~~~

BR: Fixed!

“You have a group of politically powerful oligarchs, whom other people hate, but who are entrenched there,” Kay, a visiting professor at the London School of Economics, said in an interview yesterday. “It will require something of a political earthquake” to reduce the bankers’ sway, he said.

Is this really possible? The foreign governments that own trillions in US paper would have to be mad to stand for this…wouldn’t they just print their own money and buy dollars? Look at the following graphic on the cycle of deflation from the Comstock Fund…if they are right, we are right now at “devaluation” and next comes “competitive devaluation” which supports my longstanding notion that we are in a deflationary debt crash.

http://prudentinvestor.blogspot.com/2005/07/chart-of-day-deflation-cycle.html

There’s only one financial company that during the crisis in Sept 2008 would probably fit this description of solvent, but suffering from liquidity collapse. And it is… **drum-roll please…** (you’ve guessed it) Goldman Sachs!
And just to remind you, Dudley worked as Chief Economist at GS before going to the NY Fed as chief trader first (talk about those GS “trading” profits) , then taking Timmy’s place.

A Tale of Two Credit Markets – Randall Forsyth

http://online.barrons.com/article/SB125815671249547689.html

“Cisco …had to pay just 100 basis points … more than the benchmark 10-year U.S. Treasury note …On the $2 billion, 30-year portion, the spread was just 130 basis points over the borrowing cost of the U.S. … So much for the notion that the federal government’s borrowings would crowd out the private sector…”

So much for the crowding-out crowd… That’s YOU Rick Santelli and your tea-sipping old ladies friends.

And Also from Barron’s “Sampling of Advisor’s Opinions” from Cuttone and Co. there’s also…

“…Interestingly, many of those who dismissed Dow 10,000 as a meaningless number have gone on to speak about the devastating psychological importance of 10% unemployment…”

…That’s YOU Rick Santelli and your teabagging buddies.

Yes, but only IF Chairman Ben and Secretary Tim don’t get their way and don’t devalue the dollar as much as they hope to. They only have to drop the value of the USD by 2011 to below 50% of what it was worth in 2006/2007, and the debt that’s now worth 50% below par will magically be @par again(in NEW dollars of course.)
And guess what? Ben and Tim will be praised for averting the CRE crash, Cramer will scream about the new bull market (with securities priced in worthless dollars,) and bankers will up their bonuses by 100% in order to “keep up” with bank earnings…. 295million of “other americans” – those who draw most of their income from somewhat fixed salary, pension, social security, unemployment benefits, etc (but not from investments banks, CRE, oil futures trading, or insider tips on penny stocks) will grumble, but will go on. The new American Sheep… A hurd led by The O-team of Ben, Tim and Larry… praying that Lloyd & Co. continues to do G*d’s work here on Earth…. booyah indeed.