Perspectives on the global economic meltdown- (Nov 28 2010)

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pentaiah
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by pentaiah »

Ramana ji
Unfortunately I could not locate the 10 point events to unfold in the international economic out look that I posted

But the above post of Acharaya ji about inflationocracy is the first step.
Next is the hyper inflation part.....
kmkraoind
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by kmkraoind »

Pentaiah garu,

- I do not think there will be any hyperinflation, because it will create severe social unrest and no body can offer it.
- all previous models of economics are based on pull-push (demand-supply) factors, where every player is bound to the rules.
- now US is eminence sole global power with its currency being global currency, we have to keep this major factor. This is where all global rules of economic cycles are not factored.

- during 2008 bottom, China went on buying spree, buying Blackrock and it even attempted to buy oil assets, ports in US.
- according to a report, all combined PIIGS stock market valuations are less than that off Apple market value. Now imagine what Chinese trillion$ can buy if there is a sustained global recession.
- up to last year US and EU economic officials have shuttled or requested very frequently China to appreciate yuan. All of sudden the chorus had stopped, why, because they understood its not working. Will they sit idle without thinking an alternative - definitely not, and worse they are not revealing the alternative openly - so something is cooking.

Regarding all of the Fed's and ECB's balance sheet:
- even though they are pumping money like hell, there is no inflation to reflect the economic rule of supply and demand, why, all these money is used to buy services and goods from rest of the world. Its like pouring water on sand slowly, so it will not flood.
- once they feel they are no economic predators, all Fed and ECB is needed a pen stroke from executive to write it off.

Economic predators
China - evaporate all reserves in a war or make it a pariah state so that it bonds are considered as junk.
Russia - all the money is locked up in few billionaire hands, so manipulate them, if not possible bring another October like color revolution.
GCC - replace all monolithic figures with multiple new hound of power hungry entities, so that they can manipulated. Remember how some of GCC's sovereign fund investments in Citi Bank (financials) went sour. As long as they invest in hotels or in Disney land, its okay, oil sheiks wants ports, banks and others in western countries, which are not palatable.
India - IMO, by luck it is a soft power, easily manipulated, still it is a comatose state, not realizing its full potential, so prop it carefully so that it can become an useful idiot (our elites will behave exactly in the same way).

so not expecting a hyperinflation in the near or far feature, unless caused by an oil shock by Iran situation.

Right now, after the housing shock, everything is moving according to a well-factored western script. JMT.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Christopher Sidor »

What appears most baffling to many is, despite the massive amount of money pumped in by US Fed's QE/QE-II/Twist and Bank of Englands Bond buying program, inflation in these countries has remained reasonable. But this ignores two aspects.
First is that much of the increased money is being hoarded by financial institutions including banks. I will quote verbatim what the ECB president had said in his remarks on 6th Sept 2012
The annual growth rate of M3 increased to 3.8% in July 2012, up from 3.2% in June. The rise in M3 growth was mainly attributable to a higher preference for liquidity
There are predominantly two forms of liquidity that the financial entities consider, one are AAA rated sovereign bonds plus US Treasury and the second is cash.

Secondly inflation has gone up, but in developing economies and not in other countries.

This has lead to many proponents to claim that pumping cash is not too bad. They said look no inflation has resulted like the hawks were claiming, there is no revolt of the bond vigilantees, etc. These proponents claim that there is no stagflation and worse we have avoided deflation. But that is not the complete truth.

Right now financial institutions are holding on to cash due to various reasons. Some because their balance sheet are in a bad shape or might get progressively in a bad shape. Some are hoarding cash because they do not want to lend the money out. To claim that there is one reason will not be true.

And this is the problem. If things start to improve then this money which right now sitting in the vaults will come out. And what will then happen is anyone's guess. But let us not forget that many of the crucial banking regulators, US Fed and ECB, have put a target on the amount of inflation that they would bear. Anything higher than that and well gigs up. This might lead to increase in interest rates or decrease in availability of cheap money. Last time these conditions happened, Lehman went under. Whose turn will it be this time? One of these new-age-green-energy-firms?
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by pentaiah »

Kmkraoind Saar and Christopher sider Saar
My take

First
Measuring inflation against what?
Not the basket of goods that a typical consumer level inflation is measured
Gold price tells you the true value of dollar and all other currencies are aligned with dollar
The price of gold is all time highs nd at 1600 USD plus ( or around)

One of the reason you are not seeing higher inflation at the consumer level is that the money so far given out to banks has been used and continues to be used to fix the books in the Banks and also because QE are being done not in actual dollar money circulation but in the form of IOU pAper which are in the vaults.

No body wants to disturb the the scheme because every one is protecting their self interests.

It's like in the old movies ( Appu Chese Pappu Komodo) there is only one zamindar for hundreds of villages in which there are a bunch of lenders, now the biggest customer for money borrowing are in the joint family of the zamindar the villain plays each lender against the other saying that guy is ready to lend at 3% you can get a promisory note if you lend me at 2.5% eager to get business as there is no one else consuming or burning money like this extended family you lend. All the lenders are now under writers of the well being of the zamindar family as they have now a vested interest

That is how the game is being played
The true measure of hyper inflation will take some more time
One of the reason sudden interest in Africa is to diversify commodity sources and markets for products
This was also predicted here
Watch the GPS fareed zakaria how Africa markets are thirsting for products and how Chinese and US are rapidly converging to corner shares ( I have been to SA, Zimbabwae, Namibia, Mozambique Zambia, and Keneya {Portugese colonial masters are coming down in hoarders to Mozambique because back home is burning in Europe }
Classical hyper inflation conditions are when the natural employment rates exceeded or when money supply exceeds the demand for a given GDP is not happening because the money is going into black hole of fixing the bank books but not into Aam admi on the street but into big cats of wall street investment banks, no there is no rational explanation for Dow to be at 13000 when economy is floundering. Even historic low mortgage is not inducing people to buy homes because banks are not really lending
The consumption pattern of US consumer is now for ever altered, the new hookers to the highs of consumerism is BRICs and Africa
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by pentaiah »

Read here how the scramble to new resources commodities and markets is heating up

Mongolia is a country more than twice the size of Texas with a population of only 2.8 million people. In recent years it has been the fastest growing economy in the world, registering over 17 percent growth in 2011. All of this has been driven by mining: Mongolia has just about everything the world (and in particular, its neighbor China) needs, including coal, copper, uranium, gold, rare earths, and the like. It has recently started a wind energy project and hopes to export electricity to Japan. Much of its natural resource wealth has come from a long-standing Russian-Mongolian joint venture, Erdenet, but has recently been joined by two giant newcomers, the Oyu Tolgoi (OT) and Tavan Tolgoi (TT) mines in the Gobi desert that serve the Chinese market. This wealth is pouring into a country in which 30-40 percent of the population remain nomadic herders living off flocks of horses, sheep and goats amid winter temperatures that can reach -30 degrees Celsius. Mongolia’s current GDP per capita in PPP terms remains less than $5000, which masks increasing skew in distribution. (All figures courtesy of the terrific new World Bank dataBank resource).

All of this new mineral wealth poses a huge problem of corruption and other ills associated with the resource curse. Of all former Communist states, Mongolia has been by far the most successful as a democracy outside of European countries like the Baltic states, Poland, or the Czech Republic; unlike the Central Asian -stans it has maintained a competitive multiparty electoral democracy since the Russian withdrawal in the early 1990s. These institutions are being sorely tested, however, by the challenge of dealing with resource wealth.

...............

I’m in no position to judge the degree to which the Mongolian judiciary has been politicized. It is important for the government to prosecute not just a single former president, but other officials from other parties guilty of corruption as well, including the current ruling party. However, it is important to put this issue in context. Since South Korea’s democratic transition, Korean presidents have launched politicized investigations of rivals on corruption charges. It’s a terrible practice to get into, but it also doesn’t mean that Korean democracy is failing or non-existent. So too in the case of Mongolia: judicial independence is something that needs to be built over time; if the system needs work, this should not detract from the country’s nonetheless impressive record of democratic institution-building over the past 20 years.  It was for this reason that Hillary Clinton recently visited Mongolia (and used it as a platform for criticizing China’s rights record). The resource curse will put tremendous strain on Mongolian democracy in the coming years. The country needs support from outside powers and particularly from the United States, which is in a position to help balance the pressures coming from the country’s two large authoritarian neighbors, Russia and China.
http://blogs.the-american-interest.com/ ... lfeasance/
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by sudarshan »

The title speaks for itself, methinks. Alba & Cymru might take hints, hopefully.

Catalan Autonomy Demand in Spain.
ramana
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by ramana »

sudarshan wrote:The title speaks for itself, methinks. Alba & Cymru might take hints, hopefully.

Catalan Autonomy Demand in Spain.

Aragon a big part of Spain got subsumed in the new Spain after the Reconquista. Catehrine of Aragon and Fredinand of Castille were married and they sponsored Columbus' voyages. Castille made a clause that the revenues from new world wont be shared with Aragon. Eventually they died off due to lack of money and ended up merged with Spain.

So lets see if they start making noises.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Theo_Fidel »

Unlimited QE3 declared.

More free money for the rich. They can borrow money at 0% interest, lend it back to treasury for 1.5% interest and pocket the difference. Its got to be a good life!
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Christopher Sidor »

In UK today, BBC is running a story about some 1000 people being fired from two corporations. In this month, some 200 odd people were let go by British Gas. It is expected to get worse in the days ahead.

It is said that the night is the darkest before the dawn. I fear UK has not reached that point yet. When the 2008 crisis broke out there were speculations about what type of recovery would follow it. Three shapes were proposed. The awful "L", the euphoric "V" and the dreaded "W". "L" stood for very low or close to zero growth. "V" was a quick bounce back. It was the "W" that everybody was concerned about. "W" denotes a double dip recession.

"L" was the type of recovery that Japan went through after its bubble burst in 1990s. And it took Japan 13 long years, Japan did not have some meaningful growth till 2003, for it to come out of it. The consequence of this was a debt burden of almost 200% GDP. The "saving grace", Japan's debt is predominantly domestic held and secondly is the enormous trade surplus along with the current account surplus which Japan has. Today there are a very few North Atlantic countries that share the same "saving grace".

There are reports that China will unleashing another stimulus though not on the sheer scale that it unleashed previously, some 500 billion plus. Now there are two things wrong with this. One the stimulus that is being talked about is all about fixed-investment. Second, and this is more worrisome, China has not succeeded in transforming its economy to a consumer led economy from an export/fixed-investment led economy.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by paramu »

If Fed has to announce open-ended QE after 2 rounds of QE and op twist, and at a time when the stock market is at post-crash record high, and when real estate prices are rising in US, it says loudly that in reality it is in deep sh**.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by krisna »

The six-peso diet
SIX Argentine pesos ($1.30 at the official exchange rate, or about $1 on the black market) is just enough to buy an alfajor, a sweet biscuit nibbled between meals over coffee. But according to the government, it is more than sufficient to buy an entire day’s food. :( On August 10th INDEC, the national statistics agency, declared that a family of four should be considered above the poverty line if its monthly food bill exceeded 688 pesos, equal to about six pesos per person per day.
The claim has stuck in the throats of ordinary Argentines, who have to spend far more than this to keep hunger at bay thanks to galloping inflation. Indignant citizens created mock advertisements featuring pizzas the size of finger nails. Hackers disabled the INDEC website, tweeting: “Now you’ll have to use your six little pesos to restore your page :) :rotfl:
Experts also doubt the government’s claim. A study by the University of Buenos Aires puts the minimum daily budget for a healthy diet at 24 pesos per person, four times the official figure. “It is totally impossible to eat healthily with six pesos,” says Sergio Britos, one of the study’s authors. INDEC’s report “loses all credibility” by supposing unrealistically low food-prices, he says.
same with many other countries I suppose!!
ramana
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by ramana »

Wasn't Montek Singh coming up with similar numbers for BPL in India before he was called on the mat?
Suraj
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Suraj »

Bernanke just did his bit to get Obama re-elected (and keep his own job) today.
Satya_anveshi
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Satya_anveshi »

Yes, it is virtual certainty that Obama will get re-elected. The next issue seems like the debt celing dejavu but till then easy sailing.

We should also look forward to interesting statistics ( I mean "real statistics" like in lies, damn lies and then...) on jobs front after may be tomorrow's or it has already began.

- it is already down to 8.1% (after loads of the folks discounted) vs what was the promise (less than 6%)? But how the heck Romney, the "evil" capitalist and after the rolling stone story on him, is going to milk the poor unemployment situation than Obama.
- AIG divestment is making money just in time and most of Tarp is paidout
- Osama down - #1 most wanted and what Bush could not do
- "Affordable" Healthcare bill passed
- roadmap for Afghan on track as a talking point but is set for after election anyway
- Turmoil in Middle-East will only help Obama with his "background" relative to Romney
- No SNAFU during LA hurricane

it is done deal!!
Theo_Fidel

Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Theo_Fidel »

I think the markets are seeing something change.

Stocks are off the chart. All the losses of 2008 have been erased and then some.

Looks like the permission has been granted for the next bubble.....
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by pentaiah »

China is doing it as well...
this is what I eluded to when QE1 was announced and the series began in right earnest
When Euro started sneezing because of PIGIS they learnt the lesson after some resistance by aunty Merkel, they too got the taste of QE business

what does this lead to ?

The currencies are deflating downwards and adjusting their relative positions to previously held.

Its like this if the original grading was
A+ = 95% First class merit
A = 90%-94% First Class
B+ = 85%-89% Second class
B = 80%-84% Lower second class
c = 70%-79% Fail grade

now
suddenly due QE business
while Gold is truly still First class merit or in new terminology Out Standing
other have changed the grading ( or curving)
now
O = 95% - 100% out standing (Gold)
A+ 90% -94% First class merit
A = 85%-89% First class
B+ = 80%-84% Second class
B = 75%-79% Lower second class
C = 70%-74% Pass
D = 69 and below fail
Just an anology
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by shyam »

Egan Jones Downgrades US From AA To AA-
From Egan Jones, who downgraded the US for the first time ever last July, two weeks ahead of S&P....

the FED's QE3 will stoke the stock market and commodity prices, but in our opinion will hurt the US economy and, by extension, credit quality. Issuing additional currency and depressing interest rates via the purchasing of MBS does little to raise the real GDP of the US, but does reduce the value of the dollar (because of the increase in money supply), and in turn increase the cost of commodities (see the recent rise in the prices of energy, gold, and other commodities). The increased cost of commodities will pressure profitability of businesses, and increase the costs of consumers thereby reducing consumer purchasing power. Hence, in our opinion QE3 will be detrimental to credit quality for the US.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Christopher Sidor »

FT is running a series of articles regarding QE3 in its weekend edition with its front page leading with the title, Central Bank action lifts gloom. It is all about US Fed chief promising two things
1) To buy USD 40 billion every month till there is a dent in the US unemployment.
2) To keep the interest rate low till 2015.
Due to this the S&P 500 has come very close to its pre-crisis high of some 1565, which happened on 9-Oct-2007. What the first point essentially means is that the bond buying is infinite or till there are no more real estate mortgage left.

QE3 serves up a post-summer pop
Fed sets its sights on infinity and beyond

But not everybody is confident that this will work
QE3 serves up a post-summer pop wrote: “The Fed has put its credibility on the line,” says James Dailey, chief investment officer at Team Financial Managers. “There is no evidence to suggest what they are doing will create jobs, and if we don’t see results in the next few months the market reaction could be messy.”
....
....
“The risk is we are one step closer to realising that this thing is not working,” warns Matt King, credit strategist at Citigroup. “Short term, everyone is buying because the Fed is buying. Maybe at the margin they are hoping it will help economic prospects longer term, but that will require companies to take on workers – and not just boost profits through cost-cutting.”
....
....
The Fed chairman had made clear “that he considers the stock market a crucial mechanism for the transmission of monetary policy,” says Quincy Krosby, market strategist at Prudential Financial. “That means the rally carries on. Shorting the market would be betting against the Fed, against Mario Draghi and perhaps the Chinese state. That’s a bet that most traders simply cannot make.”
....
....
The ECB and Fed have shown they can lift the “p” in price-to-earnings ratios. But corporate earnings depend on the real economy. “Bond buying by the ECB is about removing eurozone ‘tail risks’ – not producing positives on growth. If the ECB buys two-year Spanish bonds, that won’t make any difference to Spanish GDP this year,” says Mr Secker.
....
....
Channing Smith, portfolio manager at Oklahoma-based Capital Advisors, adds: “This was the last big hurrah for monetary stimulus."
But what exactly may be the problem with this QE3
Fed sets its sights on infinity and beyond wrote: If QE∞ works, Americans will feel wealthier and banks will lend more. The risk is that it will merely create inflation.
....
....
The Fed is forcing people to put their money anywhere but in cash. Neither cash nor short-term bonds offer any yield or any defence against inflation.
....
....
Mortgage-backed bonds trade on a lower yield than treasuries – below 2.2 per cent for a 30-year Fannie Mae bond. Back in 1985, 30-year mortgage bonds yielded 12.8 per cent.
The Fed action also inhibits anyone from investing in the dollar, which on a trade-weighted basis is now down 6.4 per cent since its high for the year.
....
....
Then, of course, there is gold. Fed speculation has revived the shiny metal after a sharp downturn and it has gained 16.4 per cent since May 16. It has been a great hedge against QE announcements.
All of these moves came on hopes of QE, of course. But now that QE could be indefinite, these trends could also be indefinite.
Gold also helps to put the rally in stocks, which has brought the S&P 500 within 5 per cent of its 2007 high in dollar terms, in cruel context.
Think of Yen-carry trade. Now think of dollar-carry trade on steroids. Now here is the kicker. The 2003-2007/8 growth was seen as a job-less growth. There might be growth in trading but it remains to be seen if US Fed's action leads to a dip in unemployment. If the Fed mop's up most of the mortgage securities and act like Lord Shiva, who drank the lethal poison known as Halahala from the sagar Manthan, it is possible that the rottenness might be cleansed from the system all together.


But the most significant new item might be
[url=steroids://www.ft.com/cms/s/0/2996d772-fe7d-11e1-a ... z26fbTbb1z]Creditors hint at more time for Greece[/url]
From this article it is clear that Greece will be given more time to meet the bailout conditions, but no more money would be forthcoming. The Austrian finance minister, Maria Fekter has been quoted as saying
We will give Greece the time they need for that; there will probably be no more money though.
While the IMF Chief has been quoted as saying
[an extension] needs to be considered as an option.
This dovetails with exactly what a certain German luminary had said recently.
pentaiah
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by pentaiah »

We are now entering the rapids of hyper inflation with fed chairman in kayak with a paddle.
The inflation will not be overt till the money gets into circulation (at the consumer level) right now they banks are using the funds to cook/correct the books.

All big industry is sitting on cash pile and not investing in projects because of uncertainties ( of policies geostrategic situation etc) technically if they just sit on pile of dollars the real value of the money is actually eroding even at minimum of 2%. This is one of the reasons that unemployment levels are not falling. The debasing of currency will not be apparent unless we use precious commodities as comparators
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Austin »

United States Budget Dilemma

http://www.youtube.com/watch?v=EW5IdwltaAc
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by SriKumar »

pentaiah wrote:We are now entering the rapids of hyper inflation with fed chairman in kayak with a paddle.
The inflation will not be overt till the money gets into circulation (at the consumer level) right now they banks are using the funds to cook/correct the books.
How come we've not had a major inflation, let alone hyperinflation thus far? Inflation is there but not at any un-precedented levels reflective of the 2008 catastrophe.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Prem »

Theo_Fidel wrote:I think the markets are seeing something change.
Stocks are off the chart. All the losses of 2008 have been erased and then some.
Looks like the permission has been granted for the next bubble.....
We should be happy about this. But you are right about bubble and no harm in ridding the bugger and walk out half way before KLPD happen again.
Another thing to watch is US energy resources coming on line in next 6-7 years and once it happen, it will be smooth economic sailing for next 30 years . Gonna be real bad for ME with USA reaaranging their faces as per its own likes and dislikes.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by ramana »

RamaY
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by RamaY »

ramana wrote:Wasn't Montek Singh coming up with similar numbers for BPL in India before he was called on the mat?
Yep. The whole trio of Montek, PC and MMS are a bane on Indian economy. Of late PC is making interesting sounds though....
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by JwalaMukhi »

Well check the comments section. Lot of takleef among the spainards, How dare NYT compare them to third world dumpster diving and foraging peoples onlee...
http://www.nytimes.com/slideshow/2012/0 ... AIN.html#7
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by krisna »

the next panic
Europe’s crisis will be followed by a more devastating one, likely beginning in Japan.
After World War II, Japan built a financial system modeled on those of Europe and the United States. Financial intermediation is an old and venerable idea—connecting people with savings to other people wanting to make investments. Such a sensible use of savings was taken to a new level in Japan, the U.S., and Europe in the decades following 1945—helping to fuel un­precedented growth for entrepreneurs and a genuine accumulation of wealth for the burgeoning middle class.

But such success brings vulnerability. Modern financial systems also permit governments to borrow large sums from investors, and as finance has evolved, that borrowing has become easier and cheaper. In the most-advanced countries, governments have increasingly taken advantage of expanding markets for short-maturity debt, whose principal is due soon after the loan is made. This has allowed them to borrow far more, and at cheaper rates, than they otherwise would have been able to do. Typically, these governments then take out new loans as the old ones come due, “rolling over” their debts. This year, for example, the Japanese government needs to issue debt amounting to 59.1 percent of GDP; that is, for every $10 that Japan’s economy generates this year, the government will need to borrow $6. It will probably be able to do so at very low interest rates—currently well below 1 percent.
About half of the Japanese government’s annual budget now goes to pensions and interest payments. As the government has spent more and more to support its growing elderly population, Japanese savers have willingly financed ever-increasing public-sector debts.
ut Japan illustrates the other half of the phenomenon—the extent to which finance has allowed and encouraged politicians to make attractive short-term decisions that are eventually damaging. This may ultimately yield worse crises than the one we faced in 2008 or the one now unfolding in Europe. Greece, Ireland, Portugal, Spain, and Italy found their own ways to eco­nomic devastation, but each road was paved with easy credit. Those whom the gods would destroy, they first encourage to borrow cheaply. :rotfl:
The financial sector is a powerful lobby. What policies does it demand? Financiers want pro-bailout policies kept in place—particularly the massive implicit guarantees against failure that they receive. And they want continued deficits. Our financial titans pay lip service to fiscal responsibility, but they primarily want to pay fewer taxes—­irrespective of what this means for government debt. Indeed, bigger deficits create larger markets for government debt and all of its derivative products, which in turn allow the financial sector’s profits to grow larger. Many politicians are only too happy to oblige.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by shyam »

Old news...

.SEC Says Egan-Jones Made False Claims in Regulatory Filings
The U.S. Securities and Exchange Commission accused Egan-Jones Ratings Co. and founder Sean Egan of making misrepresentations about the firm’s experience rating asset-backed and government securities in a 2008 application to become a nationally recognized statistical ratings organization.
...
...
Egan-Jones, which is paid by investors, is one of about 10 firms registered with the SEC as an NRSRO, meaning companies can use their credit ratings to meet regulatory requirements. The biggest NRSROs, Moody’s Corp. (MCO) and McGraw-Hill Cos.’ Standard & Poor’s unit, are paid by debt issuers.

The SEC also accused Egan-Jones of failing to enforce its own policies to address conflicts of interest. Two analysts were allowed to participate in determining credit ratings for issuers whose securities they owned, according to the SEC.
SEC doesn't see similar violations by the big 3 rating companies for their role in economic collapse.

BTW, Egan-Jones was the first one to downgrade US. Don't mess then Uncle Sam.
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by krisna »

More bikes sold than cars in Italy for first time since WW2
For the first time since the end of the Second World War the number of bicycles sold in Italy has overtaken the number of cars.
As austerity cuts deepen and petrol prices hit a new high, the purchase of new cars has dropped to levels not seen since the 1970s.
Families are buying bikes, ditching their second cars and signing up to car pool schemes – a major shift for a nation which has one of the highest car ownership rates in the world, with around 60 cars for every 100 people.
Italians have a new-found appreciation of the convenience of bikes and the fact that they do not pollute the environment.
:rotfl:
Italians are not just cutting down on their beloved cars – they are also spending less on food and groceries.
Six out of ten Italian families have cut their expenditure on food, including staples such as olive oil and milk, according to a study by Coldiretti, the country’s main agricultural association.
Consumer spending is expected to fall by more than three per cent by the end of this year, the sharpest drop since Italy was founded as a republic in 1946, according to Confcommercio, a consumer association.
The only sectors bucking the crisis are mobile phones, computers and discount supermarket chains, the association said in a report.
PIGS in deep sh1t
shyam
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by shyam »

George Osborne: Workers of the world unite... and give up your rights
- Companies to give people shares worth between £2,000 and £50,000
- Employees will lose right to claim unfair dismissal and time off for training
Asks workers to trade their rights against a dilutable reward....
Hari Seldon
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Hari Seldon »

Recently the IMF admitted that they'd woefully underestimated the true effect of the "austerity multiplier". They'd pegged it at 0.5 meaning each 1% decrease in Govt spending reduces GDP by 0.5%.
Now they say the true figure is between 0.8 and 1.7. Anything above 1 shoots away their assumptions, prescriptions and what not into deep space. Worse than quacks they have been. #aakthoo.
Christopher Sidor
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Christopher Sidor »

^^^
This is true especially for countries which have massive public sector as component of their economies. Since their private sector cannot compete, it falls on the public sector to do the needfull, i.e. provide employment and economic activity.

But this is not true where private sector dominates.
Singha
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by Singha »

EU has a massive public sector. even in US the effect of Govt spending in keeping things moving is often undercredited.
shyam
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by shyam »

Max Keiser interviewing a former Scotland Yard officer about financial corruption in London and how financial corruption investigations are scuttled.

http://www.youtube.com/watch?v=czivvxlUR9Q&t=13m15s
darshhan
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by darshhan »

krisna wrote:
PIGS in deep sh1t

Krishna ji, Why use the word Pigs for Italians? Any particular reason.
ramana
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Re: Perspectives on the global economic meltdown- (Nov 28 20

Post by ramana »

PIGS=Portugal, Italy, Greece and Spain

Its a well known acronym to refer to the EU countries with financial problems.

Some through in another I for Iceland but they are already in deep doo-doo.

So relax no racist or held over resentment against the Europeans. As MMS ji says they are the best people in the world for bringing civilization to all! Or something like that.
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