Market Collapse

[RedOctober]

http://politicalwire.com/archives/2009/0...tdown.html

Quote:On C-Span, Rep. Paul Kanjorski (D-PA) explained how the Federal Reserve told members of Congress about an electronic run on the banks "to the tune of $550 billion dollars" within "an hour or two" last fall. According to Kanjorski, on September 18, 2008 the Fed tried to "stem the tide" by pumping money into the financial system but it didn't work and decided instead to announce an immediate increase in deposit insurance to $250,000 per account to stop the panic. Said Kanjorski: "If they had not done that, their estimation is that by 2 p.m. that afternoon, $5.5 trillion would have been drawn out of the money market system of the U.S., would have collapsed the entire economy of the U.S., and within 24 hours the world economy would have collapsed. It would have been the end of our economic system and our political system as we know it."

People often wondered why we went off the "Gold Standard", long story short, it was about to collapse. But that information was kept "hush hush" until later. Likewise, its only later do we hear the reasoning for the deposit insurance increase and no doubt, sometime down the road we will hear the reasoning for the bank bailouts.

[IV]

So you don't think all of this is to further control (destabilize) the value of the dollar in order to "create" a reason for switching to a new and universal currency that is more stable?

I'm pretty sure this is all being done to hurt the US and not help it. Although it doesn't sound like you believe that. What's your take red?

[RedOctober]

IV Wrote:So you don't think all of this is to further control (destabilize) the value of the dollar in order to "create" a reason for switching to a new and universal currency that is more stable?

I'm pretty sure this is all being done to hurt the US and not help it. Although it doesn't sound like you believe that. What's your take red?

Well, I don't work for the Treasury, Federal Bank, IMF or World Bank so can't say really what they have up their sleeves and they don't volunteer highly sensitive information lest they create a panic and exacerbate the problems.

The flaw in this logic is that virtually every nation will be "borrowing" and therefore devaluing their currency, so in one sense, everyone will still be on equal footing.

To your credit, numerous economist have promoted the idea of a universal currency as it would be far more efficient, eliminate a number of economic problems and help nations increase their standard of living. Even I have to tacitly agree its not a bad idea.

However, as the formation of the Euro showed, easier said than done. Nationalism is a huge barrier to this, plus then there is the question of how the central bank will be managed and who manages it, in other words, who is the most influential nation?

Then of course there are the other problems of trade treaties and borders, they all have to be universal or eventually become universal. If one nation can do a sector of production cheaper than another...the other nation is going to see those jobs evaporate. That's never painless. Thus those who do that job have to be able to transplat themselves to that other nation with few issues.

As you can see briefly, there are huge hurdles to overcome this. But, never say never, a total global market collapse could very well usher in a universal currency and wouldn't doubt for a second that every developed nation's central bank have contingency plans just for this.

Now I tend to get past a lot of the media hype on whats going on currently. The big scare is "Oh no! How are we going to pay for this!!!!!" Never underestimate the power of inflation. The new Treasury Secretary already hinted that they plan on doing just that. Simply print more money and your debts are paid. Sure you have an issue with inflation after that, but believe it or not, that can be managed. Case example was the early 1980's. Inflation was rampant, how did they solve it? Chairman Paul Volkner (Who advised Ronald Reagan....and now Barak Obama) "created" a recession. It made things tough for awhile but it stopped the inflation and stabilized the economy.

Now, this isn't with out a cost either on the political front. The two biggest holders of US debt is China and I want to say Russia (can't exactly remember). By spiking inflation it makes thier "investments" essentialy worthless. I some how doubt they will be buying more US debt. Relations are already strained economicaly as China has been accused by a number of nations of "currency manipulation" and of course Russian-West relations have always been one of huge caution. So there could be some huge issues there, its no surprise that China and Russia have recently signed pacts for closer economic cooperation, there essentialy combining creditor activities. Never follow what the media says or politicians or conspiracist (if people can uncover a conspiracy with ease, then it wasn't a good conspiracy or valid one)....follow the economics and you can see a much clearer visual of whats going on.

If China and Russia don't buy the US debt, then other nations will have to...this is a bit disconcerting. Lets say France buys UK debt, UK buys Germanys debt, Germany buys Italys debt, Italy buys US debt, US buys France debt.....a default anywhere in that chain will be a catostrophe....If that happens, yeah, then you will probably see a push to a universal currency.

Everyone could easily pull out of this global slump doing what they are doing now and we could have a very good growing economy....but that debt isn't paid off all at once and a weak link could bring the whole house of cards right back down again.

Yeah, I'd say this reccession is a bit scary. Most previous reccessions have not had the propensity to become a depression...this one on the other hand does. And you can thank a Republican Congress and Democratic President in the 1990's for repealing all the FDR era banking regulations (as well as all the other nations that followed suit), there erroneas claim that they were unfairly blamed for the Great Depression vis a vi a few crack-pot economist and talking heads who acted like they knew better than economist (i.e. absolute free trade and no regulations is the way!) while ignoring the mountain of ecomomist who said they were.

[RedOctober]

Sounds like Iceland and Ireland could potentially collapse.

http://www.investmentnews.com/apps/pbcs....feed=RSS02

[RedOctober]

IMF is beefing up its ability to loan...makes me wonder what do they know?

http://www.economist.com/finance/display...tures_box1

And of course this line:

"But where such additional funds would come from is far from clear. The fund is not yet considering turning to private markets. Tapping additional resources from reserve-rich emerging countries such as China is a possibility. But this may require the fund to reform its governance structure radically to give these countries significantly more voice in its running than they have at present."

Think I'm going to re-read something from the S&L tonight....

[Pavel]

The real war going on is with the Banks. The owners of the major banks of the world are fighting to collapse the small to medium sized banks. Whoever has control over the money has control over people's homes and lives. Everyone keeps their money in banks. It doesn't matter how much gold you have, at some point people will not trade gold because it doesn't have any real value.

The real value of money is the ability to buy food, clothing, shelter, and other. Whatever can be traded for those commodities is money. However, if a uniform currency is made, no one will be looking at gold as having intrinsic value anymore.

The 4 major US banks: Wells Fargo, Morgan Chase, Bank of America, and Citibank,are the only ones which will likely come out of this downturn. However, it appears that they are causing the downturn, which only benefits themselves because they will be able to buy debt at $0.01-$0.02 on the dollar when they buy up the other banks. When that debt starts paying off, you will see that those 4 banks will have so much value that they will not be stopped.

Whether the world goes onto a single currency or not is irrelevant to the control which the banks have. They don't need to be utilizing a single currency. Rather, they need to have control over all of the money in the world.

The concern that people are essentially implying is that this is the making of a one world currency which is supposedly fulfillment of Biblical prophecy of Armegeddon and all that. The ones controlling all of this know that everyone knows about those prophecies and will not be forcing anyone to take on their system. No one can force 7 billion people to do something; Rather, they have to make the system in such a manner that everyone is accepting of it and that there is no other sensible way to handle things.The breakdown has been occurring since the 1930's in this country with Roosevelt, who insisted that in order to save everyone, we needed to give up some rights. The New Deal was a bad deal, but it was a better deal than bankruptcy of the American economy. We are now hearing that bankruptcy is an option for governments, so Americans are generally scared and are being primed for giving up more rights and following a system made perfect for the Black Messiah to solve all of our economic problems.

The housing crisis has not even come to a head yet. More and more foreclosures will occur, setting up even more banks to fail and more concern about where people will live. The big banks are holding onto the money because they want to see the little banks fail, whereby they want to purchase the debt for pennies on the dollar or to take over everyone's home to the point where subsidiaries of the banks will be renting to each of us. The only real control and only real power is to own your own home outright with no ties or allegiance to any bank. Good luck.

[RedOctober]

Actually...The government could nationalize the major banks, it would be full circle since they technically own the currency. Nationalizing Banks would also mean they own your house twice, one being if they own the bank, they own the mortgage.

The other way...and I have to thank a certain Minister related to my wife in Oregon for bringing this point out to me.....even if you have paid it off, you don't own it. How? The government could use its power of eminent domain and take if for "the public good"....provided they give "just compensation". Next, they tax it. If you fall on hard times and can't pay your property taxes, it isn't long before they take it from you.

But of course the other issue, who owns the government? Treasury demands money and surprise, surprise, they get it. But at the same time they create the illusion that your voting in government and they are listening to there populace and go through the motions of "haggling" when at the end of the day, it really doesn't matter who is in power at the end of the day, the actions would be essentially the same.

The New Deal may have been a bad deal, but on the flip side the other choice was an even worse deal (in some circles, this is when they believe the Banks had a "coup" of sorts over the government and took control). Those who know the Star Wars movies, the Emperor essentially manufactured the crisis in the Republic and since he was behind both sides, he couldn't lose. Who want's to bet that isn't happening now? And I agree more and more rights are being taken away, for example:

Under George W. Bush, your choices are;

1. Expect more terror attacks or...
2. Lose your freedom to travel unabated.

The current crisis that has its roots under the Clintion (D), Newt-Gingrich ® and Greenspan policies and now under a charismatic leader were going to have;

1. Live in shanty towns and wait in food lines or...
2. Give up some of your economic freedoms

All the while the populace is divided against itself into political factions to busy posturing, blaming and condemning each other while not seeing the big picture. Is it no surprise that there are only two viable political parties and laws in place to keep it that way?

On the global scale, you have an economic war going on between the different powerhouses....which sometimes results in being settled in blood.

[RedOctober]

"The banks... have the regulation of the safety-valves of our fortunes, and... condense and explode them at their will." --Thomas Jefferson to John Adams, 1819. ME 15:224

"I sincerely believe... that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale." --Thomas Jefferson to John Taylor, 1816. ME 15:23

"[The] Bank of the United States... is one of the most deadly hostility existing, against the principles and form of our Constitution... An institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this bank of the United States, with all its branch banks, be in time of war! It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile?" --Thomas Jefferson to Albert Gallatin, 1803. ME 10:437

"The monopoly of a single bank is certainly an evil. The multiplication of them was intended to cure it; but it multiplied an influence of the same character with the first, and completed the supplanting the precious metals by a paper circulation. Between such parties the less we meddle the better." --Thomas Jefferson to Albert Gallatin, 1802. ME 10:323

[Pavel]

Red,

Your thinking is inside of the box. Governments are subject to their constituents and have the risk of revolt. Organizations outside of government have more power. Worldwide superBanks are outside of the control of governments. They simply pay lip service to the government.

The direction which the banks are headed is toward bypassing the need for the IMF or a national bank. They will have the protection of a military, because they are the biggest sponsor with taxes, yet at the same time not being subject to government control.

If the government does eminent domain upon homes, it will only cause a revolt. People will just not stand for it, because if it is happening to their neighbor, they will be next. Rather, they will put a fire behind you and a trough in front of you and leave the decision to yourself. You can either go into the fire or be satisfied with eating from a trough of the best that they can do for you, according to them.

It is not an accident that a Democrat took office. The oil crisis was created to demonize Son-of-a-Bush and tolet the Black Messiah in. The purpose was to have a President that makes everyone feel like Mama's going to take care of us, so that we willingly go to whatever he is suggesting.

The political aspect of economics ignores the laws of supply and demand, creating lack of supply with media, creating demand with rumors of unrest. The supply of oil did not go down; the media made people feel unrest. The housing crisis was created by Greenspan in deregulating loan requirements. The issuance of more money on loans was created by the belief that homes will be continuing to go up in value by 20% per month. That is no different than the tulips in Holland back in the day. The value of homes does not go up by that much and the excess was fiat based upon everyone's greed. When the banks went back to the rules of regulation, the fit hit the shan and it was no different than when banks made the margin calls in October 1929.

Using 1929-1933 as a model, I project that the price of homes will go back to the prices in theabout 2001. Your home that you got a loan for $700,000.00 in 2007 will drop in value to $180,000. The average household income is somewhere about $50,000.00 per year, which means that the average household cannot pay any more than about $1500.00 per month for housing. The most value of a home that the average householdcan really afford is about $250,000.00. The latest projections which I have heard was that housing is to go down in value another 25-30% in California over the course of this year.

[RedOctober]

Your missing a very basic economic term called "Panic's" and that's what your are essentially describing. Also something Adam Smith stated was a danger and frequently rears its ugly head in Physiocrat denominated economies...overspeculation.

Yes, there was no shortage of oil....a panic and overspeculation led to its insane rise. Likewise, overspeculation (if purposely or accidentally is unknown) led to the housing crises. I have a hard time believing no one in the top organizations didn't see it coming, unless they trully were blinded by Laisezz Faire ideaology.

Quote:Governments are subject to their constituents and have the risk of revolt. Organizations outside of government have more power. Worldwide superBanks are outside of the control of governments. They simply pay lip service to the government.

The direction which the banks are headed is toward bypassing the need for the IMF or a national bank. They will have the protection of a military, because they are the biggest sponsor with taxes, yet at the same time not being subject to government control.

Your controdicting yourself here, ignoring recent events and missed my point entirely. If the constituents have that much influence, Congress would never have had passed legislation bailing the main banks with tax-payer money. Either the Banks or the people have more influence/control on goverment, which is it? I implied that Banks do since all they did was ask....and they recieved.

The International Monetary Fund (IMF) for all intents and purposes is a bank. Like the Federal reserve which facilitates transactions, so does the IMF http://www.imf.org/external/about.htm

As of time of this writing there is no Global Super Bank. The current economic zones still struggle for dominace over the other.

Quote:If the government does eminent domain upon homes, it will only cause a revolt. People will just not stand for it, because if it is happening to their neighbor, they will be next. Rather, they will put a fire behind you and a trough in front of you and leave the decision to yourself. You can either go into the fire or be satisfied with eating from a trough of the best that they can do for you, according to them.

You misrepresented my statement on eminent domain and ignored my statement with regaurds to property tax. In plain terms, just because you may have hold clean title STILL does not mean you own it. If your property can be taken from you with your full knowledge and without your consent, you do not own it.

Quote:It is not an accident that a Democrat took office. The oil crisis was created to demonize Son-of-a-Bush and to let the Black Messiah in. The purpose was to have a President that makes everyone feel like Mama's going to take care of us, so that we willingly go to whatever he is suggesting.

Oh please, don't make me laugh. Bush's popularity was already tanking long before the oil panic. His attempt at a resource grab in Iraq did not go as smoothly as they all hoped and as a result, his popularity suffered, then you add an unsuccessful handling of an act of God (Hurricane Katrina), there was no rebounding. Had it gone as smoothly and no Act of God, we would have president McCain. As for the current coronatated diety President, oh come on. Like the religious fundamentalist did not do the same for Bush, particularly after September 11th. Politics is nothing more than a country club and the elections only determine who gets to sit in the bigger chair for the next four years. Why do you think concentrate on silly issues on wheather or not they have a flag pin or can't remember the number of houses they own. Remember, they are all co-workers, colleagues and many times, classmates.

Quote:The political aspect of economics ignores the laws of supply and demand, creating lack of supply with media, creating demand with rumors of unrest. The supply of oil did not go down; the media made people feel unrest. The housing crisis was created by Greenspan in deregulating loan requirements. The issuance of more money on loans was created by the belief that homes will be continuing to go up in value by 20% per month. That is no different than the tulips in Holland back in the day. The value of homes does not go up by that much and the excess was fiat based upon everyone's greed. When the banks went back to the rules of regulation, the fit hit the shan and it was no different than when banks made the margin calls in October 1929.

If it ignores the laws of Supply and Demand then it wouldn't be a law. Once again what you are describing are panics, and the market aberations that go along with it. And some profit off this because they know despite the panic the underlying circumstances are the same. A lot of faceless capital companies made plenty of money on the spike on oil..and they got out just when the economic circumstances caught up to the panic.

Sorry, it wasn't just Greenspan, but Clinton and Gingrich controlled Congress as well. They repealed the Glass-Steagal Acts and claimed the "Banks could regulate themselves" as it was in thier best interest to survive. All the while ignoring the blatant fact that the Banks had no need to worry as they have become so enormous and vital to the economic system, thay should they fail, the government would have to bail them out. Either way the emperor wins.