Financial topics

[aedens]

Sums up the end game collapse from debasement.

Hyperinflation is a very common end game collapse when government debt and deficit get out of control. Deflation in a pure fiat currency has never been an end game collapse.
Context for Vin of what I was refering to...
Sat Aug 13, 2011 6:51 am
It will sum up to calculating the “financial repression tax,” more specifically, the annual “liquidation rate”

This process is known as carry trade liquidation and occurs when the majority of speculators decide that the carry trade may not have future potential.
We know how that worked for some do we not...
http://generationaldynamics.com/forum/v ... 3800#p9621
Back: Mon Dec 05, 2011
As always people assume deflation was a threat. The threat was years of misery was enabled by the excess credit by design. The balance of payment was a issue between counterparty's of gold on a governmental basis not consumer. They inflate "debased" for the fabian sociopaths running rampant also today.
The distinction between market and natural interest rates, and the key role played by credit, was already commonplace when John Stuart Mill (1871) was
writing, and was the main preoccupation of thinkers such as Wicksell (1898) and those that followed him. "I dissected Alfred Marshall since he doctrinated Keynes" The importance of understanding global financial intermediation and its tenuous link to current accounts was a key theme in Kindleberger (1965). It has motivated the collection and analysis of statistics on international banking by the policy community, a task entrusted to the BIS in the 1970s. More recently, several observers have again highlighted the need to focus on the whole balance sheet of national economies, albeit from a purely residence (balance-of-payments) perspective.
MF Global did business, including, in the U.S., the USA PATRIOT Act, which requires the Company to know certain information about its clients and to monitor their transactions for suspicious activities, as well as the laws of the various states in which the Company does business or where the accounts with which the Company does business reside. This dovetails into the observation they knew for month's in the scope. On the farm we call it canners and cutters grade 4.
My opinion does not matter. What does in any age is you cannot trust any bank with your money. Case No. 11-15059 (MG)
Going forward if you answer this I know who you are.
What instrument do we have at our disposal to fight successfully against private capital under these conditions? Is there such an instrument? There is a consciously planned approach to the market and to economic tasks in general.

Here’s Corzine from an earnings conference call. This should be his epitaph.
“The spread between interest earned and the financing cost of the underlying repurchase agreement has often been attractive even as the structure of the transaction themselves essentially eliminates market and financing risk.”

It was coming: http://generationaldynamics.com/forum/v ... ynes#p4238

http://www.zerohedge.com/news/eric-spro ... nsequences
JPMorgan: Nothing Else Matters
As far as markets are concerned, The goals: generate positive inflation in regions beset by deflation (Japan); boost bank capital and avoid insolvency by unlimited lending against a liberal definition of collateral (Europe); provide a lifeline to households, and pull forward future demand for consumer durables (US, UK); finance governments so markets don’t have to do as much (everywhere); encourage investor risk-taking by devaluing cash savings (also everywhere); then wait for private sector to recover. The caveat: stop if there are signs of inflation.
http://www.mcclatchydc.com/2011/05/25/1 ... rylink=cpy
"I, however, place economy among the first and most important republican virtues, and public debt as the greatest of the dangers to be feared."
Thomas Jefferson to William Plumer, July 21, 1816
Line of the Day:
"I felt a great disturbance in the Bourse, as if 216 hedge funds suddenly cried out in terror and were suddenly silenced. I fear something terrible has happened."

http://www.gfmag.com/tools/global-datab ... untry.html
http://www.youtube.com/watch?v=-8rH80cB ... re=related

[OLD1953]

I still see the world as playing that hot potato game, the first one to drop will take the brunt of the immediate loss. Long term is very difficult to predict, and these inflation predictions all seem longer term to me.

I can tell you what I expect, every possible effort expended to make things rosy until the election is over, a December meeting of Congress wherein the never passed budget for 2013 is totally repurposed, and a great deal of shock among US investors the next morning - very likely Christmas Day or the day after.

The efforts of the FED to force inflation just don't seem to have worked as far as I can tell. They did successfully push the inflation they caused from 1998 thru 2006 into inflation of equity prices, but the stagnation of equity prices and the relative stagnation of most CPI prices outside fuel and food are indications that monetary policy caused inflation just isn't really present at this time, and hasn't been since 2006 even in the equity markets. The drop in the BDI shows plainly that somebody isn't buying raw materials in huge bulk any longer - probably a number of somebodies.

The game has gone to extra innings, but the lights are going out in the ball park. It's time to wrap it up and wait for the next season opener.

[aedens]

When GDP to Debt ratio crosses it will be over. I agree Old on your conveyance.
We know better. They are educated beyond reality and the Taxpayers
are asking for them to pull the thumb out of there mouth or ass. They will do what they
do In Government. Break glass, lie, take more, misdirect, tell the public what problem,
well you get it.... http://www.liveleak.com/view?i=32b_1329947436

[Trevor]

Even as things stand, it's hard to make things appear rosy. Certainly much of the media is attempting to do just that, but the majority of people aren't buying it. They see fuel prices rise, unemployment remains high and the only reason the official numbers have dropped is because millions of people have just given up looking for work. I've been looking for a job myself for months and I haven't had so much as an interview, so I'm well aware of how bad things really are.

[OLD1953]

There really should be a way to get a dimensionless number representing national output. The contribution of a doctor in England cannot be less than 1/2 of the contribution of the same person after migration to the US, but that's what the GDP of both countries would have you believe. GDP, especially when compared to different countries or even the past of more than a decade ago becomes a very fuzzy number. And I'm not even going to talk about chained dollars and actual worth.

So what actually is the national output and how do we compare it to other countries in a more meaningful manner? Percentage of world production of critical industries? There needs to be some thought put into this.

The point here is that I'm really not that certain of what the economic input/output of the US or any other country really is, I know the numbers we use and I do use them, but do they have a real meaning? Do they map to the real world in a 1 to 1 mapping? And I'm not sure they do.

[aedens]

You seek a social defined calculation with math. That is not going happen since few even knows what Capital is.
http://www.youtube.com/watch?v=3ESlYTUS ... re=related <------- Old model but it brings lucid points with it.
http://www.youtube.com/watch?v=Ob8B5YNG ... re=related Impressions are what they are.
http://www.youtube.com/watch?v=DzwbF8q6 ... re=related Sound familiar
http://www.askbutwhy.com/2009/08/sir-ja ... ch-to.html Facts to disconnects.
http://www.youtube.com/watch?v=u6XAPnuF ... ure=relmfu Food for thought....
We did this in the very early ISP days as a team other than our full time career employer.
They were baffled why even then and some are still do this day I assume.
I made a very modest return when I sold my portion and focused on my current core endeavors.
A few items he missed in the presentation but did a good job on core themes. That funtions
are about attitudes to others.

Difficult to define right size for some. Europe is currently making a mistake in epic proportions.
http://www.eutimes.net/2012/02/argentin ... fault-now/
You cannot force anything since it will implode. The brushfire we mentioned is
obvious. Fix local economies of scale so trade will follow later.
Then worry about the so called export economy.
Locally it must be water, wheat, and hope for good weather without
the whip of assholes another continent away. They will trade excess as a funtion
of utility. As far I am concernd nothing can fixed at this point it is damage control.
No more no less. If the States get it we will stabilize. People do not get reciprocation
of trade and cling to protectionist dogma. More politicians do understand this than the public
is willing to admit. Attitudes are created to imbalances of choice and design.
Example: http://finance.yahoo.com/blogs/daily-ti ... 21366.html
Is it going to get better soon? I am deeply sceptical for at least 5 to 10 years as we are.

Old you are so correct we are in extra innings. Both party's need to more than wake up.
Some Business gets its. Some do not want to since they wish to disrupt in avarice to eliminate any
threat. Knowledge is power to creat and destory. Kind of simple attitudes. Water the garden when needed
and not when its raining. The liberals want more when we water the garden. More when the garden is soaked.
Divorse of interest's to balance. Health is mind, body, and soul. Clever people only ruin Business and Zones.
I truly believe and have found the Consumer in the long run decides who grows or dies in the garden.
Some Kids like mine are outraged that there peers do not want to work "transfer payments" and the other side
who want to work but not for assholes. So far we have done ok with education and employment with
non cargo cult attitudes leaders in leading technology and thought map practices to stabilities.
http://www.zerohedge.com/sites/default/ ... 20View.pdf
Review flooring ty t/d

[John]

Treasury 49-Day Bill Evidence of Growing Tax Shortfall
February 24, 2012
By Lee Adler

I missed this yesterday. The Treasury announced another surprise cash
management bill (CMB), the second in 3 weeks. Like the first one, this
one is for $20 billion. Tax receipts are not keeping up with the
Treasury Borrowing Advisory Committee (TBAC) forecast just issued on
February 2. The shortfall is now $43 billion over last 3 weeks.

If my math is correct, a total of $87 billion in net new Treasury debt
will be settling next Wednesday and Thursday. Won’t that be
interesting. Of course, the 29th is also the day of the next ECB Long
Term Refinancing Operation. Next week could be “interesting times.”
Stay tuned.

Here are the details of the newest issue.

CUSIP: 9127955J6
Term and Type: 49-Day Bill
Offering Amount: $20,000,000,000
Auction Date: 02/28/2012
Issue Date: 03/01/2012
Maturity Date: 04/19/2012


http://wallstreetexaminer.com/2012/02/2 ... -day-bill/

[Higgenbotham]

Vince,
You will probably get your answer in the next few weeks. In the past couple days, crude oil shot up close to $110 per barrel. That also happened last year as the high in the stock market approached. When stocks peaked out and started coming down, crude oil and silver also fell hard. If high crude prices and other problems peak the stock market soon, it'll be interesting to see if crude oil and silver also fall this year. You know I favored that outcome last year, but this year I'm not so sure. My 2 cents would be if they don't fall with stocks, then inflation is being built in and will be very difficult to eradicate. Of course, back in 2008, crude kept going higher but, at that time, the economy was still fairly strong and the worst of the 2008 problems hadn't hit yet to drive the excess inflation out of the system. If they are bubbles, they should continue to burst when stocks come down. If it's real inflation leading to hyperinflation, then silver and crude will continue going up. Just my opinion and I'm no expert on exactly how this should play out, so if anyone finds anything wrong or anything that need to be added, by all means do so.

[John]

The commodities bubble in 2008 was caused by explosive growth in China
prior to the Olympics, and had little to do with the U.S. economy.
After the Olympics, the explosive growth fell off a cliff, resulting
in the commodities crash, which also had little to do with the
U.S. economy, nor with the Lehman bankruptcy as everyone says. Or
maybe it was all caused by global warming.

** China fears major crisis, as economy continues to crash
** http://www.generationaldynamics.com/cgi ... 04#e090204

John

[Higgenbotham]

John,

Aedens posted this the other day, which I found quite interesting because we didn't know this in 2008.

http://www.mcclatchydc.com/2011/05/25/1 ... rylink=cpy

WASHINGTON — When oil prices hit a record $147 a barrel in July 2008, the Bush administration leaned on Saudi Arabia to pump more crude in hopes that a flood of new crude would drive the price down. The Saudis complied, but not before warning that oil already was plentiful and that Wall Street speculation, not a shortage of oil, was driving up prices.

Having watched the machinations in the markets, it was my guess at the time that about $50 of the premium in oil was due to speculators.

Looking at today's situation, there's just no possible way in my view that oil can be close to $110 (and up about $5 in the past week) without a speculative component to that. I could be wrong...but with gasoline demand falling off the cliff, it doesn't make sense.

This was all rehashed here 3 years ago, but that's what's new as I see it.