US GDP shrinks 2.9% in first quarter

[capcc76]

What was the topic again? The Bush administration and derivative packages?

I thought the topic was a decline in the US economy in the first quarter of this year due to extremely harsh weather, after 6 years and 7 trillion in spending by the Obama administration.

I think 100 years from now, whatever is bad in the US will be blamed on Bush (who I can't stand, but I do like the truth.)

How about the OP topic where the economy shrank for one quarter on Obama's watch, 6 years into his administration?

And why do you care what the topic or focus of the discussion is on? Too funny. Nothing like opening the door with inaccurate comments, but when clarification reveals you are wrong you complain where your comments lead.

I don't like Obama, but comments about the national debt increase, QE (referred to by some as money printing) during his reign completely ignore the purpose of the QEs why the money was spent and necessity for spending that money.

This also relates to how, even in the face of increasing debt, the US is recovering. It is a just going to be a long bumpy road due to the absolute mess that happened in the CMO, CDS and CDO markets between 2001 and 2007.

[capcc76]

The banking sector has produced the lion's share of billionaires on the planet so I guess we had to bail them out at the prospect of them not getting a large enouh bonus. It is really hard to feel sorry for the banking establishment. They seem to do very little of what we the people actually need or want in relation to their compensation which is incredible. Perhaps it is an all or nothing situation with them but that is just too bad. They act as predators and we don't really need predators in that particular role.

unfortunately the predators are here to stay and we have to live with it.

So why blame the bank when the greedy consumer applied for loans, provided false information on loan documents private mortgage companies assisted in the deception and government fair housing entities are raising hell about fair lending practices and making sure minorities also live the American dream and buy a house.

Because it wasn't the greedy consumer who couldn't pay his liar loan that collapsed the system. It was the banks who packaged those loans into securities, the other banks that packaged those security products into un-understandable derivative products worth many times what the actual underlying mortgages were worth, and the insurance companies that wrote insurance basically guarantying they couldn't actually cover their obligations if those derivative products did lose value.

Had it just been the collapse in the real estate market prices, we'd have been in the clear by 2009-1/2.

But flash forward to 2014, and the poor liars who had the loans are screwed, along with everyone whose home lost value- most of them just hard working people with their life savings tied up in their simple dream of owning a home. And the banks are now carrying over $700 Trillion of those same dodgy derivative products. Or, I should say, the public is exposed to over $700 Trillion of those derivative products, because the banks can't cover their bets. And if the price of oil goes up, or there's a bad harvest in Sri Lanka, or copper goes down, or God only knows what unforeseeable trigger, the system will collapse again. Because nobody understands what's wrapped up in those $700 Trillion of derivatives. They don't care about risking the life savings and retirements of billions of people, as long as they're getting richer.

Sorry, you are wrong here. I spent the better part of 5 years of my life dealing with these issues.

CMOs failed (and banks like BofA got in trouble and paid dearly for) because the bundled loans were undersecured and fraught with loans to individuals unable to repay those loans.

Upstream lenders (banks) purchase paper upon the belief and representations that lending guidelines and appraisal guidelines were followed at the granular level.

Why fault a bank for bundle and securitizing and selling as a bond. Why not fault the bond purchasers or investors purchasing this crap to make high rates of returns? Why not fault the government for having SM, GM and FM step in and guarantee this stuff so China would purchase it?

You chose to focus on only one sentence I wrote leaving out other stuff that provided explanation for the problem.

An illustration of the problem I saw over and over is as follows:

Morgan Keegan had fund manager named James Kelso. He was a star throughout the 2000s. He offered funds heavily weighted in CDO, CMOs and junk bonds. People were getting annualized returns of 21 to 28%. Investors started shifting higher and higher percentages of their portfolios to the Kelso bond funds because the returns were so high. Pension funds were even including these bond funds in their portfolio. These things crashed in 2008 and went from $17 to $ 20 a share to less than a dollar a share and never came back. People lost their retirements and life savings.

Who do you blame. I blame the brokers selling this stuff to retirees who should never be in high risk funds during the retirement stages, but I blame greedy consumers addicted to those high yields allocating such a large part of their wealth to such funds.

High returns equal high risk. Young investors rejecting safe conservative rates aggressively pursuing 25% +/- yearly returns cannot complaint if and when they lose their money.

This is what happened in the CMO and CDO markets. Investors sought high rates of return by investing in riskier securities. If they did not purchase, banks would not have bundled and sold.

[capcc76]

Forget the economy, there are plenty of reason to legitimately hate on Obama.

http://www.foxnews.com/opinion/2014/06/26/supreme-court-reminds-obama-our-constitution-applies-to-him-too/

Sometimes, Barack Obama acts like the Constitution does not apply to him and the Congress is an imaginary being. Thursday, the U.S. Supreme Court brought the president back to Earth when it reminded him that that the Constitutions Appointments Clause and the U.S. Senate are very much part of reality. They did this by saying that the U.S. Court of Appeals got it right when it voided three of Obamas recess appointments to the National Labor Relations Board.

[Naam]

The banking sector has produced the lion's share of billionaires on the planet so I guess we had to bail them out at the prospect of them not getting a large enouh bonus. It is really hard to feel sorry for the banking establishment. They seem to do very little of what we the people actually need or want in relation to their compensation which is incredible. Perhaps it is an all or nothing situation with them but that is just too bad. They act as predators and we don't really need predators in that particular role.

unfortunately the predators are here to stay and we have to live with it.

We only have to live with them because our politicians are too weak to tax the gains on dodgy derivative transactions at a rate sufficient to indemnify us for the systemic risk.

Privatizing the gains while John Q Public takes on the risk.

Tax the gains on "investments" that create no jobs or value to the world at 95%, and maybe some of that tied up money will actually be lent out to entrepreneurs and businesses that can actually benefit the world.

Claw back the bonuses of every bankster (retroactively, with interest and penalties) whose employer went bankrupt or required bailing out, and see if they may act more responsibly next time around.

unfortunately the "predators" have our politicians by their balls and in their pockets.

that means my comment "the predators are here to stay and we have to live with it" is and will remain valid.

Edited June 28, 2014 by Naam

[midas]

Banking, mortgage brokers and security industry is extremely regulated since 2008, almost harshly. I agree they brought this on themselves due to the few bad apples exploiting the system.

The part that absolutely astonishes me is how the Bush administration was either ignorant or just a sleep at the wheel. Most everyone in the financial industry and insurance industry say this coming for several years and the administration did nothing, absolutely nothing to stop it.

We knew AIG was in trouble and losing liquidity in 2004/2005. This was bleeding over into CNA and other large insurers in reinsurance market because of about $450 mil in CDS protection that AIG could not cover. There was something like $70 trillion CDS floating around worldwide.

Banks all over the world had purchased protection for CDS from AIG and failure of AIG could have brought down the entire WORLD financial and banking industry. This was not just a US problem.

What was Bush administration doing or thinking? We has whistleblowers and insiders telling everyone that would listen that AIG, CDS and CMOs were tanking. No one did anything and the CMO, CDS and credit swap market increased exponentially between 2005 and late 2007 and now we had huge amounts of Americans with their retirement and pension funds being placed into funds with large allocations to CMOs, CDS and CDOs.

Move forward to 2007. We all knew in 2007 what was going to happen and friends of mine even called the Quarter in which it would happen. Most us went 70% to 100%, got out of any funds with CDO or CMOs in the portfolio and ran like hell from financial securities.

Again, this was no secret. Everyone with any sense knew wheels would eventually come off in 2005/2006 and suspected it as early as 2004. Everyone except those that could have actually done something to stop the progression in our government.

That being said, our banking industry is currently very sound. No reason for alarm. The lesson learned is don't get greedy. We all where. I had investments and real estate appreciating 25% per quarter in 2004/2005. I suppose some just thought this would never stop and administration was too busy patting itself on the back and taking credit for wealth expansion in 2002-2007.

" Banking, mortgage brokers and security industry is extremely regulated since 2008, almost harshly."

The $700 trillion derivatives market is not regulated at all and Alan Greenspan, even refuses to explain why he even fought tooth and nail to keep it that way

LOl, who can argue with a man that reads and listens to dailyjodcuts.com, zerohedge and George Soros! Love it!

George Soros is a rich and controversial guys with ulterior motives. Does he not want American banking to fail and become dependent upon international groups. Does he not want more power for the World Bank and IMF. Understanding him and his motives may shed some light on what he says. Did he not become rich through manipulating currency to the detriments of regular folks. Did Thailand refer to him as an economic criminal. Did Malaysia make some pretty strong statements about his currency activities during the 1997 Asian financial crisis?

There are some troubling aspects about derivative markets, but I am guessing you know very little about current derivatives and base your beliefs off what outlier websites focus on or perhaps take out of context.

By all means man, if it makes you feel warm and fuzzy . . . keep your money under your mattress or burry it tin cans like Cousin Eddie on Vegas Vacation. I suppose gold hoarders living in fear and worry want to see banking collapse. Keep wanting and wishing if it makes you happy, but you really should just enjoy life, stop worrying or you are going to be disappointed when everything does not go down the tubes and the world does not come to end.

Your garrulous responses are entirely unconvincing and quite frankly don't make a lot of sense. And I have no idea who you are, so I'm not inclined to believe your view of things at all, whereas I will very much sit up and pay attention to someone like billionaire Nick Hanauer, who is warning your fellow citizens that the “ pitchforks are coming “and what he writes makes much more sense than your rambling

Our country is rapidly becoming less a capitalist society and more a feudal society. Unless our policies change dramatically, the middle class will disappear, and we will be back to late 18th-century France. Before the revolution.

And so I have a message for my fellow filthy rich, for all of us who live in our gated bubble worlds: Wake up, people. It won’t last.

http://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014.html#.U66Bq0BWp-x

Edited June 28, 2014 by midas

[midas]

What was the topic again? The Bush administration and derivative packages?

I thought the topic was a decline in the US economy in the first quarter of this year due to extremely harsh weather, after 6 years and 7 trillion in spending by the Obama administration.

I think 100 years from now, whatever is bad in the US will be blamed on Bush (who I can't stand, but I do like the truth.)

How about the OP topic where the economy shrank for one quarter on Obama's watch, 6 years into his administration?

And why do you care what the topic or focus of the discussion is on? Too funny. Nothing like opening the door with inaccurate comments, but when clarification reveals you are wrong you complain where your comments lead.

I don't like Obama, but comments about the national debt increase, QE (referred to by some as money printing) during his reign completely ignore the purpose of the QEs why the money was spent and necessity for spending that money.

This also relates to how, even in the face of increasing debt, the US is recovering. It is a just going to be a long bumpy road due to the absolute mess that happened in the CMO, CDS and CDO markets between 2001 and 2007.

" the US is recovering "

you are having a giraffe

[capcc76]

Peace, love and happiness Midas. Life is what you make of it. Be smart, work hard and you can be and have anything you want in the US. The world is not perfect, but living in the solutions produces better results than focusing on and constantly complaining about everything you fear or cannot control. Life is great and is passing you by.

[snarky66]

Plus the fact that obama hasn't created one job & doesn't care about creating one job. Yes it will be a long bumpy road. At least until we get a president who has an elementary school grasp of how an economy works.

[Johpa]

Who do you blame. I blame the brokers selling this stuff to retirees who should never be in high risk funds during the retirement stages, but I blame greedy consumers addicted to those high yields allocating such a large part of their wealth to such funds.

High returns equal high risk. Young investors rejecting safe conservative rates aggressively pursuing 25% +/- yearly returns cannot complaint if and when they lose their money.

This is what happened in the CMO and CDO markets. Investors sought high rates of return by investing in riskier securities. If they did not purchase, banks would not have bundled and sold.

It might be just semantics here, but I think not. "Consumers" generally refers to the vast middle class, not the upper 1%. The vast middle class has little to no opportunity to invest in anything that hints at 25% returns. That is the world of hedge funds and perhaps some real estate LLCs that tend to have a minimum investment of $100k. And the hedge funds, apart from the Madoff scam, usually require more than that amount as a minimum investment. The "consumer" was not the market for the securities in question. The banks knowingly bundled these securities into complex packages that purposely hid the risk in the complexities, then they paid off the ratings agencies to bless them as high quality securities with little risk, and then sold them to other financial institutions around the globe. It initially had nothing to do with consumers or retirees. But once the financial sector realized the immense profits involved in selling these securities they pressured the mortgage folks to become even more aggressive in selling mortgages to ordinary folks who had no way on knowing the complexities of their mortgages but relied upon a certain trust of banks and the mortgage industry to not sell them something totally toxic. The situation was, what Stieglitz calls, a situation of asymetric information. Stieglitz received a Nobel prize in economics for that concept. It was a criminal breakdown of the fiduciary responsibility of the lenders although I know there are those, they are called Republicans in the US, who would argue that there is no fiduciary responsibility in business; it is all caveat emptor.

[NeverSure]

What was the topic again? The Bush administration and derivative packages?

I thought the topic was a decline in the US economy in the first quarter of this year due to extremely harsh weather, after 6 years and 7 trillion in spending by the Obama administration.

I think 100 years from now, whatever is bad in the US will be blamed on Bush (who I can't stand, but I do like the truth.)

How about the OP topic where the economy shrank for one quarter on Obama's watch, 6 years into his administration?

And why do you care what the topic or focus of the discussion is on? Too funny. Nothing like opening the door with inaccurate comments, but when clarification reveals you are wrong you complain where your comments lead.

I don't like Obama, but comments about the national debt increase, QE (referred to by some as money printing) during his reign completely ignore the purpose of the QEs why the money was spent and necessity for spending that money.

This also relates to how, even in the face of increasing debt, the US is recovering. It is a just going to be a long bumpy road due to the absolute mess that happened in the CMO, CDS and CDO markets between 2001 and 2007.

" the US is recovering "

you are having a giraffe

Some people amaze me. They have no grasp of what the US is, how much wealth it has, or just how big it is.

The US government has untapped assets that are mind boggling. It has 88,000 miles of saltwater shoreline, a lot of it containing gas and oil. Everyone knows how big Texas is, but Alaska is more than twice as big. In fact Alaska is bigger than the next three states combined - Texas, California and Montana. Alaska is dripping rich in natural resources.

The US government owns 28% of all the land in the US, and much of it the most asset rich land. Vast forests of marketable timber, huge deposits of coal, gas, oil, rare earth minerals, gold, silver...

And yet 72% of it belongs to private parties who make money in all of the above plus farming. There is a vast amount of farm land. There are large rivers with enough fall to generate almost all of the electricity for the West, and enough to even export some to the East. All of the rivers belong to states or the federal government.

The US for a long time has decided not to tap its resources. But if it needed money...

I could go on, but for those who'd like to ring the death knell for the US, you have a very long time to wait.

Edited June 28, 2014 by NeverSure

[impulse]

The banks knowingly bundled these securities into complex packages that purposely hid the risk in the complexities, then they paid off the ratings agencies to bless them as high quality securities with little risk, and then sold them to other financial institutions around the globe. It initially had nothing to do with consumers or retirees. But once the financial sector realized the immense profits involved in selling these securities they pressured the mortgage folks to become even more aggressive in selling mortgages to ordinary folks who had no way on knowing the complexities of their mortgages but relied upon a certain trust of banks and the mortgage industry to not sell them something totally toxic. The situation was, what Stieglitz calls, a situation of asymetric information. Stieglitz received a Nobel prize in economics for that concept. It was a criminal breakdown of the fiduciary responsibility of the lenders although I know there are those, they are called Republicans in the US, who would argue that there is no fiduciary responsibility in business; it is all caveat emptor.

Asymetric information. That's a lot like fibbing, right?

[Johpa]

Asymetric information. That's a lot like fibbing, right?

More akin to not telling the whole truth, or withholding pertinent information. In the legal world it is remedied by laws of full disclosure.

[capcc76]

Who do you blame. I blame the brokers selling this stuff to retirees who should never be in high risk funds during the retirement stages, but I blame greedy consumers addicted to those high yields allocating such a large part of their wealth to such funds.

High returns equal high risk. Young investors rejecting safe conservative rates aggressively pursuing 25% +/- yearly returns cannot complaint if and when they lose their money.

This is what happened in the CMO and CDO markets. Investors sought high rates of return by investing in riskier securities. If they did not purchase, banks would not have bundled and sold.

It might be just semantics here, but I think not. "Consumers" generally refers to the vast middle class, not the upper 1%. The vast middle class has little to no opportunity to invest in anything that hints at 25% returns. That is the world of hedge funds and perhaps some real estate LLCs that tend to have a minimum investment of $100k. And the hedge funds, apart from the Madoff scam, usually require more than that amount as a minimum investment. The "consumer" was not the market for the securities in question. The banks knowingly bundled these securities into complex packages that purposely hid the risk in the complexities, then they paid off the ratings agencies to bless them as high quality securities with little risk, and then sold them to other financial institutions around the globe. It initially had nothing to do with consumers or retirees. But once the financial sector realized the immense profits involved in selling these securities they pressured the mortgage folks to become even more aggressive in selling mortgages to ordinary folks who had no way on knowing the complexities of their mortgages but relied upon a certain trust of banks and the mortgage industry to not sell them something totally toxic. The situation was, what Stieglitz calls, a situation of asymetric information. Stieglitz received a Nobel prize in economics for that concept. It was a criminal breakdown of the fiduciary responsibility of the lenders although I know there are those, they are called Republicans in the US, who would argue that there is no fiduciary responsibility in business; it is all caveat emptor.

Nope, the funds I specifically mentioned in my example where not hedge funds that required a qualified purchaser. Look them up. There was a lot of arbitration and litigation over those funds, primarily by middle class, retirees and average joes who had these funds in their ERISA accounts.

Pretty easy to make 20% 2001-2007. Take a look at returns in top 25 stock funds in 2006.

http://m.kiplinger.com/article/investing/T033-C000-S001-the-25-best-mutual-funds-2006.html

There are ETFs that have done 60 to 70+ percent in the last 3 years and many individual stocks have done better.

I know of an investment platform that Merrill Lynxh offers right now that has averaged about 20% since 1991. You can invest in that fund with lesser amounts, but better to invest about 100k because of load and the way money is allocated among 30 to 40 stocks. Number changes each month.

[capcc76]

Who do you blame. I blame the brokers selling this stuff to retirees who should never be in high risk funds during the retirement stages, but I blame greedy consumers addicted to those high yields allocating such a large part of their wealth to such funds.

High returns equal high risk. Young investors rejecting safe conservative rates aggressively pursuing 25% +/- yearly returns cannot complaint if and when they lose their money.

This is what happened in the CMO and CDO markets. Investors sought high rates of return by investing in riskier securities. If they did not purchase, banks would not have bundled and sold.

It might be just semantics here, but I think not. "Consumers" generally refers to the vast middle class, not the upper 1%. The vast middle class has little to no opportunity to invest in anything that hints at 25% returns. That is the world of hedge funds and perhaps some real estate LLCs that tend to have a minimum investment of $100k. And the hedge funds, apart from the Madoff scam, usually require more than that amount as a minimum investment. The "consumer" was not the market for the securities in question. The banks knowingly bundled these securities into complex packages that purposely hid the risk in the complexities, then they paid off the ratings agencies to bless them as high quality securities with little risk, and then sold them to other financial institutions around the globe. It initially had nothing to do with consumers or retirees. But once the financial sector realized the immense profits involved in selling these securities they pressured the mortgage folks to become even more aggressive in selling mortgages to ordinary folks who had no way on knowing the complexities of their mortgages but relied upon a certain trust of banks and the mortgage industry to not sell them something totally toxic. The situation was, what Stieglitz calls, a situation of asymetric information. Stieglitz received a Nobel prize in economics for that concept. It was a criminal breakdown of the fiduciary responsibility of the lenders although I know there are those, they are called Republicans in the US, who would argue that there is no fiduciary responsibility in business; it is all caveat emptor.

Oh, and they were not bundled to hide the risk. They were bundled to spread the risk. I can explain if necessary, but this is getting off track.

Banks also didn't pay off rating agencies. Didn't have to. CMOs were generally guaranteed by FM, GM and FM.

[midas]

What was the topic again? The Bush administration and derivative packages?

I thought the topic was a decline in the US economy in the first quarter of this year due to extremely harsh weather, after 6 years and 7 trillion in spending by the Obama administration.

I think 100 years from now, whatever is bad in the US will be blamed on Bush (who I can't stand, but I do like the truth.)

How about the OP topic where the economy shrank for one quarter on Obama's watch, 6 years into his administration?

And why do you care what the topic or focus of the discussion is on? Too funny. Nothing like opening the door with inaccurate comments, but when clarification reveals you are wrong you complain where your comments lead.

I don't like Obama, but comments about the national debt increase, QE (referred to by some as money printing) during his reign completely ignore the purpose of the QEs why the money was spent and necessity for spending that money.

This also relates to how, even in the face of increasing debt, the US is recovering. It is a just going to be a long bumpy road due to the absolute mess that happened in the CMO, CDS and CDO markets between 2001 and 2007.

" the US is recovering "

you are having a giraffe

Some people amaze me. They have no grasp of what the US is, how much wealth it has, or just how big it is.

The US government has untapped assets that are mind boggling. It has 88,000 miles of saltwater shoreline, a lot of it containing gas and oil. Everyone knows how big Texas is, but Alaska is more than twice as big. In fact Alaska is bigger than the next three states combined - Texas, California and Montana. Alaska is dripping rich in natural resources.

The US government owns 28% of all the land in the US, and much of it the most asset rich land. Vast forests of marketable timber, huge deposits of coal, gas, oil, rare earth minerals, gold, silver...

And yet 72% of it belongs to private parties who make money in all of the above plus farming. There is a vast amount of farm land. There are large rivers with enough fall to generate almost all of the electricity for the West, and enough to even export some to the East. All of the rivers belong to states or the federal government.

The US for a long time has decided not to tap its resources. But if it needed money...

I could go on, but for those who'd like to ring the death knell for the US, you have a very long time to wait.

Your country may have all these assets in the ground which you have referred to many times before in other threads but simultaneously your country evidently has a a very fragile social system with deep-seated problems. You may have those assets but your country is so economically fragile that the slightest hickup leads to complete breakdown and lawlessness as you saw in hurricane katrina and hurricane sandy.

I mean if people are so desperate that they behave like this just to save a few dollars on a consumer item, imagine how they will behave in a real countrywide crisis with 47% owning a gun?

Edited June 29, 2014 by midas

[Lancelot]

This administration's chickens coming home to roost.

The speed at which you are quick to condemn Obama is remarkable......virtually new land speed record could possibly be set IMO.

I read on another board that one expat's reason for leaving the USA was Obama. Whatever...

I chalk it up to people just like to complain. 2016 is coming up fast and we'll have a new bad guy to bitch about, thereby giving purpose to our unhappy existence. God forbid taking responsibility for ones own life and happiness

[capcc76]

And why do you care what the topic or focus of the discussion is on? Too funny. Nothing like opening the door with inaccurate comments, but when clarification reveals you are wrong you complain where your comments lead.

I don't like Obama, but comments about the national debt increase, QE (referred to by some as money printing) during his reign completely ignore the purpose of the QEs why the money was spent and necessity for spending that money.

This also relates to how, even in the face of increasing debt, the US is recovering. It is a just going to be a long bumpy road due to the absolute mess that happened in the CMO, CDS and CDO markets between 2001 and 2007.

" the US is recovering "

you are having a giraffe

Some people amaze me. They have no grasp of what the US is, how much wealth it has, or just how big it is.

The US government has untapped assets that are mind boggling. It has 88,000 miles of saltwater shoreline, a lot of it containing gas and oil. Everyone knows how big Texas is, but Alaska is more than twice as big. In fact Alaska is bigger than the next three states combined - Texas, California and Montana. Alaska is dripping rich in natural resources.

The US government owns 28% of all the land in the US, and much of it the most asset rich land. Vast forests of marketable timber, huge deposits of coal, gas, oil, rare earth minerals, gold, silver...

And yet 72% of it belongs to private parties who make money in all of the above plus farming. There is a vast amount of farm land. There are large rivers with enough fall to generate almost all of the electricity for the West, and enough to even export some to the East. All of the rivers belong to states or the federal government.

The US for a long time has decided not to tap its resources. But if it needed money...

I could go on, but for those who'd like to ring the death knell for the US, you have a very long time to wait.

Your country may have all these assets in the ground which you have referred to many times before in other threads but simultaneously your country evidently has a a very fragile social system with deep-seated problems. You may have those assets but your country is so economically fragile that the slightest hickup leads to complete breakdown and lawlessness as you saw in hurricane katrina and hurricane sandy.

I mean if people are so desperate that they behave like this just to save a few dollars on a consumer item, imagine how they will behave in a real countrywide crisis with 47% owning a gun?

Made it through 2008 when many lost 1/2 their investments/pensions, home values dropped 50%, many lost jobs and some lost money when a scattering of small banks failed.

No mass scale violence. No civil disruptions. We did the opposite as we typically do when confronted with a crisis. We pulled together, looked for solutions, the market rebounded and real estate values are back in many areas.

That video is sad, but come on. Do you really believe that is an accurate reflection of the US and the vast majority of people that live here? This is a one-off type "people of Walmart" gone coo-coo.

People in Thailand/other countries act like animals on a much grander scale. Storming airports, TV stations, government buildings, imposition of curfews and martial law and etc.

Most Americans are good, hardworking, honest and peaceful people. I have never witnessed violence or craziness here. Seen it on the news, but news reports uncommon occurrences.

It is truly unfortunate people have and spread uninformed negative opinions of US population or judge the entire US population based in nutty videos like that.

The US time and time again has pulled together as a nation when times got tough. Sad how you would wish faliure, suffering and civil unrest upon any country. Hate to disappoint you, but US bands together and becomes closer when faced with crisis.

Edited June 29, 2014 by capcc76

[midas]

capcc76

" Hate to disappoint you, but US bands together and becomes closer when faced with crisis."

in that case, why are so many asking to secede from the United States of America? I have seen many articles saying America has never been so divided since the civil war.

And a Gallup poll resulted in a whopping 90% of Democrats approving of the job the president is doing, compared with only 8% of Republicans.

You will never be able to come together until government stops putting so much emphasis on protecting the interests of the billionaires, whereas society really needs to be protected from the very people that plunder everything you have -e.g. $1 billion on the Obamacare website

Edited June 29, 2014 by midas

[Credo]

I don't know how divided the country is. I am pretty sure there was some major divisions during the Vietnam War and there was plenty of divisions during the Civil Rights movement.

[Ulysses G.]

IMO, the reason that the Vietnam War was so divisive is because there were so many young people that did not want to get drafted into the military and it became very fashionable to protest it. It did not have much to do with being an "unjust" war. If there had been no draft, IMO things would have gone very differently.

[impulse]

IMO, the reason that the Vietnam War was so divisive is because there were so many young people that did not want to get drafted into the military and it became very fashionable to protest it. It did not have much to do with being an "unjust" war. If there had been no draft, IMO things would have gone very differently.

Partly true. If there had been no draft, very few rich people's kids at all would have gone, and we'd probably still be sending poor kids over to die- the kids with no economic or political clout.

But that's not what the protests were about.

[Credo]

The divisions in the past were very strong. The Civil Rights movement was decisive as well, but did not include some local areas. The country managed to get through them.

The country has been through many economic downturns and most Americans will have had a parent/grandparent/great grandparent who lived through the Great Depression and very few people will not have heard the stories of hardship and how hardship is overcome. It requires pulling together.

Unfortunately, there are now some who would rather see the country pulled apart. But it won't work.

[Johpa]

I don't know how divided the country is. I am pretty sure there was some major divisions during the Vietnam War and there was plenty of divisions during the Civil Rights movement.

Today the divisions in the US today are financial with the social issues (race, religion, abortion) being used to divide and conquor the masses. Class warfare was quietly espoused as a tactic in Lewis Powell's 1971 memorandum and nearly fully implemented when corporate America installed their spokesperson, Ronald Reagan, as president. As shown in the book The Spirit Level: Why Greater Equality Makes Societies Stronger, high income inequality is highly correlated with nearly all the social ills affecting modern society. Neither natural resource wealth nor any increase in GDP can counteract the destructive consequences of high income inequality.

[capcc76]

I don't know how divided the country is. I am pretty sure there was some major divisions during the Vietnam War and there was plenty of divisions during the Civil Rights movement.

Today the divisions in the US today are financial with the social issues (race, religion, abortion) being used to divide and conquor the masses. Class warfare was quietly espoused as a tactic in Lewis Powell's 1971 memorandum and nearly fully implemented when corporate America installed their spokesperson, Ronald Reagan, as president. As shown in the book The Spirit Level: Why Greater Equality Makes Societies Stronger, high income inequality is highly correlated with nearly all the social ills affecting modern society. Neither natural resource wealth nor any increase in GDP can counteract the destructive consequences of high income inequality.

Technology (autmated checkouts and call centers, online shopping with no brick and mortar stores, automated assembly lines and etc.) and large monopoly like chains crushing mom and pop stores and paying workers crap are a serious modern workforce issue.

The reality is, and it is a reality that is here to stay, people now need to work hard and be responsible enough to get college, specialized or professional degree. Lazy people will get left behind in our current job market.

People used to "skate by," screw around, not take school seriously or drop out and still get one of the abundant decent paying unskilled jobs that used to exist in our job market. What I mentioned in the above paragraph has changed this.

People wanting to live the American dream now have to work for it, but even our lower income folks have a better standard of living than individuals living in many foreign countries.

RE: Inequality in US a bit deceiving regarding quality of life

Too funny about the numbskulls tea party folks saying they want Alaska to become part of Russia again. These people apparently have no concept as to how the average Russian lives. Even poor or low income in US have a better standard of living than average Russians.

RE: Current competitiveness in US job market

I feel my my two oldest daughter starting college this year and next year. They have so much pressure to do well. In the 80s, I took ACT the morning after a Keg party, never took a book home in high school and ultimately obtained a JD/MBA from a tier 1.

My poor girls went to a private school has pressure in grade school I never experienced worked their tales off and one took ACT 4 or 5 times to get 2 extra points, made a 32 first go but wanted 34 for scholarship criteria at some schools.

I actually don't feel too sorry for the lazy people getting left behind by current income equality as to many hard working people out there that deserve to make much more than lazy, looking for a free ride and wanna complain about the world is unfair people.

Edited June 29, 2014 by capcc76

[capcc76]

capcc76

" Hate to disappoint you, but US bands together and becomes closer when faced with crisis."

in that case, why are so many asking to secede from the United States of America? I have seen many articles saying America has never been so divided since the civil war.

And a Gallup poll resulted in a whopping 90% of Democrats approving of the job the president is doing, compared with only 8% of Republicans.

You will never be able to come together until government stops putting so much emphasis on protecting the interests of the billionaires, whereas society really needs to be protected from the very people that plunder everything you have -e.g. $1 billion on the Obamacare website

More nuggets from Midas. So happy not letting me down while ill in bed a Sunday morning.

Lol about the secession nonsense. Nutty outliers making noise as they always do. This more about crazy tea party red necks outliers in their own party trying to embarrass the Obama. They don't want to leave. They just hate Obama and will do and say anything to embarrass him.

This stuff is hilarious and more nutty websites you read that does not actually take an intelligent look into purpose or meaning and the percentage of US population signing this stuff is about as significant as percentage of US population wanting to get a sex change.

[boomerangutang]

US GDP should have been shrinking a lot more than it has. The only reason the stats don't show the real tanking of the US economy is because of proliferation of loans, on every level, from federal on down to credit cards.

What does the US produce? Really. Per capita. Very little. Nearly the entire US workforce produces absolutely nothing. One example: Not one person working at Wall Street and investment firms produces even a thimble or paperclip or carpenter's nail.

The US is increasingly a country of overweight hangers on sucking on the government teat, most of whom getting hand outs stemming from borrowed money.

[capcc76]

US GDP should have been shrinking a lot more than it has. The only reason the stats don't show the real tanking of the US economy is because of proliferation of loans, on every level, from federal on down to credit cards.

What does the US produce? Really. Per capita. Very little. Nearly the entire US workforce produces absolutely nothing. One example: Not one person working at Wall Street and investment firms produces even a thimble or paperclip or carpenter's nail.

The US is increasingly a country of overweight hangers on sucking on the government teat, most of whom getting hand outs stemming from borrowed money.

Yes on the hand out folks not wanting to work, be responsible or carry their own weight. This is a huge contributor to income inequality several were discussing. This group, as you said, sucks government resources and seems to be a catalyst to most of our problems. Trying to give this group their own homes, them lying on their mortgage applications and having to use appraisers that over appraised their homes so that they could effectively get 100% financing because they had no down payment money (appraise at 120%, put a fictitious 2nd mortgage from seller in paper work) was one the major contributors to the collapse of the mortgage industry.

[NeverSure]

Some people amaze me. They have no grasp of what the US is, how much wealth it has, or just how big it is.

The US government has untapped assets that are mind boggling. It has 88,000 miles of saltwater shoreline, a lot of it containing gas and oil. Everyone knows how big Texas is, but Alaska is more than twice as big. In fact Alaska is bigger than the next three states combined - Texas, California and Montana. Alaska is dripping rich in natural resources.

The US government owns 28% of all the land in the US, and much of it the most asset rich land. Vast forests of marketable timber, huge deposits of coal, gas, oil, rare earth minerals, gold, silver...

And yet 72% of it belongs to private parties who make money in all of the above plus farming. There is a vast amount of farm land. There are large rivers with enough fall to generate almost all of the electricity for the West, and enough to even export some to the East. All of the rivers belong to states or the federal government.

The US for a long time has decided not to tap its resources. But if it needed money...

I could go on, but for those who'd like to ring the death knell for the US, you have a very long time to wait.

Your country may have all these assets in the ground which you have referred to many times before in other threads but simultaneously your country evidently has a a very fragile social system with deep-seated problems. You may have those assets but your country is so economically fragile that the slightest hickup leads to complete breakdown and lawlessness as you saw in hurricane katrina and hurricane sandy.

I mean if people are so desperate that they behave like this just to save a few dollars on a consumer item, imagine how they will behave in a real countrywide crisis with 47% owning a gun?

Are you aware of where that happened and what the demographics are? I wouldn't wander into that area in the best of times. It is downright frightening even to me.

I was going through that area on the freeway one night. I needed gas and stopped in Slidell. While I was pumping my gas some guys with apparently nothing better to do began to walk around my car and eye me. I was very, very thankful to get out of there without a confrontation.

Just drive into New Orleans any time from the freeway (I-10.) You go through an older section of town first that has become a ghetto. You'll see lazy axxed groups of guys just hanging out, sitting on the steps of houses, and living in a dump that they created. Most likely they have a girlfriend with illegitimate children, collecting government benefits and supporting them.

The are certain areas in even Canada (parts of Vancouver) or Australia or London where I wouldn't go in broad daylight at any time.

There's a very unfair perception that because a few spots in America are dangerous, that it's all dangerous and that's far from the truth.

Edited June 29, 2014 by NeverSure

[Thai at Heart]

Banking, mortgage brokers and security industry is extremely regulated since 2008, almost harshly. I agree they brought this on themselves due to the few bad apples exploiting the system.

The part that absolutely astonishes me is how the Bush administration was either ignorant or just a sleep at the wheel. Most everyone in the financial industry and insurance industry say this coming for several years and the administration did nothing, absolutely nothing to stop it.

We knew AIG was in trouble and losing liquidity in 2004/2005. This was bleeding over into CNA and other large insurers in reinsurance market because of about $450 mil in CDS protection that AIG could not cover. There was something like $70 trillion CDS floating around worldwide.

Banks all over the world had purchased protection for CDS from AIG and failure of AIG could have brought down the entire WORLD financial and banking industry. This was not just a US problem.

What was Bush administration doing or thinking? We has whistleblowers and insiders telling everyone that would listen that AIG, CDS and CMOs were tanking. No one did anything and the CMO, CDS and credit swap market increased exponentially between 2005 and late 2007 and now we had huge amounts of Americans with their retirement and pension funds being placed into funds with large allocations to CMOs, CDS and CDOs.

Move forward to 2007. We all knew in 2007 what was going to happen and friends of mine even called the Quarter in which it would happen. Most us went 70% to 100%, got out of any funds with CDO or CMOs in the portfolio and ran like hell from financial securities.

Again, this was no secret. Everyone with any sense knew wheels would eventually come off in 2005/2006 and suspected it as early as 2004. Everyone except those that could have actually done something to stop the progression in our government.

That being said, our banking industry is currently very sound. No reason for alarm. The lesson learned is don't get greedy. We all where. I had investments and real estate appreciating 25% per quarter in 2004/2005. I suppose some just thought this would never stop and administration was too busy patting itself on the back and taking credit for wealth expansion in 2002-2007.

" That being said, our banking industry is currently very sound."

Rubbish! Even George Soros said the US banking system is " effectively insolvent "

" Banking, mortgage brokers and security industry is extremely regulated since 2008, almost harshly."

The $700 trillion derivatives market is not regulated at all and Alan Greenspan, even refuses to explain why he even fought tooth and nail to keep it that way

LOl, who can argue with a man that reads and listens to dailyjodcuts.com, zerohedge and George Soros! Love it!

George Soros is a rich and controversial guys with ulterior motives. Does he not want American banking to fail and become dependent upon international groups. Does he not want more power for the World Bank and IMF. Understanding him and his motives may shed some light on what he says. Did he not become rich through manipulating currency to the detriments of regular folks. Did Thailand refer to him as an economic criminal. Did Malaysia make some pretty strong statements about his currency activities during the 1997 Asian financial crisis?

There are some troubling aspects about derivative markets, but I am guessing you know very little about current derivatives and base your beliefs off what outlier websites focus on or perhaps take out of context.

By all means man, if it makes you feel warm and fuzzy . . . keep your money under your mattress or burry it tin cans like Cousin Eddie on Vegas Vacation. I suppose gold hoarders living in fear and worry want to see banking collapse. Keep wanting and wishing if it makes you happy, but you really should just enjoy life, stop worrying or you are going to be disappointed when everything does not go down the tubes and the world does not come to end.

Hahaha. Soros wants to put american banks under foreign influence.? Please stop watching fox news too much.

American banks have down so much toxic debt to the world, it wouldn't matter who owned them after they went bust. There wouldn't be a finwncial world worth owning.

[boomerangutang]

The US government does several things well:

>>> borrows tons of money

>>> convinces everyone, from bankers down to panhandlers that it's manageable to constantly borrow so much.

>>> hands out truckloads of money to people who say they're needy, but are really just lazy and greedy.

>>> spends 50X more for goods and services, than you or I would (same as Thai gov't).

>>> bails out badly managed companies and banks which are 'too big to fail.'

>>> gives tens of billions of dollars to largest banks, so general public will think the banks are solvent. That's what it did in late 2008. Those banks were told to take the low interest billions, and what did the banks do? Loaned it out at high interest. Wow, great for the big banks: get nearly free money from Uncle Sam, and make tubs of money on it.