honey ill change... honest i will

hamilton over at econbrowser sees a change in the economy from gloom to neutral

what? neutral?

nothing would please me more than to know i am wrong

hamilton and many other world class economists say the sun begins to shine

but im sorry i dont buy it

----

what has changed???

few if any of the fundamental causes of this breakdown have been corrected

we got to this disaster because we exported jobs and production to lower cost nations

then used the home atm and other methods of borrowed money to buy their goods

we tried to overcome stagnant and falling wages with borrowing

we cut taxes and launched two wars and a prescription drug part d all unfunded

while the asian tigers and ME oil giants were awash with capital looking for a place to invest at a high safe return

our financial giants on wall street and k street deregulated banking and pushed (yes thats right like a drug dealer)

pushed innovative debt instruments and especially derivatives till they came out of our ears

we wallowed in mis-allocated capital (that was borrowed) and prices of homes, commodities and equities etc skyrocketed

then the collapse of counterparty trust in a willey-coyote moment brought the system crashing down

that is the road runner-cliff- notes history of how the shit hit the fan
----

someone tell me, what fundamentals have changed.... (fundamentals)
as the rope, that caught our fall into the abyss, frays

when it comes to health care, remember the maine

americans must be persuaded with fear

100 thousand americans die from medical errors each year

30 thousand in car accidents

less than 10% those numbers in the terrorist attack on 911

after 911 we signed away many of our most precious rights in the bill of rights out of fear that was whipped up by domestic demagogues...wholesale violations of the 4th 5th and 8th amendments for example

health insurance companies regularly ration and deny health care

but the blue dog dems and the repubs have done a masterful job of demonizing government and getting people to fear death panels and gov rationing of health care even tho old people live longer in canada and england and senior citizens in america are glad to have medicare

universal health care will pass eventually...not during good times

but when the country descends into a great depression with 25% unemployment, 100 million without health care and a plague like H1N1 spreading thru the ranks of the poor and unemployed threatening all the rest of the country

fear, fear, is how to sell americans on an idea...remember the maine

what things are fundamental to a prosperous economy
what do we produce as a society and a nation
GD9000, gov reflation aside, the issues are fundamental
we should ask ourselves
are we producing more of the kind of products people want and need,,, and better quality
are we beating back fraud, corruption and criminality.. scourges that destroy business opportunity and a society
hows are trade with other nations
hows our resources base
are we allocating capital effectively so that we invent and create good jobs
i think (guess) the grade we are earning is.......................F
F.......... for........ efffed
seriously effin..... effed dont you think??

oh yeah i left out one biggie
we as a society are in debt up to our eyeballs
other than the above half dozen fundamentals
we have every reason to be optimistic...(snark needle pinned into the red)

outsider
you may well be right...
im terrible at calling the markets
and i come here because most of the people here are much smarter than me about housing, business finance etc
but im learnin and believe im a decent historian and a macro guy
mid term to long term i continue to believe we are in very very deep voodoo
btw
i agree with mel and others that ben, obama and others are trying to save the system because they fear mad max society
and i believe they have been corrupted by the banking oligarchs
whether they are entirely justified about the doom and gloom scenario, im not knowledgeable enuf to know for sure
but
i do believe the" just let it fail crowd" has not fully plumbed the depths of the mayhem that would ensue this time
this would be much much worse than the great depression...again for reasons of fundamentals...
ie,, people are much more dependent today on society and lack skills to be self sufficient

like before the great depression

we have the greatest concentration of wealth in america in one hundred years

the top 1% richest americans own nearly half of all stock, bonds and real property in america

these rulers have been exporting jobs to countries where wages are rock bottom and workers rights and environmental protections are non existent

many americans and their children may be about to inhabit a country where they have no jobs and no health care

btw for those of you who think you have retirement benefits coming...wake up thats been raided along with jobs, and health care

you are about to become serfs in your own country

Money Man

the drama of the town hall meeting will fade
im an old 60s activist
the real umph is to be had by stopping traffic
in 67 behind MLK and other civil rights leaders we marched 40k people down avenue of the americas, across town and to the east side drive of NYC and the riverside church and tied the big apple up in knots all day
total traffic meltdown
when hungry out of work americans clog the freeways with clunkers doing 45 mph and signs on the back saying mad as hell
then the TPTB will get stiff hair on the back of the neck

patient renter wrote
"..."What happens if people get angry enough to stop paying their credit card debt, stop getting that car loan, walk away from the underwater mortgage. J6P can end the game. Don't think he will, but he could...."
---
what happens when many of the 30 million americans who have paid off their houses, no longer have jobs and face being thrown out onto the street by the property tax collector
we have been hemorrhaging jobs for going on a decade or longer and the future looks worse
http://www.ritholtz.com/blog/2009/08/zero-10-year-us-job-creation/
where are the jobs going to come from after the "recovery" where, what sector, what industry

the fdci goldcard

where is FDIC getting the money to cover the losses from taking financial institutions into receivership?

over at bigpicture ritholtz posted a pull from bloomberg indicating fdic outlays in excess of their dwindling account...

scroll down

http://www.ritholtz.com/blog/wp-content/uploads/2009/07/credit-crisis-ou...

no?

what am i getting wrong here

a recent article (may 09) in the atlantic suggested they have an unlimited (kinda sorta) credit line with the treasury

http://business.theatlantic.com/2009/05/the_backdoor_bailout_for_banks_a...

what?

Effective Demand wrote at 12:09 pm
snip
The fed is printing up $1.25 trillion to buy up MBS and 300 billion to buy up treasuries to keep long rates low... Why not take advantage of that to clear up the problem sooner rather than later? TPTB want to use the opportunity to modify as many loans as possible but instead of having one solution, why not have many solutions and lets the lenders make the choice that makes the greatest economic sense?
---
i agree , and
just think, if the fed, treasury, congress, or whom ever had spent the tarp helping all the troubled subprime home "owner"s

they would have had enuf tarp money, (700 plus billion) to outright buy every troubled subprime loan IN TOTAL, give the house to the "owner" for free

and still have had about half a trillion dollars of tarp money left over

---

this is how you know at least (at least) one of two conditions is true

the problem had little to do with subprime
or / and
TPTB are studpid

i think npr is a very good news outlet

but

sometimes....

"Crackdown On Smuggled Guns Hindered By U.S. Laws
mock turtle"


the headline of this article is not supported by the reporting

how do american laws hinder tracking guns???

the gun show loop hole argument is nonsense

heres why (or how)

a us manufactured rifle is seized in mexico

the authorities report the make model and serial number to atf

who contacts the manufacturer, who reports which store or dealer the gun was wholesaled to

the dealer reports the person who bought the fire arm

ok so far?

now the so called loop hole...there is a private transfer from friend to friend or between strangers

cops knock on door, the original purchaser answers and says i sold that gun

the cops say oh yeah, it was picked up at a crime scene, who did you sell it to

at this point the seller better have a pretty good story or he is on the hook as the person who sold a gun to drug traffickers

Sun Aug 2 11:25:47 2009