Over 75 years ago Wall Street Crashed; but today the New Crash is already underway...
- Thread starter SouthAmerica
- Start date
when people find out that there money market funds (2.5 tril. ) is tied up in a derivative somewhere and it's being devalued ( breaking the buck ) watch then . and all that money is just waiting to be invested , right!.
February 7, 2008
SouthAmerica: Here are just a few things to keep in mind.
1) At the end of the day, funding wars it is a very inflationary activity. I have not seen a single person since Michael Harrington in the 1970âs making the connection between heavy defense spending and inflation. In the 1970âs on his book âInflationâ he made the case that the high inflation that we had in the US in the 1970's it was the result of heavy defense spending related to the Vietnam War.
People think that they can piss away trillions of US dollars in defense spending and there is no consequences and a connection to the US economy. During the 8 years of the Bush administration the United States pissed away over $ 4 trillion US dollars in defense spending. (This time is even worse than during the years of the Vietnam War, because during the Bush administration years most of this money has been borrowed from foreign lands.)
This $ 4 trillion US dollars in defense spending represents about 20 percent of the total budget of $ 20 trillion US dollars budgeted for the 8-years of the Bush administration. This includes only the direct amounts related to defense spending that have been disclosed to the public, and if we include the indirect figures that were spent related to defense spending and national security then that figure should be even higher.
It is a lot of money to be pissed away in a very unproductive area of the US economy â and donât forget it is inflationary as well.
I donât know of any economist who is doing research on this area and is trying to connect the dots.
Instead of spending most of these borrowed money to fix the current infrastructure in the United States, and also creating new infrastructure to be able to compete with the rest of the world in the coming years â the US government spent most of this money in wars and did so much damage to the US reputation and prestige around the world that it is almost impossible to calculate in dollar figures the cost of such a fiasco.
2) The United States already has over $ 9 trillion US dollars in cumulative outstanding debt, and the latest budget proposal for year 2009 that George W. Bush just prepared it will guarantee that the red ink it will accumulate at the rate close to $ 500 billion US dollars per year. Who is going to finance this American orgy in the coming years?
This massive Bush administration red ink is assuming that foreign countries such as China have nothing else better to do with their hard earned money than keep sending their savings to the United States year after year to be pissed away and at the same time evaporate in value in terms of currency value and inflation.
3) Americans have grown complacent over the last 50 years and they have not noticed that today the world is changing at the speed of light, and many countries around the world are leapfrogging their economies into the future, as the United States mindset is frozen in the past on the years of the cold war or on its new version that someone has dream up such as "islamo-fascismo" or wherever they mean.
During the latest global transfer of power the rest of the world were saving money for a rainy day, and the United States were pissing away that money as fast the United States could borrow it.
The United States were able to borrow most of this money on its own currency because of the international monetary arrangement that the United States built after WW II. That arrangement served well the United States since 1946, but the world has changed a lot during that period and today it is changing faster than ever before since it is changing at the speed of light.
The international monetary system dominated by the US dollar of the 60 years have run its course and today it is at the edge of the abyss. When the meltdown will start it is anyoneâs guess â but the major central banks will intervene and they will try to interfere with the meltdown process. But at the end of the day, central bank intervention it will not be enough to change the mindset of all the players, because the global monetary system it is much too large, sophisticated, and complex for these central bankers to be able to contain the meltdown with damage control.
4) Today, we donât have many people who had actual experience and remember the Great Depression, and how the entire mess developed.
People are so naïve that they think that today we are immune to such a debacles such as the Great Depression, because we are a lot smarter today than they were in the 1930âs. We even have proof of how smart we are today and you donât have to look further than such fiascos as the savings and loans scandal of the 1980âs, Enron, Worldcom, Citigroup, the Dot.com meltdown, the current sub prime global mess which was created in the US, and so onâ¦.
The pundits and financial geniuses that we have on television programs â they will cheer and they will tell you the sucker how it is always the right time to invest your hard earned money. And most of these people think that there is only one way for the markets to go and that way it is up even when the long-term prospects for the economy it canât justify such a general wishful thinking.
You can bet that as we descend into the new Great Depression â a slow and painful process â the people in such places as CNBC Wall Street shows at every step of the way they will be telling you that we are about to turn the corner and every thing it will be wonderful.
In the meantime trillions of US dollar in Americans paper net worth it will disappear just like smoke.
In a Nutshell: When the global PANIC sets in and everything starts spinning out of control, a lot of things that most people have no idea how they work â the DERIVATIVES market comes to mind â and also including the US dollar based international monetary system is crashingâ¦Then you will find out and will understand what I am talking about.
.
February 7, 2008
SouthAmerica: Here are just a few things to keep in mind.
1) At the end of the day, funding wars it is a very inflationary activity. I have not seen a single person since Michael Harrington in the 1970âs making the connection between heavy defense spending and inflation. In the 1970âs on his book âInflationâ he made the case that the high inflation that we had in the US in the 1970's it was the result of heavy defense spending related to the Vietnam War.
People think that they can piss away trillions of US dollars in defense spending and there is no consequences and a connection to the US economy. During the 8 years of the Bush administration the United States pissed away over $ 4 trillion US dollars in defense spending. (This time is even worse than during the years of the Vietnam War, because during the Bush administration years most of this money has been borrowed from foreign lands.)
This $ 4 trillion US dollars in defense spending represents about 20 percent of the total budget of $ 20 trillion US dollars budgeted for the 8-years of the Bush administration. This includes only the direct amounts related to defense spending that have been disclosed to the public, and if we include the indirect figures that were spent related to defense spending and national security then that figure should be even higher.
It is a lot of money to be pissed away in a very unproductive area of the US economy â and donât forget it is inflationary as well.
I donât know of any economist who is doing research on this area and is trying to connect the dots.
Instead of spending most of these borrowed money to fix the current infrastructure in the United States, and also creating new infrastructure to be able to compete with the rest of the world in the coming years â the US government spent most of this money in wars and did so much damage to the US reputation and prestige around the world that it is almost impossible to calculate in dollar figures the cost of such a fiasco.
2) The United States already has over $ 9 trillion US dollars in cumulative outstanding debt, and the latest budget proposal for year 2009 that George W. Bush just prepared it will guarantee that the red ink it will accumulate at the rate close to $ 500 billion US dollars per year. Who is going to finance this American orgy in the coming years?
This massive Bush administration red ink is assuming that foreign countries such as China have nothing else better to do with their hard earned money than keep sending their savings to the United States year after year to be pissed away and at the same time evaporate in value in terms of currency value and inflation.
3) Americans have grown complacent over the last 50 years and they have not noticed that today the world is changing at the speed of light, and many countries around the world are leapfrogging their economies into the future, as the United States mindset is frozen in the past on the years of the cold war or on its new version that someone has dream up such as "islamo-fascismo" or wherever they mean.
During the latest global transfer of power the rest of the world were saving money for a rainy day, and the United States were pissing away that money as fast the United States could borrow it.
The United States were able to borrow most of this money on its own currency because of the international monetary arrangement that the United States built after WW II. That arrangement served well the United States since 1946, but the world has changed a lot during that period and today it is changing faster than ever before since it is changing at the speed of light.
The international monetary system dominated by the US dollar of the 60 years have run its course and today it is at the edge of the abyss. When the meltdown will start it is anyoneâs guess â but the major central banks will intervene and they will try to interfere with the meltdown process. But at the end of the day, central bank intervention it will not be enough to change the mindset of all the players, because the global monetary system it is much too large, sophisticated, and complex for these central bankers to be able to contain the meltdown with damage control.
4) Today, we donât have many people who had actual experience and remember the Great Depression, and how the entire mess developed.
People are so naïve that they think that today we are immune to such a debacles such as the Great Depression, because we are a lot smarter today than they were in the 1930âs. We even have proof of how smart we are today and you donât have to look further than such fiascos as the savings and loans scandal of the 1980âs, Enron, Worldcom, Citigroup, the Dot.com meltdown, the current sub prime global mess which was created in the US, and so onâ¦.
The pundits and financial geniuses that we have on television programs â they will cheer and they will tell you the sucker how it is always the right time to invest your hard earned money. And most of these people think that there is only one way for the markets to go and that way it is up even when the long-term prospects for the economy it canât justify such a general wishful thinking.
You can bet that as we descend into the new Great Depression â a slow and painful process â the people in such places as CNBC Wall Street shows at every step of the way they will be telling you that we are about to turn the corner and every thing it will be wonderful.
In the meantime trillions of US dollar in Americans paper net worth it will disappear just like smoke.
In a Nutshell: When the global PANIC sets in and everything starts spinning out of control, a lot of things that most people have no idea how they work â the DERIVATIVES market comes to mind â and also including the US dollar based international monetary system is crashingâ¦Then you will find out and will understand what I am talking about.
.
.
February 7, 2008
SouthAmerica: By the way, I started this thread on this forum at this time to serve as a back up to my latest posting at the Daily Kos
Al Gore Wins the 2008 US Presidential Election.
http://www.dailykos.com/story/2008/2/6/22655/20537/997/451570
You can read the posting at the Daily Kos and vote on the Pool.
But I am trying to bring a point across to all these people who are interested in the US political system â the next president of the United States has to be someone of the caliber of FDR to be able to confront the Perfect Storm that lies just ahead.
The Democrats will have a last chance in drafting Al Gore and nominated him their candidate for the November 2008 presidential election. In my opinion, from all the politicians that we have today in the United States only Al Gore has the potential of becoming the new FDR of the 21st Century.
And the United States will need a giant such as FDR to guide the United States through the Perfect Storm.
I hope that the Democratic Party start understanding what is ahead of us and have the foresight and vision and finally make a move to draft Al Gore at the Democratic Party Convention â I am sure that if he is the candidate of the Democratic Party he will win the 2008 election with a powerful mandate.
I also made a connection of my Daily Kos posting to this thread.
.
February 7, 2008
SouthAmerica: By the way, I started this thread on this forum at this time to serve as a back up to my latest posting at the Daily Kos
Al Gore Wins the 2008 US Presidential Election.
http://www.dailykos.com/story/2008/2/6/22655/20537/997/451570
You can read the posting at the Daily Kos and vote on the Pool.
But I am trying to bring a point across to all these people who are interested in the US political system â the next president of the United States has to be someone of the caliber of FDR to be able to confront the Perfect Storm that lies just ahead.
The Democrats will have a last chance in drafting Al Gore and nominated him their candidate for the November 2008 presidential election. In my opinion, from all the politicians that we have today in the United States only Al Gore has the potential of becoming the new FDR of the 21st Century.
And the United States will need a giant such as FDR to guide the United States through the Perfect Storm.
I hope that the Democratic Party start understanding what is ahead of us and have the foresight and vision and finally make a move to draft Al Gore at the Democratic Party Convention â I am sure that if he is the candidate of the Democratic Party he will win the 2008 election with a powerful mandate.
I also made a connection of my Daily Kos posting to this thread.
.
I find it ironic that you post that the US is unaware of what is going on around the globe economically when it that very same activity that assures the US will not suffer the depression you envisage. You are right on about half of what you post and then use those facts to engage in tunnel vision.
I wonder if you think Italy is in the throes of a great depression at the moment? Their debt is 103% of GDP, they can't keep a goivernment going for more than few years at a time (maybe that is what is saving them
), they have huge unemployment in parts of the country, and business is incredibly hard to conduct there due to governement red tape and taxes, unions, and corruption and yet they are not in a depression by any economic measure. The US is in nowhere near such a dire sitaution and its prospects are actually quite good if spending were just redirected toward something that would help the economy grow.
Bottom line is that the US has many many options that it could use to pull itself out of a recession, not the least of which is to reduce defense spending drammatically. Fully haf of the pentagon budget which is more than the budget of Austraila is devoted to new military hardware that has nothing to do with Iraq or Afghanistan. If the US goes back to not trying to pursue an interventionist military foreign policy and spends its money on green energy incubators and rebuilding infrastuture and schools (in a school district near me 30 teachers were just laid off and how much are we spending per day in Iraq?
If we get attacked we just send a barrage cruise missiles next time or some very targeted ICBMs and save both our soldiers lives and our money, let everyone in Iran know that if their nutso president is connected in any way with a terrorist attack on US soil they risk having Tehran wiped off the frace of the map. I would think change how receptive people in Tehran will be to his radical hate speach.
Amadinenads: "Death to America!"
Teran resident: "This motherfucker is going to get us all vaporized, we need to stop him before his big mouth gets us all killed"
I wonder if you think Italy is in the throes of a great depression at the moment? Their debt is 103% of GDP, they can't keep a goivernment going for more than few years at a time (maybe that is what is saving them
), they have huge unemployment in parts of the country, and business is incredibly hard to conduct there due to governement red tape and taxes, unions, and corruption and yet they are not in a depression by any economic measure. The US is in nowhere near such a dire sitaution and its prospects are actually quite good if spending were just redirected toward something that would help the economy grow. Bottom line is that the US has many many options that it could use to pull itself out of a recession, not the least of which is to reduce defense spending drammatically. Fully haf of the pentagon budget which is more than the budget of Austraila is devoted to new military hardware that has nothing to do with Iraq or Afghanistan. If the US goes back to not trying to pursue an interventionist military foreign policy and spends its money on green energy incubators and rebuilding infrastuture and schools (in a school district near me 30 teachers were just laid off and how much are we spending per day in Iraq?
If we get attacked we just send a barrage cruise missiles next time or some very targeted ICBMs and save both our soldiers lives and our money, let everyone in Iran know that if their nutso president is connected in any way with a terrorist attack on US soil they risk having Tehran wiped off the frace of the map. I would think change how receptive people in Tehran will be to his radical hate speach.
Amadinenads: "Death to America!"
Teran resident: "This motherfucker is going to get us all vaporized, we need to stop him before his big mouth gets us all killed"
.
February 7, 2008
SouthAmerica: Reply to Mvic
Today Italy is part of the European Union and the Euroland â euro currency.
And today for all practical purposes talking about Italy and trying to separate it from the European Union it is like trying to separate the economy of the states of Michigan or Louisiana from the United States and the US dollar.
I am sure that today there are many areas inside of the United States that people are already living as if the country had engulfed itself into a deep economic depression.
For millions of Americans who have lost their jobs in the last few years and are losing their house and depleting their savings â these people are already living and going through an economic great depression.
And there are a lot more people going through that kind of experience today all around the United States than the mainstream media and the US government is disclosing to the American public. All you have to do is connect the dots.
.
February 7, 2008
SouthAmerica: Reply to Mvic
Today Italy is part of the European Union and the Euroland â euro currency.
And today for all practical purposes talking about Italy and trying to separate it from the European Union it is like trying to separate the economy of the states of Michigan or Louisiana from the United States and the US dollar.
I am sure that today there are many areas inside of the United States that people are already living as if the country had engulfed itself into a deep economic depression.
For millions of Americans who have lost their jobs in the last few years and are losing their house and depleting their savings â these people are already living and going through an economic great depression.
And there are a lot more people going through that kind of experience today all around the United States than the mainstream media and the US government is disclosing to the American public. All you have to do is connect the dots.
.
99.9% of Italians would disagree vehemently with you in your description of their country. Italy is the Louisiana of Europe? You are likely to incurr an Italian Fahtwah with words like that
There is poverty in the US no question, but there has always been poverty in the US. Is it worse today than it was during the 80's? I don't think so, not by a long shot. If we get back to the levels of poverty AND unemployment there were in the 80s it will be a severe recession but I don't think we will even get there. In general people are much richer today, the opportunity to work even if in a crappy job far more plentiful, than they were in the 80s and things would have to fall a long way to get back there and that was hardly a depression ala 1930s.
Deep Fried: "What a monumental jerkoff."
****
February 8, 2008
SouthAmerica: Your screen name describes what kind of trader you are.
You call me a jerk off just because I am telling you what is in the pipeline.
No wonder your name is deep fried.
The United States will have a reality check in the coming years.
.
****
February 8, 2008
SouthAmerica: Your screen name describes what kind of trader you are.
You call me a jerk off just because I am telling you what is in the pipeline.
No wonder your name is deep fried.
The United States will have a reality check in the coming years.
.
.
February 8, 2008
SouthAmerica: Reply to Mvic
You missed the point that I was trying to make.
I am not comparing Italy with Louisiana.
Let me give you another example maybe you will understand what I am saying.
Here I am quoting from an article of mine published on Brazzil magazine in September 2002 â âCountdown to Armageddon.â
I wrote that article around the time when the economy of Argentina was imploding and that country was going bankrupt â and the Brazilian economy were being affected by the collapse of Argentina a country right next door and an important trading partner of Brazil at that time.
âIn January 1999, the economies of Brazil and of California were very close in size; each economy had a gross national product (GNP) of approximately US$ 1.1 trillion. Today, California still has an economy that exceeds US$ 1.2 trillion, even though energy deregulation went out of control in California and almost bankrupted that state. California faces a budget deficit of US$ 24 billion; a figure that represents almost 30 percent of its total budget. If California were not protected by the value of the U.S. dollar, because the U.S. dollar is the currency of California, then we would have a different story.
California is the largest state economy in the U.S. and the second largest is New York, which is about 70 percent the size of California's. If California were an independent country their economy would rank number six in the world in terms of GNP.
If California had its own currency such as the Real, then their currency would be crashing right now. Their banking system would be in shambles as in Argentina, and Californians would be crawling and begging the International Monetary Fund for a bailout. Interest rates in California would be choking any possibility of future growth, unemployment would be exploding, businesses would be going belly-up left and right and California with all the strings attached from the IMF would be headed to economic meltdown and political chaos.
Since Brazil does not have the same type of protection of its currency, you can see very clearly the result to each economy. In the last 3 and 1/2 years California was able to keep its GNP level even with all the economic adversities they had during that period. In contrast, Brazil lost half of the value of its GNP to about US$ 558 billion and its economy is on a free fall.â
As you can see California was a basket case not long ago.
.
February 8, 2008
SouthAmerica: Reply to Mvic
You missed the point that I was trying to make.
I am not comparing Italy with Louisiana.
Let me give you another example maybe you will understand what I am saying.
Here I am quoting from an article of mine published on Brazzil magazine in September 2002 â âCountdown to Armageddon.â
I wrote that article around the time when the economy of Argentina was imploding and that country was going bankrupt â and the Brazilian economy were being affected by the collapse of Argentina a country right next door and an important trading partner of Brazil at that time.
âIn January 1999, the economies of Brazil and of California were very close in size; each economy had a gross national product (GNP) of approximately US$ 1.1 trillion. Today, California still has an economy that exceeds US$ 1.2 trillion, even though energy deregulation went out of control in California and almost bankrupted that state. California faces a budget deficit of US$ 24 billion; a figure that represents almost 30 percent of its total budget. If California were not protected by the value of the U.S. dollar, because the U.S. dollar is the currency of California, then we would have a different story.
California is the largest state economy in the U.S. and the second largest is New York, which is about 70 percent the size of California's. If California were an independent country their economy would rank number six in the world in terms of GNP.
If California had its own currency such as the Real, then their currency would be crashing right now. Their banking system would be in shambles as in Argentina, and Californians would be crawling and begging the International Monetary Fund for a bailout. Interest rates in California would be choking any possibility of future growth, unemployment would be exploding, businesses would be going belly-up left and right and California with all the strings attached from the IMF would be headed to economic meltdown and political chaos.
Since Brazil does not have the same type of protection of its currency, you can see very clearly the result to each economy. In the last 3 and 1/2 years California was able to keep its GNP level even with all the economic adversities they had during that period. In contrast, Brazil lost half of the value of its GNP to about US$ 558 billion and its economy is on a free fall.â
As you can see California was a basket case not long ago.
.