I got dibs on the big cardboard box by the heating grate

[BibleMonkey]

"WASHINGTON — The world's largest economy now faces an even deeper downturn than previously forecast, with soaring unemployment in 2009 and perhaps years of trillion-dollar deficits.

Ben Bernanke and his Federal Reserve Board now expect economic conditions to worsen substantially this year with no hint of recovery until 2010, according to minutes released Tuesday of the Fed's Dec. 16 monetary policy meeting.

The sobering prediction comes as U.S. president-elect Barack Obama acknowledged that the country must go much deeper into debt to dig itself out of an economic hole.

“We're already looking at a trillion-dollar budget deficit, or close to a trillion-dollar budget deficit,” he told reporters Tuesday after a meeting with his top economic officials in Washington. “Potentially we've got trillion-dollar deficits for years to come.”

Like most countries, the United States is facing plunging tax revenues and major new financial demands, including bank bailouts, loans to the ailing auto makers and a proposed $775-billion (U.S.) package of tax breaks and infrastructure spending.

In December, the Fed cut its key interest rate to near zero and signalled it would keep it there for some time, while exploring new ways to flush the fragile financial system with more cash. The 10-member policy-making committee, which Mr. Bernanke heads, concluded the worst is probably still ahead, including accelerating economic contraction in the first half of 2009.

Fed officials projected that gross domestic product would decline “sharply” this year and won't resume solid and sustained growth until 2010.

The unemployment rate should rise “significantly” into 2010, the Fed said, to a rate even higher than it projected in late October.

Aluminum producer Alcoa Inc. underscored the looming jobs problem, announcing that it's girding for a prolonged recession by cutting production and eliminating 13,500 jobs, or 13 per cent of its work force.

The U.S. Labour Department is poised to release its employment report for December on Friday. Many economists expect the jobless rate will hit a 14-year high of 7 per cent, up from 6.7 per cent in November, while the economy sheds another half a million jobs.

The National Bureau of Economic Research, the official arbiter of economic cycles, recently concluded that the United States slipped into recession in December, 2007. The economy shrank by an annualized 0.5 per cent in the third quarter, but most economists expect the decline to be even larger in the final three months of 2008.

The Fed members also talked about the possibility of setting explicit targets for inflation, as well as for the money supply, eventually opting to do neither for the time being.

With the bank's key interest rate now set at between zero and one quarter of 1 per cent, the Fed is shifting its attention to so-called quantitative easing. Put simply, it is creating money to drive down longer-term interest rates, rather than indirectly trying to control the money supply by lowering the price of credit. The Fed has already taken a step in that direction by making hundreds of billions available to banks, brokerages and insurers. And at the December meeting, the bank said it stands ready to add substantially to its portfolio of bonds issued by mortgage lenders Fannie Mae and Freddie Mac and may also directly buy U.S. Treasury bills.

“The available evidence indicated that such purchases would reduce yields on those instruments, and lower borrowing costs for a range of private borrowers, although participants were uncertain as to the likely size of such effects,” the minutes stated.

The Fed is eager to show that it hasn't run out of ammunition, even after taking interest rates to zero. And while it isn't yet ready to set specific targets for the money supply, it's looking at ways to show investors more clearly how it's working behind the scenes to make credit more available to businesses and consumers.

The minutes suggest “some form of quantitative targeting will remain under serious consideration in the future,” said strategist Millan Mulraine of Toronto-Dominion Bank.

“There's much more on the Fed's quantitative easing front to come,” BMO Nesbitt Burns economist Michael Gregory said in a research note. "

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I think we're in for a sort of frog-inna-water pot series of announcements, slowly easing us into the new economic reality which followed the biggest daylight robbery in human history-when so far around three trillion dollars of private debts were moved from the private balance sheet to the public balance sheet.

They were bad gambling debts-enormous abstractions-that are now converted into public debt. In a few more months, maybe more ominous data will issue forth- easing us into an awareness of the trillions of still-outstanding derivatives that will be added to all of our invisible little credit cards we have been handed by our leaders-handily coming with an already convenient balance owing, to save us the bother of having to actually buy stuff with these invisible new credit cards in all of our pockets .

Luckily for us, Canada has appointed an economic advisory council '-the billionare foxes appointed to guard the hen house will save us..... (:

[Dex]

I'll bring the boxes of U.S. 100 dollars bills we can burn to keep warm if you got an extra room in that box

[BibleMonkey]

I'll bring the boxes of U.S. 100 dollars bills we can burn to keep warm if you got an extra room in that box

I wonder if the "quantative easing" mentioned above is referencing the new high-speed printing presses punching out U.S dollars. We don't really know how many rpm the press is running at now...mebbe it speeds up when the line-up of bankers with their hands out gets longer..

November 14, 2005

The Fed Announces it Will Hide M-3 To Keep You From Knowing What?
by Robert McHugh

The Federal Reserve announced on November 10th, without explanation, and I quote,

"On March 23, 2006, the Board of Governors of the Federal Reserve System will cease the publication of the M-3 monetary aggregate. It will also cease publishing the following components: large-denomination time deposits, RPs, and Eurodollars. The Board will continue to publish institutional money market mutual funds as a memorandum item on this release."

Why? It's simple, really. So that the Plunge Protection Team can hide its market manipulative, equity buying activities...

Naw...that's crazy....

[2R]

Top down economic manipulation has been tried before and failed.
The only way to save their economy is to bring the minimum wage up to what would support a family .Their are those who would argue against working families having any dignity in the payscales of the poor .But they can be convinced .After all the e-coli scares the agriculteral workers bnow have toilet facilities a small measure of dignity for a field worker but that small measure has improved the health standards from the bottom up (pun intended) to minimize the transfer of germs from sweaty hands to the fruit you put in your mouth.
The export of factories from north america also has to slow down ,if not end as it has removed so many customers.Nobody working: nobody buying .

The only top down adjustments needed are to put the white collar thieves in jail to restore trust in the market.If the Guys who stole pensions and billions from investors are not brought to book the market will never recover ever.No one in their right mind will ever invest in a den of thieves.
It does not matter who is in the whitehouse if they do not send the thives to the big house the honest brokers will be tarred with the same wide brush as the thieves who stole and scammed honest investors.

Or is this the destruction that the rich Saudi terrorists promised ?and we are powerless against the guys who destroyed the Soviet Union ?

[MG_]

.

[TeePeeCreeper]

Maybe they shouldn't have spent so much on the war.

Pissss... they were already Trillions in debt long before the war, and other past wars

[Phaedrus]

Hey- and now that they're spending our future like they have no intention of ever seeing it anyway, how long can it be until we are staring at a massive war?

[Dushan]

"Hope" and "Change" coming next Tuesday.

Hope you have some change left in your pocket...

Elections have consequences....

[BibleMonkey]

"Hope" and "Change" coming next Tuesday.

Hope you have some change left in your pocket...

Elections have consequences....

I think I agree with Ron Paul that although Obama has a different style, and identifiable differences , there is no fundamental , important change in the government ( monetary policy ) with his election
Ron Paul's Message to OBAMA
http://www.youtube.com/watch?v=ez5robAWmu4

Ron Paul [1-4] Speaking About The Economic Crash
http://www.youtube.com/watch?v=Xj_Nv_QM ... re=related

Some of Conressman Pauls ideas are out to lunch-but he raises several good points....

=======

Kind of a happy juxtaposition on an aviation forum-Congessman Charles August Lindbergh-father of the famous aviator-was a lone voice in the wilderness speaking out against the impementation of the Federal Reserve system in 1913

"This Act establishes the most gigantic trust on Earth. When the President signs this bill, the invisible government by the Monetary Power will be legalized, the people may not know it immediately but the day of reckoning is only a few years removed.... The worst legislative crime of the ages is perpetrated by this banking bill."

* "A radical is one who speaks the truth."[5]

* "The Aldrich Plan is the Wall Street Plan. It means another panic, if necessary, to intimidate the people. Aldrich, paid by the government to represent the people, proposes a plan for the trusts instead." - The Aldrich Plan (History of central banking in the United States) was a forerunner to that which spawned the Federal Reserve.

* "To cause high prices, all the Federal Reserve Board will do will be to lower the rediscount rate..., producing an expansion of credit and a rising stock market; then when ... business men are adjusted to these conditions, it can check ... prosperity in mid career by arbitrarily raising the rate of interest.

It can cause the pendulum of a rising and falling market to swing gently back and forth by slight changes in the discount rate, or cause violent fluctuations by a greater rate variation and in either case it will possess inside information as to financial conditions and advance knowledge of the coming change, either up or down. This is the strangest, most dangerous advantage ever placed in the hands of a special privilege class by any Government that ever existed.

The system is private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people's money. They know in advance when to create panics to their advantage, They also know when to stop panic. Inflation and deflation work equally well for them when they control finance."

In case you didn't notice, Canada has also -like the Americans -bailed out our banks by moving poisoned loans onto the public books..We just didn't debate about it
http://network.nationalpost.com/np/blog ... ssets.aspx

.....As late as August of this year, the bank held assets of $22-billion in government T-bills and $31-billion in long-term bonds to back the cash in Canadians’ wallets, under their beds and in their deposit boxes.

This has all changed. Over the last three months, the bank has sold off a large part of its government T-bill portfolio and replaced it with assets classified as “other.” In August this “other” category comprised a miniscule 0.4% of the bank’s total assets, or about $200-million. It has since ballooned in size to an impressive $32.4-billion. Last week “other” surpassed government bonds to become the largest component of the bank’s assets, about 42% of the total. At the same time the bank has sold off $11-billion worth of government T-bills, which now make up just 15% of the bank’s assets, down from a hefty 41%.

The assets in the fast growing “other” category have been acquired through term purchase and resale agreements from the Big Six banks and other participants in Canada’s financial system. What is the category comprised of? No one really knows,....

[BibleMonkey]

I think we're in for a sort of frog-inna-water pot series of announcements, slowly easing us into the new economic reality which followed the biggest daylight robbery in human history-when so far around three trillion dollars of private debts were moved from the private balance sheet to the public balance sheet.

Global Crisis Destroys 40% of World Wealth; Bailout to Hit $4 Trillion

The past five quarters have seen 40 percent of the world's wealth destroyed and business leaders expect the global economic crisis can only get worse.

Steve Schwarzman, chairman of private equity giant Blackstone, said an "almost incomprehensible" amount of cash had evaporated since the financial crisis took hold.....

Cost of shoring up U.S. banks may be in trillions.

WASHINGTON (Reuters) - The cost of restoring confidence in U.S. financial firms may reach $4 trillion if President Barack Obama moves ahead with a "bad bank" that buys up souring assets.

The figure far exceeds even the most pessimistic estimates of how great the loan losses might be...

The recent financial crisis drained retirement funds worldwide by $4 trillion, according to an estimate from the Organization for Economic Co-operation and Development....

Economy Dives as Goods Pile Up

Retailers not paying factories = deflation, too many goods, not enough buyers.
The Fed has shot it's wad, we're getting closer to Vne

[Nephilim]

"... and no one should be able to buy or sell unless ..."

[Phaedrus]

Lol, good point Nephilim. No one wants to go there....


Remember my dear rube: I am your father.

[niss]

POSSIBLY HEADING FOR COLLAPSE

by George Grant, Jan.27/09

The thesis behind this series of papers is that unbacked bank money,
when expanded too fast, eventually loses value and creates a
hyperinflationary collapse of the national and world economies, (while
trying to stimulate a weak economy out of recession).
Accordingly, what is needed to prevent disaster is a dual,
precious-metal-backed and unbacked bank money system which resists both
deflation and inflation.

This thesis is being backed by today's world financial developments,
and by leading world scholars, for example as follows:

"There is now a strong case for using the term "depression" when
describing the deepening financial and
economic malaise." - Doug Noland, U.K. takes a turn for the worst,
X-Yahoo-Newman-Property:
ymail-3, Jan 22/09.

"As the United States seeks to finance its ballooning budget deficits
by printing more U.S. dollar bills, Japanese economists are increasingly
concerned that the excessive use of dollar seigniorage by U.S. financial
authorities will further shake confidence in the U.S. currency at a time
when the world lacks an alternative, globally accepted currency. ... The
latest Fed data showed that the monetary base jumped to more than $1.7
Trillion this month, over double the $840 billion in August, 2008 - a
vertical takeoff in the supply of dollars" (which expand by a multiple of
the base, and are then spent in a multiple of the actual dollar supply)
..."This is the root cause of today's financial crisis." (As Nakatani says:
"Unless the Fed drains excessive dollar supply, the dollar will be doomed
and hyperinflation will occur ... in a global financial crisis." Kasuke
Takahashi, The Temptation of Dollar Seigniorage, Asia Times Online, Tokyo,
Jan 23/09.

And:

"Governments are resorting to lower interest rates and massive
spending initiatives to stimulate growth. It seems we are all Keynesians
now!" Satyajit Das, Brave New Financial World, 2009.

Despite these warnings, nothing is being done to repair the monetary unit.
Instead, to keep things moving a little longer, we are creating and
expanding EVEN MORE money FASTER STILL, and are only divided on how much to
spend where. The Titanic is sinking, but we aren't putting out enough
lifeboats and most of us are sure to die a miserable death. We need
lifeboats in the form of an unsinkable, value-holding monetary unit that can
sail the economic seas and stay afloat. However, my recommendation of a
PARALLEL, GOLD-OR-SILVER-CONTAINING, COMMODITY MONEY COINAGE has not been
adopted. Therefore, in this little essay, I will simply say once again why
it is essential, as follows:-
(1) The bank-money system is so unstable and expanding so excessively that
the economy periodically almost collapses deflationarily and is given
monetary stimulus treatments to recover, unwell, in a hyper-ventilated
atmosphere until it becomes likely to collapse inflationarily, with
worthless money and an unworkable economy.
(2) When our "money economy", on which we all depend, collapses, we will
also drown unless we take self-sufficiency actions.
(3) These self-sufficiency actions are of two kinds: (a) Introduce a
parallel, gold-or-silver-containing coinage, which will not sink, to keep
the economy afloat while we work on it; (b) Move individually to productive
self-sufficiency with a supply of productive assets and of real-value coins
for trade; and/or both together, with the worrying expectation that only (a)
will work.

We thus come to the following summary of Predictions and Investment
Recommendations: While our economy moves erratically along, without a solid
monetary framework, we can observe that it is headed down toward depression,
and that it is being treated with desperate monetary stimuli to try and head
that depression off, in a hyperinflationary manner. Investment
recommendations must therefore take both the underlying cause and both
symptoms into account.
Against depression, one needs cash and self-sufficiency; against
hyper-inflation, one needs gold and silver coins, self-sufficiency and
perhaps inflation-hedge equities and real estate (including one's own home.
If either depression or inflation destroys the currency, one will need
precious metal coinage and self-sufficiency. (The repeated emphasis on
self-sufficiency is due to the expectation that the workings of the economy
will stop, if the currency grease freezes up). Amongst the many major
side-problems are the fact that most of us do not have sufficient liquid
assets to purchase all these needs; and, even if one does have enough, one
would have to protect oneself against the many who do not have enough -- or
vote in a government that can and will provide the essentials of life --
e.g. indirectly by providing a solid currency that can work without
depressionary collapse or hyperinflationary explosion.

[Four1oh]

So since it seems Rome is burning, who's the next world power? China? Do I need to learn chinese, or some euro-language? Arabic? Help a brudda out!

[WetJet]

Top down economic manipulation has been tried before and failed.
The only way to save their economy is to bring the minimum wage up to what would support a family.

Holy crap old friend, I never took you for a communist!

WJ

[sky's the limit]

You know,


In these tough economic times, it sure is good entertainment reading some of the posts on here...

Flarhety was on the radio today saying we need to "loosen further our remaining protections..." Just great, ask around the world from S. America, to E. Europe, to Asia, and see how Friedman and his shit worked for them...

"Conservative" economics is not what it used to be folks, and hasn't been since Thatcher, Reagan, and Mulroney. And it is NOT good for you, me or anyone else not in the select few who are making a killing. Get over the brainwash and start understanding that we are being gutted, and the wedge between rich and poor is being driven ever deeper.

stl

[beaverbob]

China was mentioned in a previous post. I have been told that China is a large invester in the US and the US owes a large part of its national debt to the Chinese.

What happens if China calls its loans?

What happens if the US dollar fails and the Euro takes over?

What happens when the US can no longer finance its military?


Scary!

Bob

[sky's the limit]

China was mentioned in a previous post. I have been told that China is a large invester in the US and the US owes a large part of its national debt to the Chinese.

What happens if China calls its loans?

What happens if the US dollar fails and the Euro takes over?

What happens when the US can no longer finance its military?


Scary!

Bob

1) China won't call in its loans, it can't have the American economy collapse like that, they simply export far too much this way to allow it.

2) Nobody wants the US dollar to fail, so we are going to see its slow death over a long period of time. If the USD collapses in a hurry, everyone loses.

3) As for the military, well, that's fairly straight forward - they lose the ability to project power, so they will be replaced by someone who can. Who? Your guess is as good as mine.

stl

[beaverbob]

Hi STL
I agree with you 100%. I suppose thats why I posted it as questions. The Chinese's largest nationa budget expense is the military and I believe they can boast a 100,000,000 soldiers now. Could be difficult to move them in a hurry though.

I believe the European Union will likely be the next super power.
Bob

[North Shore]

I wonder, in the rear-view mirror of History, if 2007-2008 wil be seen as the high-water mark of capitalism/industrialism and the period thereafter as the time in which the various bills, financial, environmental, energy, social, came due?