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Alan Greenspan: "The Financial System Is Broke"
For the definitive confirmation that the Fed is and has always been very open to, at least philosophically, pushing the market higher no matter what the cost (if not in practice - they would never do that, oh no, Liberty 33 would never stoop so low), is this quote from former Fed chairman Alan Greenspan who was on Meet The Press earlier, where he said the following stunner: "if the stock market continues higher it will do more to stimulate the economy than any other measure we have discussed here." In other words, the Fed's dual mandate of maximizing employment and promoting a stable inflation rate have been brushed aside, and the one and only prerogative for Chairman Ben currently, and for the short and long-term future, is to keep the Dow Jones (because nobody in the administration, even the Fed, has heard about the S&P yet), above 10,000. Yet Greenspan, who now apparently is off the reservation concludes with this stunner: "There is no doubt that the federal funds rate can be fixed at what the Fed wants it to be but which the government has no control over is long-term interest rates and long-term interest rates are what make the economy move. And if this budget problem eventually merges to the point where it begins to become very toxic, it will be reflected in rising long-term interest rates, rising mortgage rates, lower housing. At the moment there is no sign of that because the financial system is broke and you can not have inflation if the financial system is not working." In other words, we will be in deflation until the broke financial system becomes unbroke... and then we will have hyperinflation.
Well, ladies and gentlemen, Q.E.D.
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Bring on Systemic Failure, then let's rebuild from an honest base.
Re: then let's rebuild from an honest base.
Where would this "honest base" come from? Why would the really smart amoral scumbags - that currently exist, and own everything - simply "give up control" now?
What the "nice people" never seem to have an answer for is: If the system is run by sociopaths NOW why would the NEXT system be any better?
NOTaREALmerican
Pour yerself a nice warm bath, and don't forget to take a razor in with you.
The current amoral scumbags are running around like a one-armed paper hanger with crabs.
Like the Berlin Wall, all the signs are there, and yes, I know I sound like a giddy optimist.
this is a must read if you need to know how to spot them. psychopaths do gravitate towards those positions.
http://www.timesonline.co.uk/tol/life_and_style/article826475.ece
It's really funny--count on the optimists to look for the next system to "improve" things when we know "we" will be in the same spot at the end of that system, too.
Nothing "stays" better: you take what you can while you can--then get out before it comes crashing down--that's the way life works.
So, I say keep dreaming, you'll be sure to trip over something soon enough.
Greensperm to a "T"! My guess is Harvard Business School, The Chicago School boys, et al. all "Excelled" at the readings of Macheavelli.
I suppose it is more than anything a measure of my despair, but I'm of the same mind. Yes, I know that the French Revolution disposed of a corrupt regime only to fall victim to worse, but I'm willing to chance it now. In France the vast majority of the population was illiterate and uneducated. Not so in the USA, although we are trending in that direction, and have been for decades.
Re: Not so in the USA, although we are trending in that direction, and have been for decades
Do you actually think that anything like the constitution could be written again in modern America? There's nothing that Americans have in common, other than being united in our dislike of each other.
Besides, China has the only form of government possible for a society in a huge country with huge corporations and a very wealthy nobility. As long as you're in the top 5 or 10% you've got nothing to worry about.
I believe "let them eat cake" seemed a trifle inadequate when Marie's head was in the basket.
Touche!
I just can not accept that a man who has done so much damage to our republic as has Greenspan is still invited on major programs to present his opinions. One you're in the ruling class, there is no act of incompetence so large that you are no longer a member.
Remember what Obama said, when just in office:
"We will do everything to get the system back".
An I am sure he means with the word "everything" "EVERYTHING"!.
Throwing the administration under the bus was a nice touch too. There's an interesting positioning going on in DC now. Someone needs to take the blame for QE 2.0 and the Fed is not going to let it fall on them.
Obama hasn't attacked Iran and the Zionists are no longer supporting him. That's what the positioning is.
People, please calm down. Our solution is not that complicated. We need competing stock markets/exchanges. Its a question of when, not if. This is where I hope China gives zerohedge a billion to open a real market exchange.
What's the Chinese symbol for High Frequency Trading?
There you have it, fight for America, buy stock !
Isn't this the guy who liked Ayn Rand, the Jewish Nazi? the same guy who never actually got a Ph.D. in economics? the nutjob corporate whore weirdo?
Guess I'll pass on paying any attention to what he says.
Ayn Rand was a Jewish Nazi? Who knew?
I love how people who call for less government interference in people's lives are called "Nazis".
Alan Greenspan was once a good and honorable man, but he was utterly and irreversibly corrupted by the Fed. You are right in passing on paying any attention to what he says, but you would do well to heed the words of Rand. Also, I would tend to avoid paying attention to people who DO have PhDs in economics.
Re: but he was utterly and irreversibly corrupted by the Fed
OR, perhaps the other way round? Jeeezzz. He was a libertarian that fell into THE most powerful institution in the world. He realized that the nobility - the owners - throw better parties, and that the "righteous sword of libertarian justice" was just a childish fantasy (like the rest of the "isms" when applied to the smart amoral scumbags that live in the real world and run everything).
Back off Ayn Rand. She was just a sweet kid who saw what Communism wrought first hand. Did that make her a bit testy at times? Sure it did but she ain't no Nazi.
Here's my favorite interview with her as a tough old broad who never pulls a punch. But she actually comes off as quite the darling in this clip from Tom Snyder's Tomorrow show.
http://www.youtube.com/watch?v=4doTzCs9lEc
This is part one of a three part video. In the third part she says that it's good that America is moving right (circa 1979) but that the conservatives show no intellectual leadership. But she has hope for her country because she believes that the people will rise up and save it. Tea party, anyone?
i remember at my first communism i drank all the wine and the guy in the dress got pissed.
As long as you didn't let him touch you in the vestibule.
i honestly can say i had to cheat to pass my first communion. i wanted it so badly, wrote stuff on my hands.
That's why they have Confession...to catch communion cheaters!
Check this interview by Rand:
http://www.youtube.com/watch?v=2uHSv1asFvU
Racial hatred...check.
Racial supremacism...check
Willingness to commit genocide...check
Yes, you can call her a Nazi with good reason; but her hypocritical modus operandi -clothing moral particularism in grandiloquent narratives of human liberation- is typical of her Judeo-Bolshevik confrères, not the straight-shooting Nazis.
I'll pass on paying attention to you too, snapperhead.
Isn't this the guy who was calling Quinn a rayyycist or Smokey or sumpin?...ROTFL.
STFU and die already, Magoo.
The real question is how does the system get unbroke?
Answer: by investing all future spending in wealth creating activities. It goes without saying that past and current malinvestments must cease. Stop the foreign wars, the bloated military, bribes and subsidies to monopolies, bridges to nowhere, tax relief for failure. Simplify the tax code, the legal system, streamline government, bust the trusts and monopolies, reward success not failure. Tighten consumerist belts and invest in new technologies, in energy, transportation, agriculture, mining, manufacturing.
Re: The real question is how does the system get unbroke?
It's NOT broken. It's working perfectly for the noblity. You are asking the wrong question expecting the correct answer.
The correct question is: How do you (Americans) get rid of the huge number of sociopaths that are infesting your political system so that you can get the loot back from the nobility without resorting to a revolution (which would simply lead to offical fascism).
The sociopaths won't "give up".
Simple; every individual close out all financial accounts. Stop playing the game created for the nobility by the nobility. That act alone would change the face of the world over night. The wealth of the world will be brought back to the people from whom it was stolen.
Re: Simple
If this was really "simple" it would have happened over the course of history. The US is the way it is because of all the past events (say over the last 70 years) that got us to this point. It's the concept called The Anthropic Principle as applied to societies.
The odds of the American peasants doing ANYTHING other than worshiping their dumbass myths of greatness (slow motion eagles and flags) AND being pissed off at "those people" is practically nil. The last social revolution you guys had was the civil rights movement and the anti-Vietnam war movement, and most REAL Mericans haven’t gotten over either of these events.
Nope, the financial system you have is exactly what Americans have been voting for, for the last 70 years. American don't want to think, they want mommy (socialism) or daddy (fascism) and all they (the peasants) do is fight over which "ism" the nobility should give them (the Red Team or the Blue Team of the Republicrat Party). The nobility is now laughing all the way to their TBTF banks.
As somebody else on here said. Americans are now just interest batteries for the nobility's banks. Most Americans have no idea.
the financial system you have is exactly what Americans have been voting for, for the last 70 years. American don't want to think, they want mommy (socialism) or daddy (fascism)
We haven't been given any other choice. We've been forced to chose between the (so called) lesser of two evils over and over again. But we're catching on.
One lump or two?
I'm from Massachusetts, give me three!
What you don't realize is that a line will be drawn. This has always been the American way. A time will come when out of nowhere millions will rise up and be heard. The awakening is happenning now and these posts are a testiment to this awakening. American have always been the silent angry giant and when it's people are stirred then the world and the nobility better run and run quickly. Unfortunately, for them there will be no place to hide.
We can start by taking out $500 from our ATMs on Thursday August 12.
I had forgotten that ZH is read widely overseas too. Sorry! If you guys "over there" are as pissed off we are, then go to your ATMs and take 500 Euros, or 50,000 Yen.
I could have quoted any of your posts today, and recently - so this is arbitrary, NOTaREALmerican. . .
you're pissed off. I like it. really hope you're contagious.
++ for keeping it REAL.
Who is this "Not a real american" to give advice to America? Go back to old Europe.
I realise you're not a real American but that was a real American thing of you to surmise.
We're only going to save basic foundations of this paradigm once we decide we have to change over. We certainly shouldn't save Too Big to Fail as the backbone of our economic independence.
The second correct question is: shouldn't we sieze the assets of "the nobility" in order to pay for rectifying this mess? The obvious answer is, "Of course we should."
I don't see any other way to resolve these matters other than to get loud and to get personal. The elitists will be called out and they will slowly crawl from the shadows. These next twenty-four months should be very interesting.
There will be no need to go after them in torchlight with pitchforks and mules. Just wait. It'll be better than J-Lo moving to American Idol!
"the nobility" will have the bulk of their wealth removed from this country and the dollar at the first sign their game is up. They did it in Weimar Deutschland and they'll do it here. The difference could be rapid way information travels the internet, they didn't have that in the twenties.
So, how do we recognize them? $100 manicures? Silk suits?
And somebody that worked all their life to build a business from scratch that employs thousands of people and always did the right thing gets the the guillotine with the evil scum bags just because he/she has money? And where do you draw the line Mao? You have a full pantry you evil hoarder, maybe we should redistribute everything you saved to your neighbors to make it fair. You people scare me. Enforce the f...ing laws and make it a crime to not enforce the laws and you may have a chance. Other than that we are just going to trade one master for many masters.
I hear you and agree yakmerchant.
People want to blame regulation or lack of regulation when the actual regulation was never applied.
A Republic without the Rule of Law is no Republic.
Law must be adhered to and justice administered when it is not. Humans have no chance without law. Unless there is no private ownership because manufacturing is so advanced nobody is in need of anything...not likely to happen.
fut fut fut fut fut fut FUT FUT FUT FUT FUT... wait here comes Ben in his Helicopter dropping sachs(heehee) of Hundreds.
how does the system get unbroke?
answer : when the level of debt outstanding (public + private) has been reduced to a level where it is collateralized acceptably to the surviving creditors.
That means when approx. $60 trillion worth of debt in the OECD has been either paid back, liquidated, or restructured adequately.
There is no way around it. Investing in new technologies is all fine and well, but how do you invest when you are broke?
double post
I wonder how many calories a USTB contains?
Bills, 100; Bonds, 450
Without the Sauce
Naturally high in fiber!
http://online.barrons.com/public/article/SB120917419049046805.html?mod=m...
Good 'ole Alan Greenspan.
After 2001 crash and 9-11 everyone was urged to spend and take out home equity loans and other forms of easy credit to save the economy.
Then, from late 2004 to 2007 he ramped up the funds rate from 1% to 5%, crushing people who had answered the call to be "patriotic" and debt spend for the sake of the economy.
Lots of money for the banks on the front end as ARM's and Equity loans ramped up monthly due to FED raising the target rate, and making money hand over fist securitizing the loans and selling them to pension and other funds.
Oooops.
They can't raise rates now because of the political climate and the hobbling housing and commercial real estate markets. The banks are simply getting nearly free money at the FED window to loan out at 4.5%-29% and lowering any rates for CD's or savings.
So...the banks are doing well, the government can print and monetize ad infinitum, but the household has to delever. This will be followed by more "stimulus", more quantitative easing, higher taxes on everything, a burgeoning deficit, and finally the "need" to institute a VAT tax, income tax rates, and the FED funds rate.
It will be the Jimmy Carter 1970's all over again, with the whiplash of inflation, stagflation, or hyperinflation bleeding out the assets of the responsible household to feed the hegemony of the Washington/Wall Street elites and the entitlement poor and privileged elites in monied urban areas and cities.
Pity the dying middle class that just wants to make a decent wage, pay their bills, save for retirement, and sit down to dinner at home with a meal they cooked and paid for.
The middle class will eat humble pie as long as the ruling class
puts the screws on slowly. And then tighten them slowly, slowly.
No abrupt movements....slowly.
No sudden changes, slowly....
You see, America living in tents and they have no idea what happened.
Re: You see, America living in tents and they have no idea what happened.
Sure they know what happened: "Those people" did it to them.
The "those people story" has been working for 50+ years now. No reason it will stop working now.
Like a boa constrictor. Every time you breath out, your chest contracts a little. That's when they tighten the coils. Eventually you cannot breathe in anymore.
I think they should let us shoot up on some of that good ol' early '00 American Dream stuff every now and then, we'll love them for it.
As long as they let us remember "what we had" and fool...well...fool most of us into thinking that it could ever be a possibility again, then we'll do whatever it takes.
They do it with enough finesse and we'll be at the point where we'll pledge allegiance to a pile of shit and still hope for the better.
That sounds about right. We got the government we deserve because we allow it. We are the government. A government for the people by the people. People? Who are the people? Where are the people? The people have been convinced that they can't change it. What? That is the lie they want you to believe. It is our government to govern ourselves according to the will of the people and not the will of the few Judices with all of the silver.
When the people find that they can vote themselves money, that will herald
the end of the republic. — Benjamin Franklin
Respect for religion must be reestablished. Public debt should be reduced.
The arrogance of public officials must be curtailed. Assistance to foreign
lands must be stopped or we shall bankrupt ourselves. The people should be
forced to work and not depend on government for subsistence. - Cicero, 60 B.C.
"We have all been here before!" -CSNY
Dont blame Jimmie, it was Volker who instituted 12% mortgage rates as I recall.
those comments should be good for 200 points tomorrow, no?
This Guy is a bundle of laughs .............. even though the costs of the essentials you need to buy are going up .......... it can,t be inflation ............ because the financial systems broke ............. a total and utter nut job ............ Obviously they need a mechanic to fix it.
"if the stock market continues higher it will do more to stimulate the economy than any other measure we have discussed here."
Wanna put your cart before the horse again Magoo?
Come now Mr. Magoo, you know full well the markets serve two purposes, price discovery and capital formation nothing more nothing less. That is unless you are talking about the two tier Ponzi eCONomy then well I guess you could be right. But we had hyperinflation in the ponzi eCONomy for 3 decades, time now for hyperdeflation. Get this guy a corner and a dunce hat he's ancient history.
God, I heard that too.
Reinflate, reinflate = bail, bail we're sinking !
Re: Wanna put your cart before the horse again Magoo?
While I (a peasant) agree with you, let's look at this from the point of view of the elite nobility (shall we). Greenscam is simply saying that the top few percentages of the population (the worthy who own everything) will - by virtue of being more wise - will choose to stimulate the economy by their future wise investments. This is just trickle-down-economics. And at least half of the peasantry believes this (generally these peasants defend the nobility's "right" to have all the wealth - and vote accordingly).
Willie, why do you rob banks? Because that's where the money is.
There's only two solutions. The wealthy have everything. You can take it from them and redistribute the wealth (the game-over, reset button option). OR, you can keep the existing system going and spew the bullshit that the very wise nobility will guide this great and glorious nation - as it has for the last 70 years - to more glory and greatness. That's the only options left. Greenscam - being a sycophant of the nobility - will (of course) spew the "worship the nobility" bullshit.
Is it me or is this place turning into communist central? Workers of the world unite? I used to like this website.
i can't believe this guy is in my face everytime i turn around.......What a joke...obviously the next year will be life changing for everyone......
Magoo really thinks this ramp-job in the Dow from 6600 to 10,500 has done anything to help this busted economy the past 16 months ? Senile moron !
Nope! A sycophant of the nobility that owns the country. What else would a smart amoral scumbag be? He's just saying the trickle-down-economics will work, but we've got to give it some time.
A sycophant of the nobility that owns the country.
And owns your country too. Go back to whatever backwater hellhole you came from, and deal with your own problems.
Its broke for the middle class, small businesses, and small banks. Corps and WS banks are flush with cash.
"At the moment there is no sign of that because the financial system is broke and you can not have inflation if the financial system is not working."
In other words, we will be in deflation until the broke financial system becomes unbroke... and then we will have hyperinflation.
I think what he may have inadvertently said is, . . . The Fed is unable to fix this, unable to introduce re-inflation - because the financial system is not functioning to the beat of Keynesian models. I believe the reason is because the amount of (defaulted) debt that must be "worked through" the system is order of magnitude greater (perhaps hundreds of trillions) than anything available - to the Fed
That is bullshit
The more people and companies go broke, the less taxes the government has to service the debt. When the debt cannot be serviced, the dollar and treasuries will sell off and the value of the dollar will plummet.(INFLATION)
Looks like I have a new caption to add to my line of free zerohedge posters.
"Greenspan: Market is broken"
Check it out here - click 'all sizes' to get a high-rez download.
http://www.flickr.com/photos/tradertim/
C O O L ! !
He said that the market is "broke", not broken. That is all to clear.
No, what the liar meant to say is the FED is Broke!
So...
I was sitting on my couch thinking about Alan Greenspan (lol) and I decided to read about him. And something occured to me about how disinterested, and out of touch people have become about this country. Bear with me... Quick Quotes by Jefferson: "The central bank is an institution of the most deadly hostility existing against the Principles and form of our Constitution. I am an Enemy to all banks discounting bills or notes for anything but Coin. If the American People allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the People of all their Property until their Children will wake up homeless on the continent their Fathers conquered." "If we run into such debts as that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our callings and our creeds, as the people of England are, our people, like them, must come to labor sixteen hours in the twenty-four, and give the earnings of fifteen of these to the government for their debts and daily expenses; And the sixteen being insufficient to afford us bread, we must live, as they do now, on oatmeal and potatoes, have no time to think, no means of calling the mismanagers to account; But be glad to obtain subsistence by hiring ourselves to rivet their chains around the necks of our fellow sufferers; And this is the tendency of all human governments. A departure from principle in one instance becomes a precedent for a second, that second for a third, and so on 'til the bulk of society is reduced to mere automatons of misery, to have no sensibilities left but for sinning and suffering...and the forehorse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression. " -"Here was buried Thomas Jefferson, author of the Declaration of American Independence, of the statute of Virginia for religious freedom, and father of the University of Virginia. " Epitaph of Jefferson at Charlottesville, Virginia, written by himself, 1825. -Greenspan was the recipient of the inaugural Thomas Jefferson Foundation Medal in Citizen Leadership, presented by the University of Virginia.Awesome piece of writing. Obviously timeless. Thx Bob
TJ was the man.
He also questioned the notion of generational debt, believing the earth belongs to the living and that generational debt was evil or at least un-natural. That a family, or a nation for that matter, was not responsible for debts incurred by the dead.
From a letter to James Madison Sep.6, 1789;
"The course of reflection in which we are immersed here on the elementary principles of society has presented this question to my mind; and that no such obligation can be transmitted I think very capable of proof. I set out on this ground which I suppose to be self evident, "that the earth belongs in usufruct to the living" that the dead have neither powers nor rights over it. The portion occupied by an individual ceases to be his when himself ceases to be, and reverts to the society. If the society has formed no rules for the appropriation of its lands in severalty, it will be taken by the first occupants. These will generally be the wife and children of the decedent. If they have formed rules of appropriation, those rules may give it to the wife and children, or to some one of them, or to the legatee of the deceased. So they may give it to his creditor. But the child, the legatee or creditor takes it, not by any natural right, but by a law of the society of which they are members, and to which they are subject. Then no man can by natural right oblige the lands he occupied, or the persons who succeed him in that occupation, to the paiment of debts contracted by him. For if he could, he might during his own life, eat up the usufruct of the lands for several generations to come, and then the lands would belong to the dead, and not to the living, which would be reverse of our principle."
Caveat emptor China...you have been warned ;-)
Who junked Thomas Jefferson?
Makes you want to weep.
The last comic standing and its on Meet the Press no less.
The old SOB coming around full circle. Too bad it took 35 years to make a 360. He has literary reading time on his hands now, must be pulling Ann Rand works off the bookshelf and giving the covers a dusting.
I wonder how much soul searching he does after coming to the realization that he was the major contributor to the "broke financial system"
+100
"I wonder how much soul searching he does after coming to the realization that he was the major contributor to the "broke financial system""
You are assigning to a sociopath the charateristics of a functional human being.
He doesn't give a fuck.
http://www.youtube.com/watch?v=Ocj8Zj3UMs0
Picture Alan with his boys Rubin and Summers (The Committe to Save The World) throwing they hands in the air singin Lil John like they just don't care!
Re: I wonder how much soul searching he does after coming to the realization that he was the major contributor to the "broke financial system"
If - we assume - the US has been run by sociopaths for the last few (many) generations then Greenscam - being a sociopath - wouldn't have any concept of what you said. And the rest of the sociopaths wouldn't either. The smartest amoral scumbags run the country. And "smart" does NOT mean just intellegence. Greenscam, like the rest of the sociopaths, is VERY smart and has an infinite amount of duplicity.
Greenspan is the poster boy for the effects of 1) high verbal intelligence and 2) amoral tribal values (strong in-group/out-group dichotomy). The American was a merely a tool with which to make wealthy his peers.
It's like that scene from The Matrix, where Morpheus tells Neo about how humans were turned into a battery. The American has been turned into an interest-paying machine.
Sméagol / Gollum?
+1
Sméagol / Gollum?
Let's hope we make out like Bilbo rather than Déagol.
No, just some stupid kid fucking around with his first chemistry set. The experiments were blind attempts at understanding the universe without a working formula.
He's probably had time to listen to Andrea on CNBS and whereever and come to the conclusion (sitting in his bubble bath in the morning) ... 'Hey, that ain't right.'
- Ned
For some reason my comment above #498757 shows as one parapraph but it's actually 7 paragraphs and it's pissing me off because it won't let me fix it.
bob-did you piss off the captcha thingie too? Too many digits? You'll have to post to reply to me or someone else, since after a comment, can't edit.
- Ned
"There is no doubt that the federal funds rate can be fixed at what the Fed wants it to be but which the government has no control over is long-term interest rates and long-term interest rates are what make the economy move. And if this budget problem eventually merges to the point where it begins to become very toxic, it will be reflected in rising long-term interest rates, rising mortgage rates, lower housing. At the moment there is no sign of that because the financial system is broke and you can not have inflation if the financial system is not working." In other words, we will be in deflation until the broke financial system becomes unbroke... and then we will have hyperinflation.
are you kidding me? the fed has control of long term interest rates, they give the money to the PD's. how do you think they have gotten by all these years in this bond bull market. just another trick out of the book. all this does is prolong the problem until one day it doesn't.
IF the budget problem becomes toxic?
Oops, China PMI number is out and shows slowest growth in over a year.
http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=a0weX1WSMB74
Lot of people were waiting for this ahead of Monday...
He should know he's the asshole that broke it
Do you mean "the man who sold the world."
Moved.
sniper teams and smart bullets. Hunt the bastards down just like the israelis went after the nazis. Entirely appropiate. For what they have done to so many for so long, and all those dead and injured in fabricated wars for profit. Our sons and daughters still die to this day on foreign soil for no reason but profit.
"If the stock market continues higher it will do more to stimulate the economy than any other measure we have discussed here?"
Good, Lord. Does that mean that our future is in the hands of high frequency traders?
Get to work, damnit.
Now listen up all you slavoradors!! greenspank may have cut your left foot off to keep you from running. Let's see if we the people allow goon gov to cut off our right foot!! We're not entirely hobbled DIMMS=dumb ignorant mental midget sheeple!! http://main.fknnewz.com/blog/?p=1488 Run Tobie run! Profane times we're in!!
Greenspan-- to this day-- still doesn't understand the limits to Keynesian applications to monetary policy.
He made a huge mistake in 2000 by not only letting interest rates get too low, but allowing the finanical system to lever up and keep the real estate ball rolling to cover up the damage from the Internet bubble.
The financial system IS broke, and no amount of pumping the equity markets is going to fix it. Nothing regarding ZIRP and QE is going to fix it either. The finanical system will REMAIN broke as long as the goverment continues to intervene.
It's impossible to believe that Greenspan can't come to that conclusion after all that time to "reflect". Senility must be a really wonderful thing when one hits their 80's...
Is it me or is this really Woody Allen playing an economist ?
Personally, I've always thought it was more like Mr. Magoo, but without the glasses and just as blind (at least publicly)...
broke as in broken?
broke as in pennyless?
or broke as in
weakend or destroyed in spirit or body
@bugs
My thoughts exactly. Greenspan chooses his words carefully, and this is intentional doublespeak. Could this be his veiled support for QE2?.
+1
broke = nobody wants to finance your future needs = you have too much debt and nobody wants to lend you more = (private + public) debt / GDP can't grow = broken because the system works when and only when the level of debt outstanding is growing in relation to its output...
This will never work, Alan. Total Bank Credit faultered as the exponential curve it rose in was about to "pop". (http://research.stlouisfed.org/fred2/data/TOTBKCR_Max_630_378.png) In terms of debt service, we're talking a theoretically infinite drag on growth. No wonder the economy faltered.
Look at Commercial and Industrial Loans. Perfect parabolic curve on the peaks and troughs with increasing amplitude. (http://research.stlouisfed.org/fred2/data/BUSLOANS_Max_630_378.png) As this is essentially a reflection of a sector's creditworthiness, we can conclude that there WAS in fact potential for further real economic expansion at levels such that it could service the additional debt post-recession. How is output supposed to recover, much less rise any higher, when the rate of credit expansion, and thus the growth in the cost of servicing said debt, is "approaching zero"? Rise/Run, Greenspan. Figure it out.
Look closely at Alan Greenspan---
do you see.....
Bernie Madoff?....
Perhaps Americans should look closely at all the glorious leaders for the last few generations.
What would they see?
Perhaps the entire society is sociopathic. That would explain why the leaders of the Red and Blue Teams of your single Republicrat Party are all like Bernie Madoff too; sociopaths.
Are you suggesting that ponzian economics is somehow bad? As the ponzians themselves would say, it was never really applied in the first place!
"The financial system is broke"
Does he mean "broke", as in having no money?
Or does he mean "broken" as in not functioning?
I think he intended to mean it both ways, otherwise he would have used the word broken, and not broke.
My theory always has bin from the beginning Deflation -> (Hyper) Inflation -> Deflation.
MY CALL: DEFLATION STARTED 01/16/09 http://forum.prisonplanet.com/index.php?topic=80429.msg455348#msg455348
Some economist don’t even wonna talk about “Inflation” when it’s the “normal” 2-2.5% inflation in the FIAT system.
Every coin went down against gold. Gold reached 1100 again February 15, 2010, 02:57:25 PM
There's a reason the show is known as Meet the Depressed.
Hahaha, if you can't smell what the Fed is cooking these days, then perhaps even professional wrestling is too complicated for your liking.
That's our problem with nuts having taken over the asylum!! Nixon! I'm not a crook! In his own mind he wasn't and clear through to greenspank! My fiscal policies were right for the U.S. people when I made them, in the mind set I made them!! You can't call it financial psychobabble now, with scrambled eggs sweeping coast to roasting our monetary system!! greenspanks job was cracking eggs and it's our resulting reality job to swallow the cooked books; I mean eat our current financial food; however we the people see it currently!! Thing about the masters of disasters in the fed goon kitchen now is the cooking is taking place for a far worse future. We accepted greenspanks monetary illusion of cooking up what he knew is a mess, and current cookers now know will be a complete meltdown financially in the future!! Vote out all inscumbents nov 2! That's if the cooks haven't burn't down the U.S fiscal kitchen by then!! Perhaps no ingredients left to give rise to maintaining status quo!! Former cement workers as greenspank have it all solidified to former actions coming and reaction of such dousing all arm chair economists lookin back with 20/20 drowning us in sewage!! Should have stopped the sewage pumpers back then!! 20/20 hind sight!! Lets vote the inccumbents out nov 2 to terminate a future pain of terror fiscally!! We need rid ourselves of rat basturds now and not look back in a year and think governing goons should have gone out under 20/20 hindsight; knowing the results of greenspanks disastrous reign!! Act now or shut up when we melt down!! No 20/20 hind sighter's claiming to fame after the fact with I told you so! We've got plenty of words to save us fiscally but little action!! Currently a vote for true freedom is getting honest money!! The more ounces you retain in your hands physically, of real money gold/silver, the more opportunity we the people have to rebuild into the future!! Go with a bird or ounces of gold/silver in we the peoples hands now is of greater future worth in rebuilding a certain collapse of our current paper ponzi paper system!! Vote for real future change in an honest money system for America by accumulating real money for a time it will rebuild our nation!!
Re: Lets vote the inccumbents out nov 2 to terminate a future pain of terror fiscally!!
Dude, the country has been voting for the same two teams of the Republicrat Party for how-long-now? At least 50 years? What do you expect to change if you replace the Blue Team with the Red Team (and then back two years later) if both teams are owned by the nobility that currently controls the government?
Christ! Americans have been voting the same way over and over and over and over and over and expecting some sort of magic to happen. There's no magic. You keep voting for sociopaths.
There's other political Parties with candidates. It's not like voting for them is throwing your vote away. Voting Republicrat is throwing your vote away.
Just vote for change in a future honest money system!! Gold/silver is a vote for change and the bankster gangsters have always used it 1st; then compelled a nation to change if a currency collapse didn't rank'n file'em!! Can't storm the vestiges of a megalomania gov goon leadership!! goons no how to deal with civil disobedience!! It's a helpless feeling in the political skunks works go round!! I know it's difficult to get a clear drink from a polluted fountain!! Just accumulate what gives political pariah power and then hope we have enough with accumulated gold/silver reserves among we the people to leverage that rat basturd pack of elitist neoCONoplian goons out of power! Not even firing a shot!! It's possible if we the people prepared in a united way as the goons are to slavorade us all!! Will it happen!! It can among we the people who still know right from wrong and desire an honest monetary system! I don't like watching the district of corruption abusing honest tax paying citizens any more than the next rank'n filer! Maybe the constitution can only be redeemed by blood!! Lets try keeping wealth in the peoples hands 1st and should the goons kick down our doors with unwarranted search and seizure than I know what I'll do!! How about you? Got a plan?
Any bonds today?
Bonds of freedom
That's what I'm selling
Any bonds today?
Scrape up the most you can
Here comes the freedom man
Asking you to buy a share of freedom today
Any stamps today?
We'll be blessed
If we all invest
In the U.S.A.
Here comes the freedom man
Can't make tomorrow's plan
Not unless you buy a share of freedom today
No matter what I post, some a-hole junks me.
Must be a-hole envy!
and it burns my ass.
Looks like you asked for it... in a way, sort of, kinda like.
Put the tits back up and see what happens. Though I do think this one fits your name better.
In the eighties he enabled Social Security to become the biggest Ponzi scheme of all time.
In 1996, he was 4 years early before his Irrational Exuberence showed up and when it did in late 1999 and 2000 he was afraid of Y2K which the world had already been solved in a massive tech refresh. So at Nasdaq 5048 (3/10/00) he was far too late to put on the breaks...
In 2005-2007 he somehow missed the inner workings of the massive real estate fraud that was taking place. My favorite that he must have missed was the WSJ cover story on how illegal immigrants were being openly courted in some states for mortgages.
Time to play shuffleboard and PSTFU as his comments are 30 years too late...
"Irrational exuberance" This has to be one of the stupidest expressions ever coined. In the first place, the word exuberance is misused. Exuberance is what occurs when you have a bunch of kids innocently horsing around and laughing their heads off. Now try to imagine Rubin and Gramm trashing Glass-Steagall or Blankfein and Dimon plotting to use financial bubbles to scam the middle class. That's exuberance? Got to admit, I detested Greenspan when everyone thought he was a god. It is his lack of education that shows the most in his convoluted Fed-talk. He really is a stooge who has twisted himself into a pretzel to toady to the upper class--basically a clown who ran the economy into the ground to compensate for his alienation and vapidity as a human being. That's the problem with our fourth branch of government being untouchable and unaccountable. It attracts those who need affirmation--Bernanke being the present wretch--and who will assume the position to get it. No doubt Bernanke is a follower of Ayn Rand or Mary Baker Eddy, or some other nutty "philosopher" who saw everything clearly at the age of two and a half.
DOW futures have magically jumped above 10500 on open.
Take a look at that dollar:
http://finviz.com/futures_charts.ashx?t=DX&p=m5
Ah yes, the McNamara legacy ploy... excellent analogy.
In this case I wonder if he is insane enough to be thinking that if just pushes us over the cliff here (to Bernanke's horror, I guess) then all the poort stewardship in his tenure will be little shits in the corner... Its called insanity.
They were fast to remove remarks on the stock market. It has been clipped and edited...and stock market remarks disappeared.
really?
could be worse...
http://www.russian-jokes.com/political_jokes/guest_lecturer.shtml
"Former Federal Reserve Chairman Alan Greenspan just told a Congressional committee examining the financial crisis that neither he nor subprime mortgages for poor borrowers caused the worst recession since the depression.
He did say that over his career he made an "awful lot of mistakes," but rated his performance "right 70 percent" of the time and "wrong 30 percent."
When asked if the recent financial crisis was one of the times he got it wrong he responded, "I don't know."
http://newsblogs.chicagotribune.com/marksjarvis_on_money/2010/04/greensp...
Thanks for that Al.
I don't know either Al, but here's an idea, how about the banks holding 30% loss reserves instead of 10%!!!
As knukles say's...primal scream.
This guy had been knighted after performing all what he was required to do over the years.
That means more pumping stocks.... let's get it on!
Is it broke or broken?
How many economists do you know who could make a payroll?
His book "Age of Turpitude" was quite good. Did someone else ghost write?
FED speak is death by a thousand cuts.
Give me one fact I can use. Please. Just one.
So the FED controls the FED funds rate, well when?
How is an over valued equity market going to stimulate the economy? and exactly in what relation to the stimulus and government spending already in place?
What about the FEDs ability to control credit? How about controlling in towards small business.
Mark Beck
Somewhere today (or....was it yesterday?) I read about the divergence of the two 'economies'. There are the large cap companies that are off shore, their business is global and their job opening are also off shore. And then there is the 'real' economy of the small businesses that are within the U.S. boundaries and make up the lions share of employment.
Add to that the 'quote stuffing' that is occuring with HFTs and how they can now target a particular stock and by running quote request drive up the fake volume numbers AND the price of the stock.
So the end result is big companies get pumped up by HFT and 'boy howdy the stock market is doing fine'.
Now...how does this stimulate MY economy? Uh.....uh......uh.....hmmm....
Oh here it is...Guest Post: A Tale Of Two Economies
Wait a second. 80% of the trading is done by robots owned by rich traders, and the general public has left the stock market.
Then, who will benefit the most from the stock market going higher, and why is that so very important for the country?
we'll all be hfting soon...
http://globaleconomicanalysis.blogspot.com/2010/07/high-frequency-programmers-unhappy.html
Interesting. Perhaps the programmers will make programs that squueeze their former employers, and the algos will start canibalizing each other. I love a happy ending.
QED. That is what I call a classy ending.
TD, you have just demonstrated the theorem "Market Manipulation". Well done.
Look, voting will do nothing. The fascist are not stupid. They didn't bribe the republicans or democrats. They have bribed them all. Why take a chance of your man not getting in office. Just bribe both major candidates. One solution and one solution only and this is for the american people to shut them down overnight. Stop buying, Stop Selling, Take all our money out of the institions who have bribed our government. Stop paying taxes. What are they going to do put the entire country in jail? Nope, it will crumble and the people will rise.
"Take all our money out of the institions who have bribed our government"
NB: if everybody tried to do this, they'd only get a few cents on each dollar they've got saved in those institutions.