Thread: The strongest economy in the world

^ That's the realy sad part, Spin. Many are applauding the failure of Lehman's and the fall of Citi et al. They just don't see that regular folks with 401(k) retirements in stocks are being cleaned out. And tmany are the little guys.
Oh dear. Dow 7133, S&P 746. Investors fearing a depression...

Originally Posted by Jet Gorgon

Investors fearing a depression

Pessimism is at extraordinary levels and some of my US based trader mates are buying SWHC. Thats Smith and Wesson, the gun maker as I'm sure you know. They're not joking about it either because many others seem to be buying also.
Consider that today over 1100 stocks hit a new 52 week low, and Smith and Wesson finished the day up 9%. Sentiment is low, many are talking about protecting themselves and planning for the possibility of social unrest.
Many mocked Bkkandrew for the thread he did all those months ago but as time goes by this shit is getting worse and the endgame could be near.

Originally Posted by Spin

Glenn Beck is way behing the curve. Yapping on about banks. US banks are dead already, you cant kill then again, going on about them is a waste of breath, citi is 2 dollars for fcuks sake.

The problem is that the people in the US aren't fully cognizant of these facts... GB serves the purpose of spelling these issues out in terms that Joe Sixpack can understand... Not everyone has the savvy of a TD officianado...

^ Fair enough, Its true that the American public need to be told about how bad this shit is. Its not always apparent to Joe Sixpack that years and years of fcukery by congressmen (who are ironically even more stupid than the average joe) and other dumb-ass politicians and so-called business leaders have bought America (and perhaps the rest of the world) to its knees.
Look at AIG insurance, they already had 150 billion dollars in hand outs. Its rumoured today that they may announce 60 biilion dollars further losses.
Its time for all folks to wake up and smell the coffee, the USA is on the verge of total collapse, and the rest of the world could well go with them.

One thing is certain. When this is all over the poor will still be poorer than the rich.

Originally Posted by Spin

^ Fair enough, Its true that the American public need to be told about how bad this shit is. Its not always apparent to Joe Sixpack that years and years of fcukery by congressmen (who are ironically even more stupid than the average joe) and other dumb-ass politicians and so-called business leaders have bought America (and perhaps the rest of the world) to its knees.
Look at AIG insurance, they already had 150 billion dollars in hand outs. Its rumoured today that they may announce 60 biilion dollars further losses.
Its time for all folks to wake up and smell the coffee, the USA is on the verge of total collapse, and the rest of the world could well go with them.

I doubt it will be that grim long term. Perhaps 2 or 3 years of very tough times then a rebirthing of the worlds economy on a more rational and sustainable basis.
The sooner things go bust, the sooner they can get on with rebuilding again.

The $US has got to adjust to its real tradable value before anything will work properly. The world might as well be pricing its tradable goods in glass beads or sea shells as $USs right at the moment. The sooner the world gets rid of the $US hegemony and adopts a trading system based on productivity rather than debt, the sooner we can all get on with our lives.

Originally Posted by Spin

Originally Posted by Jet Gorgon

Investors fearing a depression

Pessimism is at extraordinary levels and some of my US based trader mates are buying SWHC. Thats Smith and Wesson, the gun maker as I'm sure you know. They're not joking about it either because many others seem to be buying also.
Consider that today over 1100 stocks hit a new 52 week low, and Smith and Wesson finished the day up 9%. Sentiment is low, many are talking about protecting themselves and planning for the possibility of social unrest.
Many mocked Bkkandrew for the thread he did all those months ago but as time goes by this shit is getting worse and the endgame could be near.

Not bought any guns yet (can you do that in Thailand???) but I bailed out of Germany for this reason. Total collapse immininent as the company I was a senior Exec of, one of the top 20 in Germany, has flatlined and income is non-existant. It is the same all over the manufacturing and engineering sectors, with the financial sector already bust.

This is a good one too...

Daniel Mudd son of news reporter Rodger Mudd. The black caucus had Fannie Mae and Freddie Mac staked out and nobody was going to but the kibosh on their action. Anyone who dared tried would get the race card played on them.

I have seen this stated a few times now and the above two posts confirm it.

The world crisis is because of mortgages given to ethnic minority's (predominantly the Blacks and Hispanics) in the US, people with bad credit ratings that otherwise never would have qualified or deserved a loan in any Bank with common sense, all in return for votes to the Democrats. The Banks was held hostages by the Democrat Governments since and including J.Carter's and attempts by the Republicans to stop this madness was thwarted every time by mainly coloured Senators that sucked up to the coloured votes this way.

So to gain power the Dem's in the US has gambled with the whole World economy and driven it over the edge and into the abyss all in a total disregard for the damage they in turn might cause.

The only consolation that might be gained from this is that it it is hardly going to do Obama any good on his ratings to be President in a time where the US goes down the tubes, even if he today in a Martin Luther King'is way promised that the US will emerge from this crisis even stronger than before, no matter how delusional that sounds it wont be in his time as President.

Here is an article With Harvard economist Niall Ferguson & interview with Laurence Tisch: Heather Scoffield asks the questions regarding Canada, "Chimerica" and the Global crisis:

....Policy makers and forecasters who see a recovery next year are probably lying to boost public confidence, he said. And the crisis will eventually provoke political conflict, albeit not on the scale of a world war, but violent all the same.

“There will be blood.”

....Laurence A. Tisch professor of history at Harvard University, and author of The Ascent of Money, A Financial History of the World, sat down with The Globe and Mail's economics reporter, Heather Scoffield.

Heather Scoffield: Is the U.S. able to escape with less pain because it has more resources to throw at its problems?
Niall Ferguson: “Partly because they can throw so much at it, and they can do it at a lower cost than anybody else, because the U.S. retains the safe-haven status, which makes the world so unfair. Here is the world's biggest economy, which gave us subprime mortgages, rampant securitization, the collateralized debt obligation, Lehmann Brothers, Merrill Lynch. It is, in a sense, the fons et origo of this crisis. And yet, because it retains safe-haven status, in a global crisis, investors want to increase their exposure to the U.S. Hence, the dollar rally. Hence 10-year Treasuries down below 3 per cent yields. It's almost paradoxical that an American crisis ... reinforces the status of the United States as a safe haven.”

Heather Scoffield: Surely that safe-haven status would be revoked if China loses faith in the U.S. ability to finance its debt?

Niall Ferguson: As you know, Chimerica – the fusion of China and America – is one of my big ideas. It's really the key to how the global financial system works, and has been now for about a decade. At the end of The Ascent of Money, I speculate about whether or not that relationship will survive. If it breaks down, then all bets are off, for the U.S. and indeed for Asia. I think that's really the key point. Both sides stand to lose from a breakdown of Chimerica, which is why both sides are affirming a commitment to it.”

“It's very interesting that the Chinese in the last week were saying such soothing things around the [Secretary of State Hillary] Clinton visit. This was only days after Treasury Secretary Tim Geithner used the dreaded ‘m' word – currency manipulation.

Heather Scoffield: Why would the U.S. administration poke a stick in China's eye like that?
Niall Ferguson: “You obviously have to recognize that Democrats have been more hawkish on China for some time, than the Republicans ... But I think Tim Geithner is smart enough to know that this is a very dangerous game to play and I would be very surprised if you heard that word again pass his lips.”

Heather Scoffield: Did the Clinton visit improve the China-U.S. relationship?
Niall Ferguson: It looks like it....The line is very clear from China. They've consistently made their position clear. They want the status quo. They do not want this thing to break down. They were kind of appalled when Geithner said the ‘m' word. And they took full advantage of Hillary Clinton's visit to smooth ruffled feathers and restate their commitment. It's a very good bilateral relation. That bilateral will is important here. The Chinese believe in Chimerica maybe even more than Americans do.

“They have nowhere else to go. They have no other strategy that they can adopt in time to cushion the blow. Their exports are contracting at a terrifying speed. They want at all costs to avoid any kind of big shift in policy. They want to keep, as far as possible, the U.S. importing Chinese goods. They want to keep currencies stable. They are still buying dollars … At least officially, Chimerica is intact. But I stress ‘officially' because there's considerable public disquiet.”

“This is a crisis of globalizaiton that is destroying global trade. This poses the biggest challenge that the Chinese administration has faced since they embarked on reforms 30 years ago.

Entire: reportonbusiness.com: 'There will be blood'

Originally Posted by larvidchr

The world crisis is because of mortgages given to ethnic minority's (predominantly the Blacks and Hispanics) in the US, people with bad credit ratings that otherwise never would have qualified or deserved a loan in any Bank with common sense, all in return for votes to the Democrats. ... attempts by the Republicans to stop this madness was thwarted every time by mainly coloured Senators that sucked up to the coloured votes this way.

I'm thinking that your post is some sort of parody of the brainwashed Foxbots on this forum, right? If so, good job and please disregard my comments.

The Republican-led repeal of the Glass-Steagall Act in 1999 allowed deregulation of US banks. What followed was a flood of CDOs, credit default swaps and mortgage loans to anyone who could breathe (regardless of color). The rest is history.

The last time I checked, the US Senate had one African American and two Hispanics, 3% of the total Senate. To blame the downfall of the world economy on America's colored underclass is so illogical from so many angles that it's probably not deserving of comment. But, if you were to take a wild guess as to who controls Washington and had to choose between Wall Street lobbyists and poor colored folks, which answer would be more accurate?

Originally Posted by GooMaiRoo

Originally Posted by larvidchr

The world crisis is because of mortgages given to ethnic minority's (predominantly the Blacks and Hispanics) in the US, people with bad credit ratings that otherwise never would have qualified or deserved a loan in any Bank with common sense, all in return for votes to the Democrats. ... attempts by the Republicans to stop this madness was thwarted every time by mainly coloured Senators that sucked up to the coloured votes this way.

I'm thinking that your post is some sort of parody of the brainwashed Foxbots on this forum, right? If so, good job and please disregard my comments.

The Republican-led repeal of the Glass-Steagall Act in 1999 allowed deregulation of US banks. What followed was a flood of CDOs, credit default swaps and mortgage loans to anyone who could breathe (regardless of color). The rest is history.

The last time I checked, the US Senate had one African American and two Hispanics, 3% of the total Senate. To blame the downfall of the world economy on America's colored underclass is so illogical from so many angles that it's probably not deserving of comment. But, if you were to take a wild guess as to who controls Washington and had to choose between Wall Street lobbyists and poor colored folks, which answer would be more accurate?

Read the post, "not the poor coloured folks" the politicians sucking up to their votes!! effectively buying them with Fantacia mortages. and the sub primes was started by J.carter and really went amok under Clinton. all the febel arguments trying to turn the responsibility away from the Democrats fall flat on the floor, the comments in the videos are real by the real people that made them, this is something that you can not talk your way out of.

Originally Posted by larvidchr

....all the febel arguments trying to turn the responsibility away from the Democrats fall flat on the floor, the comments in the videos are real by the real people that made them, this is something that you can not talk your way out of.

The Democrats were a part of it.

The Republicans were a part of it.

Private Mortgage lenders were a part of it.

Banks.

Borrowers.


I've researched it quite a bit. The only argument is to try to level which particular groups above was more, or the most complicit.

That....is a waste of time, IMO.

Here is a report on housing prices for the last 3 months of 2008:

Home prices in record drop

The S&P Case-Shiller national index reports that prices dropped a record 18.2% in the final three months of 2008.

By Les Christie, CNNMoney.com staff writer
Last Updated: February 24, 2009: 5:09 PM ET

NEW YORK (CNNMoney.com) -- Home prices declined at a record pace around the nation in the final three months of 2008, according to an industry report released Tuesday.

The S&P Case-Shiller National Home Price Index reported that prices sank a record 18.2% during the last three months of 2008, compared with the same period in 2007.

Case-Shiller's index of 20 major metropolitan areas fell 18.5%, also a record.

"The broad downturn in the residential real estate market continues," said David Blitzer, chairman of the Index Committee at Standard & Poor's, in a statement. "There are very few, if any, pockets of turnaround that one can see in the data."

Link & Entire: Home price drop is record in S&P Case-Shiller index - Feb. 24, 2009

I am not so sure MM, it is a bit like- Both Country's participated in the war, who cares which one started it!!

The thing is that it is quite difficult to find any Republicans of notoriety really defending the sub prime scheme/Fanny & Freddi at the different hearings, but as a previous poster states there was instances where the Republicans was forced in part by political deals with the Democrats to implement less than successful legislation, that was the only way they could get consensus on other at the time to them more pressing issues.

That the Democrats now after the fact have used a lot of spin to try to paint the Republicans as equally responsible is really understandable but none the less still a spin.

That the Banks having been forced into the sub primes against good economically sense then ruthlessly attempted to make money on it is beyond doubt.

I am more reluctant to point blame at low income family's taking out mortgages they could not afford considering the sales pitches and the papers/loan agreements that they properly did not understand fully in many cases.

^^ maybe it is time to relocate to the US and get a real good house deal

Here is the "Duck's tale" on inflation and inflationary policies. Most posters are aware of the basics explained, but it's worth a quick scan, as the US Treasury department has increased the money-supply to historic highs:

This is presented well: money-debt-money-debt, inflation, banking, etc.

Part 2 out of 13

Originally Posted by larvidchr

^^ maybe it is time to relocate to the US and get a real good house deal

The Associated Press: The Chinese are coming, to buy bargain US homes

Kiss retirement away Baby Boomers. 401Ks decimated, and housing bust. They can join AARP, but it won't do much good.

Boomers: 30% underwater

Many of those nearing retirement will have very little to live on thanks to an erosion of home equity.

By Les Christie, CNNMoney.com staff writer
February 25, 2009

NEW YORK (CNNMoney.com) -- What a turnaround for the American Dream!

According to a report released Wednesday, the real estate market bust and stock market declines have carved a huge chunk out of the assets of baby boomers, the largest age cohort in U.S. history.

So much home equity has been lost that should boomers need to sell their homes, 30% of those aged 45 to 54 would owe money at closing, according to "The Wealth of the Baby Boom Cohorts After the Collapse of the Housing Bubble," a report released by the Center for Economic and Policy Research, a Washington, D.C.-based, non-partisan think tank. About 18% of boomers aged 55 to 64 are underwater and would have to bring money to the table.

The CEPR also found that people who were renting homes in 2004 will have more wealth in 2009 than those who were owners. That's true for all five wealth groups the study analyzed, from the poorest to the wealthiest.

"The collapse of the housing bubble, which led to the current recession, has already destroyed almost $6 trillion dollars in housing wealth for homeowners," said report co-author Dean Baker. "This reality is compounded by the recent collapse of the stock market. Many baby boomers will only have Social Security and Medicare to rely on in their retirement."


Three cases

Boomers between 45 and 54 have lost 45% of their median net worth, leaving them with just $80,000 in net worth, including home equity, according to the report.

Older boomers have fared marginally better. Those between 55 and 64 have lost 38% of their net worth, leaving them with $140,000. But this group is rapidly nearing retirement age and they have few working years left to m
ake up the losses.

To come up with their estimates Baker and co-author David Rosnick analyzed the assets of boomer-headed families and projected their wealth through September 2009. They used data from the 2004 Survey of Consumer Finance - a survey of the balance sheet, pension, income, and other demographic characteristics of U.S. families put out by the Federal Reserve - and the November 2008 Case-Shiller 20 City Price Index. The authors then factored in stock and housing market changes since then.

Baker and Rosnick presented their findings by income group under three scenarios they considered most likely: House prices remain at November 2008 levels (the latest data they had); house prices fall by 5% from November levels; or house prices fall by 15%.

In all three cases, the vast majority of these families will have lost a substantial portion of their net wealth compared with 2004.

"We've always boasted about how mobile we are as a society," said Baker, "but this can make us a lot less mobile."


A better deal

Peter Schiff, president of Euro Pacific Capital, an investment firm specializing in overseas investments and a noted bear on housing market issues, thinks there's a good chance home prices will continue their steep decline.

"Real estate has to be priced like any other goods," he said. "Home prices have to reflect the economic reality. You buy for shelter, not to be make money. You don't need to own a house. I'm a perfect example."

He has rented for years and reports that the owners of his current home, after subtracting for property taxes and insurance, are receiving a cash-flow return on their investment of less than 1%.

"Real estate is overpriced if owners get just a 1% return," he said.

Link & Entire: Boomer wealth is evaporating - Feb. 25, 2009

Originally Posted by Milkman

This is presented well: money-debt-money-debt, inflation, banking, etc.

Part 2 out of 13

I watched parts 2 up to 6 so far.

While I am not in total agreeance with the points raised in part 2, the rest seems a pretty realistic account of US financial global financial imperialism over the past few decades. Interesting clips.