Archive - Nov 1, 2010 - Blog entry

The market ran in the morning today on the strength of China manufacturing the fuck out of some shit before falling in the afternoon after realizing that most Americans can no longer afford to buy the fuck out of that same shit (except of course for iPhones, because...

Nouriel Roubini, Laurence Kotlikoff, Steve Keen, Michel Chossudovsky, the Wall Street Journal and Hyman Minsky agree ...

Don't underestimate the contagion effects of state pension meltdowns...

What is China’s secret? According to financial commentator Jim Jubak, it may just be “creative accounting” -- the sort of accounting for which Wall Street is notorious, in which debts are swept off the books and turned into “assets.” China is able to pull this off because it does not owe its debts to foreign creditors. The banks doing the funding are state-owned, and the state can write off its own debts.

What do you do, vote for the feckless "bought" Democrat, the feckless bought Republican or the Tea Party unknown unknown?--You are in a proverbial "no win" situation.

Someone has to lose but, in this case, the loser is the Federal Reserve Bank of the United States of America – which plays the part of the perennial sucker as they are willing to sit down at the table and be taken for all they have two or three days a week. And why are they willing to be so generous? BECAUSE IT’S NOT THEIR MONEY!

Wise man say ...

Remember, much of the market rally from early September has hinged on the belief that the Fed will announce a large QE 2 program this Wednesday. For months the Fed leaked information that this was likely to be the case. We also received forecasts from Wall Street (specifically Morgan Stanley and Goldman Sachs) stating that QE 2 ranging from $1-4 trillion was coming in November.

Ambac was the walking dead 3 years ago, but nobody wanted to admit it. Well, as they skirt with bankruptcy today, the same story applies to the big US banks, and again nobody wants to admit it. What are the chances you will be reading a bankruptcy blog post like this one about the big banks in a year or two?

See the 1940 Dow analog, when the markets crashed in May and again during election week.
Bonus: Murphy v. Krugman update...nearly $50k raised to date.

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What exactly does Paul Krugman know that the rest of us don't?