Monday Reads
Quite a few interesting stories today in them papers. Here is what caught my eye:
• Will Toyota’s problems hurt Honda? (CNN/Money)
• Parsing 200 years of gold trades (MarketWatch)
• Bill Gross is getting Ornery in his old age (PIMCO) . . . Hey McCulley! Take this guy fishing or sumpthin!
• Vice Chairman Donald Kohn Retires, a Look at 40 Years at the Fed (Real Time Economics)
• The Hidden Costs Of Mutual Funds (WSJ)
• Time to outlaw naked credit default swaps (FT)
• The Future of Money: It’s Flexible, Frictionless and (Almost) Free (Wired)
• A New Algorithm to Attack Art Fraud (ieee)
• Manure becomes pollutant as its volume grows unmanageable (Washington Post)
• iTunes Prize Winner to Steve Jobs: “Yeah Right, Who Is This Really?” (Rolling Stone)
What caught your eye . . . ?
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March 1st, 2010 at 3:48 pm
Goldman’s rehab
http://www.nypost.com/p/news/business/goldman_rehab_cranks_up_engine_to_rWUvoockwZr0TlUY4OQ17J#ixzz0gwOzYiOD
Lloyd Blankfein is starting to worry about his legacy.
The 55-year-old chief executive of Goldman Sachs — three-plus years into his tenure — recently turned to a Texas corporate p.r. firm to buff the image of the tarnished Wall Street powerhouse.
Turning to outside consultants to gauge a firm’s “perception in the marketplace” is unusual for the 140-year-old firm. But that’s what you do, even if you are Masters of the Universe, when the national and international media accuse you of engineering and profiting from a back-door rescue of AIG, of using cash from a taxpayer bailout and cheap Federal Reserve financing to help finance lavish bonuses, and taking down the entire Greek economy.
HEAVENLY MAKEOVER: In the wake of bailouts and bonus binges, Goldman Sachs CEO Lloyd Blankfein has taken the unusual step of hiring a p.r. firm to improve its “perception in the marketplace.”
Blankfein took the step of using the fancy p.r. firm, Public Strategies, sources say, because he feels Goldman has successfully weathered a storm of controversy — by trimming the overall compensation pool to 36 percent of revenue — and must now work to undo the damage.
Public Strategies, headed by Dan Bartlett, a confidant of George W. Bush and Karl Rove, is already on the case. Earlier this month, Goldman clients and Wall Street analysts starting filling out an exhaustive, online questionnaire seeking to pinpoint exactly what people thought of Blankfein’s firm.
March 1st, 2010 at 4:03 pm
“Will Toyota’s problems hurt Honda?”
Ron Gettelfinger is the one who is ecstatic, not the Honda executives.
March 1st, 2010 at 4:07 pm
Fallout from Toyota’s problems:
FWIW my next car will probably be a Volks. I’ve always liked the way they drive, but they have a reputation for annoying little problems, so I bought a Mazda instead. I like the way it drives, but it has annoying little problems …
But, I like small cars that offer features and performance, so as far as I know Detroit is still out of the game.
March 1st, 2010 at 4:08 pm
The Multiplication of Money, a John Mauldin piece over at Minyanville. It gives as clear and concise a picture of what’s happening with the money multiplier as I’ve seen.
Also, a BBC piece on how the Chilean relief effort is being supported globally, courtesy of the internet:
Net puts Kenya at centre of Chile rescue efforts
People who think that local service jobs are “safe” oughta think again — virtually EVERYTHING has a significant component that is related to organization and communication, and that part knows no bounds.
March 1st, 2010 at 4:09 pm
Oh, and as a follow-up from the Olympics, it looks like Whistler won’t be up for auction after all.
http://www.theglobeandmail.com/report-on-business/intrawest-makes-deal-with-creditors/article1485410/
March 1st, 2010 at 4:20 pm
The Telegraph: Germany and France agree to rescue Greece, with conditions
http://www.telegraph.co.uk/finance/economics/7332415/Germany-and-France-agree-to-rescue-Greece-with-conditions.html
Germany and France are putting together a plan to buy as much as €30bn (£26.7bn) of Greek debt to help the country avoid a
calamitous sovereign default – but only if Athens commits to slashing public spending.
Greece has to repay €22bn to lenders in the next few months and raise a further €30bn in new borrowings…In return for the support of the Germans and the French, the Greek government has agreed to implement €4bn of new austerity measures to reach its target of cutting the budget deficit by four
percentage points this year.
March 1st, 2010 at 4:25 pm
Dodd dumps the Consumer Financial Protection Agency. Instead, an incinerator will be erected at the Treasury Department to “accommodate” consumer complaints.
http://www.nytimes.com/2010/03/01/business/economy/01regulate.html
March 1st, 2010 at 5:08 pm
The gold article seeks precedent for gold’s strength. There is no precedent. We are living a black swan moment (moment by moment).
March 1st, 2010 at 5:09 pm
Scott F: If Bartlett can make W and Cheney look good, he must have some talent for redeeming those who have sent the US into decline.
March 1st, 2010 at 5:13 pm
f411: Obama’s problem is that he would not play hardball the way some of the most effective presidents have done. Call out the Republican obstructionists and run against them to get a real supermajority and not one dependent on a bunch of senators scared of their own shadows. Probably too late now, though.
March 1st, 2010 at 5:16 pm
@constantnormal:
There was an error in your Minyanville link.
The Multiplication of Money
There, I fixed it for you.
March 1st, 2010 at 5:18 pm
German ProSieben TV Channel Finds 500 Gram Tungsten Bar At W.C.Heraeus Gold Foundry With Bank Origin
http://www.zerohedge.com/article/german-prosieben-tv-channel-finds-500-gram-tungsten-bar-wcheraeus-gold-foundary-bank-origin
March 1st, 2010 at 5:33 pm
@ constantnormal & @ OkieLawyer
You guys are running behind – ever look in Think Tank here at TBP? Mauldin’s newsletter was posted there on Sat. morning.
http://www.ritholtz.com/blog/2010/02/the-multiplication-of-money/
March 1st, 2010 at 5:36 pm
BREAKING AT 4:17 P.M.: Hazmat crews are responding to IRS offices in Utah, where two people have been removed on stretchers and others are undergoing decontamination showers due to hazardous materials, according to MSNBC.
Read the full story and breaking updates at Talking Points Memo.
http://tpmlivewire.talkingpointsmemo.com/2010/03/fbi-investigating-hazardous-materials-incident-at-utah-irs-office.php?ref=fpblg
March 1st, 2010 at 5:37 pm
Bill Gross is right about, “…with the fundamental economic problem of our age – lack of global aggregate demand…”
It’s not “jobs, jobs, jobs.”
But he’s wrong about, “…But based on existing deficit trends and the expectation that not much progress will be made in reducing them, markets are raising interest rates on sovereign debt issuance either in anticipation of higher future inflation, increased levels of credit risk, or both…”
Ten years are low. In a year they’ll be higher but still low. JGB rates are low, same for Euro debt. This is a real problem for a big bond manager, for investors, not so much.
You should already have dumped your sovereign debt, if you haven’t already, you won’t ever.
March 1st, 2010 at 5:37 pm
xtending hamp another year, you betcha, can’t keep home prices up with unemployment sucking and cash for homes going bye bye, still, keep home prices up too save states
godlman, and bartlett, roflmao, texax pr is screw you, mind your own business
March 1st, 2010 at 5:49 pm
On bloomberg Volkswagen said — Sales were UP 25% in February YoY. (After being up 41% (!!!) in Jan).
Add them to the list of companies reporting very strong Q1 — F, CSCO, UPS, AAPL, HPQ, MCD… hmm?
March 1st, 2010 at 5:50 pm
Here’s a good take on the current budget:
http://www.tomdispatch.com/post/175212/tomgram%3A__jo_comerford%2C_a_budgetary_sos_for_2011/#more
March 1st, 2010 at 5:52 pm
… the next 6 months comp SO easy. Should be 60% EPS growth Q1, 40% EPS growth Q2, 30% EPS growth Q3… YoY the next 3 Qs on SPX… even without more momentum in the recovery.
IF we get some good news… there is upside to those numbers.
March 1st, 2010 at 6:08 pm
@OkieLawyer 5:16 pm
Thank you, kind sir.
March 1st, 2010 at 6:11 pm
http://www.guardian.co.uk/business/2010/mar/01/hung-parliament-fears-send-pound-falling
This caught my eye because now you can influence an election with a currency.
Or is it just the money-mongers from hedge funds playing their ruin-them game?
March 1st, 2010 at 6:56 pm
Chilean Quake Likely Shifted Earth’s Axis, NASA Scientist Says
http://www.bloomberg.com/apps/news?pid=20601109&sid=aLAUn4Gy92ss&pos=10
March 1st, 2010 at 6:59 pm
Vancouver medals in condom distribution
http://www.cnn.com/2010/LIVING/03/01/condoms.vancouver.olympics/index.html?hpt=T2
March 1st, 2010 at 7:01 pm
Germany and France secret services are trying to identify euro shorts:
http://www.reuters.com/article/idUSLDE6201RX20100301
What a great idea. Next they should turn their inquiries toward those horrid speculators who profited from the injury of an entire nation of savers by shorting the yen lo these two decades.
And, to think, they might’ve gotten away with using the *US dollar* as a carry trade if we hadn’t stopped them!
March 1st, 2010 at 7:28 pm
Joe Retail,
re: 16:07 post..
see: “If there is a car that North American aftermarket tuning enthusiasts, entry-level consumers and Ford dealers have been longing for more than just about any other, it’s Ford’s Euro-spec Focus, and at long last it’s at the North American International Auto Show in Detroit in US-spec trim. Even better than hoped for, however, the new Focus offers everything its European counterpart does as well as specially designed details tailored to our unique market…”
http://www.driving.ca/news/story.html?id=2433046
~~
“…The new Ford Focus has been developed by a global team, led from Ford’s European small and medium vehicle center of excellence in Merkenich, near Cologne, Germany, with powertrain development led by a similar team at Ford’s technical center in Dunton, England. The vehicle has been engineered without compromise to meet all customer and legislative requirements of the major worldwide markets.
For the NAIAS preview, Ford showed a completely new 2.0-liter gasoline engine for the North American market that features DI and Twin Independent Variable Camshaft Timing (Ti-VCT) for enhanced performance and fuel efficiency. The new 2.0-liter DI Ti-VCT engine is up to 20 horsepower more powerful than the current 2.0 Duratec® I-4 unit, while contributing to projected fuel economy gains of more than 10 percent.
To maximize the performance and economy advantage enjoyed by the new Focus, the 2.0-liter DI Ti-VCT engine is mated with the latest dry-clutch six-speed Ford PowerShift automatic transmission. This transmission uses an advanced dual-clutch design, which alone can help to reduce fuel consumption by up to 9 percent compared to a traditional four-speed automatic.
Ford also has confirmed plans to begin building a full, battery electric vehicle in 2011 at its Michigan Assembly Complex for sales in North America. It will be the company’s first battery electric passenger vehicle.
Within the cockpit, the most significant innovation is the company’s next-generation driver connect technology, MyFord,™ which provides the driver with a state-of-the-art combination of controls and display screens to operate the key vehicle features. On high-series vehicles, the MyFord system includes an 8-inch touch screen, allowing the driver to control a wide range of functions via a clear and intuitive color display. Click here for more information on the MyFord system.
Other available safety and convenience technologies include keyless entry and “Ford Power” start button, a rearview camera and a semiautomatic parallel parking system that automatically steers the vehicle into a parking spot…”
http://www.thefordstory.com/our-plan-progress/next-gen-ford-focus-announced/
~~
LSS: something that may be worth checking out v. Mazda, VW, et al..
some things are changing, a few, for the better~
March 1st, 2010 at 7:30 pm
Don’t Care
I haven’t gone to a cocktail party in over 10 years. Granted, perpetually watching Seinfeld reruns on Friday and Saturday nights makes for a dull boy, but the alternative is excruciating. Uh, which would I prefer – solitary confinement or water boarding? I lean strongly in the direction of a warm bed and peace as opposed to a glass full of tinkling ice cubes and a room resonating with high-decibel blather. I suppose the parties wouldn’t be so bad if there was something original to be said, or if “you” had a genuine interest in “me” as opposed to “you,” but let’s face it folks, no one does. The only reason any of us really cares about cocktail conversations is to quickly redirect someone else’s stories into autobiographies that we assume to be instant bestsellers if only in print. If not, if the doe-eyed listener seems simply fascinated by what you’re saying, you can bet there’s a requested personal favor coming when you finally shut up. “Say Bill, I was wondering if you knew somebody at…that could…” Yeah right! But, as my chart shows, 90 seconds into a typical conversation, no one gives a damn about you and your problems – maybe those shoes and that dreadful eye shadow you’re wearing, but not anything audible coming out of your mouth.
————-
As what BR and the Crowd Here would think….I’m a “Teeny Investor.” But, Bill Gross has steered me correctly for years with his Monthly Reports. When he suggested buying Tips ..years ago….I bought Tips…and made some money…when he told me to Sell My “Tips” …I did and was GLAD THAT I DID.
The thing about Bill Gross is that you have to get his snark…and have some ability to understand how he applies it and then be sure to always READ his BOLDED COMMENTs which he makes obvious as his “TALKING POINTS” that his followers should be aware of. (I’m bolding as Gross does to emphasize what I’m saying.)
So…I’m not in any PIMCO FUNDS in my 401-K or IRA and that’s EXACTLY because Bill cautioned me to Get Out of Them….Way…Way Back… And, sure enough what he said gave me the ability to get out before “hard times” for “small investors” came true.
What I like about Bill is that he is always giving you “CLUES” and he does it for the lowest investors of us. If you read a lot (like Bill has done) you can pick up what he’s talking about and get his “cautions.” If you are an Algorithm or HF Trader…you might read him to TRADE.
Bill has not let me down with his snark and REAL INFO through the years. And, when he told me not to invest with his PIMCO Investments I got OUT! He steered me Correctly! I Captured my GAINS!
He’s a good guy…but he’s VERY SUBTLE.
March 1st, 2010 at 7:43 pm
About that Gold Post….
Isn’t “GOLD” a really hard thing for BR’s “Big Pic” posters to deal with. How can we decide the value of GOLD? Will it be a BUBBLE like the Overvalued Housing or the Dot Com Stocks?
There are so many GOLD BUGS and AUSTRIAN’s out there…. All Pushing and tugging and doing analysis and yet that Gold Thing…just keeps going on.
Here’s what I think from a puny, small invester out there in the “Hinterlands” who isn’t a Harvard Ph.D or Math Genius doing the “Black Box” Trading.
“Always own a Little Gold” …..just in case ..for your portfolio.
WHY have these GOLD PARTIES sprung up all over America in Wealthy Neighborhoods where the Gals are having “Wine Parties” to ge the Gals in the Gated Golf Neighborhoods (all over America) to come there and through their old crap Gold from Old Boyfriends, Grandma’s Legacy, Grandpa’s Legacy (hubby or boyfriends old Gold Watch (24 K) from the Civil War or from his own Great Grandpa (Civil War) and it’s out there to pay the Mortgage Payment….or to go to “Sandals or Vegas” on that Dream Vacation?
Auctioning off All the Gold out there from stressed or just idiot Americans does go SOMEWHERE!
And there are always FOOLS out there who will do this.
Just so you know…I come from a culture that buried “Our Silver Tableware” in the BACK YARD when SHERMAN CAME! Grandpappy and Grandma would have killed us if we let the YANKEE’s TAKE OUR INHERITANCE!
My Daddy and Grandma left me their SILVER….I’ve hoarded it…and the few trinkets of GOLD they left me…I’ve not sold. But, I’ve bought some Gold Miner’s stock and a little Mutual fund in Gold…in my shrunken 401-K…is looking good to me these days…even with the “ups and downs.”
Who KNOWS? Grandma also cautioned: “DO NOT EVER SELL THOSE PEARLS I PASSED DOWN TO YOU…THEY ARE CULTURED PEARLS…they will NEVER LOSE VALUE.
Wisdom of the OLD?
—–
March 1st, 2010 at 7:45 pm
LMAO at this
http://globaleconomicanalysis.blogspot.com/2010/03/im-sure-glad-recession-ended.html
March 1st, 2010 at 7:54 pm
About the Money Multiplier piece…I commented over the weekend that if money truly has a negative multiplier now, then Fed policies are going to worsen the deflationary debt crash.
BTW, I have a funny feeling something is going to break within the next several days. Markets seem literally insane.
March 1st, 2010 at 7:55 pm
Goldman Sachs warns of hit from bad publicity
http://www.marketwatch.com/story/goldman-sachs-warns-of-hit-from-bad-publicity-2010-03-01?dist=afterbell
March 1st, 2010 at 8:00 pm
“From The Rumor Bag: Financial Firms Receiving Widespread Subpoenas For Euro Shorting Collusion”
http://www.zerohedge.com/article/rumor-bag-financial-firms-receiving-widespread-subpoenas-euro-shorting-collusion
March 1st, 2010 at 8:24 pm
torrie-amos Says:
March 1st, 2010 at 5:37 pm
xtending hamp another year, you betcha, can’t keep home prices up with unemployment sucking and cash for homes going bye bye, still, keep home prices up too save states
godlman, and bartlett, roflmao, texax pr is screw you, mind your own business
——–
You know…I was against the Govt. Bailouts for Crooks but we don’t seem to be able to do anything about that on either the Republican or Democratic side.
So…If they are extending the Bailouts for Crooks and Thieves……In some way I can defend the extention of HAMP…because the average American isn’t on BR and the Financial Sites who are EXPOSING the ROT in the Sytstem. The Average joe and jane doesn’t know what the hell hit them ..because Bush said to “Go Shop” after “9/11″ and Obama told them to “BUY STOCKS” after their “401-K and IRA” IMPLODED last MARCH!
So…if the least that puppet Obama can do is to push to Extend HARP…then it might work for all those so hurt by the “Flip It…HOME CHANNEL on CABLE…and the Credit Card Companies and Mortgage Collusionists who suckered them into the same stuff they were suckered into with Dot Com before it imploded.
Should we BLAME THE PEOPLE or the MAINSTREAM/CABLE…PUMPER SHOWS/Mortgage Lenders/ Apprasiers and the rest of the HYPE MOBILE that pulled up and SUCKERED THEM?
Where does the BLAME LIE? EVERYWHERE! But don’t blame the average joe and jane just TRYING TO MAKE DO in the WORLD OF HEDGE FUNDS/HIGH FINANCE who were working 24/7 to PUMP and Make the Money for themselves their Banks their Companies and the rest.
BUYER BEWARE…but the Playing Field is NOT LEVEL and hasn’t been for about Three Decades!
Lot’s of blame…but the PEOPLE need THEIR SHARE since the PERPS ARE WALKING. Sounds bad…but “little people” don’t have advantages of those with POWER!
March 1st, 2010 at 8:37 pm
The wheels will come off. The only solutions that might work aren’t on the table (I believe it’s because they are the biggest perceived threat to the current wealth and power holders). They are:
1. Increase the money supply to match debt (I’m talking numbers that would dwarf the bank bail-outs). Distribute this new money among the bottom 95% of the citizenry (the consumer/debt slave class) at a 50% taxable rate. Freeze prices for two years. The trickle-Up (TM) effect will put the economy in overdrive, allow the settlement of all consumer debt, and spur next round of growth. The tax windfall the government receives will retire some or all of the national debt. We’ve already pissed into black hole that is the banks (thank god we’re only talikn’ fiat money!), and it evaporated. Time to try something different.
2. Default.
3. Some kind of blanket debt forgiveness.
Instead of these options, we’ve chosen deflation, and additional debt. While the increasingly corporatist government might be borrowing (from itself, even), the consumer isn’t. With fewer dollars (or even insufficiently more dollars) available, the existing debt owed, individually and collectively, can NEVER be settled (as a matter of mathematics — not simply politics or economic theory). De facto bankruptcies will take place on a biblical scale.
We can create money at a whim and distribute it as we please. Why are we not using this awesome magical power to the benefit of the hoi polloi?
March 1st, 2010 at 8:46 pm
Is this a joke? CR seems to think so.
http://www.calculatedriskblog.com/2010/03/reports-senate-nears-agreement-on.html
March 1st, 2010 at 8:57 pm
Marcus Aurelius Says: We can create money at a whim and distribute it as we please. Why are we not using this awesome magical power to the benefit of the hoi polloi?
Instead of these options, we’ve chosen deflation, and additional debt. While the increasingly corporatist government might be borrowing (from itself, even), the consumer isn’t. With fewer dollars (or even insufficiently more dollars) available, the existing debt owed, individually and collectively, can NEVER be settled (as a matter of mathematics — not simply politics or economic theory). De facto bankruptcies will take place on a biblical scale.
We can create money at a whim and distribute it as we please. Why are we not using this awesome magical power to the benefit of the hoi polloi?
———–
Sadly…Tiny Tim and Bullfrog Summers really are working to “pretend” they are doing this for the “hoi polloi.” And so are are Politicians…All Bloated from years of Lobbyists writing their bills and filling their coffers with Piles ‘o Money.
They think they are cool. Telling a new generation they are “really working for US…but it’s just those Obstructionists” who are killing the DEALS…Bills …All of the FINANCIAL REFORM THAT’s so NECESSARY.
They are so used to their Compliant Media after Bush/Cheney and the implosion of Clinton/Monica and the what went before….they GOT AWAY WITH IT ALL!
I don’t mean to be political…but the POLITICAL is what DRIVES THE MARKETS…and we are not yet even past the surface of the Criminality that has gone on on Wall Street for so many years. Yet, to be fair there are so many honest folks on Wall Street who didn’t know what they’d face when they got down there…and they got caught up in it all just like some of the elected “New Politicians” who come to the House and Senate and think they can be honest …until the “folks come in there…knocking on the door with the bags of money and the ‘written talking points” all to help these Newbies learn the ropes.
It’s the whole system that’s needing a “BIG CLEANING OUT.”
March 1st, 2010 at 9:03 pm
I think President Obama should nominate William Black to replace Donald Kohn.
March 1st, 2010 at 11:38 pm
February federal tax withholdings plunge to multi-year lows. But, hey, we’re in full “recovery” mode. Riiiiiiggght. Maybe everyone’s being paid under the table now? Or the new barter economy is spurring the recovery?
http://www.zerohedge.com/article/february-2010-federal-tax-withholdings-plunge-multiyear-low
March 1st, 2010 at 11:42 pm
Marcus Aurelius & TakBak04
As usual you are right on the money–except, TB, that the Political and the Markets are in a feedback loop mutually reinforcing each other.
Tiny Tim is venally mendacious and deserving of a lonnnng vacation at the Spanish Inn-quisition, while Larry the Bullfrog–this is only a minor quibble on my part–is truly the epitome of what the Germans call a ‘Fachidiot”–literally an expert idiot.
Expert idiots know all the facts about a subject, yet are oblivious to basic processes and their results.
Throw in some cognitive dissonance and you have a chief economic advisor to the POTUS…
…which 13 1/2 months later has pretty much driven me potty…
I just know I’m going to get the opportunity to utilize my wide variety of survival skills before too much longer…
March 1st, 2010 at 11:49 pm
@MW:
What starts the states imploding? Need to provide tax refunds, or can they push it back some more?
March 2nd, 2010 at 1:53 am
Re: What caught your eye?
I like NYU Prof. Ralph Gomory’s response to Thomas Friedman’s latest push in the NY Times for an “Innovation Revolution”. Prof. Gomory’s response, “The Innovation Delusion”, has ideas for how America can actually COMPETE for industries and jobs, instead of just letting them go overseas.
Some of Prof. Gomory’s points are:
- If cheap labor abroad is the incurable handicap that prevents the United States from competing in manufacturing industries, why are high-wage countries like Germany and Japan so successful in the automobile industry?
- Why don’t we COMPETE for industries like chip fab? It’s a high investment, low labor industry, we should be able to compete in very effectively.
- We are importing massive amount of products with what is monetarily-wise, is a promise to pay later.
- We need successful industries and we need to innovate within them to keep them thriving. However, when your trading partner is thinking about GDP, rather than profit, and has adopted mercantilist tactics, subsidizing industries, and mispricing its currency, …
- Specializing in R&D, but sending it’s fruits on to others is a strange and completely unworkable strategy for a nation.
The only thing Prof. Gomory’s article missed was that Thomas Friedman’s editorial was a front-running missive trying to support yet another high-tech visa program.
“The Innovation Delusion”:
http://www.huffingtonpost.com/ralph-gomory/the-innovation-delusion_b_480794.html
March 2nd, 2010 at 5:34 am
innovation, cheap labor…………..the conundrum now is emerging markets had cheap labor, now with the profits they have upgraded alot of mfg process to the latest and greatest most efficient machines, so now they have cheap labor and best assembly lines, they have a little problem in they need less peoeple
takbak04, understand what u say, imho, it’s a save prices program to save banks and tax base, homeowner is last, most will be nickled and dime to death on any of these programs, i got no problem if someone needs the program, yet, if you haven’t used it by now, what are the odds going forward, so it seems it’s more proof the government can remain irrational than i can remain sane, lol
March 2nd, 2010 at 6:06 am
“Marcus Aurelius Says: We can create money at a whim and distribute it as we please. Why are we not using this awesome magical power to the benefit of the hoi polloi?”
But Ben said we didn’t have to worry about deflation. He said he could use helicopters to dump money on the populous (seriously he said this) . I don’t think we have chosen deflation. Our economy just won’t work when deflation is rummaging across the fruited plain, Greenspan said so. It ain’t over until it’s over. The FED helicopters could just be warming up if this thing gets serious.
March 2nd, 2010 at 6:21 am
Make sure you read the article on derivatives in the FT.
http://www.ft.com/cms/s/0/7b56f5b2-24a3-11df-8be0-00144feab49a.html?nclick_check=1
“I generally do not like to propose bans. But I cannot understand why we are still allowing the trade in credit default swaps without ownership of the underlying securities.”
That nothing has been done with this derivatives cancer amazes me. The only possible explanations are that derivatives are such a huge cancer (some $600 trillion or so at one time) that to operate would kill the patient, or there is indeed some huge conspiracy (who’s in charge here) in control. Could it be the giant blood sucking squid? Just asking.
Seems like it would be somewhat obvious that derivatives are hugely destructive. They had a big part in bringing on the great implosion in the world’s economy, and now they are being used to destabilize governments (or so the charges go). Wouldn’t it become obvious that derivatives are weapons of mass financial destruction to para phrase Buffett from long ago.
May you live in interesting times (old Chinese curse)
This curse really does apply to our situation I’m afraid.
March 2nd, 2010 at 7:01 am
TakBak04 Says:
March 1st, 2010 at 7:43 pm
About that Gold Post….
“Isn’t “GOLD” a really hard thing for BR’s “Big Pic” posters to deal with. How can we decide the value of GOLD? Will it be a BUBBLE like the Overvalued Housing or the Dot Com Stocks?….”
Great question.
1st of all *WE* can *never* decide the value of Gold. It’s too dependent upon some key factors and all of them have to do with global institutional buyers of gold by *tonnage*. Whenever one of these holders of gold tonnage gets in trouble ,or the corporation or country thy are financially entangled with , gets in trouble they dump gold if just to cover debts due ( isn’t always about covering debt service these days ) and that’s enough to cause a drop from time to time.
But the singular overwhelming factor these days has been the over-printing of dollars as well as Euro’s ( remember incidents like then West Germany declaring that East German marks would be recognized at same value of DuetchMarks on top of the billions spent of trying to bring the East back to economic life just as one fr’instance ) and who knows whatever currencies ( anybody want to even guess at the true value of the Ruble ).
All of that paper promise of value washing around the totally interconnected global marketplace means that there’s *always* going to be a market for Gold as a hedge because it does have value in no small part because of it’s apparently *cultural global reach*. Like the markets themselves *culture* functions at a deep *emotional* , and thus ,*fundamental* level …..like religion….and in *crisis times like these there’s a whollta
*fundamentalism* going on.
And since the so-calle “free market” determines the price of things and since it wass this same market that has unequivocally *caused* this current global debt crisis , as I said in another post , it’s all ” God ,Guns , and Gold”
from here on until this global market crisis has truly corrected. Anyone confident that that vigil for that 2nd coming is coming anytime soon?
Whom here abides by the old Hollywood axiom that *Nobody really knows anything*( about the future )