The Troubled Global Economy

Nation's Biggest Banks Had Worst Year in 1987 Since the Depression - New York Times

there is a tendency to overhype and compare everything to some previous major event.
"its different this time..." type statements are wheeled out with regularity.

look back to any previous major market crach, and just about everytime, its been "as bad as 1929".

as with trend-following, you wont know if thats true until after its over.

surely, all that is happening, is the over-valuing of wealth is being written down to its true value.
no more tulips for me, thanks, I have loads already.
 
Credit-default swaps were discussed by Jon Moulton in Dispatches- How the banks bet your money, way back in Feb. Unfortunately the program doesn't appear to be available anymore online, but I recall that he did say that British banks were heavily into these, more so than anyone else. With that in mind and the fact that he said that these beasties are far larger a potential problem than the current collateralized debt obligations caused crisis. If they do go into meltdown as the AIG issue may point to, could this be the start of the final act and the start of a depression 30's style? I do hope not.
 
Lightning McQueen said:
Credit-default swaps were discussed by Jon Moulton in Dispatches- How the banks bet your money, way back in Feb. Unfortunately the program doesn't appear to be available anymore online, but I recall that he did say that British banks were heavily into these, more so than anyone else. with that in mind and the fact that he said that these beasties are far larger a potential problem than the current collateralized debt obligations caused crisis. If they go into meltdown as the AIG crisis may point to. could this be the start of the final act and the start of a depression 30's style? I do hope not.
Click to expand...

Lets hope not.

Alex Jones' Prison Planet: The truth will set you free!

Up To 500 Bank Closures Could Absorb FDIC Funds

Patterson warns of 20-25 per cent chance of new great depression this year
Click to expand...
 
Lightning McQueen said:
Credit-default swaps were discussed by Jon Moulton in Dispatches- How the banks bet your money, way back in Feb. Unfortunately the program doesn't appear to be available anymore online, but I recall that he did say that British banks were heavily into these, more so than anyone else. With that in mind and the fact that he said that these beasties are far larger a potential problem than the current collateralized debt obligations caused crisis. If they do go into meltdown as the AIG issue may point to, could this be the start of the final act and the start of a depression 30's style? I do hope not.
Click to expand...

Was this the programme you meant.

“Dispatches: How the Banks Bet your Money” | TV Programme Guide | OnTheBox.com
 
Alex Jones' Prison Planet: The truth will set you free!
Congresswoman: Criminal Insiders Behind Bailout Bill

Rep. Kaptur: Normal legislative process has been shut down, high financial crimes committed, Republican Michael Burgess says “martial law” has been announced

Paul Joseph Watson
Prison Planet
Monday, September 29, 2008

Congresswoman Marcy Kaptur boldly slammed the bailout bill this past weekend as the work of criminal insiders who have shut down the normal legislative process to commit “high financial crimes” and defraud the American people, while Rep. Michael Burgess warns that “martial law” has been declared.
Click to expand...
 
Alex Jones' Prison Planet: The truth will set you free!

Ron Paul: Bailout Will Destroy Dollar, World Economy

Congressman slams Federal Reserve power monopoly on House floor as vote nears

Paul Joseph Watson
Prison Planet
Monday, September 29, 2008

As a vote nears on the $700 billion dollar plus bailout bill, Congressman Ron Paul took to the House floor this morning to warn that the passage of the legislation will destroy the dollar and the world economy.

Stating that the passage of the bailout bill would only make the problem worse, the Congressman from Texas said, “This has nothing to do with free market capitalism, this has to do with a managed economy, an inflationary system, corporatism, a special interest system, and this has nothing to do with the failure of our free markets and capitalism.”

Paul blamed the current crisis on a Federal Reserve power monopoly over the money and credit system, the ceaseless borrowing and printing of money, and dismissed the bill as nothing but more of the same........
Click to expand...
 
The Observer profile: Nassim Nicholas Taleb - the new sage of Wall Street | Books | The Observer

'Banks hire dull people and train them to be even more dull. If they look conservative, it's only because their loans go bust on rare, very rare occasions.' But, Taleb believes, bankers are not conservative at all. They are just 'phenomenally skilled at self-deception by burying the possibility of a large, devastating loss under the rug'.

In his estimation of the scale of the disaster: 'The banking system, betting against black swans, has lost more than $1 trillion - more than was ever made in the history of banking.'
 
  • Like
Reactions: BSD
FT.com / Home UK / UK - Investors start a fresh gold rush
Investors start a fresh gold rush

By Javier Blas

Published: October 1 2008 03:00 | Last updated: October 1 2008 03:00

"Fiat money, in extremis, is accepted by nobody," Alan Greenspan, the former chairman of the US Federal Reserve, told lawmakers in Washington almost a decade ago. "Gold is always accepted," he added.

The "in extremis" scenario was for years only a possibility in the mind of die-hard gold bugs, but the financial crisis is leading regular investors - from the ultra-rich to middle-class savers - to believe that the environment in which Mr Greenspan said fiat money would be worthless is now around the corner.

The investors' response is a rush into physical gold not seen since the second oil crisis in 1979, bankers say. The shift into gold coins and bars is so extreme that it is causing shortages at refineries and mints around the world.

"This is absolutely unprecedented," says Mark O'Byrne of Gold Investment, a company that sells bullion to retail investors in Dublin and London.

Bankers at the London Bullion Market Association's annual meeting in Kyoto say their clients are not investing in gold just because of its perceived safe-haven status but also because they were able to take physical possession of it.

Veterans of the precious metals industry, such as Jeremy Charles, the chairman of the LBMA who is also head of precious metals at HSBC, say they have not seen a market like this in their 30-year-plus careers.

Gold prices surged this week to a two-month high above $925 an ounce, up more than 20 per cent since the collapse of Lehman Brothers. But betting that the investors' rush into physical assets will spur further gains could fail. Current prices are already depressing the key demand for jewellery, and that alone will cap prices.

The gold industry only forecasts a modest rise in prices, with bullion at about $958.6 a troy ounce by November next year, according to the annual LBMA poll.

On top of that, even if the retail investors' rush into gold coins is dramatic and unprecedented, its impact in gold tonnage terms is relatively small, preventing big price gains. But bankers say the price outlook is not the first consideration among those investors more concerned about "wealth preservation".

These new "gold bugs" were pushing the physical market for coins and small bars to its limits, with manufacturers unable to meet demand, LBMA delegates say.

Jonathan Potts, managing director at FideliTrade, one of the main US gold dealers in coins and investment bullion bars, says its firm has not been able to cope with the extra demand for physical gold in the past few weeks. "There is a lot of scepticism, or even distrust, about the financial system and people are running into gold," Mr Potts says. "The US Mint is doubling its gold coins production but there is demand for triple," he added.

Mr O'Byrne adds that key wholesalers have run out of stocks or are imposing quotas for the most popular one-ounce coins, such as South African Krugerrands, American Eagles and Buffaloes, Canadian Maples, Austrian Philharmonics, Chinese Pandas and Australian Nuggets.

"They cannot supply one or 10-ounce gold bars either," he said,
Click to expand...
 
trendie said:
Nation's Biggest Banks Had Worst Year in 1987 Since the Depression - New York Times

there is a tendency to overhype and compare everything to some previous major event.
"its different this time..." type statements are wheeled out with regularity.

look back to any previous major market crach, and just about everytime, its been "as bad as 1929".

as with trend-following, you wont know if thats true until after its over.

surely, all that is happening, is the over-valuing of wealth is being written down to its true value.
no more tulips for me, thanks, I have loads already.
Click to expand...


This is probably going to be worse than 1929. 1987 was a stock market crash.

Wachovia, Lehman, Bear Sterns and AIG all went under in the space of a year. In the UK Northern Rock and B & B went bust and HBOS, the country's largest mortgage lender, is in serious trouble, and could have disappeared but for the ban on short selling. JP Morgan must be wondering how many banks it can buy.

This is not the dotcome bubble bursting or some stock market crash. This is fundamental and it has fundamental reasons that will takes years to fix. The entire economy was based on nothing but stupidly sky high house prices against which everyone borrowed to incredible levels. The banks then bought the mortgages packaged and repackaged as investiment vehicles. These were used as collateral in the money markets to borrow from and lend to each other. It spread like cancer and, once house prices started to fall and people lost their jobs, the banks who for years never had to worry about value had no clue how to price these risky 'assets'.

This is very toxic and needs to get out of the system before the problem can be fixed. Bad times.
 
FXSCALPER2 said:
This is probably going to be worse than 1929. 1987 was a stock market crash.

Wachovia, Lehman, Bear Sterns and AIG all went under in the space of a year. In the UK Northern Rock and B & B went bust and HBOS, the country's largest mortgage lender, is in serious trouble, and could have disappeared but for the ban on short selling. JP Morgan must be wondering how many banks it can buy.

This is not the dotcome bubble bursting or some stock market crash. This is fundamental and it has fundamental reasons that will takes years to fix. The entire economy was based on nothing but stupidly sky high house prices against which everyone borrowed to incredible levels. The banks then bought the mortgages packaged and repackaged as investiment vehicles. These were used as collateral in the money markets to borrow from and lend to each other. It spread like cancer and, once house prices started to fall and people lost their jobs, the banks who for years never had to worry about value had no clue how to price these risky 'assets'.

This is very toxic and needs to get out of the system before the problem can be fixed. Bad times.
Click to expand...

Somebody on TV commented that the bailout
"will be as useful as giving an alcoholic a bottle of whisky."

Well now they also want to chuck in a crate of meths.
 
So right.

This is just the end of the beginning. I think we are going to see years of decline now with a depression as deep as the 1930's. It will take a while to fully unwind. Out of the other end I see China as the new global superpower with America demoted to 3rd behind Russia.

Bad times indeed, mass unemployment, unpayable debt, spiralling social costs and drastically reduced tax income will mean a large proportion of US/UK living in poverty.
 
You must log in or register to reply here.

Similar threads

oiltanker
Frontline Video How the regulations were blocked
Replies
2
Views
2K
oildaytrader
oildaytrader
G
Capital One troubles
Replies
0
Views
1K
godoftrading
G
D
Barack Obama, Buy on the Rumor, Sell on the News
Replies
0
Views
1K
DailyFX
D
D
Sunday Times - Schwatz Indicator
Replies
0
Views
2K
darth trader
D
bankroll
Stratfor Article: Hedge Fund Quits Because of Political Economy - How Does It Affect
Replies
0
Views
2K
bankroll
bankroll
Top