rich go up in flames, rather than see the rest of us go down in flames.
Last edited by numan; 07/06/11 04:23 AM.
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' Does the Weatherman Know Which Way the Wind Blows? · · ·  Soros’s Quantum Holding 75% Cash Leads Hedge Funds Baffled by Instability[/b]...billionaire George Soros, who made $1 billion betting against the British pound in 1992, is perplexed.
“I find the current situation much more baffling and much less predictable than I did at the time of the height of the financial crisis,” Soros, 80, said in April at a conference at Bretton Woods organized by his Institute for New Economic Thinking. “The markets are inherently unstable. There is no immediate collapse, nor no [b][sic !] immediate solution.”...
The second question is whether the U.S. government is willing to boost its infrastructure spending at a time when Congress is struggling to cut the nation’s deficit, Gibbins said. A failure to spur growth will send stocks down in the U.S. and keep the dollar weak, he said.
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Much better to see the assets of the Super-Rich go up in flames, rather than see the rest of us go down in flames. fringe thinking a resultant from pressure of situation??? should i remind you that in 1948 our national debt stood at 125% GDP but after 25-30 years we brought it down to pre-war levels. the wealthy did indeed endure very high marginal tax rates but were not taxed into oblivion. while the current situation can not be adequately compared to that we are approaching difficult times. The economy is an organic intangible which morphs with each new need of the market. I see a long term plan of perhaps 50-60 years to bring the national debt into focus. Obviously just as the CBO scores plans if the economic scenery changes so does the plan i.e. short term if the economy improves revenues may increase which with appropriate budgetary cuts would bring the budget under control, long term debt relief will suffer from items which outstrip inflation and that has to be of short term concern if the fed doesn't address monetary policy appropriately, etc.
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