Financial Crisis

[midas]

Everyone has som kind of contribution to make. I present my often right, sometimes wrong technical analysis. Dr. Naam presents his insights based on decades of global investing, and also insightful information from sources not eberyone has timely access to. Others offer many good things and anecdotal accounts. It alll helps. What doesn't help is sniping at each other. What also doesn't help is when people present pure unadulterated bullshit. Some of us have a hiher tolerance for bullshit than others, but it is seldom helpful and almost always distracting.

Yes Lanna you are right. People making some kind of positive contributions but only a very limited number of

posters indeed respond in this thread with vitriolic attacks after someone has submitted a newspaper article

or link to something which doesn't happen to meet their personal values.

[AlexLah]

Ok, let us also not forget that very often it is sometimes difficult to discuss things when you don't have the person in front of you.

I have tried to make sort of an overview of historic market crashes but the one we see or being told to see is very different then the ones before, i believe.

If there are some errors in the data please correct when wrong as this is just a first attempt and I am only a human being.

• 1927 “Black Friday” in Germany; economic system collapses

• 1927 Brazil’s economy collapses owing to over-production of coffee

• 29/10/1929 Stock Market Crash

• 1929 Depression

• 17/04/1930 (April 17 1930) Start of crash.Starting DJIA: 294.07; Ending DJIA: 41.22; Total loss: 86.0%; Number of days: 813

• 05/1931 (May 1931) Market Crash (Austria)

• 06/1931 (June 1931) Market Crash (Germany)

• 09/1931 (September 1931) Market Crash (Britain)

• 12/1931 (December 1931) Market Crash (Japan)

• 10/03/1937 Start of market crash :Starting DJIA: 194.40:Ending DJIA: 98.95; Total loss: 49.1% Total days: 386

• 1937 Recession

• 31/03/1938 (March 31 1938) End of crash

• 12/09/1939 Beginning of stock market crash :Starting DJIA: 155.92; Ending DJIA: 92.92; Total loss:40.4%.Total days: 959

• 28/04/1942 End of market crash

• 1958 Market Panic/Crash (France) Speculation in currencies

• 1962 Market Panic/Crash (Canada)

• 1963 Market Panic/Crash (Italy)

• 1964 Market Panic/Crash (Britain)

• 1968 Market Panic/Crash (France)

• 1972 Recession

• 11/01/1973 Beginning of market crash :Starting DJIA: 1,051.70; Ending DJIA: 577.60; Total loss: 45.1%; Related to:

Collapse of Bretton Woods, OPEC 1973 price rise, stocks, REITs, office buildings, tankers, Boeing 747dllar market flooding in 1970-1971

• 1979 Market Crisis/Panic:dollar, farmland

• 1980 Market Crisis/Panic:related to: oil

• 1982 Market Crisis/Crash/Panic:related to: third world debt

• 1982 Deep Recession

• 19/10/1987 (October 19 1987) Market Crash; market falls more than 500 points:related to stocks

• 01/1990 Market Panic/Crisis:Japan)

• 1994-1995 Market Crash (Mexico) related to: deregulation, capital inflow and outflow, domestic boom, bank lending, domestic new banks 1991,

• 1997-1998 Market Panic/Crisis (Thailand, Indonesia, Malaysia, Korea, Russia, Brazil; related to: deregulation, capital inflow and outflow, borrowing

bank lending, construction boom, crony capitalism

• 02/2000 (February 2000) Start of worst market crash of 21st century

It seems that now it is more that the root of the financial system is affected. But there might be a solution here: http://market-ticker.denninger.net

[Chaimai]

and some people just dont want to see whats coming,it is not a requirement of TV that anyone has to be a financial guru to comment on what began as a financial topic.For example i'll admit i am pretty clueless when it comes to the stock market,equities,derivitives,CDS etc,but i still enjoy an input,but it appears we are back to the vitriol of this a.m. after a cooling off.

sbc, how do you know what's coming ?

There is so much fiction and speculation coming out the facts are being fogged. I agree that history is a good place to look for the liklihood of what might happen going forward - this does not include referencing events of 400 years ago. Modern history will suffice, particularly modern financial history.

Also, while there are a lot of idiots out there (governments down to bankers down to the press) I am still prepared to put some faith in the ability of some governments, some bankers and some people to help me to come through this. I can't do it alone, although I will work as hard as I am able to influence what is under my control, I have to have faith in unknown others to work to the same recovery agenda.

There, now see how easy that was to express a view without acerbic personal comment.

well done,so you can do it.

All we have to do now is teach midas

[Naam]

Take my little corner of the derivatives world for instance, the front month SP 500 emini contract. Just yesterday over 2 million contracts (derivatives) were exchanged. Face falue at present about $35k/contract. Totally liquid and marked to market in every minute of every trading day (23 hours). Dozens more similar type derivative instruments, traded on exchanges all over the world, where members must meet certain finacial standards to ensure that they will make good their obligations. There is no systemic risk inherent in these markets, as all information is known to both contractual parties and that same informaion is disseminated to all market participants to weigh.

Now take these CDS's we hear so much about. Some (we don't know how many) are traded between parties (we don't know who), to cover certain events (we don't know what many of these are) for specific payouts ( we don't know how much). What we do know is that some underwriters of these instruments have required bailouts. We can only speculate about if there will be future bailouts and for how much.

Given this dearth of specifics regarding these instruments and given that asset prices are changing rapidly, many assume this will trigger payouts of ? to ?. We conjure up "worst case scenarios" and value the things we DO know about accordingly. We don't like not knowing things.

but the doom&gloomers (not only in Thaivisa but worldwide) throw a few hundred dollar trillions out of the blue into the debate, call them toxic derivatives or don't call them anything but insinuate that all derivatives are the works of the devil and meant to destroy the world. yes there are shitty derivatives, yes the bankers lined their pockets but fleeced the shareholders and bondholders, yes it is a shitty situation, yes the bailouts have to paid for sooner or later by taxes and/or inflation but no, not all of the sixhundred something trillions to be settled sooner or later are toxic, and no... the derivatives did not cause megalomania in Robert Mugabe's brain nor did the global crisis make the druglords in Mexico shoot policemen and NO... reviving the french revolution and demand "bankers and politicians à la lanterne or guillotine" is not a feasible solution but ridiculous.

the [sad] comic of this situation is that people who, six months ago, didn't know how to spell the word derivative and perhaps thought it was a french cheese or an italian dessert have become suddenly experts in financial matters by pointing out who made what negative remarks in their internet blogs, absorbing and spreading the message "the end is near!"

[Chaimai]

Because 12D started this topic on the back of the deplorable activity/lack of activity on the part of the UK government I am posting what I consider to be a balanced news report. This is UK property focussed but any recovery will come from this asset class.

I have taken out a more optimistic comment from an estate agent because they cannot be considered impartial. Those checking financial history may reflect that in the 1990s house values generally fell by 30%.

House prices 'dip a further 2.3%'

The lender said that prices were expected to continue falling

House prices fell by another 2.3% in February in the UK, according to the country's biggest mortgage lender.

HBOS, now part of Lloyds Banking Group, said that the average UK home was now worth £160,327.

The lender said there were "tentative" signs that housing market activity was beginning to stabilise, but added 2009 would still be a difficult year.

The lender's preferred annual change figure - which takes a three month average - is down 17.7%.

When looking at February's prices, the cost of the average home was 17.8% lower last month than in February 2008.

'Downturn'

The 2.3% monthly fall was more in line with the general downward trend in house prices seen over the past year than the 2% rise in prices reported in January by the lender.

We firmly believe that now and the next six months are the trough for house prices

David Smith, Dreweatt Neate estate agents

The group's housing economist Martin Ellis said that prices in the three months to February compared to the previous quarter - which provide a more balanced indicator of the underlying trend - were 3.6% lower.

But he did have some guarded good news for those wanting to get on the property ladder.

"While market activity remains at very low levels, there are some tentative signs that activity may be beginning to stabilise. The house price to earnings ratio - a key measure of housing affordability - has fallen to its lowest level for six years," he said.

"Continuing pressures on incomes, rising unemployment and the negative impact of the dislocation of the financial markets on the availability of mortgage finance are, however, likely to mean that 2009 will be another difficult year for the housing market."

The figures come a few days after rival lender, the Nationwide building society, reported that house prices fell 1.8% in February, taking the annual decline in prices to 17.6%.

Although mortgages have become cheaper following a string of interest rate cuts, the demand from lenders for a high deposit, falling prices and householders' fears over job security have put the housing market under severe strain in the past year.

Signs of optimism?

According to the Halifax, house prices are now at the same level as they were in August 2004.

Although Mr Ellis acknowledged that house prices were likely to continue falling in 2009, he said that homes were becoming more affordable.

[AlexLah]

True but don't forget that what was first presented as a problem they said well you know there's a few peeps that defaulted on their mortgage and now the banks have some losses bla bla, words like credit cornflakes crunch. bla di bla. But now as the curtain is slowly opened we start to see things.

A lot of those famous TV (Television) financial guru's they even had no clue, so why are they financial guru's then?

Thanks to this and some other threads we have now a basic understanding of what those CIA contracts are and why they posses a big risk.

[samuibeachcomber]

yes a balanced report(cautiously optimistic).I would guess it depends how bad unemployment becomes as to whether prices continue to decline,must be a tough time being an estate agent.

[Naam]

Also, while there are a lot of idiots out there (governments down to bankers down to the press) I am still prepared to put some faith in the ability of some governments, some bankers and some people to help me to come through this. I can't do it alone, although I will work as hard as I am able to influence what is under my control, I have to have faith in unknown others to work to the same recovery agenda.

because all of us are sitting in the same leaky boat although at different places and different body parts under water.

[midas]

And while we hope for a speedy recovery in the UK housing market, there are some interesting developments on the other side

of the Atlantic

The 92 Percent Group is committed to the preservation of free-market economics in the United States, specifically in relation to the Obama Administration's Homeowner Affordability and Stability Plan. We believe this plan is unjust to the vast majority of American taxpayers; in particular to the 92 percent of homeowners who are current on their mortgages and to renters who have not purchased houses they cannot afford.

Today's economic crisis impacts all Americans, not just those who are behind on their mortgages. Everyone shares concerns over health care, job loss, and the decimation of their retirement savings. All Americans have made sacrifices over the past year. The American taxpayer is already on the hook for mismanaged banks, incompetently run auto companies and extravagant stimulus packages. We don't need the additional burden of paying for our neighbor's mortgage. The bottom line - we believe that being current on one's mortgage or being a renter should not be grounds for being put at a financial disadvantage.

We are proposing a tax strike in April to protest this unjust act. We are urging all taxpayers to withold $5,000 from their taxes on April 15, 2009. $5,000 is the amount of money the goverment proposes to pay to lenders and borrowers who are behind on their mortages.

We have added a "Letter to Congress" page and urge everyone to copy and paste it into an email to their Senators and Congressmen in Washington.

http://92percentgroup.org/Home_Page.html

[flying]

I say get your money out while you still can.

http://www.bloomberg.com/apps/news?pid=was...id=alsJZqIFuN3k

Yes, a run on a bank/the banks is just what we need to get the revolution started.

Loose talk started a run on Northern Rock and caused the unnecessary commitment of £billions in support and the start of the fear/paranoia culture.

That is the first thing I thought when I read that.

Why on earth would this high ranking FDIC chairperson make such honest statements in public?

She surely has no future in politics.

Couldn't she keep her pie hole shut till those of us on the move were done with our tasks

Actually as much as the truth hurts ( including possibly me ) I must say it is refreshing.

[AlexLah]

I would agree with this 92% group but I guess the IRS thinks differently. About the UK house price in 2000 avarage price was around a 100.000 so still another 50 % to go? A while ago there was a picture a guy made of a member of parliament and by closer inspection he had a paper in his hand that mentioned a 60%

fall in house prices from peaklevel. Anyone else seen that?

[midas]

I would agree with this 92% group but I guess the IRS thinks differently.

Well here is an even broader one Alex- not just confined to a tax strike relating to mortgages

-US Tea Party is against all tax increases and it has managed to the get some

well-known supporters. It's also an interesting web site

http://www.usteaparty.com/

[12DrinkMore]

So here we go, mono-optic man Brown has started the money printing.

http://www.independent.co.uk/news/business...05-1637909.html

Official borrowing costs have fallen for the sixth month in a row, but the Bank will now tackle recession with so-called quantitative easing (QE) - effectively printing money - to ease credit conditions.

The Bank will create £75 billion to pump into the economy over the next three months.

Additional they have also reduced the cost of borrowing to 0.5%.

So all your GBPs are now worth less. Nobody has a clue where this is going to end up.

which is uncharted territory for the MPC

But all I can see is that this is the last mad attempt of Brown to get himself re-elected next year. He has now surely sent the UK into the doldrums for the next decade or two. There is no longer any sane long term plan to make an economic recovery. The UK economy is well and surely finished unless by some miracle what he is doing works.

The incredibly huge problems are

- the massive and still unknown losses in the banks and insurance companies

- the massive unfunded pension scheme liabilities which are now coming to a head over the next couple of years as the baby boomers retire

- the massively bloated civil service now accounting for 25% of the work force, who now have an average wage GREATER than the private sector, even before you factor in the four day weeks now beginning to appear. And all these civil servants are expecting an inflation proofed pension.

- 2,000,000 unemployed forecast to increase to 3,000,000 over the next year

- the national pension scheme funded by current tax payers

- a probable huge double figure drop in GDP as the banking industry withers away

- a tiny industrial base as it was shipped out to Asia over the boom years

- a country dependent on imports for food and raw materials, which are now 30% more expensive due to the GBP being devalued

The list goes on, but lets move to another important point, the British National Spirit.

Consider America, Germany, Thailand, Sweden in fact all countries I can think of, and you can feel there is a proud national spirit. What have we got as Brits? Firstly any mention of a national spirit and you will be immediately classed as a member of the BNP and put in prison, and secondly, the Brits are always moaning and looking for either someone to blame or someone to knife in the back. The British National Spirit has died a long time ago, and a prime example is the national football team, who decided to take on a Swedish manager. Somehow I can't imagine the Italians or the Germans doing this.

So I don't see a National Spirit that can be called upon to rise up and take this challenge. Brown is certainly not the man to foster it. He has already proven himself to be incompetent at every level. I can imagine America will take up the challenge, Germany will through sheer efficiency and prudence survive, Italy has a fierce National Identity that won't be destroyed, the Irish are already taking on the challenge. But the UK? Gordon "save the world" Brown is looking to the world as a his Saviour; he refuses to admit any guilt himself, and is trying, in typical UK fashion, to "put the blame elsewhere", and persuade the world to take on his own insane policies of spend his way out of debt. Incredible.

There have already been several investors and analysts who are very negative about the future of the UK. I can only agree.

A couple of posts ago Chaimai put up a post about the housing market.

This is totally FALSE indicator being used to try and look for a recovery in the economy. Brown is also looking to stop the fall in house prices. But this is UTTER BULLSHIT, and as long as the GREAT BRITISH HOUSE PRICES are used as the main economic indicator we are well and truly fukced. Sure since 1998 the boom years have been FUNDED by the house price increases, but this is not ADDED VALUE to the economy. The rising house prices have been used to buy goods and holidays. Debt has been increased based purely on the rising house prices. This is all in the past. The house prices will no longer support an economic boom. The only indicator that should be used to mark a recovery is factory output, YES, real goods that are being produced and bought.

I am amazed that people still think that once house prices start rising again, all will be rosy. STUPIDITY RULES. Firstly without manufacturing there can be no added value in the economy and real money being created. But secondly, with increasing unemployment, four day weeks, inflation in staple goods like food running at 8%, stagnant wages and banks understandably not lending on what is seen as a depreciating asset, there cannot be a new housing boom.

From what I can see, Brown is trying to replace the artificial wealth lost by falling house prices with money he creates by using his keyboard. There is only one way this is heading.

Here you go Alex, over to you.....

http://www.dailymail.co.uk/news/article-11...n.html?ITO=1490

[AlexLah]

Can I have a moment, I am gonna buy a few drinks. will be back in about half an hour with hopefully something.

Edit: Sorry my mentioning a secret memo was correct but not the %, percentage mentioned. In the memo whas mentioned a staggering 10% decline in price, guess what they were 50% off...............

Some predict a bit steeper fall in the coming years.

Edited March 5, 2009 by AlexLah

[12DrinkMore]

More cause for utter despair

Normally you would think that creditors are interested in the success of the business they lend money to. Logical, or so you would think. But how about if they gain more by sending the business into bankruptcy? Does you perception of the world change just a little?

Say you borrow 100,000 quid to buy a house and the lender takes out a Credit Default Swap against the case were you default. So he now doesn't care less whether you can pay the installments or not. And presumably the bonuses earned by lending out the money are still coming in, WACKO!. So now add in the factor that another Credit Default Swap could be taken out for the same debt by somebody TOTALLY unrelated to the debt. hel_l, now if you default, there are two guys looking to make 200,000 together. And add in a few more, and a few more. And now where is AIG? And who is paying for this?

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Insanity and the bankers rule.

WE HAVE NO CHANCE LEFT, BUT ARE ALL DOOMED.

Really, there can be no future when unrelated parties are allowed to profit from a business collapsing, and the original lender makes more from the failure of a company than he would from the repayment of the loan.

The companies that sponsored this "insurance betting" Lehmann, AIG etc. are now collapsing, but who is ending up with the massive bill? YES it is all the poor suckers like you and me, who voted for politicians to represent US and protect OUR interests from all this chicanery. They have let us all down badly.

Jesus am I MAD today....

[12DrinkMore]

Can I have a moment, I am gonna buy a few drinks. will be back in about half an hour with hopefully something.

Pick up a few more me too, thanks.

[brahmburgers]

This just in from seekingalpha ......

Subpoenas for Merrill's merry millionaires. New York Attorney General Andrew Cuomo has issued subpoenas to seven top Merrill Lynch executives who received over $10M in cash and stock last year. Among the execs are top investment banker Andrea Orcel, global sales and trading chief Thomas Montag and former head of strategy Peter Kraus, each of whom made more than $25M apiece in 2008. Cuomo is investigating whether the bonus payments violated securities laws, and will ask the execs about their individual bonuses, their communications with John Thain and the timing of the bonuses. Bank of America (BAC) has filed a petition in New York state court to keep the pay data confidential.

[AlexLah]

I think something went wrong, ok repost.

I mentioned a secret memo and I have to say I said a wrong number, correct % decline of UK houseprice mentioned in secret memo was a staggering 10%.

They were just off by 50%.... .....

Here secret memo (unreadable on this pic)

Others predict a bit steeper fall.........

What shall we do, throw teabags?

[midas]

From what I can see, Brown is trying to replace the artificial wealth lost by falling house prices with money he creates by using his keyboard. There is only one way this is heading.

Here you go Alex, over to you.....

http://www.dailymail.co.uk/news/article-11...n.html?ITO=1490

At least in UK some would be hoping for no more than skirmishes between the public and police

- which isnt as bad as what could happen in USA

Buy, Buy, Buy

by Michael Gaddy

While we stumble along economically with bailouts, buyouts, and poor sales in almost all sectors, two products in America are seeing dramatic increases in sales: guns and ammo. People who never owned a gun before are buying; people are buying multiples of military style weapons and ammo is being bought by the case instead of by the box.Many explain this away as folks simply worried that Obama will move to ban certain firearms, especially those referred to by the ignorant as "assault weapons," I believe the motivation to buy firearms and ammunition goes much deeper.

More and more Americans are becoming increasingly aware of the storm that is brewing on the horizon, a storm driven by the possibility of a complete economic collapse.

The more astute are reading the handwriting on the wall: military combat units being assigned for stateside duty to quell domestic disturbances, a militarization of law enforcement, and the fear of what will happen when the state is no longer able to provide monthly checks to the millions currently living on government handouts labeled as "entitlements."

http://www.lewrockwell.com/gaddy/gaddy39.html

[12DrinkMore]

Others predict a bit steeper fall.........

Even that seems optimistic. AVERAGE wage in the UK is some 25,000 Quid.

In a lot of Eurocountries anybody on the average wage does not really think about buying a property. But in the UK it is considered to be a right even if you are jobless. Now look at the standard of property in the UK. It is <deleted>, really, rows of nasty terraced houses, or flats, with no gardens and often no parking for the car. I guess that is OK though, average housing for average people. But then look at the price in relation to the average salary. SIX times the average salary.

In the past it was considered affordable to pay 2.5 times annual earnings, plus a deposit of 10%. So the average person should be able to afford an average house around 80,000 Quid, being very generous. Considering the poor standard of UK housing compared to Europe (and YES it is poor, just go and look and compare) I reckon the average house price in the UK should be around 110,000 maximum or even much less.

And once this level has been reached, why should there be any growth greater than that what is affordable on salary levels? I can't see the banks going overboard on lending money in the next few years.

I have friends in the UK who sat back over the last 10 years just gloating over the idea that they could earn more from house price inflation that actually working and producing something. In the end, the only real source of wealth creation is manufacturing.

What shall we do, throw teabags?

NO! Hang them out to dry and get at least three more cuppas out of them. Worth their weight in gold in the future...

Anybody wanna buy a used tea bag, only used twice....

[AlexLah]

Here ya go, a cold one.

Here the size of a pile of 315 Billion USD................

How many frikkin trees had to be chopped for that?

Used teabags, ha ha ha!

[12DrinkMore]

Today I can laugh!

3 Doctors at a convention.

The French Doctor tells his collegues that someone who has just had a Kidney transplant in France would be well enough to look for a job in 6 weeks.

The German Doctor says he can go better and claims that someone who has a Heart translplant in Germany would be well enough to look for a job in 4 weeks.

The English Dr looks unimpressed and says he could go alot better. He makes the statement to the effect that: -

We in the UK transplanted an arsehol_e from Scotland into Number 10 Downing street and half the country was looking for a job in 24hrs.

http://www.independent.co.uk/opinion/comme...ry-1637572.html

Brown is the idiot of the world. And that gives him the global recognition the prat desires

Edited March 5, 2009 by 12DrinkMore

[AlexLah]

Ha ha ha!

I have seen something similair, the ten worst financial disasters, starts with some oil spill costing a few hundred millions, then Exxon Valdez a few Billions and on the number one place Prince Obama, 850 Billion in just a few weeks, ha ha ha.

Here a nice chart that will show something very interesting.

Nice, finished my first cold one, getting a second...

[flying]

People who never owned a gun before are buying; people are buying multiples of military style weapons and ammo is being bought by the case instead of by the box.Many explain this away as folks simply worried that Obama will move to ban certain firearms, especially those referred to by the ignorant as "assault weapons," I believe the motivation to buy firearms and ammunition goes much deeper.

More and more Americans are becoming increasingly aware of the storm that is brewing on the horizon, a storm driven by the possibility of a complete economic collapse.

The more astute are reading the handwriting on the wall: military combat units being assigned for stateside duty to quell domestic disturbances, a militarization of law enforcement, and the fear of what will happen when the state is no longer able to provide monthly checks to the millions currently living on government handouts labeled as "entitlements."

I dont even have to read it. I mentioned to friends 6 months ago that hippies were buying guns for gods sake.

Folks all said the same..................Nah this is just like when Clinton was elected.

No way !! This is so different. It is not about Asault weapons bans

Hippies are buying.....meaning non gun toting folks are buying anything. Pistols, Rifles & shotguns galore.

This has nothing to do with any bans Obama or Holden have in mind.

As for the military? I think it will be interesting if more States like New Hampshire demand the return of their states national guard. The national guard is unlawfully being used by the govt as military.Then what? We have no draft & our actual military is not what it once was in the days of a draft.

Will they hire blackwater guards?

We are living in a interesting time.

[AlexLah]

Wasn't Blackwater named into XE, pronounced as Zee?

So what are all those gunowners think they are going to do?

Protect themselves against people rioting, looking for food?

Fight the US military incase it get's that far?

Are they going to Wall Street to gun down the bankers?

I really have no idea why these people think owning a gun will protect them incase of some severe crisis.

Or do they think owning a gun will allow them to join some kind of militia?

Just does not make sense.

[flying]

Wasn't Blackwater named into XE, pronounced as Zee?

Yes but I also still call Prince...Prince

Fight the US military incase it get's that far?

That was always the intent of the 2nd amendment to many....

Beat an out of control govt in a fair fight if need be.

I really have no idea why these people think owning a gun will protect them incase of some severe crisis.

I believe the folks who were disarmed under the likes of Hitler, Mao. Stalin etc felt the same way as you.

Just does not make sense.

That sounds odd coming from you

But not a whole lot seems to make sense these days eh?

[Carmine6]

Wasn't Blackwater named into XE, pronounced as Zee?

So what are all those gunowners think they are going to do?

Protect themselves against people rioting, looking for food?

Fight the US military incase it get's that far?

Are they going to Wall Street to gun down the bankers?

I really have no idea why these people think owning a gun will protect them incase of some severe crisis.

Or do they think owning a gun will allow them to join some kind of militia?

Just does not make sense.

I was in Los Angeles in the LA riots in the 90's. The shotgun and rifle came out of storage for that, and I stayed over at my mother's house for a few days to make sure there were no problems. I wasn't even in a bad area. You had to fend for yourself, the LAPD literally gave up ground and would vacate areas. Business owners were camping on top of roofs to guard their stores. Blew over fairly quickly.

But remember Katrina was weeks long anarchy. That's with the rest of the country stable and willing to help afterwards. Imagine if things got out of hand in a few cities at once.

[brahmburgers]

Brown is the idiot of the world. And that gives him the global recognition the prat desires

I disagree. I saw Brown's speech to the joint US houses of Congress. I give him A+ as an orator. His ideas may be a bit brass plated, but I resent the petty denigration expressed in the quoted post.

[samuibeachcomber]

thought it was a typical "sucking up" speach to the americans as only brown and blair know how to do.The content was meaningless dribble,and personally i dont think anyone was buying it ,least of all the americans.

And apart from his speech to congress it felt like he was given short shrift by the Obama admin.who seemed pretty cool towards brown,and why not after 12 years of leading the UK economy down to what it is now,can hardly call those years a success....................and still brown has not been able to apologies to the UK population for those incompetent years of not watching and hearing what was going on,really alarm bells should have been ringing.

Edited March 6, 2009 by samuibeachcomber

[thaidrew]

I am sure we all agree that there have been too many greedy dealers taking advantage of a flawed system, but I do not see it is possible to stay out of the disaster. I hear what all you people say, and agree with the basic underlying facts, that there simply is not enough cash to allow funds to be withdrawn if we all apply together, but, if cash were to be collected from the banks, what on earth do we do with it. Putting it in a hole in the ground solves nothing since there is huge risk of it disappearing, risk of it devaluing, and personal risk if it were suspected that it were there. Much the same applies if it were to be converted to gold or diamonds and stored the same way. Given that the banks are not safe, agreed, and the buried idea is of little use; what actually is the solution? Are government bonds secure, or would the request for redemption simply be met with a statement that the funds must be applied for by completion of certain forms and the process move along at a speed dictated by the department following directions from higher up?

In short, I do not really see any alternative but to trust to the system of using a bank, unsafe as they may be. Imagine if there was no certainty of withdrawal of funds, no jobs freely available and no confidence in the system. If you were to turn up at the supermarket or local shop with cash, or gold for that matter, how long do you think it would be before you received a visit from somebody intent on relieving you of the funds? Realistically, like it or not I still do not see any viable solution but to spread the funds over as many different banks in a variety of currencies as possible. The result is not much different either way. Britain is broke, the US is close behind, and so is Europe, but it is a global community and all countries are intertwined, either financially or with trade, so if superannuation is lost, pensions not affordable, etc, then the same must follow worldwide. I cannot imagine that the west can live like that with Asia any different, China included. A mighty shakeup is on the horizon I agree, but please suggest how it would be possible to avoid being sucked into the vacuum along with the rest???????