Here is another development in the ongoing economic depravity, China moving to sell off and not purchase more T-bills... I am not sure whether this trend will continue, or if it is just a provacative move to induce real "change" in our financial policy, man the irony is astounding here..
"A decision by China to reduce its US Treasury holdings suggests concern about the US attitude towards its economic woes, Chinese economists were quoted as saying in state media Wednesday.
The remarks, coming after US data showed a modest decline in Chinese investments in US government bonds, were in contrast to an earlier statement in Beijing which had said the recent sell-off was a routine transaction.
"China is implying to the US, more or less, that it should adopt a more pragmatic and responsible attitude to maintain the stability of the dollar," He Maochun, a political scientist at Tsinghua University, told the Global Times.
According to US Treasury data issued Monday, Beijing owned 763.5 billion dollars in US securities in April, down from 767.9 billion dollars in March.
It was the first month since June 2008 that Beijing failed to purchase more US T-bills. "
Wednesday, June 17, 2009
Tuesday, June 16, 2009
Federal Reserve Feels the Surge of New Power
Federal Reserve to gain power under plan
"The Federal Reserve, already arguably the most powerful agency in the U.S. government, will get sweeping new authority to regulate any company whose failure could endanger the U.S. economy and markets under the Obama administration's regulatory overhaul plan.
The final plan due to be released on Wednesday -- which originally aimed to streamline and consolidate banking and securities regulation in one or two agencies -- now is expected to sidestep most jurisdictional disputes and simply impose across the board standards to be applied by all financial regulators, according to administration and industry sources.
The most likely candidate for elimination is the Office of Thrift Supervision, whose failure to detect and forestall problems at Countrywide, IndyMac, Washington Mutual and other freewheeling mortgage lenders is thought to have contributed to the financial crisis.
The decision to concentrate sweeping new powers at the already overstretched Fed is not without controversy. Sen. Christopher J. Dodd, chairman of the Committee on Banking, Housing and Urban Affairs, which must approve any regulatory overhaul, has raised objections to that approach, and so has Federal Deposit Insurance Corp. Chairman Sheila C. Bair. "
And then my man-crush financial homeboy Timmy Geit chimes in: ""What we're trying to do is focus on the things that were at the core of the problems we saw in the crisis," said Treasury Secretary Timothy F. Geithner at a Time Warner Economic Summit in New York on Monday."
""When you have too many people involved, there's an accountability problem," he said. "At the core of making the system stronger is to give one place in the system clear accountability, responsibility and authority for preventing future crises."
The problem with Geit's stance, is that it is exactly backwards. Preventing future crises is impossible, unless they ceased to exist and stopped inflating the money supply into total worthless oblivion. Thanks for the inflationary depression.
"The Federal Reserve, already arguably the most powerful agency in the U.S. government, will get sweeping new authority to regulate any company whose failure could endanger the U.S. economy and markets under the Obama administration's regulatory overhaul plan.
The final plan due to be released on Wednesday -- which originally aimed to streamline and consolidate banking and securities regulation in one or two agencies -- now is expected to sidestep most jurisdictional disputes and simply impose across the board standards to be applied by all financial regulators, according to administration and industry sources.
The most likely candidate for elimination is the Office of Thrift Supervision, whose failure to detect and forestall problems at Countrywide, IndyMac, Washington Mutual and other freewheeling mortgage lenders is thought to have contributed to the financial crisis.
The decision to concentrate sweeping new powers at the already overstretched Fed is not without controversy. Sen. Christopher J. Dodd, chairman of the Committee on Banking, Housing and Urban Affairs, which must approve any regulatory overhaul, has raised objections to that approach, and so has Federal Deposit Insurance Corp. Chairman Sheila C. Bair. "
And then my man-crush financial homeboy Timmy Geit chimes in: ""What we're trying to do is focus on the things that were at the core of the problems we saw in the crisis," said Treasury Secretary Timothy F. Geithner at a Time Warner Economic Summit in New York on Monday."
""When you have too many people involved, there's an accountability problem," he said. "At the core of making the system stronger is to give one place in the system clear accountability, responsibility and authority for preventing future crises."
The problem with Geit's stance, is that it is exactly backwards. Preventing future crises is impossible, unless they ceased to exist and stopped inflating the money supply into total worthless oblivion. Thanks for the inflationary depression.
Thursday, June 11, 2009
Very Curious Japanese Bond Holders?
"Japan secretly trying to divest out of their US debt?"
"Two Japanese nationals were detained by Italian financial police last week after trying to enter Switzerland with $134 billion worth of undeclared U.S. bonds, mostly Treasury bonds, an Italian daily said Wednesday. The Japanese consulate general in Milan confirmed that the detention had taken place and said it was trying to confirm with Italian authorities whether the two were indeed Japanese nationals and their identities.
According to the report in il Giornale, two unidentified Japanese in their 50s concealed the bonds, including 249 U.S. Treasury bonds each worth $500 million, in a suitcase with a false bottom that was searched by the Italian authorities June 3 when they were in Chiasso, at the border with Switzerland, about 50 kilometers north of Milan. The daily did not say on what charges they have been detained, but the two may have been detained on suspicion of attempting to take a large amount of securities out of Italy without declaring it because the paper said they had not declared the bonds.
This is very significant news, because, as Michael Barnett writes in an email, one of the following must be true:
1. The Japanese are trying to secretly divest themselves of about 25% of their US debt. (They own about $600B in US debt.)
2. The Japanese are acting as Chinese or North Korean agents in trying to help them divest themselves of US debt in secret.
3. There is an enormous sum of counterfeit US debt out there and these guys are trying to sell some of it.
None of these cases bodes well for the US debt market."
Very very curious happening...Along with Russia also whispering of moving away from U.S. debt, Chinese students laughing at my man Timmy Geit, and HR 1207 coming up, the fed appears to be in hot water? check it out.
"Two Japanese nationals were detained by Italian financial police last week after trying to enter Switzerland with $134 billion worth of undeclared U.S. bonds, mostly Treasury bonds, an Italian daily said Wednesday. The Japanese consulate general in Milan confirmed that the detention had taken place and said it was trying to confirm with Italian authorities whether the two were indeed Japanese nationals and their identities.
According to the report in il Giornale, two unidentified Japanese in their 50s concealed the bonds, including 249 U.S. Treasury bonds each worth $500 million, in a suitcase with a false bottom that was searched by the Italian authorities June 3 when they were in Chiasso, at the border with Switzerland, about 50 kilometers north of Milan. The daily did not say on what charges they have been detained, but the two may have been detained on suspicion of attempting to take a large amount of securities out of Italy without declaring it because the paper said they had not declared the bonds.
This is very significant news, because, as Michael Barnett writes in an email, one of the following must be true:
1. The Japanese are trying to secretly divest themselves of about 25% of their US debt. (They own about $600B in US debt.)
2. The Japanese are acting as Chinese or North Korean agents in trying to help them divest themselves of US debt in secret.
3. There is an enormous sum of counterfeit US debt out there and these guys are trying to sell some of it.
None of these cases bodes well for the US debt market."
Very very curious happening...Along with Russia also whispering of moving away from U.S. debt, Chinese students laughing at my man Timmy Geit, and HR 1207 coming up, the fed appears to be in hot water? check it out.
Monday, June 1, 2009
More disgusting economic morsels of savagery
Zoellick Warns Stimulus ‘Sugar High’ Won’t Stem Unemployment
" World Bank President Robert Zoellick warned policy makers that fiscal-stimulus plans are insufficient to turn around the “real economy” and rising joblessness threatens to set off political unrest across the globe.
“While the stimulus has given an impulse, it’s like a sugar high unless you eventually get the credit system working,” Zoellick said in an interview yesterday with Bloomberg Television’s “Political Capital with Al Hunt.” “When unemployment increases, that’s probably the most political combustible issue.”
Reflux wonders what this bozo means with the phrase "eventually get the credit system working". Lets review, since the Federal Reserve act brought about its existence, the U.S. government has inflated the currency supply, backed by no hard assests, pure fiat. The Treasury manipulates interest rates above and below what the market would set them at, sending false signals to consumers and entrepreneurs, eventually leading to business cycles and bubbles within industries. Financial geniuses then created new financial instruments to sell, which eventually collapsed and destroyed trillions of dollars in the process. Then the U.S government decided to bailout, inject liquidity, and provide a 'TARP' to shield them from financial rain(how sweet). Instead of allowing the market to correct itself and past bad decisions, it was decided to take a play from the Keynesian playbook, and it appears this dude wants more of the same.
Ohhh I get it, he wants to "recapitalize banks", hmm I thought that was what the trillions was for. Silly me again! Economics is sooooo difficult! Eff you Zoellick!
" World Bank President Robert Zoellick warned policy makers that fiscal-stimulus plans are insufficient to turn around the “real economy” and rising joblessness threatens to set off political unrest across the globe.
“While the stimulus has given an impulse, it’s like a sugar high unless you eventually get the credit system working,” Zoellick said in an interview yesterday with Bloomberg Television’s “Political Capital with Al Hunt.” “When unemployment increases, that’s probably the most political combustible issue.”
Reflux wonders what this bozo means with the phrase "eventually get the credit system working". Lets review, since the Federal Reserve act brought about its existence, the U.S. government has inflated the currency supply, backed by no hard assests, pure fiat. The Treasury manipulates interest rates above and below what the market would set them at, sending false signals to consumers and entrepreneurs, eventually leading to business cycles and bubbles within industries. Financial geniuses then created new financial instruments to sell, which eventually collapsed and destroyed trillions of dollars in the process. Then the U.S government decided to bailout, inject liquidity, and provide a 'TARP' to shield them from financial rain(how sweet). Instead of allowing the market to correct itself and past bad decisions, it was decided to take a play from the Keynesian playbook, and it appears this dude wants more of the same.
Ohhh I get it, he wants to "recapitalize banks", hmm I thought that was what the trillions was for. Silly me again! Economics is sooooo difficult! Eff you Zoellick!
My main man Timmy Geit, snake oil salesman extrodinaire
Geithner tells China its dollar assets are safe
"BEIJING (Reuters) - U.S. Treasury Secretary Timothy Geithner on Monday reassured the Chinese government that its huge holdings of dollar assets are safe and reaffirmed his faith in a strong U.S. currency.
A major goal of Geithner's maiden visit to China as Treasury chief is to allay concerns that Washington's bulging budget deficit and ultra-loose monetary policy will fan inflation, undermining both the dollar and U.S. bonds.
China is the biggest foreign owner of U.S. Treasury bonds. U.S. data shows that it held $768 billion in Treasuries as of March, but some analysts believe China's total U.S. dollar-denominated investments could be twice as high."
Here is the kicker for me: "
China is the biggest foreign owner of U.S. Treasury bonds. U.S. data shows that it held $768 billion in Treasuries as of March, but some analysts believe China's total U.S. dollar-denominated investments could be twice as high.
"Chinese assets are very safe," Geithner said in response to a question after a speech at Peking University, where he studied Chinese as a student in the 1980s.
His answer drew loud laughter from his student audience, reflecting skepticism in China about the wisdom of a developing country accumulating a vast stockpile of foreign reserves instead of spending the money to raise living standards at home."
If the students at home in China are wise to the shammy-shafty that is U.S. debt, a bottomless black hole of irretrievable spending, then the government must know this fact as well. Check back soon for Geithner's next adventure.
"BEIJING (Reuters) - U.S. Treasury Secretary Timothy Geithner on Monday reassured the Chinese government that its huge holdings of dollar assets are safe and reaffirmed his faith in a strong U.S. currency.
A major goal of Geithner's maiden visit to China as Treasury chief is to allay concerns that Washington's bulging budget deficit and ultra-loose monetary policy will fan inflation, undermining both the dollar and U.S. bonds.
China is the biggest foreign owner of U.S. Treasury bonds. U.S. data shows that it held $768 billion in Treasuries as of March, but some analysts believe China's total U.S. dollar-denominated investments could be twice as high."
Here is the kicker for me: "
China is the biggest foreign owner of U.S. Treasury bonds. U.S. data shows that it held $768 billion in Treasuries as of March, but some analysts believe China's total U.S. dollar-denominated investments could be twice as high.
"Chinese assets are very safe," Geithner said in response to a question after a speech at Peking University, where he studied Chinese as a student in the 1980s.
His answer drew loud laughter from his student audience, reflecting skepticism in China about the wisdom of a developing country accumulating a vast stockpile of foreign reserves instead of spending the money to raise living standards at home."
If the students at home in China are wise to the shammy-shafty that is U.S. debt, a bottomless black hole of irretrievable spending, then the government must know this fact as well. Check back soon for Geithner's next adventure.
Wednesday, May 27, 2009
Maddening Infuriation and Spurious Convoluted Theft
"Once Considered Unthinkable, U.S. Sales Tax Gets Fresh LookLevy Viewed as Way to Reduce Deficits, Fund Health Reform"
"With budget deficits soaring and President Obama pushing a trillion-dollar-plus expansion of health coverage, some Washington policymakers are taking a fresh look at a money-making idea long considered politically taboo: a national sales tax.
Common around the world, including in Europe, such a tax -- called a value-added tax, or VAT -- has not been seriously considered in the United States. But advocates say few other options can generate the kind of money the nation will need to avert fiscal calamity.
At a White House conference earlier this year on the government's budget problems, a roomful of tax experts pleaded with Treasury Secretary Timothy F. Geithner to consider a VAT. A recent flurry of books and papers on the subject is attracting genuine, if furtive, interest in Congress. And last month, after wrestling with the White House over the massive deficits projected under Obama's policies, the chairman of the Senate Budget Committee declared that a VAT should be part of the debate.
"There is a growing awareness of the need for fundamental tax reform," Sen. Kent Conrad (D-N.D.) said in an interview. "I think a VAT and a high-end income tax have got to be on the table."
A VAT is a tax on the transfer of goods"
There is also a growing awareness that taxation without representation is seen as a disgusting, intolerable nuisance. We are getting taxed more and more, inflation silently works behind the curtains thieving your wealth, and we are recieving less and less(but we sure are kicking ass in sand-land huh!)
Fuck you Rahm's brother, lower tax rates actually increase revenues, but you wouldn't know that living in a fantasy world shielded from the blinding sunlight of empiricism.
NO MORE TAXES YOU PETCHULANT BASTARDLY REPTILES
"With budget deficits soaring and President Obama pushing a trillion-dollar-plus expansion of health coverage, some Washington policymakers are taking a fresh look at a money-making idea long considered politically taboo: a national sales tax.
Common around the world, including in Europe, such a tax -- called a value-added tax, or VAT -- has not been seriously considered in the United States. But advocates say few other options can generate the kind of money the nation will need to avert fiscal calamity.
At a White House conference earlier this year on the government's budget problems, a roomful of tax experts pleaded with Treasury Secretary Timothy F. Geithner to consider a VAT. A recent flurry of books and papers on the subject is attracting genuine, if furtive, interest in Congress. And last month, after wrestling with the White House over the massive deficits projected under Obama's policies, the chairman of the Senate Budget Committee declared that a VAT should be part of the debate.
"There is a growing awareness of the need for fundamental tax reform," Sen. Kent Conrad (D-N.D.) said in an interview. "I think a VAT and a high-end income tax have got to be on the table."
A VAT is a tax on the transfer of goods"
There is also a growing awareness that taxation without representation is seen as a disgusting, intolerable nuisance. We are getting taxed more and more, inflation silently works behind the curtains thieving your wealth, and we are recieving less and less(but we sure are kicking ass in sand-land huh!)
Fuck you Rahm's brother, lower tax rates actually increase revenues, but you wouldn't know that living in a fantasy world shielded from the blinding sunlight of empiricism.
NO MORE TAXES YOU PETCHULANT BASTARDLY REPTILES
Laughter quacks as hubris smacks into faces
I am never one to pass up an opportunity to point out the utter hubris and insanity in monetary policy. I have previously posted about China's warnings to the U.S. Here is another prime example which displays our seriously compromised position in regard to China:
"China warns Federal Reserve over 'printing money"
"China has warned a top member of the US Federal Reserve that it is increasingly disturbed by the Fed's direct purchase of US Treasury bonds. "
"Richard Fisher, president of the Dallas Federal Reserve Bank, said: "Senior officials of the Chinese government grilled me about whether or not we are going to monetise the actions of our legislature."
"I must have been asked about that a hundred times in China. I was asked at every single meeting about our purchases of Treasuries. That seemed to be the principal preoccupation of those that were invested with their surpluses mostly in the United States," he told the Wall Street Journal. "
AYAYAYAY!
"China warns Federal Reserve over 'printing money"
"China has warned a top member of the US Federal Reserve that it is increasingly disturbed by the Fed's direct purchase of US Treasury bonds. "
"Richard Fisher, president of the Dallas Federal Reserve Bank, said: "Senior officials of the Chinese government grilled me about whether or not we are going to monetise the actions of our legislature."
"I must have been asked about that a hundred times in China. I was asked at every single meeting about our purchases of Treasuries. That seemed to be the principal preoccupation of those that were invested with their surpluses mostly in the United States," he told the Wall Street Journal. "
AYAYAYAY!
Tuesday, May 26, 2009
The Next Bubble
I have been following some economic commentators which raised the prospect of there being another damaging hit to the credit/financial markets, a problem which looms from commercial real estate. False signals to the market, and subsidized interest rates almost assuredly led consumers into a false sense of security, in terms of home ownership and debt obligations. This must have happened to some extent, in the commercial real estate markets as well.
http://247wallst.com/2009/05/24/the-next-catastrophe-for-banks-3-5-trillion-in-commercial-real-estate-debt/
Interesting read.
http://247wallst.com/2009/05/24/the-next-catastrophe-for-banks-3-5-trillion-in-commercial-real-estate-debt/
Interesting read.
Wednesday, May 20, 2009
"U.S.-Russian Team Deems Missile Shield in Europe Ineffective"
http://www.washingtonpost.com/wp-dyn/content/article/2009/05/18/AR200905
1803055_pf.html
http://www.washingtonpost.com/wp-dyn/content/article/2009/05/18/AR200905
1803055_pf.html
"A planned U.S. missile shield to protect Europe from a possible Iranian
attack would be ineffective against the kinds of missiles Iran is likely
to deploy, according to a joint analysis by top U.S. and Russian
scientists.
The U.S.-Russian team also judged that it would be more than five years
before Iran is capable of building both a nuclear warhead and a missile
capable of carrying it over long distances. And if Iran attempted such
an attack, the experts say, it would ensure its own destruction.
"The missile threat from Iran to Europe is thus not imminent," the
12-member technical panel concludes in a report produced by the EastWest
Institute, an independent think tank based in Moscow, New York and
Belgium.
The report, scheduled for release today, could further dampen the Obama
administration's enthusiasm for a Bush administration plan to deploy
radars and interceptor missiles in Poland and the Czech Republic. The
missile shield has been promoted as a safeguard against future attacks
from rogue states, particularly Iran. But the plan has severely strained
relations with Moscow, which says it would undermine strategic stability
and lead to a new arms race."
Total destruction of the case for this stupid missile shield. Well, at
least the weapons contractors paid to build them will get rich.
Thursday, May 14, 2009
Econo-CRASH
For a while now I have been enthralled with economics, and more
pointedly, what were the causes of economic collapse. Some people like
to tow the Keynesian line and blame the market and market deregulation,
some people blame banks, some blame Alan Greenspan.
pointedly, what were the causes of economic collapse. Some people like
to tow the Keynesian line and blame the market and market deregulation,
some people blame banks, some blame Alan Greenspan.
Here is an awesome article that clearly spells out the reasons for this
economic downslide, maybe knowledge can help to avert this kind of
problem in the future, although I highly doubt that.
"The prevailing view amongst the commentariat (reflected in the recent
deliberations of the G20) that the financial crash of 2008 was caused by
market failure is both wrong and dangerous. Government failure had a
leading role in creating the conditions that led to the crash.
"Central banks created a monetary bubble that fed an asset price boom
and distorted the pricing of risk.
US government policy encouraged high-risk lending through support for
Fannie Mae and Freddie Mac (which had explicit government targets of
providing over 50pc of mortgage finance to poor households) and through
the Community Reinvestment Act and related regulations. "
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