Financial Crisis

[AlexLah]

I posted this one a while ago. So if the stock market is a (partly) indicator of the economy you can see that this last decade it took 2 to six years to get to previous level. But hey they still could create some kind of bubble.

Where is the next bubble? Or maybe the US will become the new low cost manufacturer of goods when people are willing to work for 10 Dollars a day and foreign investors are willing to set up new factories? Nobody really knows how to fix this mess other than throwing money in the black hole repairing roads and bridges and digging underpasses for turtles.

But hey on the positive side there are only about 17% un/underemployed so the majority of people still have work.

I believe it is save to say we have seen a top.

[BlackJack]

China:

Yes, I'm following the index and some of the companies in it.....it's like the mountains in Le Tour de France, isn't it ?

What's your view LRB ?..where are we going ?

LaoPo

That IS my view, which is soon to be an Intermediate term negative view, though it may turn out to be wrong as the LT chart is showing signs it may have turned up.

Surely by now with such things as the revelation about the nature of the Goldman Sachs

trading programme, the artificial environment as to how banks can determine

the way their assets are valued and how markets seem so utterely divorced from economic

fundamentals......at the end of the day markets can now be engineered to

behave any way people want them to ?

Lets start to call it what it is and not beat around the bush - (no pun intended George as you let it happen)

con·spired, con·spir·ing, con·spires

v.intr.

1. To plan together secretly to commit an illegal or wrongful act or accomplish a legal purpose through illegal action.

THIS IS precisely what GS has done - read the website they tried to shut down - www.goldmansachs666.com

As each day passes more and more FACTS are revealed about GS and so when we look back we can see that it is in fact a conspiracy.

con·spir·a·cy (kn-spîr-s)

n. pl. con·spir·a·cies

1. An agreement to perform together an illegal, wrongful, or subversive act.

2. A group of conspirators. FED, GS, US government, banks etc.

3. Law An agreement between two or more persons to commit a crime or accomplish a legal purpose through illegal action.

4. A joining or acting together, as if by sinister design:

So Klingons aside this is a conspiracy we are watching unfold. Its not the black helicopters and people switching briefcases but higher up very sophisticated stuff. Like wizz bang computer programs that can do 60% of Wall Street trades in nano seconds!!

When you have a wall street bank that is not accountable in any shape or form, that can use a computer program to manipulate the markets, with gold and money it does not have, and the government allows it to happen with no investigation then folks I think you can bet your last dollar that its a conspiracy in the TRUE SENSE.

Wake up!!!

Good luck

[teletiger]

Still, this saga has 10 years to run yet.

Gosh, all that entertainment to come.....Hope I don't shuffle off before it ends.

Anyway....is sounding like the Establishment apologist really your style Naam? I think not.

Regards.

Just interested where you got this figure .............I mean that is a long time IMO

and i dont think people will be patient for that long..................

Gerald Celente expects things to seriously start unwinding in US around 2012

Haha....Quite right to pull me up on that one midas. I did actually give it some thought. Though now you've mentioned it, maybe not enough thought. Pandoras box comes to mind.

My first thoughts were Alice Darling's "over by Christmas", to more than one "taking a generation to unwind".

"US jobs to get back to 2007 par by 2015". Alice's forecast of UK debt back on track by 2014 I got dizzy at that point. Figured that Alice is a half-wit, so doubled his estimate.

This is a depression in the making....how deep we'll see. The actions of the powers to be? Geo-political events? (sure to be some major ones). Defaults in the West? State defaults? Reserve currency? Peak oil? War? US home defaults peaking 2011/12? Commercial loans roll over? EU bank exposures? Pensions time-bomb? and last week UK's SS commitments overtook tax income...... Hehe. I missed half a dozen. Did I mention the $2Trillion deficit?

On the plus side? The Markets are up. I'm a natural optimist. But to work these problems out one has to be a realist. Not a political strength.

IMF and others tell UK to outline deficit reduction plan now, to avoid doubt and possible currency problems. Mandy says no discussion on cuts 'til after election. Slap on the wrist for that one. "Says he mis-spoke". Cap 'n trade? Us health bill?...Maybe I'm not an optimist after all.

Very pertinent statement there Midas. "I dont think people will be patient for that long."...Especially in the US, China.

Millions of people are hurting now, see no future, yet finance is paying out $Billions...off their backs. That may not be the reality....but when people are desperate....Just another possible problem.

Yes, 10 years 'til some sort of normality returns. 'And I've just opened Pandora's box a crack....lots more in there.

Regards.

[lannarebirth]

China:

Yes, I'm following the index and some of the companies in it.....it's like the mountains in Le Tour de France, isn't it ?

That IS my view, which is soon to be an Intermediate term negative view, though it may turn out to be wrong as the LT chart is showing signs it may have turned up.

Surely by now with such things as the revelation about the nature of the Goldman Sachs

trading programme, the artificial environment as to how banks can determine

the way their assets are valued and how markets seem so utterely divorced from economic

fundamentals......at the end of the day markets can now be engineered to

behave any way people want them to ?

Lets start to call it what it is and not beat around the bush - (no pun intended George as you let it happen)

con·spired, con·spir·ing, con·spires

v.intr.

1. To plan together secretly to commit an illegal or wrongful act or accomplish a legal purpose through illegal action.

THIS IS precisely what GS has done - read the website they tried to shut down - www.goldmansachs666.com

As each day passes more and more FACTS are revealed about GS and so when we look back we can see that it is in fact a conspiracy.

con·spir·a·cy (kn-spîr-s)

n. pl. con·spir·a·cies

1. An agreement to perform together an illegal, wrongful, or subversive act.

2. A group of conspirators. FED, GS, US government, banks etc.

3. Law An agreement between two or more persons to commit a crime or accomplish a legal purpose through illegal action.

4. A joining or acting together, as if by sinister design:

So Klingons aside this is a conspiracy we are watching unfold. Its not the black helicopters and people switching briefcases but higher up very sophisticated stuff. Like wizz bang computer programs that can do 60% of Wall Street trades in nano seconds!!

When you have a wall street bank that is not accountable in any shape or form, that can use a computer program to manipulate the markets, with gold and money it does not have, and the government allows it to happen with no investigation then folks I think you can bet your last dollar that its a conspiracy in the TRUE SENSE.

Wake up!!!

Good luck

You wake up . All Wall Street companies are like that and for the most part always have been. What has changed is the HUGE participation in markets by largely ignorant "investors".

Banks are scum and that never wasn't the case. What's changed is that the government no longer protects you from said scum. Even that, the apathetic populace doesn't seem to care about except when the trade isn't going their way.

From here on out it's a three card monty scheme. If the market goes up your currency goes down and your taxes go up. Every combination will have the "stakeholders" losing. They're gonna keep moving that ball.

Edited July 18, 2009 by lannarebirth

[teletiger]

A lesson all us numpties would do well to learn, Lanna.

Regards.

[midas]

This is a depression in the making....how deep we'll see. The actions of the powers to be? Geo-political events? (sure to be some major ones). Defaults in the West? State defaults? Reserve currency? Peak oil? War? US home defaults peaking 2011/12? Commercial loans roll over? EU bank exposures? Pensions time-bomb? and last week UK's SS commitments overtook tax income...... Hehe. I missed half a dozen. Did I mention the $2Trillion deficit?

And dont forget this Pandoras box either

http://original.antiwar.com/justin/2009/07...as-war-signals/

[BlackJack]

Goldman Sachs has less than $.02 Trillion in assets and $39 Trillion in derivatives exposure.

Is table 1 on page 22($million) creative accounting? http://www.occ.treas.gov/ftp/release/2009-72a.pdf

A law unto themselves

[BlackJack]

You wake up . All Wall Street companies are like that and for the most part always have been. What has changed is the HUGE participation in markets by largely ignorant "investors".

Banks are scum and that never wasn't the case. What's changed is that the government no longer protects you from said scum. Even that, the apathetic populace doesn't seem to care about except when the trade isn't going their way.

From here on out it's a three card monty scheme. If the market goes up your currency goes down and your taxes go up. Every combination will have the "stakeholders" losing. They're gonna keep moving that ball.

large ignorant "investors

hahahah

The worst derivatives offenders list looks familiar, now doesn't it?

1 JPMORGAN CHASE & CO. $81,108,352

2 BANK OF AMERICA CORPORATION $77,874,726

3 GOLDMAN SACHS GROUP, INC. $47,749,124

4 MORGAN STANLEY $39,125,255

5 CITIGROUP INC. $31,715,734

$47 trillion in off-sheet monsters

waiting in the wings

enough said

[teletiger]

This is a depression in the making....how deep we'll see. The actions of the powers to be? Geo-political events? (sure to be some major ones). Defaults in the West? State defaults? Reserve currency? Peak oil? War? US home defaults peaking 2011/12? Commercial loans roll over? EU bank exposures? Pensions time-bomb? and last week UK's SS commitments overtook tax income...... Hehe. I missed half a dozen. Did I mention the $2Trillion deficit?

And dont forget this Pandoras box either

http://original.antiwar.com/justin/2009/07...as-war-signals/

That one would be right out of left-field (leg-side in the UK ) for me Midas. The Israelis have got that one covered and are more than willing to let that dog hunt.

Even they would be prudent to await the outcome of the power struggle going on there. A powerful clerical council from Qom came out in favour of the reformists 10 days ago. A few ex high ranking RG (Republican Guard) leaders aligned with them. Big business in Iran.

If Khameni is isolated from the Guardian council, he's finished. Relying on the RG to stay in power will expose the Theocratic sham that Iran is. An (alleged) estimated $46 billion has been syphoned off by the RG to support Hezzbolah. No chump change for a country like Iran. Ahmadinejad thinks he's organized a coup, but without Khameni he's nothing. RG puppet.

Sorry for the simplification. A much more professional account on

http://www.atimes.com/

'And the cost?

Regards.

[Abrak]

Haven't you been listening Naam? There is no solution. Just sit back and enjoy the ride.

.......

Anyway....is sounding like the Establishment apologist really your style Naam? I think not.

Far from being an 'Establishment apologist' isnt Naam's point more along the lines of 'we should actually be giving the Establishment credit for resolving much of this crisis, rather than bitching and moaning when noone has offered a credible alternative.'

This thread consists of people in various stages of bearishness (myself included) while events are turning out far better than, I think, anyone forecast.

Financial stability has been restored and economic projections are being revised up.

http://www.lse.co.uk/MacroEconomicNews.asp...&_inflation

The Fed is now forecasting normalised growth next year and above sustainable growth for 2011.

Obviously these are only forecasts which may well not be achieved - I just dont think, though, that anyone thought that the Fed would even be in a position to revise up its numbers. Surely someone has been getting things right?

The Fed and CBO has stuck to a number of tenets regarding the underlying strength of the US economy - such as the underlying strength of the US household balance sheet - which has been ignored by many people.

If things turnout anywhere near how they see them, much of this recession will go down as 'cyclical' caused as much by 'financial panic' as 'mismanagement' and a 'panic' that was handled in swift and effective manner.

Even if things do turn out badly, worst case scenarios look to have been avoided and some credit must be given for policy responses such as 'coordinated QE' (both radical and innovative in the extent of its use) without which I would have thought that things would have been so much worse.

[jcon]

Haven't you been listening Naam? There is no solution. Just sit back and enjoy the ride.

.......

Anyway....is sounding like the Establishment apologist really your style Naam? I think not.

Far from being an 'Establishment apologist' isnt Naam's point more along the lines of 'we should actually be giving the Establishment credit for resolving much of this crisis, rather than bitching and moaning when noone has offered a credible alternative.'

This thread consists of people in various stages of bearishness (myself included) while events are turning out far better than, I think, anyone forecast.

I would agree with these statements.

Further, I would just like to say that the ridiculous 'ATM Withdrawal Fee' thread has almost as many views as this thread.... (well 'almost' being some 47k views vs. some 5xk views)... TV millionaires are really penny wise pound foolish eh? hahaha

As for this thread: I used to enjoy reading ZeroH and Denninger, etc... but now I don't because word has gotten around and conspiracy guys are using it as fodder (without even knowing the meaning of the trading content). Who is the one who first linked to ZeroH in this thread? Lanna? Was it you??!!!

This thread will get fun for me again if we see harmonica or bingobongo return so we can insult each other again, or that one guy with the funny PacMan 'engulfing' charts comes back (or did he do that in the 'Global Correction' thread? - that was a good thread).... Until then, Professor Abrak, you have the floor!

[lannarebirth]

Haven't you been listening Naam? There is no solution. Just sit back and enjoy the ride.

.......

Anyway....is sounding like the Establishment apologist really your style Naam? I think not.

Far from being an 'Establishment apologist' isnt Naam's point more along the lines of 'we should actually be giving the Establishment credit for resolving much of this crisis, rather than bitching and moaning when noone has offered a credible alternative.'

This thread consists of people in various stages of bearishness (myself included) while events are turning out far better than, I think, anyone forecast.

I would agree with these statements.

Further, I would just like to say that the ridiculous 'ATM Withdrawal Fee' thread has almost as many views as this thread.... (well 'almost' being some 47k views vs. some 5xk views)... TV millionaires are really penny wise pound foolish eh? hahaha

As for this thread: I used to enjoy reading ZeroH and Denninger, etc... but now I don't because word has gotten around and conspiracy guys are using it as fodder (without even knowing the meaning of the trading content). Who is the one who first linked to ZeroH in this thread? Lanna? Was it you??!!!

This thread will get fun for me again if we see harmonica or bingobongo return so we can insult each other again, or that one guy with the funny PacMan 'engulfing' charts comes back (or did he do that in the 'Global Correction' thread? - that was a good thread).... Until then, Professor Abrak, you have the floor!

Prior to the March 6th low I had linked to the Denniger site as I think most people don't really know what goes on in markets. He's pretty informative and straight forward but too much of an idealogue in a mileu where being an idealogue will bankrupt you. If past history is any indicator of future market action all this Goldman hate could probably send the market up another 20%. Still, vee bottoms are rare. Accumulate, markup, distribute, markdown, same as it ever was.

[jcon]

^^^^ whoa lanna you're up late!

I figured it had to be a trader(traitor!!! lol) amongst us who linked to either Denninger or ZeroH....

I agree with your second half of your post. But who knows? Oh that's right, Plarex knows. pff!

[Publicus]

We've had excellent discussions in this thread which are of great interest to all of us. However, we need to step out of the box.

The IT revolution and the technological revolution in general are driving modern economies in new directions. The changes already underway are as profound as the changes the Industrial Revolution brought to how we humans live our lives.

It's been pointed out that fewer people work to support retirement annuities, that more people spend longer time in education and that the financial system is dysfunctional.

The 30 or so countries which have advanced economies already are evolving towards a new means of production, as it were. The new means of production is technology itself, i.e., the technology economy.

The advanced economies are inexorably moving toward fewer people working and more technology performing our daily tasks whether physical or metaphysical.

Money, currency, finance and financial instruments are becoming dinasaurs. This already has been suggested in posts to this threat. We know that they're already causing more difficulties and complications than they are worth to us.

Indeed, what will be the value of money and all the rest of it when 70& or so of the population doesn't need to work because technology will do our labor for us? Who needs money in such a society? Why would such a society need money?

And what of the 30% or so of the population of any given advanced economy who do work, but who work in R&D and in inventing, creating and maintaining the technological society once it has significantly superceeded the post industrial and IT societies?

The extant chaos in the advanced economies and their financial systems is the most direct symptom we've seen of the waning of the old economic order that is based on work, money and finance.

Great questions remain in respect to how the technologically based society governs itself, distributes its resources, how people who needn't work utilize their time etc.

So this post is but an introduction to an anlysis of the realities we're experiencing and of the future as it is developing. And the points I raise are more than Utopian. They are real.

The Center For the Study of Democratic Institutions in Santa Barbara, California has been but one place where research and discussion of these matters has been ongoing for decades. The focus of the Center is on the future of democracy in the new technological economy, but all of the central issues concerning money, work and finance are the predicate of the Center's work.

Whereas 20 years ago the matters under discussion at the Center seemed largely abstract to me, nowadays I increasingly recognize the reality of the technological economy and its implications.

Edited July 18, 2009 by Publicus

[Abrak]

As for this thread: I used to enjoy reading ZeroH and Denninger, etc... but now I don't because word has gotten around and conspiracy guys are using it as fodder (without even knowing the meaning of the trading content). Who is the one who first linked to ZeroH in this thread? Lanna? Was it you??!!!

This thread will get fun for me again if we see harmonica or bingobongo return so we can insult each other again, or that one guy with the funny PacMan 'engulfing' charts comes back (or did he do that in the 'Global Correction' thread? - that was a good thread).... Until then, Professor Abrak, you have the floor!

Actually what this thread has sorely missed was a genuine in 'bull' of the economic and financial situation. He would have been insulted and villified to death but would be looking pretty good right now.

Even some of the 'bears' like Krugman are now arguing that it is all just about over and it is simply a matter of dividing the spoils as to what extent he is a genius.

He claims that fiscal deficits saved the world but then he would.

http://krugman.blogs.nytimes.com/2009/07/1...aved-the-world/

I would genuinely be interested in a coherent argument why the economy is on a sustainable recovery path leading to strong growth as the 'output gap' narrows.

I certainly think I made 2 wrong assumptions which led to overbearishness. First I have been surprised by the extent of response to fiscal and monetary policy (there are arguments for saying both will be fairly ineffective as a response to this sort of crisis.) I also suspect my thinking was somewhat tarnished by the '97 experience with Thailand whereby counterproductive fiscal/monetary policy was implemented (leaving only an export led recovery which cannot be aggregated on a global basis.)

Secondly I overestimated the extent of the debt crisis (which has more to do with 'bad' lending rather than 'overlending'). To the extent it is 'bad' lending it is a one off financial shock and is far less of a 'structural' problem than some people assume. I think this is one reason that consumption has held up better than expected. I now very much doubt there will be major deleveraging of the consumer similar to 1940/50s or has been seen in the Japanese private sector.

Still none of this actually translates into a growth story. The Fed/CBO argues there is a core underlying non-inflationary growth rate of 2.6% for the US economy. This is despite the fact there has been no underlying real growth for at least 10 years that wasnt the result of debt generated wealth effects. Secondly they argue there is an output gap which will lead to a period of above average growth as real demand, employment and output catches up with 'potential'. All the signs are that potential GDP is falling rather than rising. That is why the Fed are reducing their employment forecasts while increasing their GDP growth numbers. (The last two weeks jobless numbers - showing a fall - are a result of seasonal adjustments.)

[Naam]

what sense does it make to read or listen to those gurus and know-it-all who can only (no doubt justified) bitch but can't present any solution which works in general or might have any impact on us individuals reading/posting in Thaivisa?

is perhaps some masochism involved? or is it the (in vain) cry for help "Mummy, Mummy! look what i found out today. can you imagine what other crimes these <insert appropriate names of bàstards> have committed?"

Ok so what do you suggest to stop the <insert appropriate names of bàstards> ?

if all of us would sit in the same boat i would suggest we concentrate discussing solutions. but this is impossible because of the many different individual situations, assessments and targets we have in mind. commenting, quoting and (i admit up to a certain degree justified) bitching is in my [not so] humble view a waste of time and a behaviour similar to dogs barking at the moon or chasing a passing 20ton truck.

[Naam]

Anyway....is sounding like the Establishment apologist really your style Naam? I think not.

T-Tiger, if somebody thinks i am an apologist he/she is completely wrong. correct is that i am a realist who (as it happened quite often in my life) is trying to adapt to facts and make the best out of a situation which i know i neither can change nor make the tiniest impact no matter how hard i might try.

[midas]

Even some of the 'bears' like Krugman are now arguing that it is all just about over and it is simply a matter of dividing the spoils as to what extent he is a genius.

He claims that fiscal deficits saved the world but then he would.

http://krugman.blogs.nytimes.com/2009/07/1...aved-the-world/

I think you must be on his payroll

[BlackJack]

what sense does it make to read or listen to those gurus and know-it-all who can only (no doubt justified) bitch but can't present any solution which works in general or might have any impact on us individuals reading/posting in Thaivisa?

is perhaps some masochism involved? or is it the (in vain) cry for help "Mummy, Mummy! look what i found out today. can you imagine what other crimes these <insert appropriate names of bàstards> have committed?"

Ok so what do you suggest to stop the <insert appropriate names of bàstards> ?

if all of us would sit in the same boat i would suggest we concentrate discussing solutions. but this is impossible because of the many different individual situations, assessments and targets we have in mind. commenting, quoting and (i admit up to a certain degree justified) bitching is in my [not so] humble view a waste of time and a behaviour similar to dogs barking at the moon or chasing a passing 20ton truck.

AGREE

The internet is a powerful tool for sharing information

the wrongs in the USA financial system need righting and theres no denying this.

So i suggest you all sign up at the World wide pledge to end financial fraud

Its a start and with enough people pledging and making others aware it may take some shape.

Remember the Wall Street Banks have bankrupted the future and your family and your kids will be paying off these massive debts in taxes for many many years.

In the meantime there are 2 ways to help clear the financial mess

1. legalize marijuana and then tax it (its the largest cash crop in the World)

2. Close the banks for 3 days and then revalue Gold (its happened before) and there is talk (talk) of it happening again.

OK now hit me with a stick !!!!!!!!!!!

Edited July 19, 2009 by BlackJack

[midas]

AGREE

The internet is a powerful tool for sharing information

the wrongs in the USA financial system need righting and theres no denying this.

So i suggest you all sign up at the World wide pledge to end financial fraud

Its a start and with enough people pledging and making others aware it may take some shape.

Very good BlackJack - this gets to the heart of this crisis far more than text book economics

Now come on Naam.......give them your pledge and stop telling people not to bitch

[Naam]

pledge... pledge... pledge...

[Chunkton]

what sense does it make to read or listen to those gurus and know-it-all who can only (no doubt justified) bitch but can't present any solution which works in general or might have any impact on us individuals reading/posting in Thaivisa?

is perhaps some masochism involved? or is it the (in vain) cry for help "Mummy, Mummy! look what i found out today. can you imagine what other crimes these <insert appropriate names of bàstards> have committed?"

Ok so what do you suggest to stop the <insert appropriate names of bàstards> ?

if all of us would sit in the same boat i would suggest we concentrate discussing solutions. but this is impossible because of the many different individual situations, assessments and targets we have in mind. commenting, quoting and (i admit up to a certain degree justified) bitching is in my [not so] humble view a waste of time and a behaviour similar to dogs barking at the moon or chasing a passing 20ton truck.

AGREE

The internet is a powerful tool for sharing information

the wrongs in the USA financial system need righting and theres no denying this.

So i suggest you all sign up at the World wide pledge to end financial fraud

Its a start and with enough people pledging and making others aware it may take some shape.

Remember the Wall Street Banks have bankrupted the future and your family and your kids will be paying off these massive debts in taxes for many many years.

In the meantime there are 2 ways to help clear the financial mess

1. legalize marijuana and then tax it (its the largest cash crop in the World)

2. Close the banks for 3 days and then revalue Gold (its happened before) and there is talk (talk) of it happening again.

OK now hit me with a stick !!!!!!!!!!!

Naam, is this the tidbit you were alluding to re banks?

1. FOFOA is right that the world’s governments stand to gain most from a surprise devaluation, since it will prevent us commoners from preemptively swapping our paper for real things, setting off an inflation that would make an even deeper devaluation necessary.
   There's a rumor that I was reluctant to mention when it first started circulating, because it seemed a little too far down the tin foil hat / black helicopter road. But in this context it seems pretty reasonable. According to widely-followed newsletter writers Harry Schultz and Bob Chapman:
   ”Some US embassies worldwide are being advised to purchase massive amounts of local currencies; enough to last them a year. Some embassies are being sent enormous amounts of US cash to purchase currencies from those govts, quietly. But not £’s. Inside the State Dept there is a sense of sadness & foreboding that ‘something’ is about to happen, unknown re a date—just that within 180 days, but could be 120-150 days.”
   Bob quotes another source that “Panasonic has told their people to be back in Japan by Sept 09.”
   Harry Schultz’s remarkable take on the situation:
   “My HSL suspicion is that the elite plan another FDR style “bank holiday” of indefinite length, perhaps very soon, to let the insiders sort-out the bank mess which is getting more out of their control every day. Insiders want/need to impose new bank rules. Widespread nationalization could result, already under way. It could also lead to a formal US$ devaluation, as FDR did by revaluing gold (& then confiscating it). But devalue against what? The euro? Doubtful. Gold? Maybe. Or vs. the IMF basket of currencies (which seems more likely)—& much in the news recently.
   Any kind of bank holiday will push the US$ lower, which may be a bonus benefit to their ongoing scenario of letting the $ fall. Such a fall would get the devaluation they want without having to declare it. In sum, the insiders want more bank & system control, fewer banks & a lower US$. A bank holiday would suit all their needs."
   
2. The details of the plan will spread within an ever-widening circle of banking and government folks who, like Sir Robert, will demand the chance to profit from the insider trade of the century. Because such a secret is impossible to contain for long, once in place the plan has to be executed as soon as possible.
   
3. If the rest of us play it right, we’ll be able to at least protect ourselves, and maybe even make out (in percentage terms at least) like Goldman Sachs no doubt will.
   

Harry Shultz: “Obviously, U can’t open safeboxes if the banks are closed, so plan accordingly. During the FDR bank holiday, thousands of banks never reopened; it was a face-saving way of shutting them down. I would guess the same would occur today; thousands have little or no net value, loaded with debt, bad mortgages.”

A Tremendous Secret

[midas]

”Some US embassies worldwide are being advised to purchase massive amounts of local currencies; enough to last them a year. Some embassies are being sent enormous amounts of US cash to purchase currencies from those govts, quietly. But not £’s. Inside the State Dept there is a sense of sadness & foreboding that ‘something’ is about to happen, unknown re a date—just that within 180 days, but could be 120-150 days.”

Bob quotes another source that “Panasonic has told their people to be back in Japan by Sept 09.”

There would be a lot at stake here.......surely someone in Bangkok would have a friend of a friend

working at the US Embassy who could confirm this or otherwise ? I love the remark about " But not £’s " ha ha ha the new Peso of Europe

Edited July 19, 2009 by midas

[nomimusic]

We've had excellent discussions in this thread which are of great interest to all of us. However, we need to step out of the box.

The IT revolution and the technological revolution in general are driving modern economies in new directions. The changes already underway are as profound as the changes the Industrial Revolution brought to how we humans live our lives.

It's been pointed out that fewer people work to support retirement annuities, that more people spend longer time in education and that the financial system is dysfunctional.

The 30 or so countries which have advanced economies already are evolving towards a new means of production, as it were. The new means of production is technology itself, i.e., the technology economy.

The advanced economies are inexorably moving toward fewer people working and more technology performing our daily tasks whether physical or metaphysical.

Money, currency, finance and financial instruments are becoming dinasaurs. This already has been suggested in posts to this threat. We know that they're already causing more difficulties and complications than they are worth to us.

Indeed, what will be the value of money and all the rest of it when 70& or so of the population doesn't need to work because technology will do our labor for us? Who needs money in such a society? Why would such a society need money?

And what of the 30% or so of the population of any given advanced economy who do work, but who work in R&D and in inventing, creating and maintaining the technological society once it has significantly superceeded the post industrial and IT societies?

The extant chaos in the advanced economies and their financial systems is the most direct symptom we've seen of the waning of the old economic order that is based on work, money and finance.

Great questions remain in respect to how the technologically based society governs itself, distributes its resources, how people who needn't work utilize their time etc.

So this post is but an introduction to an anlysis of the realities we're experiencing and of the future as it is developing. And the points I raise are more than Utopian. They are real.

The Center For the Study of Democratic Institutions in Santa Barbara, California has been but one place where research and discussion of these matters has been ongoing for decades. The focus of the Center is on the future of democracy in the new technological economy, but all of the central issues concerning money, work and finance are the predicate of the Center's work.

Whereas 20 years ago the matters under discussion at the Center seemed largely abstract to me, nowadays I increasingly recognize the reality of the technological economy and its implications.

I tend to agree with your analysis Publicus, and the future will undoubtedly look much different than what we know today. If a person 100 yrs ago would try to explain the direction the world has come it would be incomprehensible to them. I think we are on the cusp of such a change. I am waiting to retire here in the US, and hopefully move to Thailand (another story). But I work for the US Postal Service, and in our industry we are seeing devastating changes, as technology has gobbled up most of our business through emails, direct bill pay, fax, and other various technology. I am sure mail service in all countries are going through the same. We are only one of many various industries that will either change, or outlive our purpose.

Our whole way of doing business is changing. Up until now we have witnessed most business only focusing on the bottom line, and projecting earnings and profits as far into the future as the next quarter. In doing that, the big picture is foggy at best, and research and development has taken a back seat. I personally know Doctorates in Bio-Chem medical research that live on miniscual salary and their jobs are only as good as the grant that pays them, which goes a year at a time. And these are our hopes for cures for things like cancer, heart desease, etc. This is our system.....

I agree that we need to think outside the box, and rethink the economy in ways that can help for the common good of mankind. Our outlook so far has been to let those in power become more powerful, those with more money become more rich, and turn our heads to common sense regulations that has enabled this to happen. Unfortunately, this greed has crippled and hurt those who are in small business, and the common man the most. This is the only thing that has trickled down in this economic system. Sure, if you risk you should have a payoff if you succeed. But the degree of the payoffs that have occurred in recent times in America is crazy. I think in this new technological age, many things will change whether we want them to or not. And just like those who wanted to cling to the horse and buggy, many today will go down kicking and screaming, or change.

It is my hopes that these changes can be made in a way that uplifts everyone, and not make a world of incredibly rich, and incredibly poor.

I wish I had the answers, but I see we need to focus more resourses on research and development of technology in a ways can have it's greatest impact. Perhaps in a world like this, we could see poverty and many answers to major illnesses solved by distributing our braintrust and financial trust in a direction that would have the greater impact. Perhap the end of "Social Darwinism" where everyone has a chance to uplift thier status and create a better life for the next generation of the world, and not the dog eat dog mentality.

Idealistic...?. perhaps. But that is the direction my vision is looking.

[AlexLah]

Good observation Publicus

Some people look strange or start throwing verbal tomatoes at me when I try to explain that what we are witnessing is a relatively new division of labor in the world economy that was conditioned by some important events like the technological revolution in production, communications, and transportation, the demise of the Soviet Union and East Europe and the formation of the European Union and its expansion ever since.

You mention the fact that so much work is now automated I say, there are fewer jobs left that pay well. Where once GM was the largest employer (about 600.000 in US) it is now Wall Mart that employ roughly a million people working for minimum wages. This whole worldwide wage competition is orchestrated by the big corporations that are in a race for the bottom.

Your x-ray could be taken in a hospital in the US but judged by a cheaper doctor in India as technology now allows for high speed data transfers throughout most of the world. Software developing and call centers now taking place/based in India and the Philippines as those people work for a fraction of the cost compared to their US based brothers and sisters.

The presence of low wage immigrant workers forced to escape from their impoverished countries by the actions of corporate neo-liberalism and corrupt governments shows the true meaning of globalization.

This is not a temporary change the world is going through, It is the result of changes that are as world changing as the industrial revolution was.

This (orchestrated) financial crisis will be used to impose drastic changes in the way (many) people live just like the events of 9/11 were.

Edited July 19, 2009 by AlexLah

[Abrak]

Whether one harks back to the essence of Marxism, the very first post on this thread or simply consider the implications of the IT revolution one cannot escape the drive of capitalism to accumulate capital in the hands of the few at the relative expense of the masses. At some point people need to start thinking 'out of the box' for everyones sake.

Here is a fair and equal resolution to all the US's economic ills - well at least for the next 10 years. End of banking crisis, end of recession, resumption of growth in a manner that is indisputably generally fair given a least sacrifice solution.

First turn to page A11 of this document bottom figures to see US distribution of wealth.

http://www.federalreserve.gov/PUBS/oss/oss...obkgdscreen.pdf

Note that the top 10% have seen their wealth increase 80% over the last 9 years (ending 2007 but while it will have gone down, inequality has increased because of debt) while the bottom 50% have seen non-existent increase in wealth.

So what we are going to do is take 12% of their wealth or an average of US$500,000 from the top 10% of households. This really isnt that unfair as 1. they still have more wealth to GDP in 2007 (and even 2009) than in 1998 and (2) their average income has increased 50% over the period (and we are leaving that untouched) while the bottom 25% average income increased 15% (need to scroll up a few tables.)

This raises a quite remarkable US$6trn (approx) (by the way you need to make the tax progressive). You hand out US$100,000 to each of the households in the bottom 50% of wealth distribution (i.e. 60million households). Clearly the top 10% of households are unfazed (probably quite glad to contribute) - they still have plenty of wealth and US$350,000 annual incomes. The bottom 25% of households have seen their net wealth increase from US$-2k to US$98k and the next 25% of households have seen their wealth increase from US$56k to US$156k.

A US$6trn wealth transfer to the most impoverished immediatedly solves the bad debt problem (the Government even gets its TARP money back), recapitalizes the banks and probably eradicates much of the budget deficit. Assuming some 10% of the wealth feeds through to consumption (100% of wealth gains fed through to consumption 1998 to 2007) then you are looking at a 6% boost to GDP assuming no multiplier.

Now you might think this is all madness but really it is just too sane to be true.

[jcon]

Actually what this thread has sorely missed was a genuine in 'bull' of the economic and financial situation. He would have been insulted and villified to death but would be looking pretty good right now.

<snip econ lesson> lol

Well Abrak, I think VegasVic could be considered the resident 'bull' (where is he btw?). Or maybe britmaveric (mainly on currencies, and the GBP to be more specific), but he's just being jolly about it and not taking it too seriously methinks

Naam is a realist and therefore could have been seen as a 'bull' in certain times in this thread, lanna also calls it as he sees it so he doesn't take sides either... nor do I, so one could say we've all been 'bulls' at certain times....

But the closest thing to a 'permabull' would have been VV (at least 'back in the day' - all of one year ago haha, short memories....).

Plarex, come on. That one guy making that post about a 'Star Trek' - style no-currency future was making an entirely different (and more interesting) point than what you went on about in your post (when you tried to align with him, as if you were talking about the same thing). 2 totally different points - if you can't see that, then, well...

[AlexLah]

Jcon,

Is what I said not true?

[Abrak]

Jcon,

Is what I said not true?

From my perspective there is one important point that doesnt ring true. I come from a left wing economic background (Cambridge) in my beliefs in how the world works and how to take advantage of it. So I dont really see anything 'new' in what is going on although I think you are right to the extent that globalization and IT revolutions are accelerating underlying capitalist processes.

Still they have been there all along. The median post tax income in real terms of the US worker is lower now than 30 years ago. A child is more likely to see his parents go bankrupt than get divorced.

Unlike JCON I find the US Household balance sheet interesting because I know exactly what my Alma Mater will be writing about this financial crisis. It will say that the crisis was self-inflicted because the US Household far from being financially bankrupt (which it clearly wasnt) merely reflected the underlying moral bankruptcy of capitalism.

Quite frankly you look at that balance sheet and can only view the whole debt crisis as pathetic.

[AlexLah]

Sorry I try again to explain my point.

I agree with the observation that a technological revolution has occurred.

Next in my reply I try to point out where this revolution has taken us.

The US have outsourced their manufacturing industry to lower wage countries and moved the US to a service based economy.

Even services like (some) call centers have been moved outside the US.

The big corporations will try and do anything to lower their cost to instigate higher profits.

Look at health insurance companies that deny treatment to ill people. Every person that they can deny treatment to, means a higher profit to their company and as a result the shares of that company (when listed) will rise.

But hey, that is the only thing that counts for a "Trader" right, the price of shares.

Do your homework and try to look beyond your little world on the 63 floor.