Thread: The strongest economy in the world

A devaluation of the value of the $US via inflation and the resultant cut in living standards for the US poor and middle class is the only way out of this financial mess for USA. The easy living on borrowed money cant go on forever. There comes a time when one has to pay the piper.

The US markets didn't think much of the unemployment numbers... The DOW dropped 214 points today, effectively negating the bear market rally which began in March...

^ True, Spin. And what investor is going to select Rolling Stone for fekin insider market info.

Originally Posted by Spin

Originally Posted by robuzo

Matt Taibibi, whose article about Goldman Sachs in Rolling Stone has caused quite a stir.

He didnt even touch on some of the more important matters involving GS. There are many more, one example being the levels of program trading on the NYSE, its estimated that around 45% of all trading volume is now done by computers owned by outfits such as GS, JP Morgan and Credit Suisse. The market quite literally goes where they want it to go. The idea that that the market moves in the direction that market sentiment and underlying fundamentals send it obsolete.

More on this here

and at 4minutes onwards:

Shame you weren't impressed. It was a but short interview. More here The Great American Bubble Machine : Rolling Stone

Ya, I'm waiting to read the Top Ten and critiques of Nine Inch Nails in the WSJ.

Originally Posted by robuzo

Shame you weren't impressed

Not so! I was impressed, right from the get go. I linked to that article when it broke on the 26th and wasn't even online in text version both here and here

On reflection, it was worthy of its own thread as Goldman Sachs are a real piece of work

Link: The Scariest Jobs Chart Ever

This looks bad. Notice the differences. We'll wait and see.

^ That's the dumbest fekin chart I've ever seen.

Well good golly ya'll still got me thread breathing life after all this time. Anyhoo... no matter how much you hope and pray for the demise of the good ole US of A it ain't gonna happen anytime soon.

Consider the greying of nations factor ... this is going to affect countries like China worse than the US. And like it or not the US is going to open the doors to the immigrants.

And how about the US stop giving out trillions of dollars in subsidies to various companies to set up shop in various places ?

And how about we stop with all the tax benefits to the sports industry? Shoot we could come up with a trillion dollars in less than 10 years by just shutting down the US military.

Perhaps that's why Pres O is trying to get the Talitubies in Afganistan wiped out once and for all at the mo. Wants to get out and save a load of cash.
As for the graph, well it looks like the final moments of an Airbus journey, results might be similar too. Disaster!

There's plenty of money to be made by the US government in health care and public utilities as well. The private sector has proven that well enough.

Somebody mentioned that the US is becoming controlled by the financial sector. It's worked pretty well in the UK, right ?

The US is still the strongest economy in the world bar none. The US will recover from the current crisis.

I just hope the era of the billionaires getting richer on the taxpayer dole is over. I doubt it though.

I doubt it too. It is a fundermental in economics that the first duty of the rich if they want to stay rich is to make sure the poor stay poor.

Originally Posted by Storekeeper

The US is still the strongest economy in the world bar none

Have you been on the moon for the last two years?

May well be that Norway has a better economy, but the country is so small it has no effect on the global economy. Can'y think that anyone's doing much much better than the Yanks.

Rather nice piece detailing the events at AIG leading upto its implosion and 182 Billion $ bail-out. A must read, in fact.

linky

Originally Posted by Spin

Rather nice piece detailing the events at AIG leading upto its implosion and 182 Billion $ bail-out. A must read, in fact.

linky

Very interesting read, thanks Spin.

I find this very disturbing IF true: The US Treasury Department is being accused of changing the way Treasury Sales are recorded.

Meaning, that they are making Federal Reserves buys of Treasury Bonds (buying their own debt) look like foreign nations actually bought them.

So, the recent reports of high foreign demand for US Treasury bonds, is a....lie.

If true, this means things are not only bad now, but will get worse:

"But in a little-noticed switch on June 1, the Treasury changed the way it accounts for indirect bids, putting more buyers under that umbrella and boosting the portion of recent Treasury sales that the market perceived were being bought by foreigners.

Like... A long time reader sent me a note yesterday, and said, "hey Chuck, did you see the story in the Wall Street Journal (WSJ) on Foreign Demand for Treasuries?" Well, I hadn't and went immediately to the WSJ, and there it was... Tucked away in a corner so that no one would see it, if they weren't looking for it... A story, by Min Zeng, titled, "Is Foreign Demand As Solid As It Looks?

These are the things that really TICK ME OFF folks, so stay with me on this... Basically, as we all know the U.S. Treasury Auctions have been getting "covered" easily recently... And foreign demand was listed as the reason... Which would have been the exact opposite of what I was saying about foreigners shying away from Treasuries...

Here's the skinny... But I'll let Min Zeng tell it, since he did the research and brought this to the public, even though it was tucked away so no one would notice!

To Repeat:

"But in a little-noticed switch on June 1, the Treasury changed the way it accounts for indirect bids, putting more buyers under that umbrella and boosting the portion of recent Treasury sales that the market perceived were being bought by foreigners.

The new definitions are deep in the arcane world of Treasury auctions. The change involves buyers who place orders through primary dealers. Those had been counted as direct buyers, but as of June 1 they were classified as indirect buyers, making that group larger than before. Because investors view that group as being dominated by foreign buyers, they assumed foreign demand was higher."

>>>> OK, back to me... Ahhh, so that's what's going on... The Treasury "moved the goal posts on us"... As Sylvester would say... That's despicable! Why isn't someone in Washington D.C. shouting from the roof tops about this? Oh, that's right, they're all in cahoots!

This is HUGE folks... So...

When the markets were thinking that foreign demand was increasing, it was actually, as I had said, shying away from Treasuries! Which, if the market participants are thinking that as long as foreigners are "buying into our deficit spending" then the dollar will be on terra firma, but instead are getting "duped" by the U.S. Treasury, you would think that someone would have some xplainin to do...

Link & Entire: EverBank: Daily Pfennig

^ yeps as stated in my post 1417 the dirty tricks book is out and there is a economic war going on. The US will lure any sucker to buy the bonds knowing full well it is a bad paper, and the big holders are trying to get out on the quiet without collapsing the Dollar.

More on the commercial real estate spiral. It WILL get worse.

BISMARCK, N.D. (AP) - Hundreds of anxious shoppers watched as city officials used power saws to cut 2-by-4s during Home Depot Inc.'s ribbon-cutting ceremony for its 102,700-square-foot building center in Bismarck. Less than three years later, the home improvement retailer shuttered the underperforming store, leaving a big orange empty eyesore on the outskirts of town.
The building, sitting derelict and silent on acres of asphalt, is now listed for sale at $10.5 million. But there's been little interest in the near windowless warehouse-like building that occupies a lot the size of a dozen football fields.

For potential tenants "it's a hard pitch because for most uses it seems to be a bit of a tough fit," said Brian Ritter, business development director of the Bismarck-Mandan Development Association.

As the recession takes its toll on big-box retailers, more communities across the country are having to confront not just the eyesore of giant empty stores, but also the loss of jobs and tax revenue that follow.

Link & Entire: As retailers cut back cities confront 'ghostboxes'

^ Yep. Good post on the Treasury change, too.

This whole thing is just starting to unfold. And it goes a lot deeper than just a banking or housing crisis. At the root of it is the overinflated value placed on the the worlds default trading currency. Until the worlds supply of paper money gets back into balance with goods and services that are of real value to society, recovery will remain stalled.

Still no time to come on here and play, but here is some gristle for youse to chew on (from a really good blog, btw):
America's Finances Are A Train Wreck
Throughout America's spending binge, which really got going in the 80s, ignoring the mounting deficit has become the standard course of action. We've never (and still haven't) paid a price for running up such a big tab. It's been all gravy so far.

And as Morgan Stanley analyst Richard Berner notes (via Paul Kedrosky), that's the problem. The lack of consequences to our spending has hardened us to the belief (however much Obama or anyone else proclaims to "lose sleep" over the matter) that deficit spending can go on forever.

America's long-awaited fiscal train wreck is now underway.