And Just When You Think It Couldn't Get Any Worse

[jazdoc]

Gary, I found your post interesting. Could you please elaborate further on your statement "I read the rich do not help the poor."

 

[Phelonious Ponk]

Shutting down a visible and profitable department is a tactic often employed to create a "crisis" atmosphere for the viewing public.

Lee

Or to appeal to a constituency that trained to believe all "cutting" is good, and never asks about the end results.

Tim

 

[jazdoc]

Or to appeal to a constituency that trained to believe all "cutting" is good, and never asks about the end results.

Tim

OTOH, can anyone name a single government program that has been downsized because it doesn't achieve 'results'. Indeed, what are the deliverables whereby we judge a government program's effectiveness?

I"m reminded of the classic scene from Ghostbusters:

 

[Phelonious Ponk]

OTOH, can anyone name a single government program that has been downsized because it doesn't achieve 'results'.

Sorry, I guess I wasn't clear. I was talking about the result of the cutting, not the result of the program.

Tim

 

[Gregadd]

OTOH, can anyone name a single government program that has been downsized because it doesn't achieve 'results'. Indeed, what are the deliverables whereby we judge a government program's effectiveness?


I"m reminded of the classic scene from Ghostbusters:

Public housing projects. I recall some very dramatic demolitions.

 

[jazdoc]

Public housing projects. I recall some very dramatic demolitions.

Not exactly a ringing endorsement of the 'War On Poverty'

 

[RogerD]

Any ideas what Bernanke will announce this afternoon after the Fed meets or are they just out of bullets

If I was the Chairistan I would raise rates to 2 pct and kill the speculators and this would also protect the currency. It would also attract funds into the U.S. and signal the end of the intentional policy to drive the dollar down. Game over and start to get our fiscal house in order. The markets would initially tank on the news but then stabilise. It would also raise the M1 multiplier. Everything will go to hell otherwise and it still might but this needs to be done. My take.


"The End Game

Well, all the major averages have sliced through their respective 50- and 200- day moving averages and have radically undercut the June lows. And recall, QE2 started November 10, 2010. All the gains from QE2 are now gone. In fact, as it now stands, 20 months of hard earned capital appreciation in the S&P 500 has been wiped out in just three weeks ... bear markets are merciless; malevolent beasts. Global growth prospects are clearly being marked down — the action in the once-hot BRICs say it all as these areas are in full-fledged bear mode:
Brazil: -33%
Russia: -21.6%
India: -20%
China: -27%
The bond market also clearly has recession in its sights — none of this namby- pamby "35% odds" stuff out of Wall Street. The 10-year U.S. note yield closed at 2.31% in yesterday's session, undercutting last October's QE2-related low; dead air all the way down to 2%, which would be a test of the December 2008 trough.

In terms of the end game, it seems obvious now. If we can agree that the problem is excessive indebtedness at a whole bunch of levels (each country seems to have its own unique situation, for example the nonfinancial private sector credit outstanding relative to GDP in Spain is around 200%!) in many countries then there is really only one answer. This is not really about the EFSF, which helps reduce debt servicing costs but does not help alleviate the problem of overall debt burdens — that is just a swap. I think the ECB and the Fed (watch for some big changes in the press statement today), but especially the ECB, has to buy bonds en masse and reduce the amount of European debt outstanding and sharply boost the money supply. I believe that is the only way out right now. The central banks have to be the ones to absorb the debt and bring debt ratios down to more comfortable levels.

As for the Fed, when Ben Bernanke gave his testimony to Congress back on July 13th, the Dow was sitting at 12,492 (10,809 at yesterday's close), the 10-year was at 2.92% (2.31%) and oil was at $98/bbl ($81.21). Recall that back then, he did not shut the door on more Fed easing policy if the situation called for it. The only question is whatever it is the Fed decides to do, will it bolster aggregate demand any more than taking rates to 0% and embarking on two rounds of quantitative easing programs. These are the vagaries of a central bank burdened with the task of stimulating an economy saddled with so much debt and so many scars from years of real estate deflation and lingering joblessness.

The gold price seems to understand the end game, since it will involve an explosion in the monetary pace. The bond market is doing what it's doing— and now equities with a lag— because this asset class doesn't believe the next reflation wave will really do much to ignite confidence and spending, even if it manages to save the euro and the region's undercapitalized banks."

http://www.zerohedge.com/news/david-rosenberg-breaks-down-end-game

 

[Steve Williams]

Well Bernanke just said the Fed will keep rates unchanged until at least mid 2013

 

[RogerD]

Well Bernanke just said the Fed will keep rates unchanged until at least mid 2013

well than he is one stupid f***** , because the market will come apart. No wonder Volcker went fishing! We are at the gates of hell and it will get hotter!

 

[Steve Williams]

Nce he made the announcement the Dow has given up most of it's gain.

 

[RogerD]

I would expect STAGflation to continue and the economy to continue to decline. The Fed needs to be abolished and Timmy needs to be fired. The U.S. Treasury needs to take control now and Obama needs to grow a pair.

http://market-ticker.org/akcs-www?post=191843

 

[Steve Williams]

when you say the US Treasury do you mean the Fed

 

[RogerD]

when you say the US Treasury do you mean the Fed

I mean the central bank serves no real purpose anymore. They do not follow their mandate as wriiten,which is price stability(currency stability) and a employment level that produces economic progress.

What they do now is to feed speculation, in all asset classes,which leads to economic stagnation and inflation or destroys purchasing power,accelerates currency outflows and lower living standards. The exact opposite of their mandate.

Ah we have a extended five waves down off the top and a 5 wave off the bottom into the close today. If this rally is a 3 count and lasts two days only then watch for a possible heavy wave of selling to grip the market later this week. If this rally continues into the end of the week then it could have been a severe fourth wave with another high due. I don't have that as a good bet,we will see. Coming under 10K would be extremely bearish.

I agree with Denninger's take but the wild card is "a way to continue the bubble" by way of QE3,4,5 ect which will pummel this country. I'm done, because I can't believe Bernanke is allowed to be a shill for the ruling elite in this country and roll the dice. Very disturbing!

http://market-ticker.org/akcs-www?post=191850

 

[RogerD]

Dylan Ratigan nails it!

http://www.msnbc.msn.com/id/21134540/vp/44079837#44079837

 

[Steve Williams]

Wow

I'm out of breath listening to him. Definitely worth a watch

 

[NorthStar]

In the past, some of my best sources of news and politics have been non-political internet discussion boards. Such discussions are dangerous and can lead to horrible fighting on the wrong boards, but on the right ones it can be the fastest conduit of different perspectives available. It needs, however, to be backed up by professional news...read, not watched...from both the right and the left. And the center if you can find it. For professional news coverage, the internet cannot be beat. I can search the stories of interest across the sources of value and very quickly have a view of this crisis, for example, not only from both sides of the political aisle and from a market point of view, but from a global perspective as well.

As rapidly as aggressive, competent investigative journalism has faded, opinion has proliferated. The proliferation of editorial itself is not a problem. The problem is our tendency to only read what we already agree with.

Tim

Very interesting Tim, and I must confess, I agree.

"Awereness is in the hands of people who live in the land." - Bob

 

[NorthStar]

Well Bernanke just said the Fed will keep rates unchanged until at least mid 2013

Good or bad for you Steve? ...Or neither, or both?

 

[NorthStar]

The question I have, and this is because I am not familiar with leadership who want to sink the country, is what can the ordinary people do about this? The US is a nation of the people, and this is where freedom to act and to be heard is enshrined in the founding of the country.

Take the 1997 crisis in Thailand - one of the leading Buddhist monks urged his followers to donate gold and precious items to the Bank of Thailand to help bail the country out. If I remember right, some 20 tons of gold was donated. For a small country like Thailand, that's a significant drop in the bucket.

Whereas in the US, I read that the rich do not help the poor. The rich and the corporations have trillions in reserves overseas because they are waiting for another tax holiday on repatriated earnings before they will bring the money in. Wouldn't that money held overseas, and the taxes paid on those earnings be a great shot in the arm to kick-start the economy?

Here in Washington, the State tourism bureau has been shut down because of lack of funding. In previous years, the few million that the bureau cost has resulted in far more in revenue. Doesn't shutting down sources of revenue dig you further in the hole?

Gary, I found your post interesting. Could you please elaborate further on your statement "I read the rich do not help the poor."

Yes, same here. I feel like what Gary feels. But don't know much about the true reality of the world we live in!

...Or just feel outraged sometimes, just like Roger! ...And for very specific reasons concerning the way the United States of America do business at home and with the rest of the World!
I was and still am directly affected, and for the worst! It made my life totally despicable! On all aspects!

-> The people who work hard all their life at improving the world we live in deserve to be protected by the wisdom police! And the people who steal and corrupt need to be jailed!

Ok, I'm done now!

 

[RogerD]

Yes, same here. I feel like what Gary feels. But don't know much about the true reality of the world we live in!

...Or just feel outraged sometimes, just like Roger! ...And for very specific reasons concerning the way the United States of America do business at home and with the rest of the World!
I was and still am directly affected, and for the worst! It made my life totally despicable! On all aspects!

-> The people who work hard all their life at improving the world we live in deserve to be protected by the wisdom police! And the people who steal and corrupt need to be jailed!

Ok, I'm done now!

Hi Bob, can you tell I'm outraged??

Outrageous is when you walk into MickyD's and pay 3.29 for a sausage Mcmuffin. No wait in 2013 you walk in and pay 6.99!

I guess these young ones weren't around when they were .79 cents

Thank you Mr Chairistan! Franz Pick was right!

 

[RogerD]

Outraged because, The Fed is now a engine of destruction of the American way of life. If you don't have price stability you cannot plan rationally for the future. It forces people to take on "risk" that society in general would never do. If forces corruption,it lowers living standards,your real quality of life suffers in so many ways,it is out and out destructive.

For what? So a few can buy a island and think they will escape the madness? Pure insanity!