Financial Crisis

[Abrak]

I think this is quite an interesting interview with Robert Shiller about the US Housing market. He tends to be ahead of the curve maybe by two to three years but he seems to be becoming more positive.

http://www.bloomberg.com/video/62409982/

Some stats for the US housing market are way off the charts...

[AlexLah]

Remember I have send about 3 e-mails to the ECB asking if there was a procedure in place for countries that would like to disband the Euro. Never got a reply back. I then went digging and found a site that explained that there was no such procedure in place.

I have tried to find the site and article back with many different search terms but have not been successful.

The latest announcement by the IMF's economic terrorist, makes me think they want to force countries that are in financial problems into another of those shock therapies which they tried out in Latin America and other countries with the help of the famous Friedman and Chicago school of economist preaching that free markets are the way to go and forcing those countries to reduce wages and benefits of the peasants and sell all state owned stuff to private investors as a condition to get these loans.

Anyways here an article that has an opinion on the worst case scenario, disbanding the Euro.

http://financialedge.investopedia.com/financial-edge/0610/Disbanding-The-Euro---A-Worst-Case-Scenario.aspx

Have a good time all!

Alex

.

[teletiger]

China may just have lost half a Trillion $ in UST

= rumours, unfounded speculations, nose poking, hypothetical extrapolations

Too right there Herr Naam. A rumour of bubble popping proportions. The Washington Post hasn't seen Zhou either.

http://blog.washingtonpost.com/spy-talk/2010/08/zhou_xiaochuan_defection_rumor.html

Regards.

[midas]

I think this is quite an interesting interview with Robert Shiller about the US Housing market. He tends to be ahead of the curve maybe by two to three years but he seems to be becoming more positive.

http://www.bloomberg.com/video/62409982/

Some stats for the US housing market are way off the charts...

Positive .......yeah well

There are other who don't agree

Housing Crash Continues -- It's Still A Terrible Time To Buy

Why?

http://patrick.net/housing/crash.html

[Abrak]

Positive .......yeah well

There are other who don't agree

Housing Crash Continues -- It's Still A Terrible Time To Buy

Why?

http://patrick.net/housing/crash.html

Yeah well there is always disagreement. I like to buy things after a collapse and when fundamentals are at there worst. I remember a couple of pages ago you said that house prices in Detroit had fallen 88% to US$11,000 on average. You could look at house prices and house prices to income ratios over the last 450 years and they would point to that being a serious buying opportunity or unprecedented. It doesnt mean it will make money but it seems a good starting point.

Usually when everyone thinks it is a good time to buy it isnt.

[midas]

Are oil prices about to go through the roof ?

Here is a link to the Mexican newspaper La Jornada

covering a personal interview with Fidel Castro. The Cuban leader

claims there will be a strike on Iran on September 9th.

He was very passionate about this same matter

when addressed the Cuban Assembly just 2 weeks ago

" Esta barbaridad puede producirse en cosa de unas días, para ser más precisos, el 9 de septiembre próximo, que es cuando vencen los 90 días otorgados por el Consejo de Seguridad de la ONU para comenzar a inspeccionar los barcos de Irán."

http://www.jornada.unam.mx/2010/08/30/index.php?section=politica&article=002e1pol

Edited August 31, 2010 by midas

[midas]

Are oil prices about to go through the roof ?

Here is a link to the Mexican newspaper La Jornada

covering a personal interview with Fidel Castro. The Cuban leader

claims there will be a strike on Iran on September 9th.

He was very passionate about this same matter

when addressed the Cuban Assembly just 2 weeks ago

" Esta barbaridad puede producirse en cosa de unas días, para ser más precisos, el 9 de septiembre próximo, que es cuando vencen los 90 días otorgados por el Consejo de Seguridad de la ONU para comenzar a inspeccionar los barcos de Irán."

http://www.jornada.unam.mx/2010/08/30/index.php?section=politica&article=002e1pol

I have just been thinking about this further………………..I wonder……?

It seems clear that the Democrats in US are going to get slaughtered in November ( not surprisingly

the way they have behaved ! )

New Poll Says GOP "Tidal Wave" Coming In November

http://www.businessinsider.com/gallup-generic-ballot-10-point-lead2010-8

So by " allowing " Israel to strike Iran now, this would inevitably result in chaos in the Middle East

with terrible consequences for the US which in turn could allow the US President to enact

“ emergency powers ” – e.g. no mid term election in November ?

[flying]

From my perspective (US housing) house prices will still fall because they are still over priced.

For the most part prices still are based on fantasy or a wrong assumption a borrower made.

Yes there are some deals out there...especially raw land & a few homes but mostly ones that are being auctioned off. Not sold in normal fashion. ie: mostly short sales.

Prices need to go sub 2006 now. If they had adjusted sooner perhaps 2006 would have been enough.

That of course relies on employment also.

As always all of it will not pertain to carpetbaggers who have excess cash to spend & can pick up deals & sit on them.They can possibly make their future generations happy

Edited August 31, 2010 by flying

[BlackJack]

Australia figures out today

even with a hung parliament it is still powering on

housing building up

spending up

now the Reserve Bank wants to put up interest rates to cool things off

interest rates for bank deposits already 6.5 % at call

now thats impressive and worth looking at if your watching your going going gone US dollars

[12DrinkMore]

I guess that currency rates is the single most important issue to expats.

According to

http://www.thaivisa....n-fund-inflows/

we could be heading towards 1997 rates. So here's a little table of a few rates against the THB from 1997, 2007 and now, just a reminder.

97 07 Now

AUD 20 28 27

USD 25 36 31

GBP 43 70 48

EUR 32 47 39

CHF 19 29 30

CNY 3.0 4.6 4.6

MYR 10 10 10

SGD 18 23 23

Where next?

The Asian economies are growing strongly at 7% plus, the US/UK struggling to conjure up a figure above 0 and the Euro zone in a godawful mess, even a return to the 1997 levels is, IMO, not going to suddenly stimulate investment in factories and production of mass produced durables leading to more employment. For example the massive GBP devaluation did not lead to any export led recovery, it just increased the RPI and CPI. And now any advantage that gave the UK has been negated by the EUR falling.

The continued ZIRP, sold to us as stimulating the economy, but was more put in place to rescue the banks, does not seem to have induced entrepreneurs to rush out and start up factories. As King remarked, the countries can't all export their way to recovery, particularly the PIIGS, who are now in the unenviable position of having spent vast sums of other peoples money on non-productive stuff.

I wonder what would have happened if the interest rates had been left at the levels they were before Brown announced that he had "rescued the world". we will never know if the "mega crash and depression" would have really happened. We just have to accept the leaders word for it, in the same way that we have to accept the claim of anthropogenic global warming and "spend money and do something", in case it might be true. Just as we all had to rush over and kick out Saddam because of his huge stash of "Weapons of Mass Destruction", which have since been as elusive as the Japanese gold in Kanchanburi.

Edited September 1, 2010 by 12DrinkMore

[Abrak]

From my perspective (US housing) house prices will still fall because they are still over priced.

For the most part prices still are based on fantasy or a wrong assumption a borrower made.

Yes there are some deals out there...especially raw land & a few homes but mostly ones that are being auctioned off. Not sold in normal fashion. ie: mostly short sales.

Yes.... usual story .... there is this fake market out there and a more accurate reflection of real prices at the distressed end.

Still if I was one of the cash rich, reserve based Asian exporters, I would be looking at having a distressed debt based property portfolio in the US rather than simply adding to my USTs. You might be a bit early but it is probably better than being a bit late out of USTs.

[flying]

Yes.... usual story .... there is this fake market out there and a more accurate reflection of real prices at the distressed end.

Still if I was one of the cash rich, reserve based Asian exporters, I would be looking at having a distressed debt based property portfolio in the US rather than simply adding to my USTs. You might be a bit early but it is probably better than being a bit late out of USTs.

Agreed !

I too would jump at the real estate before the UST's

Also agree that if I were one of the cash rich I would be early to the table if it had what I wanted on it....even if i felt lowest possible price had not yet been reached. As you said better early than late.

[BlackJack]

I guess that currency rates is the single most important issue to expats.

According to

http://www.thaivisa....n-fund-inflows/

we could be heading towards 1997 rates. So here's a little table of a few rates against the THB from 1997, 2007 and now, just a reminder.

97 07 Now

AUD 20 28 27

USD 25 36 31

GBP 43 70 48

EUR 32 47 39

CHF 19 29 30

CNY 3.0 4.6 4.6

MYR 10 10 10

SGD 18 23 23

Where next?

The Asian economies are growing strongly at 7% plus, the US/UK struggling to conjure up a figure above 0 and the Euro zone in a godawful mess, even a return to the 1997 levels is, IMO, not going to suddenly stimulate investment in factories and production of mass produced durables leading to more employment. For example the massive GBP devaluation did not lead to any export led recovery, it just increased the RPI and CPI. And now any advantage that gave the UK has been negated by the EUR falling.

The continued ZIRP, sold to us as stimulating the economy, but was more put in place to rescue the banks, does not seem to have induced entrepreneurs to rush out and start up factories. As King remarked, the countries can't all export their way to recovery, particularly the PIIGS, who are now in the unenviable position of having spent vast sums of other peoples money on non-productive stuff.

I wonder what would have happened if the interest rates had been left at the levels they were before Brown announced that he had "rescued the world". we will never know if the "mega crash and depression" would have really happened. We just have to accept the leaders word for it, in the same way that we have to accept the claim of anthropogenic global warming and "spend money and do something", in case it might be true. Just as we all had to rush over and kick out Saddam because of his huge stash of "Weapons of Mass Destruction", which have since been as elusive as the Japanese gold in Kanchanburi.

BTW they found the Gold in Chatree

have a look

Kingsgate Consolidated is an Australian gold producer which operates in Asia at Chatree -

[churchill]

Ever heard of Thorium ?

Sounds like it could solve a few problems !

Obama could kill fossil fuels overnight with a nuclear dash for thorium

If Barack Obama were to marshal America’s vast scientific and strategic resources behind a new Manhattan Project, he might reasonably hope to reinvent the global energy landscape and sketch an end to our dependence on fossil fuels within three to five years.

http://www.telegraph.co.uk/finance/comment/7970619/Obama-could-kill-fossil-fuels-overnight-with-a-nuclear-dash-for-thorium.html

[BlackJack]

then sun has all the power we need but you cant put a meter on it and so cant sell it to the punter

so the big Co's don't want to pursue it

however you can invest in wind power, solar, tidal waves etc

or look into rare earths that are needed for the wind power magnets or nano cos for the solar panels etc

[churchill]

It would kill nuclear power ( No excuse for the Iranians ) and reduce development in other alternative energies .

Hold on investing in Uranium !

[Abrak]

The one thing I am totally puzzled by is the whole Iraqi oil story. If you can remember there was a certain feeling that the invasion was about oil. (It probably wasnt but I am sure it helped.)

There was also a massive effort to protect its oil supplies during the war.

So what has happened since is totally mysterious. A lot of people estimate that Iraq has the most oil reserves in the world.

http://en.wikipedia.org/wiki/Oil_reserves_in_Iraq'>http://en.wikipedia.org/wiki/Oil_reserves_in_Iraq

These are not proven reserves because Iraq really hasnt made much of an effort what with all the wars and sanctions.

http://en.wikipedia.org/wiki/Oil_reserves

On a proven basis they come in at number 4 but with 150 years of supply - the US has 3x the production with 8 years of supply.

So the real puzzle is how come nobody ever bothered increasing production after the invasion. It would have paid for the thing and the rebuilding, helped solved the supply shortage etc.. And look it takes say 5 years to bring oil online so it is clearly a concerted lack of effort.

Production is actually less than when they had sanctions.

http://seekingalpha.com/article/193859-will-iraq-s-oil-production-increase

It just seemed quite a good idea to invade Iraq for its oil supply and a bit of a shame they didnt get it online.

[Naam]

has anybody looked into the rare element Unobtainium?

[churchill]

has anybody looked into the rare element Unobtainium?

I think it is Obtainium , which will be a big problem for many investors on Wall St !

[12DrinkMore]

Blaire on Brown...

http://www.bloomberg.com/news/2010-08-31/blair-backs-cameron-program-slams-strange-brown-for-failings-in-memoir.html

“I had a feeling that my going and being succeeded by Gordon was also terminal for the government,” Blair wrote. “I discovered there was a lacuna -- not the wrong instinct, but no instinct at the human, gut level. Political calculation, yes. Political feelings, no. Analytical intelligence, absolutely. Emotional intelligence, zero. Gordon is a strange guy.”

but you have to wonder about strange when Blaire comes up with this

Blair devoted much of the book to Brown, 59. The two were friends and allies when first elected to Parliament in 1983 -- “as close as two people ever are in politics,” Blair wrote, comparing them to “lovers desperate to get to lovemaking.”

Brown and Blaire desperate to screw each other? Or screw the country?

[churchill]

and who would have ended up on top !

[midas]

Afghan central bank insists Kabul Bank is sound

Afghanistan's central bank tried to shore up confidence in the country's biggest financial institution Wednesday after its top executives resigned amid allegations of mismanagement and corruption.

Mohammed Azimi, a businessman in Mazar-i-Sharif, said he went anyway to a branch of the Kabul Bank to withdraw $50,000 or $60,000, but the bank would only let him withdraw $5,000.

"They wouldn't give me the money," Azimi said. "They said they would give me the money tomorrow."

News reports said Gen. David Petraeus, commander of U.S. and NATO forces in Afghanistan, attended a meeting about a month ago in which the governor of the central bank gave President Hamid Karzai evidence of illicit activities at Kabul Bank. Fitrat said he couldn't discuss the activities of Karzai or Petraeus.

http://www.ajc.com/business/afghan-central-bank-insists-604098.html

[flying]

has anybody looked into the rare element Unobtainium?

You sure your not thinking of Obamatanium?

Looks like gold on the outside but once inside...well that is another story.

But if in fact you did mean unobtainium...Well of course none has looked into that due

to its inherent properties.

[Naam]

somwhere i read that Unobtainium is used for flying. is it perhaps some sort of fuel?

[midas]

I think this is quite an interesting interview with Robert Shiller about the US Housing market. He tends to be ahead of the curve maybe by two to three years but he seems to be becoming more positive.

http://www.bloomberg.com/video/62409982/

Some stats for the US housing market are way off the charts...

I didn’t comment the other day but I have never believed Case-Shiler, had much credibility

Well now there is proof this is the case !

There is a pretty substantial scheme to artificially "boost" existing home prices by up to 40%, putting all the NAR data, and all other relevant public housing data materially into question.

This is from an email a few days ago:-

“ Real estate agents are not reporting the true sold prices on homes. Here are 2 examples. If a home is listed on the MLS and then sells at auction like Hudson & Marshal or RealtyBid, you can see the sold price online or if you attend the live auctions, see the house sell at open outcry auction. The next day the houses are reported sold on the MLS but always at full price.

The example below sold for $115,000 at Realtybid but is listed as sold for $159,500 on the MLS.

Also, homes are listed on the MLS and sold on the HUD site. You can see the sold area on HUD and the Bid Stats. The house listed below sold on the Hud site for $90,061 but again was listed as sold for full price on the MLS $113,400.

These are only 2 examples, I have seen over 100 and assume it is occurring everywhere. I understand that foreclosures are not included in the sales stats from the Realtor Assoc. but the stats they use are taken from the sold prices listed on the MLS. They are all false. ”

 

Simply said, this means that any pricing data coming off Multiple Listing Services is fatally flawed, and if this observation is verified, could potentially be a simplistic means to misrepresent the true home price by up to 40% higher.

Edited September 2, 2010 by midas

[ronz28]

Ever heard of Thorium ?

Sounds like it could solve a few problems !

Obama could kill fossil fuels overnight with a nuclear dash for thorium

If Barack Obama were to marshal America’s vast scientific and strategic resources behind a new Manhattan Project, he might reasonably hope to reinvent the global energy landscape and sketch an end to our dependence on fossil fuels within three to five years.

http://www.telegraph.co.uk/finance/comment/7970619/Obama-could-kill-fossil-fuels-overnight-with-a-nuclear-dash-for-thorium.html

Fascinating topic!

There is an intro video, etc. here from the Thorium Energy Alliance

http://www.thoriumenergyalliance.com/

I wish Thailand would wait to construct this type of reactor to generate energy. It sounds like a much cheaper and safer alternative to uranium reactors.

[churchill]

Ever heard of Thorium ?

Sounds like it could solve a few problems !

Obama could kill fossil fuels overnight with a nuclear dash for thorium

If Barack Obama were to marshal America’s vast scientific and strategic resources behind a new Manhattan Project, he might reasonably hope to reinvent the global energy landscape and sketch an end to our dependence on fossil fuels within three to five years.

http://www.telegraph.co.uk/finance/comment/7970619/Obama-could-kill-fossil-fuels-overnight-with-a-nuclear-dash-for-thorium.html

Fascinating topic!

There is an intro video, etc. here from the Thorium Energy Alliance

http://www.thoriumenergyalliance.com/

I wish Thailand would wait to construct this type of reactor to generate energy. It sounds like a much cheaper and safer alternative to uranium reactors.

Sounds too good to be true - doesn't it - Are there any negatives ? and why aren't governments rushing to develop ?

[churchill]

Ever heard of Thorium ?

Sounds like it could solve a few problems !

Obama could kill fossil fuels overnight with a nuclear dash for thorium

If Barack Obama were to marshal America’s vast scientific and strategic resources behind a new Manhattan Project, he might reasonably hope to reinvent the global energy landscape and sketch an end to our dependence on fossil fuels within three to five years.

http://www.telegraph.co.uk/finance/comment/7970619/Obama-could-kill-fossil-fuels-overnight-with-a-nuclear-dash-for-thorium.html

Fascinating topic!

There is an intro video, etc. here from the Thorium Energy Alliance

http://www.thoriumenergyalliance.com/

I wish Thailand would wait to construct this type of reactor to generate energy. It sounds like a much cheaper and safer alternative to uranium reactors.

Sounds too good to be true - doesn't it - Are there any negatives ? and why aren't governments rushing to develop ?

India seems to be a leader

Is Thorium the Nuclear Fuel of the Future?

http://spectrum.ieee.org/tech-talk/energy/nuclear/is-thorium-the-nuclear-fuel-of-the-future

[morrobay]

If Gore had been rightly elected in 2000 would the U.S. financial crisis be the same ?

It seems like the Iraq war + bush cutting taxes and that hack greenspan lowering interest rates causing the housing bubble/crisis would not have happened with Gore

[Abrak]

I didn’t comment the other day but I have never believed Case-Shiler, had much credibility

Well now there is proof this is the case !

There is a pretty substantial scheme to artificially "boost" existing home prices by up to 40%, putting all the NAR data, and all other relevant public housing data materially into question.

This is from an email a few days ago:-

“ Real estate agents are not reporting the true sold prices on homes. Here are 2 examples. If a home is listed on the MLS and then sells at auction like Hudson & Marshal or RealtyBid, you can see the sold price online or if you attend the live auctions, see the house sell at open outcry auction. The next day the houses are reported sold on the MLS but always at full price.

The example below sold for $115,000 at Realtybid but is listed as sold for $159,500 on the MLS.

Also, homes are listed on the MLS and sold on the HUD site. You can see the sold area on HUD and the Bid Stats. The house listed below sold on the Hud site for $90,061 but again was listed as sold for full price on the MLS $113,400.

These are only 2 examples, I have seen over 100 and assume it is occurring everywhere. I understand that foreclosures are not included in the sales stats from the Realtor Assoc. but the stats they use are taken from the sold prices listed on the MLS. They are all false. ”

 

Simply said, this means that any pricing data coming off Multiple Listing Services is fatally flawed, and if this observation is verified, could potentially be a simplistic means to misrepresent the true home price by up to 40% higher.

Yes Midas,

I am sure that is true. Houses in a down market can generally be 'bought' well below market price. The question is whether the 'transaction' price rather than the 'reported' price is a good one to buy at. So I do not argue that current 'reported' prices are overstated but whether there might or might not be some 'good buys' around.

The Case-Shiller index is pretty good because he has done backdated numbers until 1890 and 450 years in terms of Amsterdam. If you look at the chart it still shows that prices are too high (quite clearly.) However, transaction prices might now be in the right ball park and (personally) while interests rates are at very low levels I wouldnt really expect this chart to fall below 100.

You can also see that if say Detroit prices have fallen 90% it would be unprecedented even from the peak of exuberance.

http://www.ritholtz.com/blog/2010/07/updating-the-case-shiller-100-chart-forecast/

Its quite a good chart by the way. Although I guess Bernanke didnt think so.