| | | Page 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28 | Watch, Its happening ,the global economic change.
| FHL(C)
User ID: 534303
10/25/2008 7:54 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Thanks Paladin
from your thread,
[link to www.godlikeproductions.com]
The real truth about cheap money has been plain for more than 250 years. Richard Cantillon – "the father of modern economics and one of history's great traders," as Sean Corrigan reminds us at SafeHaven.com – first spotted that the process of creating new money can never be neutral. "Somebody, somewhere has to have the new money first," Corrigan notes, and that lucky soul gets more spending power than his efforts deserve. It's a windfall, pure and simple. And when our man spends his good fortune, he then dilutes the value of money held by everyone else, stealing a piece of their purchasing power and making them poorer.
This is whats being done by the Fed now with all their bankster and government criminal mates, and they say where there is smoke there is fire, so making a guess i would say behind the scenes many crimelords who have piles of cash, especially USD are being called upon to do their bit for the economy, what twisted webs are being woven behind closed doors as you read this.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 534303
10/25/2008 8:06 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
FU&FW
[link to www.telegraph.co.uk]
GLG chief Emmanuel Roman warns thousands of hedge funds on brink of failure
Emmanuel Roman, the co-chief executive of Europe’s biggest hedge fund GLG, has warned that thousands of hedge funds are on the brink of failure as the global economy contracts with unexpected severity.
By Rowena Mason
Last Updated: 5:50PM BST 24 Oct 2008
Emmanuel Roman, of GLG Partners, said 25pc-30pc of the world’s 8,000 hedge funds would disappear "in a Darwinian process", either going bust or deciding meagre profits are not worth their efforts.
"This will go down in the history books as one of the greatest fiascos of banking in 100 years," said Mr Roman, who with Noam Gottesman, co-runs GLG, a former division of Lehman Brothers Holdings with assets of $24bn (£14.8bn). "There need to be some scapegoats, and the regulators are going to go hunt people. That will be good in the long run."
His views were echoed by Professor Nouriel Roubini, a former US Treasury and presidential adviser known for his accurate prediction of financial crises, who estimated that up to 500 hedge funds would fail within months.
Both men were speaking at the same hedge fund conference in London yesterday, and Prof Roubini said he would not be surprised if the US and other countries soon had to close their stock markets for more than a week to halt descent into "sheer panic".
The economist warned that the world is heading for a protracted recession that will end the US’s financial dominance.
"It’s the beginning of the decline of the US financial empire. The Great Depression ended in a massive war. I hope that’s not going to happen
but it’s pretty ugly now," Prof Roubini said.
He added that turmoil over world trade, currency markets and debt is likely to cause geopolitical tensions between the Western world and emerging superpowers such as Russia, China and "a bunch of unstable oil states".
The conference saw analysts, economists and hedge fund managers discussing the possibility that global recession could now last two years on fears that government bail-outs and nationalisations have failed to stop the markets slumping.
"We’re now paying the price for the biggest asset and credit bubble in history," Prof Roubini said, advising investors to stay clear of risky assets and keep money in cash. "The bail-outs have not worked because the markets are no longer rallying, and the policy-makers have run out of options."
The global financial meltdown accelerated this month, with the UK and US governments being forced to take stakes in some of the world’s biggest banks. Stock markets around the world have fallen sharply this month as investors’ concern switches to the impact on the wider economy.
"It’s like we’re walking blind in a minefield," said Prof Roubini. "Every situation has become risky and no one can trust each other. The banks are too big to be allowed to fail, but they’re also too big to save."
Research from Hedge Fund Intelligence (HFI) shows that despite one of the worst months on record for credit funds, US hedge funds alone still have $1.7trillion (£1trillion) in assets.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 534303
10/25/2008 8:21 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Its feeding frenzy time for the remaining big 2 and the Fed, on wall street, and who knows what the square mile is getting up to, or other financial centers, but it adds up too this, banksters are not your friends, doesn't matter how big a client you are, if they can turn you into road kill they will, then crunch the bones to get at the marrow. This all in effort to keep the current financial system ticking over until they have locked in their security, power and place, then they will let the rotting hulk of hegemonic fiat currency collapse and buy up the remains, cents on the putrid dollar, to start it all over again, whilst they rearrange their blood drenched visages gorged on the pain, suffering and death of billions of people, into paragons of virtue and beneficence.
YAH rebuke mammon and let these greedy beasts be gobbled up by more fearsome beasts, Lord willing, giving some respite to the unfortunate, disenfranchised and suffering in the process, unto salvation, safety and return, amen.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 534303
10/25/2008 8:33 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Just to make it clear, i think it is possible to have "fair banks" and possibly banking systems( Bendigo bank in Australia comes to mind, and that Indian gentleman who won the noble prize a year or 2 ago for his, lending to the poor, banking system in India, which has gone global and actually works)), we shall see what happens over the next 2-3 years.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 534303
10/25/2008 9:38 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
The information herein is pertinent, but the authors vain fantasy that the USD is still green and rosy, is deliberate and IMO ostrich behavior to condition others to go back to sleep.
The USD is doomed IMO as world fiat currency for too many reasons to list(read the entire thread for a start).
What is/will happen is that other regional groupings are preparing for the long haul, and that means saying lots of nice things to the fraudsters currently in control of the USD and US military. Because at this stage none wants WW3/4 just yet IMO.
FU&FW
"
[link to www.telegraph.co.uk]
Dollar roars back as global debts are called in
For six years the world has been borrowing dollars to bet on property, oil, metals, emerging markets, and every bubble in every corner of the globe.
By Ambrose Evans-Pritchard
Last Updated: 3:48PM BST 23 Oct 2008
The strong rebound in the dollar has surprised some analysts
The strong rebound in the dollar has surprised some analysts
This has been the dollar "carry trade", conducted on a huge scale with high leverage. Now the process has reversed abruptly as debt deflation - or "deleveraging" - engulfs world markets. The dollars must be repaid.
Hence a wild scramble for Greenbacks which has shaken the global currency system and shattered assumptions about the way the world works. The unwinding drama reached a crescendo yesterday as the euro fell to $1.28, down from $1.61 in July. The slide in the Brazilian real, the South African rand, the Indian rupee, and the Korean won, among others, has been stunning.
Stephen Jen, currency chief at Morgan Stanley, said US mutual funds, pension funds, and life insurers invested a big chunk of their $22 trillion (£13.5 trillion) of assets overseas to earn a higher yield during the boom. They are now in hot retreat as the emerging market story unravels. "There is a complete rethink going on. People are bringing their money back home," he said.
Hedge funds are 75pc dollar-based, regardless of where they come from. Many are now having to repatriate their dollars as margin calls, client withdrawls, and the need to slash risk forces them to cut leverage. The hedge fund industry had assets of $1.9 trillion at the peak of the bubble.
Data collected by the Bank for International Settlements shows that European and UK banks have five times as much exposure to emerging markets as US and Japans banks, with surprisingly big bets in Latin America and emerging Asia - where they rely on dollar funding rather than euros.
The fear is that deflating booms in these frontier economies will have an 'asymettric' effect on the currency markets, setting off another round of frantic dollar buying. "It is not impossible that the euro could collapse completely against the dollar, going back to 2001 levels," said Mr Jen.
He said the "composite" dollar-zone including China, the Gulf oil states, and other countries locked into the US currency system, will together have a current account surplus next year. The de-facto euro bloc of the core euro-zone and Eastern Europe is moving into substantial deficit. This creates a subtle bias in support of the dollar.
Of course, much of the currency shift this year is a natural swing as the crisis rotates from the US to Europe and beyond. The dollar was pummelled in the early phase of the crunch when economists still thought Europe, Japan, China and the rest of the world would decouple, powering ahead under their own steam. The Federal Reserve's dramatic rate cuts were seen then as a reason to dump the dollar.
The decoupling myth has now died. The euro-zone and Japan appear to have fallen into recession before the US itself, led by a precipitous fall in German manufacturing.
The ultra-hawkish stance of the European Central Bank - which raised rates in July - is now viewed as a weakness. Foreign exchange markets are no longer chasing the highest interest yield: they are instead punishing those where the authorities are slowest to respond to the downturn.
A hard-hitting report by Citigroup this week said the ECB had unwisely ignored screaming signals from the bond markets earlier this year for a rate cut. "The ECB did not listen. Not only did they no reduce rates as they should have but they increased them in one of the biggest policy mistakes of 2008," it said.
The spectacular dollar rebound has geostrategic implications. Heady talk earlier this year that dollar hegemeny was coming to an end - or indeed that the US was losing its status as a financial superpower - now seems very wide of the mark."
IMO this is pure garbage, fear induced myopia, history denying revisionism
"The spectacular dollar rebound has geostrategic implications. Heady talk earlier this year that dollar hegemeny was coming to an end - or indeed that the US was losing its status as a financial superpower - now seems very wide of the mark."
The rebound is only going to last as long as it takes to hyperinflate to cover the CDS/derivatives problems, who knows maybe even before, if any of the SWFs decided to get out of the dollar and/or Tbonds, again IMO.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 534303
10/25/2008 10:18 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Excellent article, thanks to the poster. Shows a significant possible path we are being steered down by the banksters and fraudsters, they don't want a new American civil war, they want wage slaves and handout hopeless in the style of live boiled frogs.
[link to www.godlikeproductions.com]
[link to freewordofgod.yuku.com] |
| .
User ID: 534761
10/25/2008 2:04 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
The Banker Conspiracy
October 25, 2008
berngreen1.jpg
by Henry Makow Ph.D.
On his internet radio show, Alan Stang recently asked me if there is such a thing as a Jewish conspiracy. He said he gets email from people blaming Jews, Jesuits, the Vatican, Freemasons etc.
I replied that the central banking cartel is the only body that has both the motive and the means to take over the world. The head of the octopus, it consists mainly of Cabala-believing Jews and Freemasons. Zionism, Freemasonry, organized Jewry, Jesuits etc. are arms of this octopus.
The "motive" is to protect this private monopoly over the public (government) credit. The central banking cartel controls the purse strings of the world's nations. Essentially, anyone who succeeds in public life is their puppet or unconsciously serves their agenda, a world government tyranny designed to ensure all nations remain debt slaves.
The "means" of course is unlimited money funneled through their network of cartels. This allows them to own the government, mass media, education etc.
The ideology of world tyranny, Illuminism, derives from the Jewish cabala which conveniently preaches that man (i.e. the bankers) can usurp the place of God. About 1770, a syndicate of bankers led by Mayer Rothschild started the "Illuminati", a satanic cult designed to subvert society and implement their agenda. According to Edith Starr Miller, the Rothschild syndicate included Jewish financiers such as Daniel Itzig, Friedlander, the Goldsmids and Mosses Mocatta. ("Occult Theosophy" p. 184.)
According to Miller, the goals of the Illuminati (and Communism and the NWO) were the destruction of Christianity, Monarchies, nation-states (in favor of their world government or "internationalism"); the abolition of family ties and marriage by means of promoting homosexuality and promiscuity; the end of inheritance and private property; and the suppression of any collective identity in the spurious name of "human brotherhood" i.e. "diversity." Of course, this "public" property will be effectively owned by the bankers who control the state. (p.185)
SATANISM
The goal of the world banker conspiracy is to enshrine Satan as God. The reason humanity has suffered so much in the past is that the Illuminati advanced the "New World Order" by provoking revolution, war and financial turmoil.
The world government tyranny is the only conquest in history engineered without the knowledge of the conquered. In the First Protocol of the "Protocols of the Elders of Zion," the author says three times, our "countersign" is "Force and Make-believe." By "Make-believe" I assume he means mass deception or "magic."
When alien bankers control the purse strings of the State, inevitably the State becomes synonymous with these bankers. The State is a ruse used to manipulate the masses, "public" in name only. This is the true face of Communism.
This tyranny is also the first in history which people cannot mention for fear of being labeled "anti Semitic" and a "hater." Trust me, the hatred is mostly on the other side.
This ruse is achieved by arranging for all Jews to be blamed for the machination for relatively small minority. It's as though all Italians were blamed for the activities of the Mafia. As a Jew, I can testify that very few Jews are aware of how they are being manipulated by Illuminati sponsored movements such as the B'nai Brith (Freemasonry); Zionism; Communism; Socialism, Neo-conservatism Feminism and Liberalism.
It doesn't help that Jews implicate themselves by acting like an attack on the Rothschilds is against them. Talk about insinuating yourself into the line of fire! Imagine what people would think of Italians if they treated an attack on Al Capone and organized crime as "hate." The bankers have always run organized Jewry and used Jews as their pawns.
Organized Jewry throws out the charge of "anti-Semitism" and "hate" like a occult curse from which all shrink in fear. The way to take away this magic is to wear the badge of anti-Semite with pride, asserting that it stands for opposition to the disproportionate role Jews play in advancing the New World Order. Thus anti-Semitism will assume its past role as a legitimate political (not racial) movement directed against particular Jews. For example, Karl Leugar was re-elected Mayor of Vienna five times (1897-1910) as head of the Anti-Semite party.
Like everyone else, Jews are kept in a bubble and don't know who they are. They have been brainwashed to see themselves as innocent victims. Most suffered for the machinations of their "leaders." But many others were murderers and oppressors.
THE BIGGEST REVELATION
The biggest revelation for me was the discovery that Judaism is not a religion but a pagan racial creed at best, and a Satanic secret society at worst. The nature of a secret society is that the membership is fed worthy platitudes and isn't told the real agenda.
Most Jews are unaware that Judaism largely eschews the Old Testament in favor of the Talmud and Cabala. Very few Jews read these books. If they did, they might realize that the Talmud is full of hate and contempt for non-Jews. They would discover that the Cabala is the basis of modern witchcraft, astrology, numerology, tarot cards, black magic, androgyny, sex magic and much of the New Age movement. It is the basis of Illuminism which teaches that good and evil are one and that black is white and vice-versa.
According to Texe Marrs, the Cabala teaches that the "holy serpent is the true God; that all the evil that a person does, through alchemy is magically transformed into righteousness; and that yes, Lucifer is Lord. Satan is the true and only god. That is the essential doctrine of Cabalism." (Codex Magica p. 426.)
PUBLIC LIFE
obamalogo1.jpgThe fraudulent nature of our public life all stems from the fundamental fraud, Illuminati control of public credit. Thus we have the spectacle of two mind-controlled Illuminati puppets vying for the US Presidency. The case of Barrack Obama is the most outrageous. He cannot prove he is even an American citizen. His real father, Communist activist Frank Marshall Davis, was a rapist and pedophile who probably sexually abused his son.
Larry Sinclair claims he has had sex and smoked crack with Obama in the late 1990's. Oddly, this resume is perfect for the Illuminati. Obama can be easily controlled or he will be exposed. (Check out the You Tubes of Obama without a teleprompter.)
Now Joe Biden is prophesying that Obama will be severely tested after coming to office and will betray his supporters and plummet in the polls. He seems to be describing something like martial law.
We need to face the fact that the world has been taken over by a satanic cult. Instead of fighting among ourselves, recognize there are really only two sides in this struggle--God's and Satan's.
You can find this article permanently at [link to www.henrymakow.com] |
| FHL(C)
User ID: 535072
10/25/2008 11:30 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
Ok everyone, this is as clear as you will get it, this represents serious economic doom.
FU&FW
[link to market-ticker.denninger.net]
Congress: What Bernanke and Hank Aren't Telling You
Congress: Think.
Ben and Hank have both told you that the critical issue for the economy is for "lending to resume", stating that it has dramatically contracted.
If this was the truth, then Ben and Hank would have come to you for $700 billion in the TARP, but instead of TARPing the money, they would have asked for permission to use it to capitalize 10 new banks which would be immediately IPO'd off to the public with the stake being in the form of some kind of super-senior debt that held a coupon high enough to encourage immediate (or nearly-so) replacement with private capital.
This would have resulted in an aggregate of seven trillion worth of new lending capacity in the economy, an amount that, incidentally, would allow the full replacement of Fannie and Freddie as holders of housing debt with about $2 trillion left over for credit cards, auto and business loans.
That would have immediately solved the "credit freeze" problem.
So why wasn't this proposed?
This is the reason:
In short, it wouldn't have done anything because the economy only grows at a rate of about 20 cents for every dollar of debt taken on. That is, it takes five dollars of debt to generate one new dollar of GDP.
The bad news is that once you reach the "$1 for $1" level you are no longer able to finance growth with debt, and it becomes inevitable that you will begin to finance debt with debt.
That, of course generates no GDP at all but precipitously tightens the spiral.
We crossed that Rubicon roughly around 1968, and you have had this fact concealed from you.
Congress, please listen:
The Truth is that we now require about $5 of debt to generate $1 of GDP.
The Truth is that the reason you were not asked to approve $700 billion to capitalize 10 new banks, thereby creating seven trillion in lending capacity is that the economy cannot soak up that new lending capacity; each dollar of new debt generates almost no aggregate GDP. If this were not true then that would be the logical and effective cure for the 'credit crunch" - if the borrowing capacity and impact on GDP necessary to help existed. They do not.
The Truth is that you were lied to about the purpose of the TARP/EESA, because what you were sold was mathematically impossible. It is supposed to be unlawful to lie to Congress.
The Truth is that the purpose of the EESA/TARP is to rescue the bankers on Wall Street and elsewhere who have made imprudent loans, all of whom are aware of the declining value of a dollar of debt in the economy - a fact they have intentionally concealed from you. The bankers (including Hank and Ben) all know how to do this math, and they are well-aware that the best they can do at this point is to "Rob every dollar you can while the getting is good, and hope they don't figure it out before you get the cash."
The Truth is that once you reach a level where a dollar in debt will not support a dollar in GDP you must inevitably either pay down or default that excess debt. Unfortunately, in this case we must pay down or default approximately 80% of the aggregate public and private debt in the United States in order to return to a standard were $1 in debt will generate $1 in GDP. Defaulting or paying down less will "turn the clock back" to a degree, but does not change the ultimate outcome. Only returning to $1 of debt returning $1 or more of GDP, and holding the total level of debt outstanding at or below that level, results in a stable monetary system.
The Truth is that the monetary and banking system is inherently unstable until and unless this is done, and as the "zero point" is approached it becomes more and more unstable, producing more and more violent dislocations. This is why every crisis since 1968 has been more serious and required larger and more intrusive interventions to calm, including the 1970s/80s energy shocks and inflation crisis, the 1987 market dislocation, the LTCM crisis, the Tech Implosion and now the Credit Bubble/Housing crash.
The Truth is that the absolute worst thing you can do when "in the hole" like this is to spend even more on a deficit basis, thereby driving the debt ratio higher and return-per-dollar-of-debt in GDP lower. The last eight years have been disastrous in this regard.
The Truth is that the TARP/EESA and other "stimulus" and "rescue" packages, which now total more than $1.6 trillion dollars, have dramatically tightened the spiral depicted above. The above graph does not include the impact of the Fannie and Freddie rescue nor of the EESA. Both will move the return-per-dollar-of-debt meaningfully lower.
The Truth is that $7 trillion in new lending capacity, if it was put into the market and utilized, might well push the aggregate rate of return for $1 in debt below zero - that is, force it to a negative rate of return. Ben and Hank know this, which is why they didn't propose that solution, and why they did not force the bankers (under law) to lend out the recapitalization they provided.
The Truth is that if we reach the point where a dollar of debt has a NEGATIVE impact on GDP The United States monetary system and government will implode. The reason for this is mathematically obvious - each additional dollar of borrowing beyond that point actually contracts GDP instead of growing it; this is, for all intents and purposes, a "black hole". It is that event that has led to the implosion of other monetary systems such as the hyperinflationary implosion of Argentina.
The above are mathematical facts, not my or anyone else's opinion.
It is your job to safeguard this nation and prevent this outcome, even if you are lied to or have these facts concealed from you by people who know better.
We are dangerously close to that event horizon and your actions are bringing us closer to it, not moving us further away.
Debt that cannot be serviced must be defaulted. While it sounds counter-intuitive, the "bad mortgages" must foreclose, not be reworked. All of them.
House prices must fall to no more than 3.5x incomes on a median basis.
Corporate debt (e.g. LBOs, etc) that cannot be serviced under existing terms must be allowed to, and indeed encouraged to, default.
The contraction in outstanding debt that this will produce must occur, and the economic impact that results from it, while painful, is far less painful than a monetary system failure.
A monetary system failure is inevitable if we reach the point where one dollar of new debt no longer supports a positive contribution to GDP.
Again: This is mathematics, not social science or politics. It is not subject to your or anyone else's desires or political aspirations. It is as certain mathematically as is the fact that 2 + 2 = 4.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 535072
10/26/2008 6:01 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Now with the greed gates being thrown open for the big boys, everyone else and their dog is going to cram in, i honestly cant see the rest of the world putting up with such behavior for much longer.
FU&FW
[link to news.yahoo.com]
Companies start competing for bailout money
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By MARTIN CRUTSINGER, AP Economics Writer Martin Crutsinger, Ap Economics Writer – Sat Oct 25, 2:53 pm ET
White House pleads for patience on rescue plan AFP/File – The White House seen on October 22, 2008 in Washington, DC. The White House pleaded Friday for patience …
Related Quotes Symbol Price Change
NCC 2.07 -0.68
PNC 58.88 +2.00
^GSPC 876.77 -31.34
WASHINGTON – The bailout is now the hottest lobbying game in town.
Insurers, automakers and American subsidiaries of foreign banks all want the Treasury Department to cut them a piece of the largest government rescue in U.S. history.
The betting is that many with their hands out will be successful, especially with financial markets in a stomach-churning dive and predictions the economy is about to tumble into a deep recession.
These groups argue that the credit squeeze is so severe and the risks to the economy so dire that their industries need financial support as well.
The Treasury is considering requests from a variety of industries, but has not decided whether to expand the program, officials said Saturday.
Lobbying efforts are intensifying.
The Financial Services Roundtable wrote Treasury officials on Friday requesting that the initiative to buy $250 billion in bank stock grow to cover insurers, auto companies, securities dealers and U.S. subsidiaries of foreign companies, including banks. The Treasury's plan is intended to bolster banks' tattered balance sheets and get them to resume making loans.
As the Treasury now interprets it, these additional groups would not participate in the bank stock program. They could receive help from a separate part of the $700 billion rescue that will buy bad assets from financial institutions.
Steve Bartlett, the president of the Roundtable, urged the Treasury to broaden the definition of those eligible for the stock purchase program.
"The institutions that are excluded play a vital role in the U.S. economy by providing liquidity to the market," Bartlett wrote Neel Kashkari, the Treasury Department official running the bailout program.
Referring to U.S. subsidiaries of foreign companies, Bartlett said, "This is a global crisis and to not recognize the U.S. firms controlled by foreign banks or companies would create further impediment to the market's recovery."
A financial industry official said Treasury Secretary Henry Paulson met over the past week with various groups, including hedge fund managers, that were petitioning for assistance. The official spoke on condition of anonymity because the Treasury has not made a decision.
Some insurers technically would be eligible for stock purchases now if they own subsidiaries that are savings and loan institutions regulated by the Office of Thrift Supervision.
Last month, American International Group, the country's largest insurance company, received an $85 billion loan from the Federal Reserve. Since then, it has gotten further support in an effort to withstand the biggest upheavals on Wall Street since the Great Depression.
Complicating the government's decision-making is that the Bush administration will not be in charge after Jan. 20. Paulson, who has said he has no intention of staying on the job, has pledged to consult with both campaigns on his bailout actions.
Democrat Barack Obama's presidential campaign said Friday it supported the effort by the auto industry to get money from the $250 billion made available for stock purchases. That would be in addition to $25 billion recently approved by Congress for low-interest loans to help the struggling industry retool and build fuel efficient vehicles.
The debate over expanding the bailout comes as the Treasury is rushing to get money out the door to the primary recipients: banks that sharply curtailed lending after suffering billions of dollars of losses on mortgage-related assets as home foreclosures soared in the housing slump.
Lawmakers are pressuring the Treasury to do more in the foreclosure area, as well.
Sheila Bair, head of the Federal Deposit Insurance Corp., told Congress about efforts to provide government-backed loan guarantees for mortgages that are reworked to help homeowners in danger of default. That would give banks an incentive to speed up refinancing efforts because the government would back part of the reworked loan.
The Treasury also is moving ahead to get bank stock purchases approved. It announced on Oct. 14 that it was spending $125 billion to buy stock in nine of the largest financial institutions. An announcement was expected Friday about a second round involving 20 to 22 other banks.
But it was decided each bank would announce its own agreements with the Treasury, out of concern that excluded banks could suffer a stock sell-off from disappointed investors.
PNC Financial Services Group Inc. announced Friday it was acquiring National City Corp. for $5.58 billion, in what was the first instance of a bank using fresh investments from the bailout program to make an acquisition. PNC said it had received $7.7 billion in cash through selling stock to the government under the program.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 535072
10/26/2008 9:11 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Anybody have access to the latest figures for long term securities for the last 2 months?
FU&FW
[link to www.rense.com]
The recent surge in US Treasurys is also misleading, much of it having to do with terrified investors that are dumping their shares in stocks, mutual funds and hedge funds for the perceived safety of US debt. Foreign investors, however, seem to be losing their enthusiasm for Treasurys as America's future continues to darken.
The net foreign purchases of long term securities in August was a mere $14 billion following an even more dismal $8.6 billion in July; not nearly enough to meet $55 billion per month the US needs to balance its consumption of foreign goods. Even worse, the purchases of long-term US securities "went negative" by for foreign private investors (by $8.8 billion) which means that the dollar is being artificially propped up by foreign central banks to avert a disorderly unwinding of the currency.
Foreign investors and central banks are no longer providing the capital to support the US $700 billion current account deficit. They have lost confidence in America's ability to bounce back from the credit crisis which has swept through the financial system and is now hammering away at the broader economy. That means the demand for US debt will fall and the prospect of hyperinflation will grow. Even if the dollar is able to weather the storm ahead (and the nation can avoid a funding crisis) the massive deficits brought on by Bernanke's "emergency" spending spree will force interest rates upwards and tighten credit even more. As Michael Panzer, author of "Financial Armageddon" says:
"While the U.S. may not suffer from a funding crisis in the immediate future, the voracious money-raising appetite will make life much more difficult for the private sector, in the sense that, they will be 'crowding out' increasingly desperate borrowers who will find their options are more and more limited."
The Fed now faces the daunting task of trying to maintain America's dominant place in the global system while the economy contracts, deficits skyrocket and the pillars of US-style capitalism come crashing to earth.
[link to freewordofgod.yuku.com] |
| Anonymous Coward
User ID: 530832
10/26/2008 9:59 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
 |
| .
User ID: 535960
10/27/2008 12:16 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
[link to www.financialsense.com]
In looking at the currency markets and the Dollar markets, the current trends seem to have gone too far in one direction without any significant counter trend move. In the case of the US Dollar, it is clear that the Dollar has benefited from the unwinding of carry trades that had been implemented over the years by the hedge fund community. Looking back at the last decade, the growth of assets under hedge fund management has soared into the trillions with a substantial portion of that money leveraged in various carry trades. Chief among these was the YEN Carry trade where hedge funds borrowed sold Dollars to borrow cheap money in Japan, and then used that money to purchase assets on a leveraged basis, often in the natural resource space. Now, with hedge funds in a period of forced redemptions, a gigantic margin call of sorts have been sent out around the world, forcing these funds to unwind their leveraged trades and buy dollars to pay back their carry trade loans. As a result, the advance in the US Dollar has been driven by largely mechanical trading, and forced reversals of previously favored long positions.
It is perhaps the ultimate irony that these events have transpired at the very time that the US Government is creating billions and billions of new dollars out of thin air. In the past, other countries have walked down this road and none has ever succeeded in sustaining such an attempted reflation for long without incurring huge pain in the currency value. Yet, the US has embarked down this well trodden path in what could be ultimately seen as the road to ruin. Only time will be the ultimate arbiter of the wisdom of recent decisions. Thus, we know that with a mass of evidence to the contrary, a cloud of suspicion should be hanging over the current advance in the greenback. From here, what we need to see to validate these suspicions is some solid statistical evidence. In my view, I have found what I believe is strong evidence – statistical evidence, that the Dollar advance should be near its end.
In the chart below, I show the US Dollar Index and its one year trading band (255 trading days) going back to the late 1960’s. Most of the time, prices are contained inside the bands. On rare occasions, prices will move either up to, or in even rare occasions, outside the upper band. On these occasions when prices push outside the upper band, there are only two signals that are being given. Either the market is in ‘kick off’ mode and is signaling a major intent to move seriously higher on a sustained basis, or the movement outside the upper band is a marker for an over-extended market that is about to reverse. In such cases, the reversal is usually compelling and usually comes within just a few days. |
| .
User ID: 535960
10/27/2008 12:33 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
[link to business.timesonline.co.uk]
Banks exploit legal loophole to seize homes
Robert Watts
Banks and credit card companies are exploiting obscure legal powers to seize the homes of thousands of people who cannot pay their credit card bills.
In some cases, people owing as little as £1,000 have been served with charging orders – the legal instrument enabling a creditor to order the sale of a property.
The practice has emerged days after Yvette Cooper, chief secretary to the Treasury, called on banks to do more to allow people to keep their homes.
According to the Ministry of Justice, 97,026 charging orders were granted by courts in England and Wales last year, a tenfold increase since 2000.
Related Links
* Northern Rock accused over rising repossessions
* How to avoid repossession
They allow financial institutions to order the sale of a property to pay off unsecured debts on credit cards, personal loans, store cards and car finance. Some will have been used only to threaten the debtor, or to levy a surcharge on the mortgage to recoup the debts.
Nationwide, the building society, and Northern Rock, which was nationalised earlier this year, are among the most aggressive in using the court orders.
Mark Sands, head of insolvency at KPMG, the accountancy firm, said: “The power of a charging order can come as a horrible shock to someone. When they took out the loan or the credit card, they were almost certainly not told that their home was at risk if they failed to keep up with repayments.”
The rate at which the courts have granted charging orders has increased sharply in the past two months, according to Citizens Advice, National Debt-line and the Consumer Credit Counselling Service. Last week a homeowner posted a message on a website saying a credit card company had launched a charging order against him for a debt of £1,000.
From next year banks will be given further arbitrary powers because they will no longer need to secure a county court judgment against a defaulting debtor. They will be able to move directly to seek a charging order after two or three months of missed payments.
Vince Cable, the Liberal Democrat Treasury spokesman, said: “No one should be allowed to lose their home simply because of a credit card debt. More needs to be done by the government to ensure that lenders simply do not act overzealously, and only take possession of properties as a last resort. The fact that banks can now kick people out of their homes for not keeping up with their unsecured debts is very worrying.”
Alex McDermott, social policy officer at Citizens Advice, said the government had presided over a hidden scandal, because homes repossessed in this way did not appear in the official statistics issued by the Council for Mortgage Lenders.
The Consumer Credit Counselling Service said Northern Rock and Nationwide were particularly aggressive.
Northern Rock confirmed it used charging orders where customers had missed payments on unsecured loans, saying: “Any application for a charging order on an unsecured loan is in strict accordance with the Consumer Credit Act.”
Northern Rock and Nationwide declined to discuss how many homes they had forced to be sold. |
| Anonymous Coward
User ID: 536692
10/27/2008 11:07 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
How to Control a Currency Panic
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Published: October 27, 2008
The financial crisis has ratcheted up a dangerous notch. The currency markets have gone topsy-turvy. The authorities now have to make some pretty big and delicate moves — something like performing microsurgery in a plane in turbulent skies.
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The yen has risen by 40 percent against the euro since August, with most of that occurring in October.
This month, the Australian dollar has also fallen by 25 percent and the pound by 16 percent against the American dollar. Swings of this scale are alarming when they happen in the stock market . But they are petrifying in currency markets, because they make it virtually impossible to price exports or imports.
What’s going on?
Mainly, the pace of financial de-leveraging is accelerating. In particular, so-called currency carry trades — borrowing cheaply where interest rates are low, for example in Japan, and lending the funds where rates are high, such as in Australia or the euro zone — are ending abruptly.
The unwinding of these trades has jerked currencies around enough to provoke more margin calls on traders, amplifying the pressures on them to sell. Then there is fear: Investors are selling currencies of countries that import foreign capital, precipitating currency crises in eastern Europe and Korea that further hurt their economies.
This combination of de-leveraging and fear has also pushed stock markets into something like a free fall. Japan’s Nikkei index is at its lowest since 1982, the MSCI index of non-Japanese Asian stocks is down 33 percent in October and Western stock markets continue the downward spiral initiated by the credit crisis.
While corporate credit, currencies and stocks are in trouble, government bonds are still strong. That’s a relief, since the markets are turning to the world’s governments to do something to stabilize lending between banks and corporations and, now, international cash flows.
To stop the currency panic, the world’s governments should work together to set and then defend target exchange rates. That will probably require countries with big reserves of foreign currency, like China or Japan, to deploy some of the cash for the greater global good, and overspending countries like the United States and Britain to accept devaluations and lower standards of living.
It won’t be easy, but the alternative — a breakdown in the global trade system — would be far worse.
Cut the Carry Trade
The expansion of the crisis from credit to foreign exchange has made even clearer the dangers of some types of speculation. In particular, the currency carry trade has been shown up as most unhealthy.
The practice of borrowing in currencies made cheap by low interest rates, like the yen, and investing in high-yield currencies like emerging markets works wonderfully so long as times are good. Speculators don’t just benefit from this difference in interest rates, they can also enjoy a capital gain as the assets they jump into rise in value.
But when the market turns and the herd stampedes for the exit, capital gains turn into losses. That’s what is happening now. The sharp rise in the yen and, to a lesser extent the dollar, is forcing speculators to repay their hard-currency loans before the currency mismatch sinks them, with the effect of whipsawing emerging market economies. .
For speculators, this painful lesson is ultimately salutary. Once burned to a crisp, many times shy. But the collateral damage is more distressing.
The banks that lent to the carry traders suffer. Investors like pension funds and insurers who hold the assets now being dumped by carry traders find the value of these assets are falling dangerously close to their liabilities. Exporters who sell goods in rising currencies — most obviously Japanese companies — face a huge squeeze on profits.
The currency rebalance should lead to an economic catharsis. The rise in the yen could help rebalance world trade, although the rise in the dollar works in the opposite direction. Certainly, countries like Britain, with its yawning current account deficit, could benefit from a cheaper pound.
That said, this is hardly the moment for the global financial system to face more big losses, more runs on financial assets and, in response, more government capital injections for banks and perhaps insurers.
However this crisis pans out, one thing should be clear: Huge currency speculation of the kind that made the currency carry trade a cornerstone of global finance in recent years is highly destabilizing. When this crisis is over, the authorities should aim to reduce it.
EDWARD HADAS and HUGO DIXON |
| FHL(C)
User ID: 468982
10/28/2008 12:28 AM | | FHL(C)
User ID: 468982
10/28/2008 12:38 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
With thanks to the ac who posted here
[link to www.godlikeproductions.com]
FU&FW
THE NOT-SO-INVISIBLE HAND:
HOW THE PLUNGE PROTECTION TEAM
KILLED THE FREE MARKET Ellen Brown, October 25th, 2008
www.webofdebt.com/articles/manipulation.php
“We’re now no different from any of those Western European semi-socialist welfare states that we love to deride. Italy? Sure, it’s had four governments since last Thursday, but none of them would have allowed this to go on; the Italians know how to rig an economy.”
– Bill Saporito, “How We Became the United States of France,” Time (September 21, 2008)
October 24 marks the 79th anniversary of the October 1929 stock market crash. Heavy selling started on Thursday, October 24, 1929, and accelerated the following week on Black Monday and Black Tuesday, October 28 and 29. Many feared a repeat of this disaster on Friday, October 24, 2008, after Japan’s Nikkei stock average fell nearly 10% during the night, Hong Kong’s Hang Seng fell 8%, and Germany’s and Britain’s fell 5%.
“In a stunning turn of events,” reported Yahoo! Finance, “the futures for the major indices were ‘lock limit’ down before the start of trading Friday, meaning they had hit a 5% threshold that prevented them from trading any lower until the stock market opened Friday.” Traders prepared for the worst, but remarkably, disaster was averted. The U.S. market fell only 3.5%, just another “ordinary” bearish day.
Why the more modest drop in the U.S., where the financial debacle originated and should have hit hardest? Suspicious observers saw the covert hand of the Plunge Protection Team (PPT), the group set up under President Reagan to maintain market “stability” by manipulating markets behind the scenes. Bill Murphy commented in LeMetropoleCafe.com:
“Today the Muppets on CNBC were remarking how well our market acted, not falling apart as expected. All day long they spoke of how our market was acting differently today than every other stock market in the world. Well hello, the other countries don’t have a PPT, which is WHY our market is so different.
“There are those who might think what the PPT is doing is right. What they don’t realize is their making ‘Everything is fine’ for so long, and not allowing the market to trade freely . . . like allowing the stock market to fall the way it should, has kept the individual in the market . . . when they might have been SCARED out some time ago.”
In response to Bill Saporito’s comment in Time it might be countered that Henry Paulson’s Plunge Protection Team is quite adept at rigging an economy. The difference between an acknowledged socialist state and the stealth socialism we have in the U.S. today is that in a socialist state, everyone expects the market to be rigged and operates accordingly. In a rigged pseudo-capitalist economy, investors are easily separated from their money because they expect the market to follow “free market principles” based on “supply and demand.” They are seduced into “pump and dump” schemes – artificial manipulations that allow insiders to unload stock at a high price or buy it at a low price – because they trust in Adam Smith’s “invisible hand,” which is supposed to automatically set things right in a market left to its own devices. The market today is indeed controlled by an invisible hand, but it is not necessarily serving the interests of small investors.
Plunge Protection for Some, Plunge Creation for Others
The most egregious examples of market manipulation have been in gold, silver and oil. The official “spot” (or cash) prices of gold and silver were taken down sharply in the last ten days, despite the fact that physical demand has been inexorable. Gold is available in the “real” market only at huge markups, and popular types of silver are not available at all.1 We were taught in school that communism does not work because when industry is in the hands of a single owner (the government), competition is eliminated and chronic shortages and black markets develop, since the government does not let prices respond to “supply and demand” but dictates them from the top. Today this is happening with gold and silver, with the true physical price varying radically from the reported paper price.
Gold is known as the “contra-investment,” the “go to” investment which historically has gone up when other stocks were failing. Investors see it as something tangible that will hold its value when everything else is falling apart. For that reason, rigging the market to “maintain stability” means suppressing the price of gold.
The current round of gold manipulations started on Thursday, October 16, at 10 am, when the price of gold suddenly suffered a freefall plunge of $45 within minutes. It continued to drop until it was down by nearly $60 in a little over an hour:
Nothing happened on Thursday between 10 and 11 am to warrant this vertical drop. If anything, gold should have been shooting up in the same exponential fashion that it was falling. On Wednesday, the stock market had dropped over 700 points, and Dow futures (bets on which way the market would go) were down by 150 points Wednesday night. During the night, the Japanese stock market fell more than 10%, and all European markets were down.2 Thursday morning, among other very bad economic news, U.S. industrial output was reported to have posted its biggest fall in 34 years, and mid-Atlantic factory activity had crashed unexpectedly from September to October. Yet Dow futures were suddenly 130 points higher; and gold was slammed down right at 10 am, although physical gold was available only by paying huge premiums, and gold prices around the world were shooting up. The day continued in the same counterintuitive way, just one more egregious example of an ongoing pattern of manipulation that has become so blatant that either the manipulators have become supremely confident of their invulnerability or they are so terrified of impending doom that all pretense of plausible denial has been abandoned.
“The Most Massive Intervention Since Roosevelt”
Market manipulation is not generally discussed by the commentators on CNBC, but sense can hardly be made of today’s wildly unpredictable trading patterns unless the plays of powerful men behind the curtain are factored in. One commentator who does talk about this manipulation is Don Coxe, strategist for the Bank of Montreal. In a weekly conference call on September 5, 2008, he described what has been going on in the markets since July as “the most massive intervention of government into the capital markets or the financial system since Roosevelt closed the banks back in 1933.”3
According to the British Globe and Mail, Coxe is “no paranoid conspiracy theorist. As the chairman and chief strategist of Harris Investment Management in Chicago, he is one of the most respected investment authorities in North America.”4 The unprecedented intervention he described went back to when the financial establishment was facing a very banker-unfriendly market in July. Gold was about to break through the psychologically important $1,000 mark, oil was above $140 dollars a barrel, the dollar was breaking down, the bank stock index had dropped in six months from 90 to 50, and the Federal Reserve had a balance sheet to match, after making huge loans to banks on shaky collateral. Fannie Mae and Freddie Mac were on the verge of collapse, and hundreds of billions of their securities were held abroad. As if by magic, these trends all suddenly reversed, beginning with a dramatic reversal in the swooning dollar.
How was it done? The cat was let out of the bag by the Nikkei English News, which reported in late August that finance officials from the U.S., Japan and Europe had drawn up plans to strengthen the dollar following the collapse of investment bank Bear Stearns. The intervention called for the central banks to purchase dollars and sell euros and yen if the dollar’s value dropped significantly, with Japan providing the yen for the currency swap.5
As the dollar strengthened, gold, silver and oil plunged. The pundits read the drop in gold and silver as a reaction to the rise in the dollar, since precious metals rise historically when the dollar falls. But what they failed to explain was why the dollar was rising. As Bill Murphy observed, “the dollar rallies sharply whenever the US stock market comes under pressure. It is almost simultaneous.” He quoted one of his newsletter contributors:
“Since the [stock market] low on 22 SEP we have lost 8.3 trillion bucks worth of asset value within the equities markets and what happens? The US dollar goes up, and up, and up, and up, and up. From what? 72 to 84 now (up 1.14 just today??!!??)? A non-stop rally that is NEVER adversely affected by news or market events. It’s almost been a 45-degree ascent. THAT is pure unmitigated intervention of a huge degree.”6
To illustrate the point, Murphy posted this chart, showing the dramatic, inexplicable July reversal in the dollar’s slide:
How to explain this stunning about-face? In Coxe’s September 5 conference call, he candidly laid out how the Federal Reserve and the Treasury, in conjunction with the CFTC (Commodity Futures Trading Commission) and the SEC (Securities and Exchange Commission), colluded to manipulate this “necessary” bounce in the dollar, along with a corresponding boost to financial stocks and sudden collapse in the commodities markets. Coxe called it “brilliant,” but the play was at a cost of millions of dollars to commodities investors and short sellers who were betting on what a “free” market “should” do. Oil plunged more than 50%, from a high of $145 a barrel in July to a low of about $64 on October 24. The same pattern was seen in silver and gold, with gold falling from a high of over $1,000 an ounce to a low of $700 on October 23. It all added up to a massive “pump and dump” scheme, with insiders pocketing the fortunes lost by unsuspecting investors. It’s a messy business, but somebody has to rake in these obscene profits for the “greater good” of market stability.
“The Most Sordid Scheme in the History of Finance”
Theodore Butler, writing on SilverSeek.com on September 2, reported that there was more than just central bank collusion going on behind the scenes. He tracked an unprecedented wall of short selling of gold and silver – massive "borrowing" of stock, selling it into the market and forcing down the price, then "covering" by buying the stock back at the lower price. Butler wrote:
“In gold, no more than 3 U.S. banks sold short in one month more than 10% of world annual mine production. This was the largest short position in gold and silver ever recorded by U.S. banks. After the massive and concentrated silver and gold short position was established by these U.S. banks, the [gold and silver] markets experienced a historic decline in price. It all took place during the first widespread retail silver shortage in history. It is completely at odds [with] how the law of supply and demand works.”
Butler called it the most sordid scheme in the history of finance. “It makes a mockery of financial regulation and the rule of law,” he wrote. “It allows a large financial entity, or entities, to rip off the investing public and gouge them for obscene profits. It is cronyism, back-room dealing, market fixing and inside information at its worst.”7
While gold and silver were being shorted to oblivion, the SEC imposed a ban on the short selling of 19 select financial stocks, including Fannie Mae and Freddie Mac. It was blatant favoritism for the privileged few, but Coxe said it was necessary to make financial stock look attractive to potential buyers (particularly sovereign wealth funds), in order to allow the banks to sell their stock and raise the capital necessary to start lending again.
At the same time, Treasury Secretary Paulson sought and was granted an unlimited credit line to Fannie Mae and Freddie Mac directly from the U.S. Treasury, as well as the authority to buy the mortgage giants’ stock. Fannie and Freddie were put into a form of bankruptcy called a conservatorship; but unlike in the ordinary bankruptcy, in which creditors divide up the debtors’ available assets without government help, in this case the claims of the lenders were guaranteed by the Treasury. Foreign lenders were bailed out while the shareholders were wiped out – including banks, pension funds, and other institutions holding the savings of millions of Americans. In the long run, the “bailout” created more problems than it solved; but according to Coxe, it was a necessary sacrifice to keep the mortgage market functional for the near term.
How near? The Presidential election is now only weeks away. Markets have an uncanny way of looking good before elections.
Rob Kirby, writing in LeMetropoleCafe on September 9, observed that there are laws and stiff penalties against market collusion. The U.S. antitrust laws impose fines of up to $10 million and jail terms of up to 3 years for unfair practices that inhibit competition or monopolize markets in restraint of trade. “I admire [Coxe’s] candor,” said Kirby, “but my take on this is that all the perpetrators should face a firing squad, or worse, for treason.”8
That probably won’t happen, however, because the “perpetrators” can claim governmental immunity. The Plunge Protection Team, officially called the President’s Working Group on Financial Markets, was formed by President Reagan in response to a stock market crash in 1987 for the express purpose of “maintaining investor confidence” by manipulating markets with public funds. The PPT includes the President, the Secretary of the Treasury, the Chairman of the Federal Reserve, the Chairman of the Securities and Exchange Commission (SEC), and the Chairman of the Commodity Futures Trading Commission (CFTC).9 Calling the shots is no doubt Secretary Paulson, who now has a $700 billion fund to use for the purpose, after Congress passed his massive bank rescue plan on October 3.
“Socialism for the Rich”
Nouriel Roubini, Professor of Economics at New York University, wrote on his popular blog Global EconoMonitor:
“Socialism is indeed alive and well in America; but this is socialism for the rich, the well connected and Wall Street. A socialism where profits are privatized and losses are socialized with the US tax-payer being charged the bill . . . .”10
Investment guru Jim Rogers told “Squawk Box Europe”:
“America is more communist than China is right now. You can see that this is welfare of the rich, it is socialism for the rich. . . it’s just bailing out financial institutions. . . .
“This is madness, this is insanity, they have more than doubled the American national debt in one weekend for a bunch of crooks and incompetents. I’m not quite sure why I or anybody else should be paying for this.”11
If we are going socialist, we should own up to it and have some transparency in what’s going on. We the people need to know how to plan and to invest for an uncertain future. If we’re nationalizing the banks, let’s nationalize them all the way, with the profits going back to the people along with the losses and risks. Better yet, let’s nationalize the Federal Reserve, so it can issue “the full faith and credit of the United States” directly, without having to back this credit with a multi-trillion dollar federal debt that will never get paid back but just continues to grow. It would actually be less inflationary for the government to print dollars directly than for it to print bonds that are swapped for dollars created on a printing press by a privately-owned central bank, because in the latter case both the bonds and the dollars remain in circulation. U.S. bonds not only serve as money around the world, but they count as the “reserves” for banks to create many times their face value in loans. These bonds never get paid off but just get rolled over from year to year, inflating the money supply just as if dollars were printed directly; but the bonds carry the added burden of perpetual debt and interest payments.
The costly bank bailouts and blatant market manipulations going on today are justified as being necessary to save a private banking system that we think we need to get the credit that keeps the economy running. But we don’t actually need private banks to get credit. Many authorities have attested that, contrary to popular belief, banks don’t lend their own money or their depositors’ money. Every dollar lent by a bank is money created out of thin air on a computer screen. It’s just “credit.” The bank “monetizes” the borrower’s own promise to repay. The government could issue its own credit in the same way. There are a number of successful historical precedents for this, including the publicly-owned central banks of Australia and New Zealand, which saved those countries from the devastating effects of the Great Depression in the 1930s; and the publicly-owned bank of the colony of Pennsylvania, which funded the Pennsylvania provincial government without taxes or debt in the first half of the eighteenth century. (See Ellen Brown, “How Banks Secretly Create Money,” www.webofdebt.com/articles, July 3, 2007; and “It’s the Derivatives, Stupid!”, ibid., September 18, 2008.)
Today’s bankrupt banks dug their own black hole when they loaded up their books with lucrative but highly risky derivative bets that are now backfiring on them. Instead of trying to clean up the banks’ books by throwing taxpayer money at this impossible-to-fill black hole, we would be better off simply letting the banks go bankrupt, as President Reagan did with the savings and loan industry in the 1980s. The banks’ bad debts could then be discharged in bankruptcy, and their assets could be absorbed into a public credit system with a new, untarnished set of books that would serve the interests of the people and return the profits to the people.
So What Is an Investor to Do?
That still leaves the question of how to negotiate today’s very unpredictable markets. The Friday before the white-knuckle October 24 ride, investors were being encouraged to get back into the market. Commentators cheerily announced the best market week in 5-1/2 years, after the Dow climbed from a low of 7,774 on October 10 to a high of 9,924 on October 14. But the week still ended below 9,000, and the market was coming off the most historic plunge since the Great Depression, down from a high of 10,845 on October 3 to below 8,000 a week later. By October 24, the Dow was again hovering near 8,000.
“Frankly, I’m sick of this,” said CNBC market watcher Erin Burnett as she tracked the Dow’s wild gyrations on October 23. “Up and down, up and down. It doesn’t seem to mean anything or be linked to anything.”
I’m hanging onto my gold and silver stocks out of sheer doggedness; but other beleaguered investors might well decide it’s time to pull their money out of a stock market that is looking more and more like a rigged and risky Las Vegas casino and put it somewhere else. As one talk show commentator quipped recently, “I’m fully diversified. I’ve got some under the mattress, some under the floor boards, some in the backyard.”
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 537051
10/28/2008 8:07 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
With thanks to trader. Great summation.
FU&FW
[link to www.godlikeproductions.com]
Why the Dollar is Up and What Really is Going On
Quote
Aside from the social engineering that is going on to destroy this Republic and distract people with a contrived soap-opera of an election (which may have a surprise ending), the markets are crashing and people are confused about what is really going on. Some people, and certainly those who are running the show, know fully well what to expect, but the average investor is kept confused by the pseudo-intellectuals and bought-and-paid for experts.
As the Treasury is being looted by a cadre that has taken over this government -- and totally debases the U.S. dollar by massively increasing the monetary base -- people sit back in utter amazement and confusion as they watch the U.S. dollar climb on foreign exchange markets. It doesn’t seem to make any sense, and people who are rationally trying to protect themselves against this debasement of the currency by buying tangible assets, are in a losing situation. But it does make sense. And to understand the mechanism (and timing) of the dollar’s climb is the only way to avoid harmful, premature investments.
It is well-known that enormous amounts of US bonds and other paper securities are held by foreign governments, including China, Japan, and other governments. Those governments know that the US currency is being irreparably debased, and they know of course also that everything denominated in US dollars, is simultaneously being debased. This includes those US bonds and other paper securities. They are no idiots, and want to sell the paper. If they dump it on the market, the price of that paper would go down because they simply have too much of it to move. So they try to sell it in smaller lots, and sell just enough onto the markets so as to not affect the price too adversely.
The key to understanding why the dollar is going up has to do with what in fact those countries get in return when they sell that paper. They are getting something, and that something is Dollars. The more bonds they sell, the more dollars they get in exchange for those bonds, and this causes a temporary shortage of dollars which temporarily increases the value of the dollar. The more bonds they sell, the greater the shortage of dollars to pay them, and the higher the dollar.
What we are witnessing with the current increasing value of the dollar is a temporary phenomenon, and the magnitude of that increase in the dollar correlates with the magnitude of just how much US paper foreign governments are trying to dump. The only thing that is keeping the bond markets from collapsing with this ongoing, massive selling of bonds by foreign countries, is the fact that, within the US, there is concern about the stock market and a misnomered flight-to-safety where people buy bonds instead of equities. Because there is no other vehicle large enough to accommodate the sheer amount of fiat currency in the US, corporations and others are literally forced to buy up bonds and Treasury securities, even though the debasement of the currency will make these dollar-denominated assets plummet as the effects of the debasement unfold.
The rise of the dollar is entirely temporary, and is mechanistic and time-limited in nature. When those foreign countries take possession of the dollars they are paid in exchange for the bonds and securities they are selling, they will then want to dump those depreciated dollars. So essentially, the value of the dollar will first spike, then hover in a seeming steady state of equilibrium, but then collapse. When the dollar then inexorably starts down, the game is over, and all the consequences that have rationally been predicted for social collapse and re-structuring of this Republic will quickly come to pass, as does day to night.
As the municipal, county, and state governments sequentially go bankrupt from their ownership of 70% of stocks in the stock market, and as they flee from the stock market to buy depreciating US bonds, everybody goes broke in a catch 22 situation. The key to the timing of these events is to watch the bonds and the inter-related, but temporary, mechanistic spike in the dollar, for when those foreign countries have received those depreciated dollars, they will, for their own survival, dump those also, and everything inevitably unwinds.
These things are known to those who are looting the treasury before the inevitable collapse. Bush himself has bought a 100,000 acres of land in Paraguay, and has his exit strategy planned out. Instead of declaring a force majuere, all-contracts-void in the mammoth derivatives scam, those people who are looting the treasury of this country plan on making vast fortunes on the collapse of the stock and other markets. Why, for example, will the stock market go down? The answer is “Because That’s Where the Money Is.”
The only real question is: Where is the Provost Marshall General and Where are the Naval Flag Officers who have the full legal authority to stop the expropriation of trillions of dollars by arresting corrupt government officials, and have the power to prevent the bankers and their cronies from destroying this Republic? Yes, where is the Provost Marshall General, and where are those duly appointed, patriotic Officers who still believe in defending this country against enemies foreign and domestic?
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 537051
10/28/2008 8:20 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Another good insight from trader.
[link to www.godlikeproductions.com]
The stock market is entering the stage of disbelief.
In all major downturns there are usually four stages.
The first stage is Complacency on or near the top. As a market goes down it then enters the Concern phase, where people are concerned about its going down. As it continues down, it enters the Disbelief stage where people cannot believe what is happening. This is the stage just entered into now, and still has a way to go (down) until people start to think “this can’t be happening”.
The Disbelief stage has not yet taken its course, and probably won’t until the DJIA is pushed through the 7700 level of 2003 into unchartable waters. As it pushes significantly through and below that level, the Disbelief and “this can’t be happening” thinking turns into the Capitulation stage where people say get me out of the market, I don’t care what the price is, just get me out. This is the Capitulation stage where the stock market goes down very fast and very vehemently. The Capitulation stage is also the stage that those who have sold at higher levels wait and plan for, because they can then sit back with a bucket and buy back everything they sold at the top, and literally trillions of dollars flow into their coffers.
It is the same scenario played out in the markets since time immemorial, and how (with a few twists) the Rothschilds, for example, made the bulk of their fortune in England at the time of Napoleon’s defeat; or otherwise more recently, in the US in the crash of 1987. This time, however, it appears that much fundamental social engineering and political re-structuring is also an objective, and the magnitude of the collapse, or its duration, might best not be underestimated as the collapse is also the means to that re-structuring.
The particular timing of this scenario is perhaps best found in watching the bonds and the dollar. Despite the huge flight-to-quality buying of bonds occurring within this country, the selling of those bonds by foreign governments outside this country is keeping the price of bonds from skyrocketing. When the value of the dollar hovers and starts to fall as foreign countries re-patriate their assets (and dump the dollars they got from selling the US bonds and paper), it will turn into an every-man-for-himself situation for other countries and tangible assets like gold will break away and act independently of the bonds, dollar, and the stocks. There is still a very great way to go on the downside as market psychology is only now entering the Disbelief Stage.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 537051
10/28/2008 10:00 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
Seems to me that if Goldmansachs and Morgan Stanley were cut out right now and all derivatives positions dishonored, that 70% or more of the crisis would be resolved, IMO, still maybe that's being to simple, doesn't take into account The Fed, USA and Internat Banksters.
FU&FW
[link to www.nakedcapitalism.com]
Emerging Markets Capital Flight Exacerbated By Goldman and Morgan Stanley Becoming Banks
I somehow managed to fail to connect the dots on this one. When Morgan Stanley and Goldman, the far and away two biggest prime brokers (as in lenders to hedge funds) became banks, tougher regulatory requirements forced them to curtail hedge fund lending significantly.
To give you an idea of the concentration in this business, Morgan, Goldman, and number three (until late 2007) prime broker Bear Stearns had among them 70% market shares, with some sources saying as high as 75%. So with all three now regulated as banks, the reduction in credit availability, even absent adverse market conditions, margin calls, and redemptions, is considerable.
From Roger Peston at the BBC (hat tip reader Doc Holiday):
As for this most recent phase of the withdrawal of credit, which has caused financial crises for a series of emerging economies in eastern Europe, Asia and South America (see "Now there are runs on countries") and also global falls in share prices, it was in a way wholly foreseeable.
It was caused, to a large extent, by an exceptional and unprecedented shrinkage in the prime brokerage industry, which in turn led to a serious reduction in the volume of credit extended to hedge funds, which in turn forced hedge funds to sell assets, especially those perceived as higher risk.
This contraction in loans provide through prime brokers was the inevitable consequence of the collapse of Lehman, but also - far more importantly - of the recent conversion into banks of Morgan Stanley and Goldman Sachs.
Morgan Stanley and Goldman are - by far - the biggest prime brokers, with Morgan Stanley the number one.
But as banks, they're prevented by regulators from lending as much relative to their capital resources as they had been as securities firms.
So the US authorities should have known - and presumably did know - that by allowing Morgan Stanley and Goldman to become banks they were in effect forcing a serious contraction in the hedge-fund industry, which in turn would lead to sales of all manner of assets held by hedge funds and precipitate turmoil throughout the financial economy.
Which, as if you needed telling, only goes to show that regulatory intervention carried out with the best of intentions can have consequences that - in the short term at least - can be very painful.
Topics: Banking industry, Hedge funds, Investment banks, Regulations and regulators
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 537051
10/28/2008 10:33 AM | | FHL(C)
User ID: 537881
10/29/2008 7:43 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
With credit to 11th hour watcher, thank you
[link to www.godlikeproductions.com]
FU&FW
Chinese Yuan the Worlds New Reserve Currency? Please Pin for a day or 2?
Quote
Things are getting worse. On Friday morning, futures trading was halted for the first time ever after futures plunged more than 5 percent. The sell-off came after another 500-plus down day on the Dow followed by steep declines in equities markets across Europe and Asia. Japan's benchmark index, the Nikkei, slipped more than 9.5 percent after Toyota and Samsung reported disappointing earnings. The news was equally bad in Europe where shares were battered across the continent on fears of a global recession.
[link to marketoracle.co.uk]
Since September, $16 trillion has been erased from global stock market value. Losses in the US--where the financial turmoil originated--have been much smaller than other, more vulnerable markets. The Dow is down less than 40 percent from its peak of 14,000, whereas Hong Kong, Poland and China have all tumbled more than 60 percent. Its a bloodbath.
The Chicago Board Options Exchange Volatility Index, "the Fear Index", surged to 79.13 on Friday, the highest in its 18-year history, while the Dow clawed its way back from 500 points down to a 312 point loss on the day. The massive blow-off in stocks is mainly the result of ongoing deleveraging among the hedge funds which are dumping shares in at a record pace to cover the dwindling value of their asset base. According to the New York Times: "Hedge funds lost an estimated $180 billion during the last three months and some are near collapse. Investors are demanding their money back, and Wall Street is bracing for a shake-out in the $1.7 trillion industry." If a large fund, like Citadel, goes down, it will create a black hole in the financial system, similar to the loss of Lehman Bros. and, once again, the US Treasury will have to come to the rescue by providing a multi-billion dollar taxpayer bailout.
The dislocations caused by the unwinding of the hedge funds creates the possibility that US markets will have to be closed while assets are dumped on the market. New York University Professor Nouriel Roubini summed it up like this:
"Policy makers may soon be forced to close financial markets as the panic selling accelerates.
Indeed, we have now reached a point where fundamentals and long term valuation considerations do not matter any more for financial markets. There is a free fall as most investors are rapidly deleveraging and we are on the verge of a a capitulation collapse. What matters now is only flows - rather than stocks and fundamentals - and flows are unidirectional as everyone is selling and no one is buying as trying to buy equities is like catching a falling knife. There are no buyers in these dysfunctional markets, only sellers and panic is the ugly state of this destabilizing game.
We have reached the scary point where the dysfunctional behavior of financial markets has destructive effects on the financial system and - much worse - on the real economies. So it is time to think about more radical policy actions and government interventions." (Nouriel Roubini's Global EconoMonitor)
The stock market rout has triggered gigantic swings in the currency markets, too. The dollar has surged 16 percent against the euro in a matter of weeks while every other currency in the world has steadily lost ground, excluding the yen. The sudden fall in commodities and the unwinding of dollar-based bets in foreign capitals has bolstered the dollar and made US Treasurys the preferred "flight to safety" investment.
The volatility is causing problems everywhere, particularly where foreign companies must pay back loans in dollars which have risen steeply in relation to their own currencies. Emerging "commodities based" markets are getting clobbered. The stronger dollar also threatens to make it harder on US exports which have been the one economic bright spot in recent months. If present trends continue, then foreign governments will have to allocate more of their reserves to prop up their own currencies which will make it even more difficult for the US to fund its current account deficit as well as the Treasury's expanding balance sheet. In other words, these violent and unprecedented currency swings foreshadow a funding crisis looming just ahead as credit is drained from the financial system and capital becomes even scarcer. For now the dollar is flying high, but the future is looking grimmer by the day.
The financial crisis is wringing credit from the system and pushing prices downward across the board. No asset class has been spared, including gold which posted its biggest one week loss in 28 years and has plummeted from $1,040 in March to $734 at Friday's market close.
Oil has also been hammered by speculative bets made by the hedge funds which are now forced to sell their positions to cover downgrades on their mortgage-backed assets. The erratic movement in oil prices makes it possible to see the real destructive power of the unregulated market, particularly the opaque buying and selling by the hedge funds. In just 14 months oil went from $70 to $145 and back to $67 again on Friday. Wall Street speculators drove up prices with money they borrowed from the investment banks and delivered a knockout blow to the US consumer. The Fed played a critical role in this "gaming the system" by providing the low interest credit that created burgeoning profits for the investment class and falling living standards for everyone else.
Now that the currency bubble has popped, its effects are being felt worldwide. Countries that benefited from the high commodities prices are now getting slammed everywhere from Russia to the Persian Gulf. Ethanol producers are facing bankruptcy if things do not turnaround in the next 12 months. As the Wall Street Journal notes:
"The tragedy of the second bubble is that it has left the economy in a weaker position to ride out the housing slump and credit panic. The American consumer has been whipsawed with $4 dollar gas and food inflation, while entire industries have been put on the edge of bankruptcy. Detroit's auto makers have spent the last year taking down their truck and SUV assembly lines while gearing up to make hybrids and electric cars, even as their cash flow has been ravaged. Their new investments are based on the expectation that oil will stay high permanently, but will the market for hybrids exist if oil is $50 a barrel?
As Congress plumbs the causes of our current mess, the main one is hiding in plain sight: Reckless monetary policy that did so much to create the credit mania and then compounded the felony with a commodity bubble and run on the dollar whose damage is now becoming apparent." (Wall Street Journal)
The effects of low interest rates and credit contagion are not limited to "bottom line" considerations. As Marketwatch's Thomas Kostigen points out, monetary policy can be a death sentence for poor people across the planet who are invariably it biggest victims:
"The harsh reality of the economic fallout isn't that Joe the plumber can't buy his business or that people's retirement funds are being lost or that unemployment is rising; the harsh reality is that people will die.
Already, since food prices began to rise 100 million more people have been pushed into poverty, according to the World Bank, with as many as two billion on the verge of disaster. Almost half the world's population, let's remember, live on less than $2.50 per day. Millions die annually of hunger and starvation, and more than a billion do not have access to fresh water.
These numbers are poised to rise dramatically with population growth, dwindling natural resources and higher consumer prices across all goods and services. So as the stock market tumbles and the world economy falters, it's important to remember that it's more than financial losses we are talking about, it's the loss of life.
And increasingly it isn't just people in far-off places around the world who are succumbing to such extreme hardships. Note this: Job losses in the state of Indiana have caused the child poverty rate there to spike 29% since 2000. The wealth gap in the United States and around the world is at record levels -- and it has serious consequences.
The Organization for Economic Cooperation and Development reported this week that the gap between the rich and the poor is getting bigger around the world, and that the U.S. is experiencing the biggest dichotomy.
We are experiencing the largest wealth gap in history. Further erosion of the economic floor will only send more people plunging into destitution.
This is why it's so important to fix the economic crisis -- now.
We're all linked." (MarketWatch)
The Bush administration has called for an economic summit to be held by the 20 largest economies sometime after the presidential elections. US and EU officials are hoping to stitch together another Bretton Woods wherein control of the global economic system was delivered to those same nations. It's likely, however, that the outcome will turn out considerably different than anticipated. Already, under China's leadership, 12 Asian nations have agreed to set up an 80-billion-dollar fund to protect their economies from currency-runs, capital flight or other financial disruptions. China has the world's largest reserves at $1.9 trillion followed by Japan at more than $1 trillion. Clearly the two richest nations will set the agenda and play a central role in deciding how best to deal with the global recession.
The November summit in Washington could produce some unwelcome surprises which were hinted at by Thailand's Deputy Prime Minister, Olarn Chaipravat, who told Bloomberg News: ,
"The message of this initiative is for China to consider whether or not China would open up its banking system and allow the strongest currency in the world, which is the Chinese yuan, to be the rightful and anointed convertible currency of the world."
Surely, the present financial malaise which has its roots in Wall Street and at the Federal Reserve, has demonstrated that the dollar must be replaced as the world's "reserve currency" and that America must be deposed as the de facto steward of the global economic system. Leadership implies responsibility and the US must be held to account for its failings. It's time for a change.
By Mike Whitney
Email: fergiewhitney@msn.com
Mike is a well respected freelance writer living in Washington state, interested in politics and economics from a libertarian perspective.
[link to freewordofgod.yuku.com] |
| FHL(C)
User ID: 537992
10/29/2008 10:33 AM | | Re: Watch, Its happening ,the global economic change. | Quote |
FU&FW
[link to www.telegraph.co.uk]
The IMF, led by Dominique Strauss-Kahn, has the power to raise money on the capital markets by issuing `AAA' bonds under its own name. It has never resorted to this option, preferring to tap members states for deposits.
The nuclear option is to print money by issuing Special Drawing Rights, in effect acting as if it were the world's central bank. This was done briefly after the fall of the Soviet Union but has never been used as systematic tool of policy to head off a global financial crisis.
"The IMF can in theory create liquidity like a central bank," said an informed source. "There are a lot of ideas kicking around."
[link to freewordofgod.yuku.com] |
| Anonymous Coward
User ID: 538786
10/30/2008 12:14 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
Gold Market Dis-Information Specialists Ply Their Trade
Commodities / Market Manipulation Oct 23, 2008 - 03:55 PM
By: Rob_Kirby
Commodities
Diamond Rated - Best Financial Markets Analysis ArticleTim Gardiner, president and CEO, Mitsui & Co. Precious Metals Inc. appeared on Canada's Business News Network [BNN] and – in a ridiculous attempt to explain the recent demolishing of the gold price - made the claim that demand for gold was down and, “the only reason for physical shortages of gold products at retail was ‘logistical' and due to a shortage of ‘blanks' from which the coins are stamped”.
Shamefully, Canada 's BNN seems to endorse the position taken by Mr. Gardiner – seeing as how they have failed to do basic fact-checking and posted this synopsis of Mr. Gardiner's appearance/analysis on their web site :
Thursday, October 23, 2008 – 8:35 a.m. time slot:
Indian festival and wedding season is just around the corner. But demand for gold is down, as brides are running towards fake gold jewellery instead. BNN talks about this industry angle with Tim Gardiner, president and CEO, Mitsui & Co. Precious Metals Inc.
Guest: Tim Gardiner, president, Mitsui Global Precious Metals
Well, here's a dose of reality folks: In a conversation I had with one of Canada 's largest physical, retail bullion dealers last Friday – here's a summary of what he told me:
- As a long time and valued customer of the Royal Canadian Mint, he has been told that the Mint is not accepting ANY orders for gold or silver coin for at least 3 months – and no guarantees then either.
Gold:
- There are zero one ounce gold bars in North America at wholesale – period.
- Same thing for 10 oz gold bars.
- Some kilo gold bars are available at wholesale but in highly limited supply at prices start at 5 % over spot [COMEX price].
- He is currently receiving a couple of hundred calls per day for small gold [one ounce denominations] and has no product to sell.
Silver:
- He told me there are ZERO one thousand ounce bars available at wholesale in the U.S.A and `supply of the same in Canada is HIGHLY limited.
- He laughed when I mentioned that there was supply at COMEX and he told me COMEX was a JOKE. He told me he doesn't price silver using COMEX [silver futures prices] any more – he looks at prices being paid on E-Bay instead.
- He is currently getting 50 calls a day for silver and has no product to sell.
Perhaps Mr. Gardiner, or BNN, could explain to us all just how the U.S. mint was able to ‘source' the blanks required to satisfy investor demand for gold coins back in the pre-millennium days of 1999 but are now un-able to satisfy roughly 1/3 rd of their prior, demonstrable peak output?
The shortages of physical precious metal we are currently experiencing are reflective of a well documented fraud – long maintained by the GOLD ANTI TRUST ACTION COMMITTEE [www.gata.org]. GATA has been documenting this long-in-the-tooth price rigging of precious metals prices – largely through the thoroughly corrupt COMEX futures exchange in N.Y. – for approximately a decade.
As for Mr. Gardiner, he is either naïve, misinformed or talking his book as evidenced by Mitsui's owning one of the largest short gold positions on TOCOM [Tokyo Commodities Exchange] which everyone can see here .
Demand for physical precious metal is welling up, with significant and growing premiums being paid for physical metal, due to smart money migrating into the tangible space before it is widely understood by the general investing public the true extent of mismanagement and malfeasance at the highest levels of our existing monetary order. This is the REAL story that BNN has not reported.
In recent days, anecdotal accounts are beginning to surface that “major off-market transactions” are occurring at much, much higher prices. One such account rumored earlier this week was that a major trade in the physical market occurred between two non-U.S. players at a price equivalent of $ 1,075 per ounce. Perhaps more interestingly, the deal apparently was settled in EUR not DOLLARS .
It is a fact that a great deal of what ails our global economic sense of being is our current “un-backed” fiat monetary system which has been ABUSED by Central Bankers through unbridled credit creation and money printing. In light of what has occurred – precious metals in general and GOLD in particular is now reasserting its historic role as a “go to” wealth preservative.
To counter act and remedy their own largess; it is Central Banks and their proxies that have ruthlessly ENGINEERED the harsh credit crunch we are currently experiencing and merciless, coordinated price-take-downs in strategic commodities, including gold, utilizing futures markets - in vain hopes of re-instilling confidence in their now failing paper money system. For anyone who suggests that these claims are false on the basis that gold is not money; just ask them why it is that EVERY Central Bank on the planet lists gold bullion on their balance sheet as an “ OFFICIAL RESERVE ASSET ”?
Just make sure you remember the long drawn-out blank stare you receive in return.
From where I sit, both Mr. Gardiner and Canada 's BNN might want to “brush up” on the facts or quit talking their books if they want to be accepted as serious purveyors of honest, reliable, relevant business news.
Subscribers to Kirbyanalytics.com are benefiting from paid in-depth research reports, analysis and commentary on rapidly unfolding economic developments as well as recommendations on courses of action to profit from chaos. Subscribe here .
By Rob Kirby
[link to www.kirbyanalytics.com]
Rob Kirby is the editor of the Kirby Analytics Bi-weekly Online Newsletter, which provides proprietry Macroeconomic Research. Subscribers to Kirbyanalytics.com are benefiting from paid in-depth research reports, analysis and commentary on rapidly unfolding economic developments as well as recommendations on courses of action to profit from chaos. Subscribe here .
Copyright © 2008 Rob Kirby - All rights reserved.
Disclaimer: The above is a matter of opinion provided for gen |
| 1.5
User ID: 539413
10/31/2008 9:59 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
Gold Market Dis-Information Specialists Ply Their Trade
Commodities / Market Manipulation Oct 23, 2008 - 03:55 PM
By: Rob_Kirby
Commodities
Diamond Rated - Best Financial Markets Analysis ArticleTim Gardiner, president and CEO, Mitsui & Co. Precious Metals Inc. appeared on Canada's Business News Network [BNN] and – in a ridiculous attempt to explain the recent demolishing of the gold price - made the claim that demand for gold was down and, “the only reason for physical shortages of gold products at retail was ‘logistical' and due to a shortage of ‘blanks' from which the coins are stamped”.
Shamefully, Canada 's BNN seems to endorse the position taken by Mr. Gardiner – seeing as how they have failed to do basic fact-checking and posted this synopsis of Mr. Gardiner's appearance/analysis on their web site :
Thursday, October 23, 2008 – 8:35 a.m. time slot:
Indian festival and wedding season is just around the corner. But demand for gold is down, as brides are running towards fake gold jewellery instead. BNN talks about this industry angle with Tim Gardiner, president and CEO, Mitsui & Co. Precious Metals Inc.
Guest: Tim Gardiner, president, Mitsui Global Precious Metals
Well, here's a dose of reality folks: In a conversation I had with one of Canada 's largest physical, retail bullion dealers last Friday – here's a summary of what he told me:
- As a long time and valued customer of the Royal Canadian Mint, he has been told that the Mint is not accepting ANY orders for gold or silver coin for at least 3 months – and no guarantees then either.
Gold:
- There are zero one ounce gold bars in North America at wholesale – period.
- Same thing for 10 oz gold bars.
- Some kilo gold bars are available at wholesale but in highly limited supply at prices start at 5 % over spot [COMEX price].
- He is currently receiving a couple of hundred calls per day for small gold [one ounce denominations] and has no product to sell.
Silver:
- He told me there are ZERO one thousand ounce bars available at wholesale in the U.S.A and `supply of the same in Canada is HIGHLY limited.
- He laughed when I mentioned that there was supply at COMEX and he told me COMEX was a JOKE. He told me he doesn't price silver using COMEX [silver futures prices] any more – he looks at prices being paid on E-Bay instead.
- He is currently getting 50 calls a day for silver and has no product to sell.
Perhaps Mr. Gardiner, or BNN, could explain to us all just how the U.S. mint was able to ‘source' the blanks required to satisfy investor demand for gold coins back in the pre-millennium days of 1999 but are now un-able to satisfy roughly 1/3 rd of their prior, demonstrable peak output?
The shortages of physical precious metal we are currently experiencing are reflective of a well documented fraud – long maintained by the GOLD ANTI TRUST ACTION COMMITTEE [www.gata.org]. GATA has been documenting this long-in-the-tooth price rigging of precious metals prices – largely through the thoroughly corrupt COMEX futures exchange in N.Y. – for approximately a decade.
As for Mr. Gardiner, he is either naïve, misinformed or talking his book as evidenced by Mitsui's owning one of the largest short gold positions on TOCOM [Tokyo Commodities Exchange] which everyone can see here .
Demand for physical precious metal is welling up, with significant and growing premiums being paid for physical metal, due to smart money migrating into the tangible space before it is widely understood by the general investing public the true extent of mismanagement and malfeasance at the highest levels of our existing monetary order. This is the REAL story that BNN has not reported.
In recent days, anecdotal accounts are beginning to surface that “major off-market transactions” are occurring at much, much higher prices. One such account rumored earlier this week was that a major trade in the physical market occurred between two non-U.S. players at a price equivalent of $ 1,075 per ounce. Perhaps more interestingly, the deal apparently was settled in EUR not DOLLARS .
It is a fact that a great deal of what ails our global economic sense of being is our current “un-backed” fiat monetary system which has been ABUSED by Central Bankers through unbridled credit creation and money printing. In light of what has occurred – precious metals in general and GOLD in particular is now reasserting its historic role as a “go to” wealth preservative.
To counter act and remedy their own largess; it is Central Banks and their proxies that have ruthlessly ENGINEERED the harsh credit crunch we are currently experiencing and merciless, coordinated price-take-downs in strategic commodities, including gold, utilizing futures markets - in vain hopes of re-instilling confidence in their now failing paper money system. For anyone who suggests that these claims are false on the basis that gold is not money; just ask them why it is that EVERY Central Bank on the planet lists gold bullion on their balance sheet as an “ OFFICIAL RESERVE ASSET ”?
Just make sure you remember the long drawn-out blank stare you receive in return.
From where I sit, both Mr. Gardiner and Canada 's BNN might want to “brush up” on the facts or quit talking their books if they want to be accepted as serious purveyors of honest, reliable, relevant business news.
Subscribers to Kirbyanalytics.com are benefiting from paid in-depth research reports, analysis and commentary on rapidly unfolding economic developments as well as recommendations on courses of action to profit from chaos. Subscribe here .
By Rob Kirby
[link to www.kirbyanalytics.com]
Rob Kirby is the editor of the Kirby Analytics Bi-weekly Online Newsletter, which provides proprietry Macroeconomic Research. Subscribers to Kirbyanalytics.com are benefiting from paid in-depth research reports, analysis and commentary on rapidly unfolding economic developments as well as recommendations on courses of action to profit from chaos. Subscribe here .
Copyright © 2008 Rob Kirby - All rights reserved. |
| 1.5
User ID: 539413
10/31/2008 10:03 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
On a voluntary basis, it is a puzzle why healthy institutions would need or want to sell equity to the Treasury. On Tuesday, October 14, an hour before the market opened in New York at 9:30 am, Treasury Secretary Paulson, Federal Reserve chairman Ben Bernanke and Federal Deposit Insurance Corporation (FDIC) chairwoman Sheila Bair, announced that the government would invest up to $250 billion in preferred stocks, half of it at large banks. They were supported in the announcement by Securities and Exchange Commission (SEC) chairman Christopher Cox, Commodity Futures Trading Commission chairman Walter Luken, Office of controller of Currency Controller John Dugan and Office of Thrift Supervision chairman John Reich.
The lists of banks participating includes Goldman Sachs Group Inc ($10 billion), Morgan Stanley ($10 billion), JP Morgan Chase ($25 billion), Bank of America Corp - including the soon to be acquired Merrill Lynch ($25 billion), Citigroup ($25 billion), Well Fargo ($25 billion), Bank of New York ($3 billion), Mellon ($3 billion) and State Street Corp ($2 billion). These moves are designed to keep money flowing through the frozen banking system to keep the economy going.
The government will purchase preferred stocks, an equity investment designed to avoid hurting existing shareholders and deterring new ones. The preferred stocks do not have voting rights, and carry a 5% annual dividend that rises to 9% after five years. The government's plan will be structured to encourage firms to bring in private capital. Firms returning capital to the government by 2009 may get better terms for the government's stake. Financial institutions will have until mid-November to decide whether they want to participate in the government recapitalization scheme
[link to www.atimes.com] |
| 1.5
User ID: 539413
10/31/2008 10:08 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
Already, since food prices began to rise 100 million more people have been pushed into poverty, according to the World Bank, with as many as two billion on the verge of disaster. Almost half the world's population, let's remember, live on less than $2.50 per day. Millions die annually of hunger and starvation, and more than a billion do not have access to fresh water.
These numbers are poised to rise dramatically with population growth, dwindling natural resources and higher consumer prices across all goods and services. So as the stock market tumbles and the world economy falters, it's important to remember that it's more than financial losses we are talking about, it's the loss of life.
And increasingly it isn't just people in far-off places around the world who are succumbing to such extreme hardships. Note this: Job losses in the state of Indiana have caused the child poverty rate there to spike 29% since 2000. The wealth gap in the United States and around the world is at record levels -- and it has serious consequences.
The Organization for Economic Cooperation and Development reported this week that the gap between the rich and the poor is getting bigger around the world, and that the U.S. is experiencing the biggest dichotomy.
We are experiencing the largest wealth gap in history. Further erosion of the economic floor will only send more people plunging into destitution.
[link to marketoracle.co.uk] |
| 1.5
User ID: 539413
10/31/2008 10:10 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
U.S. pulls the plug on the world
The U.S. administration has prompted a huge surge in the U.S. dollar, which may help refinance its financial sector. The cost is a currency whirlwind that threatens the collapse not just of banks and companies but entire countries.
In the past week the financial crisis, which began in banking and spread to stocks, has careered into the currency markets. The U.S. actively decided back in September 2008 to shut down the investment banks that lend to the biggest professional investors. This has caused those investors to sell anything and everything and to settle their trades.
The result was a whirlwind of liquidation. Korean won, Turkish lira, Brazilian real, British pounds and commodities from oil and metals, all were sucked into the downdraft.
[link to www.russiatoday.com] |
| 1.5
User ID: 539413
10/31/2008 10:12 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
NASSIM NICHOLAS TALEB: Let me tell you why it's not like before. Look at what's happening. The world is getting so fragile that a small shortage of oil -- small -- can lead to the price going from $25 to $150.
PAUL SOLMAN: A barrel.
NASSIM NICHOLAS TALEB: A barrel. A small excess demand in an agricultural product can lead to an explosion in price.
We live in a world that is way too complicated for our traditional economic structure. It's not as resilient as it used to be. We don't have slack. It's over-optimized.
PAUL SOLMAN: What do you mean by "over-optimized"?
NASSIM NICHOLAS TALEB: Let me tell you what is happening in the ecology of the banking system. They're swelling to large banks, OK, because it's vastly more optimal to have one large bank than 10 small banks. It's more efficient.
PAUL SOLMAN: Well, we've certainly seen the consolidation of the industry.
NASSIM NICHOLAS TALEB: Exactly. And that consolidation is what's putting us at risk, because we are -- when one bank, large bank makes a mistake, OK, it's 10 times worse than a small bank making a mistake.
[link to www.pbs.org] |
| Anonymous Coward
User ID: 539413
10/31/2008 10:15 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
Glad you're checking it out. Well, part of the trick is that DTC (which handles stock transfers) is a separate company from CEDE (which is the legal owner), but CEDE is a wholly owned subsidiary. The way I understand it. But let me see again where I found the number ... Yeah, the document called DTC Consolidated Financial Statements shows 17.9 billion in assets. I think it was the annual report. Which has changed since last year and now shows the 2003 report. ... So, it says its subsidiaries settled transactions worth $923 trillion, and it says that values of securities on deposit is 24.6 trillion, which sounds like that 23 trillion number for 2003 rather than 2002. Hm, I do seem to remember them saying it more directly, and using the word "assets". But it was in a somewhat promotional piece (like the annual report), where they were bragging about it, rather than in their actual financial statement.
Anyway, a key to the argument is what the relation is between DTC and CEDE. If DTC owns CEDE and CEDE legally owns those now 24.6 trillion - that's what's remarkable. Even if everybody involved will say that "oh, it is just a formality, and of course it really is the stock holders' stocks". Oh, even if they didn't own them, it should be major news that they're even holding that amount of stocks for anybody. But the truly earth-shattering part would be the CEDE part.
Unfortunately, the relationship between DTC and CEDE, or even the factual existence of CEDE, is based on heresay and rumors. I.e. I haven't seen any documentation of it. And obviously DTC don't even mention CEDE as far as I can see.
Even if they do own CEDE, and CEDE does own all the stocks, I don't find it surprising that they can get away with ignoring it in their actual financial statement. If the auditors even knew that, they would probably be quite content with the explanation that, oh, it is just stuff we're temporarily holding, and it is of course all the customer's money. All seems logical and reasonable. Except for that it isn't, if the legal reality, when it comes down to it, is that they own it and the customers don't.
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User ID: 539413
10/31/2008 10:22 PM | | Re: Watch, Its happening ,the global economic change. | Quote |
'The banks are cheating us'
Hong Kong investors protest Lehman Brothers losses
Reuters
Published: Friday, October 31, 2008
HONG KONG - Angry Hong Kong investors, some banging gongs and others waving banners, scuffled outside a bank on Friday as frustration mounted over losses tied to investments linked to failed U.S. bank Lehman Brothers.
Several hundred investors, many of them elderly retirees, marched to eight banks which had sold Lehman structured products, including ABN Amro, Standard Chartered, Bank of China, Citic Ka Wah and DBS bank, demanding compensation for their losses.
Some investors tried to barge into a DBS bank branch on Hong Kong island, jostling with security staff who linked arms to form a human barricade.
Lehman Brothers mini-bonds holders scuffle with officials during a protest against various banks which sold them the product in Hong Kong Friday.
Lehman Brothers mini-bonds holders scuffle with officials during a protest against various banks which sold them the product in Hong Kong Friday.
Bobby Yip/Reuters
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"The banks are cheating us," shouted some investors, while others banged gongs and waved protest banners accusing the banks of misleading investors on the risks involved.
DBS said in a statement e-mailed to Reuters that a dedicated customer care centre had been set up to deal with concerns.
"DBS Bank (Hong Kong) Limited is deeply concerned about the anxiety our customers are experiencing on this matter," a spokeswoman said in the statement.
"Every customer is important to us and in cases where our standards are not met, DBS will not hesitate to make compensation," she said.
But one investor who burst into tears outside a Standard Chartered bank branch, said she wasn't convinced.
"Basically, the banks are trying to stall us, they are not willing to have dialogue with us," said a lady surnamed Yim.
To deal with the stalemate, Hong Kong's central bank said it would make available mediation and arbitration services between investors and banks with the aim of "settling claims in a speedy, confidential and amicable way, or of narrowing the issues in dispute."
Banks will however have the right to refuse or accept mediation on a case-by-case basis.
Local media reports say tens of thousands of Hong Kong investors had bought Lehman-issued and referenced credit-linked notes, called mini-bonds, worth HK$15.6 billion ($2 billion).
DBS said earlier this week that most of the notes were worthless, provoking the investor backlash.
Investors in Singapore and Indonesia have also hit the streets in protest, expressing outrage that the failed products they bought were actually complex derivatives.
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