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All these numbers will go negative as european banks scramble to delever. ECB's three year loans give them time to get their balance sheets in order and they will be forced to do it. Perfectly rational on a bank by bank basis but ugly for the european economy.
I WARNED about this REPEATEDLY, but was ignored and mocked by the zerohedge readership. We are facing the biggest collapse in aggregate demand in history and its time for central banks and governments to GET SERIOUS. We need BOLD monetary and fiscal stimulus programs to get people spending again or we risk a total cedit collapse and decimation of peoples' equity porfolios. Do you people realise how much exposure US banks have to Europe? Do you realise how leveraged their balance sheets are!? The world is crying out for LEADERSHIP and all we are seeing is indecision and impotence.
We have had bold stimulus, albeit to the wrong people, and it has not stopped the collapse. It was baked in the cake a decade ago and it's too late. The central control of interest rates is a dismal failure. The authorities have only two choices, a deflationary depression or an inflationary depression. I vote for deflationary, at least my savings will be worth something. But what I want is irrelevant, we will have the latter, triggered by what is happening now.
Buy PMs now (or soon) and be patient.
I agree with you there. The one thing that the powers that be are fully aware of is that inifinite growth is the only thing that will keep the debt based money system moving. Bold moves by the central banks or not, the outcome is guaranfuckingteed, as infinite and exponential growth are completely impossible. Death of currency by inflation or death of currency by deflation - the death comes either way.
It really is that simple. So why do so few people grasp this? Over the holidays my best friend from HS stopped by my parents house with his 16 YO step son. There are about 8 of us engaged in this conversation (what is money, what is debt based money, what does it mean, etc.). About 5 minutes into the conversation the high school junior says, "so money is debt with interest... it must grow exponentially". I wanted to cry. Non of the adults got it.
this discussion is very important and widely ignored. not only that but much of the investment world is based on growth at an accelerating pace. we are a hungry, overpopulated finite world running out of clean air and water. rock and a hard place.
"The central control of interest rates is a dismal failure"
This is simply false. Our Federal Reserve has managed to keep interests rates at record lows despite this economic turmoil, which is a remarkable achievement.
In that case, let's control all prices. Then all prices can remain low and we can all live like kings!
The world is not black and white. You have to accept the value of price controls or you are simply an extremist/purist. There is a time and a place for price controls, and a time and a place for liberty. Purist libertarians need to understand that THERE ARE NO UNIVERSAL PRINCIPLES.
Funny but that is exactly what some jack boot is going to be saying to you with his boot on your throat.
i have read the term jack boot for years and never known its real meaning. thanks to our information revolution i, in seconds without moving my wide ass, found out it refers to boots that are "jacked" or reinforced with chain mail to parry sword blows. my new fave has wings like a late fifties/early sixties u.s. car's tailfins to protect the knees. used by cavalrymen.
the term is later used for the hobnailed, iron heeled german infantry boot where we get into the door kicking down/neck stomping mentioned above.
I am not a purist. I am pragmatic. You are only supporting price controls for one item. Please tell me what other items should have price controls. The "time for price controls" (I assume we are still discussing interest rates) apparently has been almost 100 years now.
You know as well as I that price controls of anything reduce production. The reduction of production of capital leads to depression and destroys banks (obviously).
Stupid is a UNIVERSAL PRINCIPAL.
The fact that we were manipulated rather than educated is a UNIVERSAL PRINCIPAL.
The fact that ill founded policy will eventually fail and that many will suffer is a UNIVERSAL PRINCIPAL.
The fact that almost all people follow and that very few are independent thinkers is a UNIVERSAL PRINCIPAL.
The fact that all leaders and schools of thought will eventually be found wanting is a UNIVERSAL PRINCIPAL.
The fact that people falsely assume that thinking about their beliefs is thinking is a UNIVERSAL PRINCIPAL.
The fact that people live in their status quo, that they don't see beyond that status quo and that they don't know that they aren't seeing that which is beyond is a UNIVERSAL PRINCIPAL.
This is just a start. We should not expect to see UNIVERSAL PRINCIPALS from within a status quo.
I intend no personal malice in this rant. I am simply not happy with a world that raises us to be blind.
This is remarkable too. Watch me type....
Yes, and lets not forget the $244 plus TRILLION in derivatives on the banks books. Financial bets sitting on the table 20 times greater than all the money in the world markets. If even a fraction of these collapses, the next crash will be game over. Read the chart on page 24
Office of the Comptroller of Currency
OCC Quarterly Derivatives Report Q1/11
Godzilla is at our door, and all the politicians think they can get away with painting its toenails.
RIGHT MDB! Got to get people SPENDIN again!
Might I suggest buying more 'Forever Lazy's'? Cant ever have enough of those 'consumer neccessities', hell look at the thing, dont even have to take it off to take a dump!
BUY MORE FOREVER LAZY!! Save the WORLD BANKSTERS! FOREVER LAZY COMMERCIAL - YouTube
Forever lazy....this would be a good slogan for a campaign on going braless.
After my recent trip to Florida, I'd have to say that would be a mixed blessing. The older ladies would lap it up, the younger ones not so much.
I just gots me 5 of dem sets for da hole family!
So in terms of monetary policy, what do you recommend? If we create more credit, we assume more future debt issuance. If we increase the debt, the affect of real growth (GDP) will be decimated by the increase in taxes to fund the debt, and interest on the debt.
Taxes do not have to be increased, as we can simply borrow the money. Interest rates will not rise for two reasons:
1. China depends heavily on our consumption of their exports and so they must conitnue to finance American spending
2. Our Federal Reserve is able to buy our government's debt and bid up treasury prices, which is also known as quantitative easing
1. China and Japan are actively dumping the dollar (alongwith Russia) and creating trade agreements that do NOT depend on the dollar.
2. Fed buying government debt and treasuries is a game of pass the buck. Interest rates cannot remain low forever. At this point in the game a small incremental increase of interst rates will push debt/GDP ratios up like the EU.
Taxes will be increased on the people through higher prices of goods because of cost-push inflation created by QE. Borrowing money from oneself is impossible to keep going forever. I can't see how taking money from the left hand and passing it to the right hand will make me whole while the debt still remains and grows.
are we certain that mdb is not teasing us?
I am short, actually, so not everyone minds current developments!
But why should people go out and buy crap that they don't need. Why do you have to have an apple 4s when you already have a 4. It is ridiculous. And guess what, no amount of money sloushing around is going to get people to do that. That mentality is over. The whole system needs to reset. The bankers will try to inflate and do what you say but people won't buy in to it. The next result, a brutal crash and high inflation. I am so close to pulling the trigger on silver I can't stand it. The only thing stopping me is that it looks like it will go down more. It's incredible. The PMs will be one of the few things standing at the end of the day in a couple years.
the world is crying out for leadership?
milliondollarbonus, Germany had people just like you just after WWI.Does Weimar ring a bell?
You can't dig your way out of a hole.
Europe is collapsing under it's own socialist weight. Europe and America have kicked the can as far as it will go. Time to pay the piper.
You're mistaken. Weimar wasn't a failure in itself. The fact that Germany had to bleed dry to pay the bankers who made the war loans killed Germany financially. The only way out for Germany, then so called Weimar Republic was to print and pay the bankers with diluted shit.
We could all live well and prosper if we took the bankers out behind the wood shed.
I have also warned REPEATEDLY, but also ingored, that there is far too much credit and debt, and an asteroid full of CDS' flying above our head. Bold leadership would outlaw CDS's. Drastically bring down credit, and have debt haircuts. Only then will the world enter a new era of peace, harmony and progrogress.
But seriously, why call it Money Supply? It's Debt supply.
In fact, between those two words, both the Eu's and the world's problems lie. Supply side greed and debt-money.
Try this experiment. Call your cash Debt Notes. And your Credit Card a Debt card. I suggest that a sharp slowdown in spending might ensue.
Hwo will you pay for that?
a. With my debt card
b. With Debt notes
Changes everything. Relaguaging Debt into Credit and Money have left us blinded to their real meaning.
Gets even worse if you look at a "paycheck" and realize that you are being paid other people's debt for your time and energy.
Maximilien François Marie Isidore de Ro...
... con usual lo tec hw.
I think within the next 3 months there is going to be 1 week where the Euro will lose 800 pips + and it still wont be the bottom. I will look to cover around the 1.10 area
No way for Ben to print unless Oil drops to 60-70 dollar range. Bens got one more year in office then Ron Paul kicks his ass out and hopefully charges him for treason.
Unfortunately, knight99 , that will only be the situation in a sensible world and, as we are all aware on ZH, we live in frickin' Bizzarro world.
What will, more likely, happen is that the current POTUS will be re-elected and keep Helicopter Ben in because of the 'marvellous' job that he's been doing so far.
Of course lending is collapsing. Who the hell is going to expand a business [or start one up] in an environment where the entire social order is collapsing thanks to the idiots in charge? Europe is a basket case of regulations that hassle business to death. Fuck you technocrats.
You are exactly spot on, small business that drive employment are either slowing, shrinking or outright closing on purpose. They are tired of fighting the up hill battle of fraud, corruption, regulation, law suit's, margin squeeze, cost of business etc.
All this fine central planning has created a fine environment to do business in, "Hope, Hope and Change" you will go broke in.
I could not imagine trying to run a business over there.
It is tough enough to merely ship something INTO the EU.
Now where did I write down that harmonized code..........................
Help defeat NDAA :
Try this link:
http://www.whitehouse.gov/webform/comment-legislation?billname=H.R. 1540 - National Defense Authorization Act for Fiscal Year 2012
It's more direct.
Edit - oops, wrong issue...
What is to be expected when politician's whose only real expertise is selling themselves for votes are controlling something they know nothing about?
They refuse to balance their books, which most households are capable of.
They hire "expert" consultants who are really manipulating for their own gain as people forget that Goldman helped Greece hide their true financial status when they entered the Euro.
This whole system needs an overhaul as we cannot continue to allow ourselves to be led by incompetence and self interests.
there's nothing wrong with banks, both European and American, that can't be easily fixed with a few gallons of gas and a match.
alien-IQ , with the price of gas what it is at the moment ...
Maybe a couple boxes of matches and some old newspapers. :-D
Yeah let's not go around wasting some fine gasoline now.
any real assets look cheaper and cheaper when you read these!
Petroplus told this story 2 days ago
Dang! ANOTHER centrally planned central banker money printing FAIL?
Well....guess theyll just have to try that yet AGAIN!
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