$75 Billion In New Treasuries On Deck
If you missed your chance to stock up on double ply UST (T is for toiler) paper, fear not: you will have another chance to buy some again... and again... and again. The first opportunity will be on August 11th and 12th, when a total of $75 billion pieces of paper, backed by another rapidly deflating piece of paper will be made available for your indirect (or is that direct?) auction pleasure.
Specifically:
$37 Billion in Three Year Notes;
$23 Billion in Ten Year Notes;
$15 Billion in Thirty Year Notes;
And here is how America became $304 billion dollars more indebted to China (and Itself compliments of monetization), since July 24. That's a almost a third of a trillion in new debt issued in under a month.
(17 votes)
»
- Login or register to post comments
- Printer-friendly version
- Send to friend
on Wed, 08/05/2009 - 15:13
#26228
Yeeeah-- It's getting HOT in here.
GOLDMAN & AIG are going to make Madoff look like Mother Theresa before long......
From the NYT--
In the months since A.I.G. received its $182 billion rescue from the Treasury and the Federal Reserve, state insurance regulators have said repeatedly that its core insurance operations were sound — that the financial disaster was caused primarily by a small unit that dealt in exotic derivatives.
But state regulatory filings offer a different picture. They show that A.I.G.’s individual insurance companies have been doing an unusual volume of business with each other for many years — investing in each other’s stocks; borrowing from each other’s investment portfolios; and guaranteeing each other’s insurance policies, even when they have lacked the means to make good. Insurance examiners working for the states have occasionally flagged these activities, to little effect.
More ominously, many of A.I.G.’s insurance companies have reduced their own exposure by sending their risks to other companies, often under the same A.I.G. umbrella.
on Wed, 08/05/2009 - 16:20
#26359
Madoff is the tip of the iceberg. What do Maurice Greenberg, Michael Bloomberg, Alan Greenspan, Ben Bernanke, Barnie Frank, Dick Fuld, Lloyd Blankfein, Larry Silverstein, Larry Summers, Charles Schwab, Sandy Weill, Robert Zoellick, James Dimon, Blake Grossman, Jaun Claude Trichet, Dominique Strauss-Kahn, & Alan Schwartz have in common?
They lead/have led important financial posts/companies in the world. This list does not include the similarities in the leaders of media & technology companies. Birds of a feather flock together, many are billionaires with friends that own printing presses (how they are connected). I hope that these individuals are not bigoted anti-non-semites because it appears there is a lack of diversity at the top in many fields - discrimination and collusion is possible in this case judging by the percentage representation. We are frustrated at a system that does not appear fair, and we have to ask what is the system?
I have no hate for any particular group and desire to see a fair system and justice prevail. At some point we will need to vote with our dollars and boycott, but what groups should we boycott? It would appear someone very clever has divided society into opposing groups including rich/poor, black/white, illegal alien/resident, democrat/republican, christian/atheist to emotionally charge divisions while a small group has acted in concert and divided the spoils.
With Malice toward none, with charity for all, with firmness in the right, as God gives us to see the right, let us strive on to finish the work we are in, to bind up the nation's wounds.
on Wed, 08/05/2009 - 16:26
#26364
As I've stated before, Capitalism isn't fair. It's not supposed to be.
on Wed, 08/05/2009 - 17:01
#26413
The same can be said for oligopolistic fueled kleptocratic systems.
on Wed, 08/05/2009 - 21:06
#26644
What we have here is a Plutocratic Oligopoly-Enabled Kleptocracy (POEK).
on Wed, 08/05/2009 - 17:08
#26425
You are completely wrong!! There is a big difference between free market capitalism and crony capitalism. Free markets reward the risk takers, the hard-working, and yes the lucky. Crony capitalism rewards the well connected at the expense of everybody else; it is a socialism for the rich.
-----------------
That said markets cannot be 100% free. We need a minimal state and a minimal amount of social services, because LIFE is not fair. What is not fair is that some people are born into poverty, with birth defects and other disadvantages while others are born into riches and win the genetic lottery. We must make sure that the disadvantaged have a change to catch up to the advantaged (free elementary education and generous loans for higher education). We must have safety nets for the crippled. We must also have a state that maintains basic rule of law. All incentives must be geared so that effort, and virtue are what is rewarded. That is what a just society looks like (not the welfare state imagined by socialists)
on Wed, 08/05/2009 - 17:49
#26479
Yes...cuz even Octomom, whom it was decided should not have children, should be given a fair shot at having demon spawn make a killing off the taxpayer.
We need to help each other, but doing so at gunpoint creates resentment, and inspires lethargy.
on Wed, 08/05/2009 - 19:23
#26561
Actually Dox was completely correct. Capitalism isn't fair, it is just. It benefits those that are efficient, and punishes those who are inefficient with utter and complete indifference as to which parties are involved, or what their situation is.
on Wed, 08/05/2009 - 20:16
#26597
Do you want to argue semantics?
Fair = Just
You seem to take a very socialistic view of "fairness". Fair is precisely that it rewards the efficient. The fact that you have a short term win/lose situation is not unfair or unjust. So yes, true Capitalism is fair and is just.
My reaction is because Dox sounds like the Gordon Gekko type who defends cronyism as a legitimate form of business.
on Wed, 08/05/2009 - 18:06
#26502
Capitalism in its ideal state is a meritocracy with rules to ensure an even playing field. We have had anti-trust laws to stop monopolies from rent seeking behavior for decades, the problem arises when regulators and politicians become "captured" with bribes, promises of high paying jobs in the companies being regulated after they leave their policing roles, and political pressure applied by connected crooks above.
This is the current problem with our system. Economic development can only continue with new S curves like the internet and computers have done (by the way, Steve Ballmer, Michael Dell, Steve Jobs, Larry Ellison, Larry Page & Sergey Brin have all done an excellent job developing the next economic technology curve - Examples of excellent leading technology businessmen that happen to have Jewish heritage).
When government begins to only protect the entrenched businesses and institute policies that reduce competition and protect their friends the monopolies - the empire falls and it will fall for even the connected over the long term. Large businesses have not been adding jobs, small & medium sized businesses have been adding jobs and pay significant taxes in percentage terms. The bigs and smalls will fail together if we don't increase the number of jobs in the economy - with the next development that somebody is incentivized to discover/make in their basement. There will be no consumer to buy big or little business products without jobs.
The small businesses today are the large ones of tomorrow and will generate jobs and prosperity IF THERE IS ANY INCENTIVE TO PUT CAPITAL RISK ON THE LINE. If you change the rules of the game to benefit big campaign donors (monopolies) and increase taxes on small businesses there IS NO FUTURE and. Why would anyone risk their hard earned capital when the risk/return after tax does not make sense. Imagine you had saved for 20 years and were interested in opening a business, why work 80 hours a week to support 50% of the population that doesn't pay any taxes when the risk/return equation does not work? It's called moral hazard and it will crash the system.
The political solutions to this economic crisis will be totalitarian government including life & death decisions through healthcare. They already operate or guarantee many sectors, now the Fed (non gov) wants complete financially regulatory oversight. They caused the first great depression and this greater depression while they had regulatory duties that they didn't enforce, why would we want to turn the wheel of the school bus over to the Cartel with a blindfold on that already ran us into a ditch and it refuses to even be audited. Who are they giving money to, and who are they not giving money to?
Nobody in their right mind would risk their capital in this environment, only those with friends that operate printing presses with loans at 0% (riskless investments).
This has nothing to do with capitalism, but everything to do with corruption.
on Wed, 08/05/2009 - 21:15
#26651
Indeed. Apologists for national healthcare say that we (who?) ought to give the "necessary minimum requirements" to anyone regardless of their level of effort or competence. But, while those compassionate motives may be genuine, nobody answers even the most basic questions like: who decides what are the necessary minimum requirements? What kind of lifestyle is 'basic' to which people would be entitled? How long are they entitled to it, and what causes the entitlement to be terminated? When does this entitlement begin? If someone invents a miracle drug tomorrow that prevents the common cold and herpes, are they entitled to that too? When would that hypothetical right to said substance begin? When it is conceived? When it is first produced? When the patent (do they still give patents in 'perfect world') expires, or is expropriated?
The devil, as always, and as necessarily dictated by reality (not feelings or fairness,) is in the details. The bottom line is, there are not any 'fair' answers to these questions that will make a planned system thrive indefinitely in which nobody has to worry about their own survival. It can't be done. Magic, as it were, does not exist. Wishing it to be so, feeling that it should be so, fretting that it isn't so, not a bit of it makes the slightest difference.
on Wed, 08/05/2009 - 15:14
#26233
total of $75 pieces of paper
-----------------
75 dollars? i can buy all that paper
on Wed, 08/05/2009 - 16:08
#26337
of topic, but i recommed you short NWSA
Murdoch: News will charge for all newspaper sites
on Thu, 08/06/2009 - 00:54
#26880
Excellent development, the king is dead (established media) long live the king (bloggers).
Why would anyone pay for propaganda?
on Wed, 08/05/2009 - 15:14
#26234
I California worth 304Billion ?
on Wed, 08/05/2009 - 15:30
#26269
I sell it to you for $30 Billion if you pay cash - even throw in a brand new set of ginsu knifes.
on Wed, 08/05/2009 - 16:38
#26380
yes, but priced in ZB ( Zimbabwean dollars )
on Wed, 08/05/2009 - 17:35
#26462
i was wondering when someone would grab that poster for an avatar....
on Wed, 08/05/2009 - 17:47
#26477
lol i know, i saw that no one here has put it up so i figured why not ...
on Wed, 08/05/2009 - 15:14
#26235
Don't worry, passing free health care for all will solve this.
on Wed, 08/05/2009 - 15:27
#26262
Maybe not but reducing healthcare down from 16.3% of our GDP would help solve this.
on Wed, 08/05/2009 - 15:53
#26312
And how the hell would you do that? Price controls? Ask the 1970's about how well that works. Scare tactics? Great! We enslave our doctors and send thugs to the insurance companies. Nothing like breaking a few legs to keep the medical business "honest."
on Wed, 08/05/2009 - 16:15
#26351
Why not just get the insurance companies out of the health care business. Then we don't have to thug-them-around? They're a waste of money anyway. As-in, including them makes for an extremely inefficient system.
Ok, I just realized that's not gonna fly with you people. So I'll just post some quick numbers.
I made $60,000 last year. My boss came from Australia last year and we discussed health care. Turns out, he was spending an equivalent of 1.8% of his yearly income on healthcare (that includes his income taxes and extra private insurance). While at the same time, I was spending about $500 a month on healthcare (this includes medicare, medicaid, the amount of my insurance covered by my work that would otherwise be going to me, and the amount I pay in insurance a month--it did not include any deductibles or any costs other than what came out of my check). About $500 a month amounts to about $6,000 a year. Which amounts to about a 10% real tax...... The healthcare insurance business is a parasite on the economy, and should die.
on Wed, 08/05/2009 - 16:37
#26378
If you think insurance companies are the reason health care costs are rising faster than inflation you do not understand the problem.
Comparing what you SPEND is a useless exercise because it does not consider the COST or the VALUE of what you receive. The reason we spend more than other countries on health care (as a % of GDP) is because by and large we are subsidizing the planet with our advances and developments. The UK only spends 10% while we spend 16%, so we must have a problem! Ummm, not quite. The UK government has forced prices down through such wonderful exercises as "comparative effectiveness" by which a government panel decides that certain treatments don't extend life enough to warrant paying for. Pleasant, no? There's a reason that people looking for medical treatment come FROM Canada to the US, and it's because we have the best-trained doctors and highest quality health care system in the world.
The end result in the UK is shortages, rationing, and lower quality product. Try the post office some time, you'll see what I mean.
on Wed, 08/05/2009 - 17:05
#26419
Value? I lost three family members to the insurance companies because they decided that covered items cost too much and required engagement with their review procedures...
However it is sliced a bureaucrat is the decision maker.
on Wed, 08/05/2009 - 17:20
#26447
Haha. Ever lived under nationalised health care, or do you like just spouting opinions?
We do have the best health care in the world - if you can afford it. Many people are finding they are struggling to afford it right now, so the value of that system is being challenged.
Regarding your point about treatments and payments - either you have never been seriously ill (good for you), or have been lucky enough not to have been denied coverage by a corporate risk assessment algorhythm. If you were denied, would you rather pursue the insurance company or an entity with which you would have the ability to do the oft used FOI application?
Finally, I have lived under nationalised healthcare and maintained BUPA coverage, giving me the total coverage which prepares me for anything, anywhere. I don't pay through the nose, and can easily decide which to use depending on the situation.
I do hope that you are never unfortunate enough to lose your job and either you or a loved one become gravely ill, bankrupting your entire savings and assets. However, if it did happen - I would hope you would have a better understanding of what being in Sweden, Japan, Switzerland, the Netherlands, England, Canada, Brasil, Ireland, Trinidad and Tobago, Columbia, Peru, China, India, Israel, Singapore, Taiwan, Thailand, Austria, Finland, Bosnia and Herzegovina, Belgium, Croatia, Czech Republic, Germany, Scotland, Estonia, Denmark, Georgia, Greece, Hungary, Iceland, Itlay, Latvia, Leichenstein, Malta, Ukraine, Poland, Romania, Russia, Serbia, Slovakia, Australia, Sri Lanka, or New Zealand is like for people who can't afford top tier coverage.
on Wed, 08/05/2009 - 19:10
#26551
"However, if it did happen - I would hope you would have a better understanding of what being in... Japan ... Canada...is like for people who can't afford top tier coverage."
Been in both, covered by the basic social safety net (only), and in need of care in both. Guess what? You don't have any idea at all what you are talking about. The care is immediate, appropriate, without any nonsense or bureaucracy... just immediate, professional and consistent care. No questions asked.
Get. Information. From. Real. Sources.
Like millions and millions of us who have/do live it.
Not Republican Insurance Company shills.
Hong Kong was interesting. I had to tell the Doctor's office how many days of care I thought I would need, paid something like $30/day up front (I bought 7 days). Then whatever care was needed was provided for that period of time (medication, visits, whatever...)
on Wed, 08/05/2009 - 22:45
#26719
Hey Anon #26551,
Sorry if I touched a nerve, I have also lived under two systems (outside of the US) which provided excellent coverage (My wife and I had a child in one system - I can tell you it was an amazing experience). The difference for me, and specifically what I refer to when I mention "top tier" (which I assume is the words that have set you off)? Transferability (having to insure myself in the USA and outside the UK in order to avoid "pre-existing conditions"), and elective procedures.
Otherwise, I agree the care is world class.
Just for your information, I don't listen to any insurance company shills, and I am open to hearing the musings of all political perspectives (no matter how freaking crazy they are).
Isn't that why we read comments?
on Thu, 08/06/2009 - 00:11
#26833
I understand the subsidizing, because I have always believed if we were not playing global cop, all the others would have to provide for themselves. They would have problems paying for universal health care if they had to pay to protect themselves or at the very least keep stability in their region.
on Wed, 08/05/2009 - 16:51
#26400
BUT, Medicare, Medicaid are already managed by the Government... So you are essentially saying we need to go ALL IN with the Government on the hope that health coverage costs will fall... No thanks. If they rework healthcare does that mean Medicaid/Medicare are going away? I don't think so.
I just can't understand why people think the Federal Government should be entrusted with yet more control over their lives, makes no sense. Let them start small: fix Social Security first! Then get back to us!
on Wed, 08/05/2009 - 18:21
#26515
aw, fuck, i thought it was Cap 'n Trade that would save us...
Talk about the 1930's and you invariably see the links between taxation taht pushes the country further into depression. I see a shit-ton of states running budget deficits (fixing by layoffs and sales/income tax increases), an administration trying to pass some HUGE taxation bills, and a Fed that's wiping all of our asses with our fiat currency. I'm pissed.
on Wed, 08/05/2009 - 15:16
#26237
Big FOMC meeting with a release on August 12. At least one former Fed Governor thinks they're gonna take the opportunity to announce the expiration of QE. As the article notes, QE as introduced is set to expire in Sept, so one way or another that FOMC report is going to make waves.
http://www.bloomberg.com/apps/news?pid=20603037&sid=ayTqng4UbttM
on Wed, 08/05/2009 - 15:32
#26272
Great link, thanx.
on Wed, 08/05/2009 - 15:32
#26273
They are so full of shit. They got every other frakkin' bank out there doing their QE, so who cares what they say.
on Wed, 08/05/2009 - 15:43
#26293
Echo that. Just like TALF was to be wound down, then extended, then the TGLP, the deposits backed, then PPIP. Of course any reduction in the treasury buying will be accompanied by a disproportionate increase in the MBS buying
on Wed, 08/05/2009 - 16:07
#26333
There will be no exiting QE. Unless they really are worried up the stock market bubble they are forming.
on Wed, 08/05/2009 - 23:54
#26809
Agreed, change the definitions of an indirect bidder, send a few hundred billion overseas or to local banks, and a few new Canadian primary dealers and POOF! All is honky dorey.
Then the Fed says, 'we know nusing about zis QE'.
All is wonderful in OZ. It's a beautiful thing.
on Wed, 08/05/2009 - 18:37
#26529
Questionable if it'll actually happen--since little Timmy G. learned he can screw us all, in a compounding sort of way, with a larger release of TIPS (bullshit that the Fed isn't using the same playbook as the administration).
on Wed, 08/05/2009 - 21:55
#26683
Thanks for something on topic. Some of us actually have skin in the game...
on Wed, 08/05/2009 - 15:16
#26238
BENNY'S HAVING A TAG SALE
THE ESTATE IS BEING AUCTIONED OFF
ALL MUST GO
on Wed, 08/05/2009 - 16:42
#26387
Feeling a little bit like Huck Finn...
Tom Sawyer had the chore of white-washing the fence. Tom was a smart kid, so when he saw a Huck Finn come along he saw an opportunity to get out of work. Tom tricked the Huck into white-washing the fence for him, and in exchange for the opportunity to paint the fence, the boy had to "pay" him an apple. Tom tricked other kids too. They all traded something for the opportunity to white-wash the fence. Tom was "rich" and the fence was finished in no time.
on Wed, 08/05/2009 - 15:16
#26239
At this rate we should get 10,000 on the Dow easily. Yee-haw!
on Wed, 08/05/2009 - 15:18
#26241
Some pretty funny stuff in the actual statement. Looks like the Treasury wants to joing the Fed in taking over hedge fund responsibilities.
The presenting member then discussed interest-rate volatility. Both realized and implied volatility remained at elevated levels relative to historical norms, with long-term rate volatility significantly higher than front-end rate volatility. The negative convexity profile of the mortgage market has increased with the QE purchases but it is difficult to hedge the convexity in the current market. This is because there are no natural sellers of volatility left in the market, following the collapse of hedge-fund capital, despite overwhelming demand for volatility from mortgage servicers and originators; this has created a chronic structural net short position in the market place. The presenting member suggested that Treasury, if it wanted to be opportunistic, could potentially benefit from this demand for volatility by offering putable issues.
-EB
on Wed, 08/05/2009 - 15:41
#26289
LOL...
Market manipulation causing excess fear of volatility leads to further market manipulation in the option market?
That is too funny.
on Wed, 08/05/2009 - 16:09
#26340
that's always the result of QE, isn't it? a lot of tail chasing.
on Wed, 08/05/2009 - 15:18
#26242
$77BB using your breakdown but what's a couple BB difference amongst comrades?
In the new everyday math being served up it's a mere bag-o-shells to quote the famed economist Ralph Kramden.
on Wed, 08/05/2009 - 15:18
#26243
AFTER RESCUE, NEW WEAKNESS SEEN AT A.I.G.
By MARY WILLIAMS WALSH
Published: July 30, 2009
The dozens of insurance companies that make up the American International Group show signs of considerable weakness even after their corporate parent got the biggest bailout in history, a review of state regulatory filings shows.
...
But state regulatory filings offer a different picture. They show that A.I.G.’s individual insurance companies have been doing an unusual volume of business with each other for many years — investing in each other’s stocks; borrowing from each other’s investment portfolios; and guaranteeing each other’s insurance policies, even when they have lacked the means to make good. Insurance examiners working for the states have occasionally flagged these activities, to little effect.
More ominously, many of A.I.G.’s insurance companies have reduced their own exposure by sending their risks to other companies, often under the same A.I.G. umbrella.
...
http://www.nytimes.com/2009/07/31/business/31aig.html?pagewanted=1&_r=2&ref=business
on Wed, 08/05/2009 - 15:50
#26308
Oh crap, it's Polly Peck all over again.
Don't tell me, they're involved with a shady bank ...
on Wed, 08/05/2009 - 15:19
#26246
The chinese are up to a nasty surprise when we run out of credit and start all over again with another currency called "Amero". At the end of the day is all worthless paper anyways ;)
on Wed, 08/05/2009 - 15:55
#26319
The new currency will be 1000 old USD. So the chinese will just hold 1B of new currency which will buy them 2 buildings in Manhattan. It is going to be a riot. HA !
on Wed, 08/05/2009 - 16:13
#26348
so will 300 million americans ya dumb ass
on Wed, 08/05/2009 - 17:08
#26423
bhaaa.. bhaaa... That is what most folks know. Slurp the Geber spoon fed by G.E & NewsCorp.
on Wed, 08/05/2009 - 15:20
#26247
there is nothing more beautiful than seeing debt going up exponentially, while employment, tax revenue and GDP are going down in the same manner ... the apocalyptic elegance of a exponentially asymmetric X
on Wed, 08/05/2009 - 18:26
#26520
You understand the graphs, the numbers, the buying of time. I am not alone peering into the abyss and the horror..the horror.
"And then...something happened. I let go. Lost in oblivion -- dark and silent and complete; I found freedom..Losing all hope was freedom."
I love the smell of napalm in the morning!
on Wed, 08/05/2009 - 18:54
#26540
excellent quote my friend. i try to write things down in the most elegant language in the universe, and then just read it like a book. and this downfall which has happened, and which will, undoubtedly happen produced some of the most elegant models, and conclusions i have ever encountered. mathematically, the apocalypse is a beautiful thing.
on Wed, 08/05/2009 - 15:22
#26251
Can some one help me understand how debt servicing work on these. Do they pay out the interest on all of these in feb & aug every year. If a country owns $100 b of let's say of 5 year and the current yield is 2 % note does US actually write a check for 2 billion dollars on August 15 ? Does treasury write that check ?
on Wed, 08/05/2009 - 15:22
#26252
Joseph Stiglitz on Bloomberg: (video in about an hour)
""-A slow, very slow recovery
-Fundamental problem is a lack of aggregate demand e.g. House as an ATM no more
-Length of malaise depends on the Government
-They have dealt with the banks but have not dealt with broader international issues
-US has underspent on infrastructure and technology this needs to change
-how to pay - tax and/or borrowing
-debt versus assets - debt is fine if assets are improving in quality (but that is not the case)
-the way the money was put in the banks was a disaster
-we need to deal with health care from when I was in the Clinton admin in 93
-we spend more and get poorer results
-admin needs to cut defense spending to defend against enemies that don't exist
-4 components of aggregate demand consumption, investment, net exports, gov spending
-that's why I feel pessimistic - savings rate higher
-very low growth e.g. 1% or negative - could have more shocks e.g. CRE, Foreclosures, non-transparent accounting by the banks (we do not know the state of the banks)""
more to come
on Wed, 08/05/2009 - 15:24
#26254
How to manipulate a stock after hours
CSCO expecting .29 EPS on 8.5B Rev.
MW BREAKING NEWS
CSCO Net income .19 on 8.5B Rev
Stock plummets 3-4% in first minute
A minute later
CNBS Breaking News
CSCO EPS .31 on 8.54 B Rev
Stock now up 2%
WTF is with all the goddamn different numbers?
Isn't it about time they give ONE fucking number Chrissake man this is disgusting!
on Wed, 08/05/2009 - 15:26
#26257
Well I for one am through... I feel like daffy duck with his beak on backwards, I'm going all in at Goldman....if they're going to rob the fuckin' country, at least I can get my part of the goddamn take...
on Wed, 08/05/2009 - 15:28
#26263
you greedy capitalist pig *clenches fist*
on Wed, 08/05/2009 - 15:35
#26278
Greedy!?!? Man I got five kids to feed....
on Wed, 08/05/2009 - 15:40
#26288
Time to drive vice tourists around in your taxi..
on Wed, 08/05/2009 - 15:43
#26291
Nice catch.... =]
on Wed, 08/05/2009 - 17:10
#26428
Brunette, athletic, non-conformist, sleazy....
on Wed, 08/05/2009 - 19:48
#26580
Open your mind bitchez.
on Wed, 08/05/2009 - 15:43
#26292
let them eat cake/green shoots
on Wed, 08/05/2009 - 16:25
#26363
You will be Chewbacca'd or chewie'd.
on Wed, 08/05/2009 - 15:38
#26265
-
on Wed, 08/05/2009 - 15:29
#26266
Stiglitz part 2
-stimulus designed poorly
-mortgage program a step in right direction
-most disappointing was the resuscitation of the banks - it's cost billions more than it should have
-money given to the banks on terms that were outrageous -
-Summers, Bernanke and Geithner didn't have a vision they muddled through
-the too big to fail banks are even bigger now
-we are in worse shape than before
-Summers and Bernanke and Geithner have done good work (but are not in my league)
-this crisis exemplifies flaws in the thinking of Central Bankers e.g. focus on inflation while missing the big picture
-monetary theory is focused on wrong concepts - they got it wrong
-this episode bolsters my theories
on Wed, 08/05/2009 - 18:14
#26511
Thanks but we already know all this.
on Wed, 08/05/2009 - 15:35
#26277
75 billion doesnt seem like a big number anymore. Wall Street gave themselves 33 billion. So what's another 42B.
on Wed, 08/05/2009 - 15:36
#26280
Last I heard, the Democratic Party of Japan looks set to unseat in the Liberal Democratic party in T-minus 39 days.
This is significant because the Democratic Party's finance minister has promised it will only fund America the Sunk with Sepukku -- I mean Samauri -- bonds. That is, bonds denominated in yen -- so the currency risk is assumed by the United States rather than Japan.
Ruling Party’s Rural Base Erodes in Japan
http://www.nytimes.com/2009/08/06/world/asia/06japan.html?pagewanted=2&_...
Japan 'would avoid dollar bonds'
http://news.bbc.co.uk/2/hi/business/8046599.stm
on Wed, 08/05/2009 - 15:55
#26318
We're heading for the 'No Fault Default'.
on Wed, 08/05/2009 - 19:31
#26565
Oh man do I hope the DJP wins. I'm looking forward to making my home in Japan again once the LDP goes... Close enough to China but not in, and off this sinking ship.
on Wed, 08/05/2009 - 15:36
#26282
Stiglitz on Bloomberg part 3
-a little miffed that I was invited to the White House on an infrequent basis e.g. they are listening to others
-it's because I am critical of them - those who advise the President don't want to confuse him with other views - they want to shape the info he gets
-their intellectual framework has some flaws
-the admin has missed out by not including me - the bank recovery is not sufficient to spur and economic recovery
-the optimists keep seeing victory around the corner
-now a movement into malaise - how do we move out
-Unemployment is continuing to grow - wages lower - 3 years before recovery takes hold
-labor force growing 1% - productivity 2% - therefore we need growth greater than 3%
-we can't export ourselves out of this
-Bernanke - does he deserve a second term - Bernanke didn't get it right - I think we need to consider a new face eg Yellin
on Wed, 08/05/2009 - 15:44
#26294
Yellen? The locals know her as the dark lord of the flies...
on Wed, 08/05/2009 - 15:58
#26322
What other way out is there than to export?
We cannot depend on 1) being financed by the Chinese or 2) cheap oil for much longer. The Chinese and the oil-producers have their own problems.
At least Joe Biden was up investing in batteries in MI today. That's something, but we can't expect much from investment over a timeframe less than about 3 years.
on Wed, 08/05/2009 - 19:21
#26560
Export to whom? The rest of the world is also in recession; moreover the US lacks surplus resources and cheap labour.
I think the novel idea is: the US needs to live within its means.
on Wed, 08/05/2009 - 15:38
#26283
"we are in worse shape than before"
Boy now that's the understatement of the year!
Bear in mind I'm not a fan of Stiglitz.
on Wed, 08/05/2009 - 15:38
#26284
I wonder when the indirects will realize that sharing needles is risky. Even if the dope goes down real well, until they choke and stop breathing.
on Wed, 08/05/2009 - 15:39
#26285
Why does it feel like this ENTIRE MARKET is being propped up by lies??
on Wed, 08/05/2009 - 15:40
#26287
where are all of those naysayers who said that the usa could not sell 2t usd of debt in a year? i bet they can sell 2.5t with the extra 500b usd to fund fdic credit line.
on Wed, 08/05/2009 - 15:52
#26311
Man, thank goodness we're just going to default on all this debt. I'd hate to think of the pain involved with paying it off.
on Wed, 08/05/2009 - 16:00
#26326
the usa will not default....repayment will occur
whether through dollars, seized assets, or
a pound of flesh.....
defaulting would trigger wars and rumors of
war.....
on Wed, 08/05/2009 - 17:15
#26439
default through inflation. already happening. the chinese can buy a lot less commodities with their toilet paper than they could 5 months ago.
stupid fucks.
on Wed, 08/05/2009 - 17:37
#26465
the inflation trick is very limited....
china has not summoned the usa multiple times
this year because they want to share ancient
chinese secrets.....they have put the usa on
notice that inflation will not be treated
with indifference.....
on Wed, 08/05/2009 - 19:46
#26578
Thanks for getting this. We'll be doing a tight rope balancing act between deflation and growth for years to come. Please tell me you are buying treasuries so I don't feel all alone.
on Wed, 08/05/2009 - 19:49
#26581
yo, adrian.
on Wed, 08/05/2009 - 16:02
#26324
To cover the cost of WWII the United States issued war bonds to it's citizens to help cover the cost.
The only reason I am bringing this is up is because War is supposed to stimulate the economy.
WWII helped to bring us out of the great depression (or temporarily delayed it seeing as we had a pretty bad recession when WWII ended)
We have been at war 9 years. After nine years the U.S wants to DOUBLE it's forces in Afghanistan. What is going on here? It only took 6 years to end WWII. I am assuming this war will continue to be financed by China, but will all the bailouts, and such can we afford to carry out this war ad infinitum?
*side note* Another broken campaign promise by Obama. He promised to bring the troops home not re-impregnate Afghanistan with fresh American bodies.
on Wed, 08/05/2009 - 16:07
#26331
RAND corporation issued a report to DoD last Fall (2008) indicating a war would be necessary to cover the economic collapse. My money is on Pakistan or Iran.
http://aconstantineblacklist.blogspot.com/2008/11/rand-corporation-lobbi...
http://www.wholetruthcoalition.org/2008/10/30/rand-corporation-lobbies-p...
on Wed, 08/05/2009 - 16:37
#26379
With Obama calling the shots there is absolutely no way that America will instigate a war to save wall street.
The Iraq wind-down is underway; Biden has already notified Maliki that we are not going to re-inject ourselves.
If it wouldn't upset the geo-politics of NE Asia we would've already pulled the 2nd Infantry out of South Korea.
Logistics alone probably means that the American footprint in Afghanistan has reached its maximum. I recommend scaling back ASAP. Mission creep must be resisted. Peace Corps efforts in muslim lands is an act of futility.
This hoax almost certainly originates within China. There is a major paranoid faction within the PLA that is always running scare stories up the flag pole: they want yet more funding. It's that simple. Obviously America is the only threat that has ANY credibility with the powers that be in China. Every other power is a joke -- especially Russia -- she's out of men! You can expect to see a never ending chain of war scares coming out of the PLA and the PLAN since they form the basis for more funding.
on Wed, 08/05/2009 - 16:08
#26336
ww2 did not end the depression and whatever
stimulation occurs during war
results in huge dislocations
which materialize in force after the war....
usa fortunes improved a few years
after the war because
the rest of the world was devastated and it had
unhindered access to many foreign markets....
the doubling of forces in afghanistan
is a prelude to a major
war in the middle east related to syria and
iran....has nothing to do with afghanistan....it's
part of strategic envelopment....
the oligarchs have put the usa on a perpetual
war footing after ww2....the war on fake terrorism
is a justification for the murderers of the
plutocracy to extend their powers and bloodshed
on Wed, 08/05/2009 - 16:22
#26360
"the oligarchs have put the usa on a perpetual
war footing after ww2"
Actually---The U.S has been at war since inception. It's very founding was birthed in the womb of war.
If you think about it since developed nations have been around there has always been war with only brief intermitent periods of peace.
I guess my question is. Why not issue war bonds to the citizens instead of having China finance us? It would make more sense to pay interest to our citizens than to pay that interest to China. No?
on Wed, 08/05/2009 - 18:01
#26496
Series EE?
on Wed, 08/05/2009 - 20:17
#26598
Most US citizens don't have the ability to purchase bonds (unless there was a loan program). Do you think the difference between reported personal earnings/personal spending (reported savings rate) really represents savings? Really? It's debt retirement, nothing more. Not to mention that >15% of said earnings are gov't subsidised.
on Wed, 08/05/2009 - 16:35
#26375
I thought Globalization started in the 90's???
Seriously though, war does improve the economy when spent on correctly. The problem with war-time spending nowadays is the money doesn't go to the soldiers, as much, proportionally. It goes to large contractors and gets lost in the Middle East (anyone else remember that?). So it doesn't help those who will benefit the economy the most. I'm sure most of you are trickle-down people. But just as Obama should have spent the stimulus to assist those who were about to foreclose, war-time spending needs to give jobs and money to those who would otherwise not have it. If the spending doesn't attack the problem, it's useless. But whatever. Why am I talking?
on Wed, 08/05/2009 - 17:40
#26468
war does not improve the economy....it typically
introduces massive inflation because it is
financed via fiat currency....the inflation
produces bogus gdp numbers....afterwards the
hangover sets in....
this propaganda about war curing depressions is
evil crap to induce acceptability of war....
wars do not cure economic problems - in fact they
create more of them....no economic problem
justifies war but that is the subtext of the lie
of ww2 cured the depression...
on Wed, 08/05/2009 - 22:19
#26701
you are right 99%, except the inflation part. Wars were inflationary even before we had a fiat currency.
on Wed, 08/05/2009 - 18:41
#26534
What's the argument for Afghanistan? We need to remove the Taliban's cash cow heroin trade. No funding=lower global threat.
Or maybe we just need a real foothold in the area to locate equipment/troops before we invade Iran. Pakistan is out of the question, as their gov't is quietly on our side. Differnt story if the Paki people revolt.
on Wed, 08/05/2009 - 20:43
#26615
They are talking about doubling Afghani military and police forces - not US forces.
on Wed, 08/05/2009 - 16:03
#26330
TIPS are a better investement than nominal bonds.
on Wed, 08/05/2009 - 16:31
#26369
Define normal bonds? Hell, define normal for that matter?
on Wed, 08/05/2009 - 16:55
#26408
1: perpendicular ; especially : perpendicular to a tangent at a point of tangency2 a: according with, constituting, or not deviating from a norm, rule, or principle b: conforming to a type, standard, or regular pattern3: occurring naturally <normal immunity>4 a: of, relating to, or characterized by average intelligence or development b: free from mental disorder : sane5 aof a solution : having a concentration of one gram equivalent of solute per liter b: containing neither basic hydroxyl nor acid hydrogen <normal silver phosphate> c: not associated <normal molecules> d: having a straight-chain structure <normal butyl alcohol>6of a subgroup : having the property that every coset produced by operating on the left by a given element is equal to the coset produced by operating on the right by the same element7: relating to, involving, or being a normal curve or normal distribution <normal approximation to the binomial distribution>8of a matrix : having the property of commutativity under multiplication by the transpose of the matrix each of whose elements is a conjugate complex number with respect to the corresponding element of the given matrixhttp://www.merriam-webster.com/dictionary/normal
on Wed, 08/05/2009 - 16:40
#26383
Until the government starts redefining what inflation is...then they are junk like everything else
on Wed, 08/05/2009 - 16:07
#26335
Hey, a third of a trillion, got to admit it has a nice ring to it
Scary!
on Wed, 08/05/2009 - 16:11
#26346
The message from BO is simple:
Delay the inevitable or else.
on Wed, 08/05/2009 - 16:14
#26349
Unless the Fed/treasury continue to support the long end of the T trade through QE, interest rates will shoot up as investors stop buying long bonds.
the first 300 billion of QE will run out in Sept. They have to add more to the pot
on Wed, 08/05/2009 - 17:12
#26433
Naw.. The Fed will just start purchasing stocks.
on Wed, 08/05/2009 - 19:42
#26575
They are selling a whole 15B in long bonds. The Fed still has 80B left in QE. So it's not a problem now.
Sh*t will hit the fan over the next few years as these < 2y notes need to be recapitalized. Even if the deficit shrinks the auctions will continue to grow!
on Wed, 08/05/2009 - 16:41
#26385
The wall street sheisters give billions to Obama. Obama hires all goldmanites, ram emmanuel, axelrod, shapiro, feldman, barofsky, orsag, berhake, summers, bair, cass summstein to control the monies. They give free taxpayor monies by 27 trillion to the goldman clansmen. this is capitalism? This is Stahlin/Lenins/Marxism/samuelly communism. Death to marxism and all who waged war against Russian Marxists. Praise the dead soldier who fought the russian Marxists. May you all say a prayor for those dead soldiers buried in central europe who fought the Russian marx-menites. May you curse all governments and soldiers who fought for Stalin and his Marx-men. May you curse all government and banks that financed Russian TSalinist Marxists from 1917 to 1945.
on Wed, 08/05/2009 - 17:02
#26414
Dude - Are you stoned are just nuts ?
on Wed, 08/05/2009 - 17:03
#26417
Put down the bong...
on Wed, 08/05/2009 - 17:14
#26437
That must be a bubble.. Must think "Spun" is a Wall Street documentary.
on Wed, 08/05/2009 - 17:02
#26415
Without QE there is not enough liquidity to purchase the Treasuries that Obama wants to sell.
BTW the porkulous spending has hardly kicked in! This tsunami of debt is due to a collapse in tax receipts and August 15.
Any attempt to ramp up middle class taxes during a Depression will have the exact same character as Smoot-Hawley tariffs.
A VAT, in particular, would have the exact same straight-to-the-pocketbook impact: the massive pool of unemployed would be crushed.
Summers' economics already has us circling the drain.
That which would pull us out of the tailspin is not even on the table:
investment tax credits,
permanent tax reduction for the lower and middle classes,
hydro-electric dam construction in British Columbia -- power sold to LA,
conversion of class 8 rigs to CNG ASAP,
mass production of nuclear power -- such plants to be located in mega-buckets in coastal waters with the reactor below sea level,
exploitation of the hydro-potential of Peru, et. al. -- run an international HV DC backbone up and down the hemisphere,
convert coal fired power plants into combine-cycle systems which steam extract coal liquids ( 1 bbl per ton ) before the char is combusted in an open Brayton cycle and Rankine cycle process,
lay mega-plastic hoses along isobaric paths upon the ocean shelf so as to permit the mass transfer of natural gas...
The solution is low cost power supplies, exports and mass production.
Flooding the world with printed money will collapse the currency. Politically mandated spending into that headwind will give us hyperinflation. These conditions establish a run away chain of debasement. Ask Mugabe.
on Wed, 08/05/2009 - 17:31
#26457
Wow what a bunch of new age mumbo jumbo ideas. damming up every river and underwater nuke reactors and tubes capturing natural gas all along the seaboards.. I'll have what you're smoking
on Wed, 08/05/2009 - 20:31
#26607
Think what you will, but this is one way off of the petrodollar recycling pump that has blown bubbles in the US economy for the last 35-40 years.
US Energy needs => dollars to mid east => ME dollars back to US as deposits => deposits seeking risk => loans to US consumer => dollars purchase trade goods (China, lately) => trade dollars buy energy => ME dollars back to US => repeat
At least one broken link in this chain to date...
on Wed, 08/05/2009 - 18:09
#26503
Wow-how are they going to sell those. Looks like the risktrade is on again next week-or crash the market enough to get the prices you like.
on Wed, 08/05/2009 - 20:31
#26605
welcome to the Bear Mountain of the stock market. bears, fasten your seatbelts.
I hope you stupid bulls got some parachutes
on Wed, 08/05/2009 - 23:05
#26742
AND YET,.... the markets didn't crack. Gotta wonder what's going on under the table.
on Wed, 08/05/2009 - 23:24
#26780
Hurry up and buy these. These wont last forever. You might not ever have another chance to buy these. These auctions keep accelerating and they STILL can't keep up with demand. I mean come on uncork this and sell A BUNCH of these so we don't have to wait so many milliseconds to get our hands on them.
on Wed, 08/05/2009 - 23:56
#26813
Anyone check out the Bollinger Bands on the Dow? Like JAWS. They have a wayyyyysss to drop before the black box traders get a crack at it on the downside.
The sell pressure was really tough today, and the SPY gunner was firing like crazy. How long can the ammo last?
on Thu, 08/06/2009 - 00:09
#26828
There is capitalism and then there is everything else. This "crony capitalism" is another term for socialism.
on Thu, 08/06/2009 - 00:44
#26872
nope, fascism ... look it up ..
on Thu, 08/06/2009 - 07:30
#27067
Paper. It's what's for dinner.
on Thu, 08/06/2009 - 07:54
#27090
Point of fact: Of the $75bn in notes and bonds to be auctioned next week, only something like $14bn is new debt. The rest is rolling over existing paper. Likewise, a meaningful portion of the $304bn noted in the post - and I don't know that portion that is off-hand - is actually roll-over rather than new debt.
We love criticism of public officials and others for misreprenting the facts - and I'm happy to do so - but we become rather hypocritical if we do it ourselves. We have certainly issued loads of debt, and there's MUCH more coming. We all know that. Let's just make sure the we get it right.
The two questions I would throw out there for chewing on is whether we're issuing sufficient debt to offset the deficit spending (if not the gov't is manipulating money supply) and how much manipulation there is of the yield curve, which is generally viewed as an indicator of future economic activity.
http://www.rhodytrader.com/is-the-treasury-issuing-enough-debt