Remember in the Empire Strikes Back when Lando and Vader have a heart-to-heart?
Well, Paulson just had one with the banks.
Paulson: Perhaps you feel you have been treated unfairly?
Banks: No.
Paulson: Good. It would be unfortunate if we had to leave a garrison here.
Banks: The deal is getting worse all the time.
If I guess this right, the next support level for the Dow Jones is 5000 points.
By support level, I mean … the Dow will be 5000 before December 31. Because trading usually settles down during the holidays.
Many of the sharks are circling and see things. They will probably short this market 3000 pts. That would amazing and creepy at the same time.
General Motors stock price is now below $4.00 per share, which is essentially ZERO, adjusted for inflation 1947. The only thing that could save General Motors is another World War.
Even a bailout would only prolong the inevitable.
There is a problem developing now in the U.S Government. The problem involves the indiscriminate use of power to re-form and re-make the markets in one mold.
One size does not fit all, so we may have some real problems going forward.
The U.S. Treasury, managing all these semi-nationalized companies, may be downgraded to junk status during the early part of the next year.
There is just too much risk on the books…. and off the balance sheet
Credit card payments are slowing down industry-wide. Some people are not even making the minimum payments. The credit scores of consumers will decline, which will decrease the consumption going into next year. If consumers are unable to pay down their maxed out credit cards, we have a problem.
I hear economists talking about the “road to recovery” includes another stimulus package. All the stimulus package has shown us is that when store owners and gas stations know that the checks are coming, the prices of goods and services go up!
The recent price declines in gas and tires and motor oil are relative, since fewer people can actually afford to buy these things.
We have a contradiction.
We are experiencing hyperinflation on one hand with the Federal Reserve monetizing the debt.
We are also experience stagflation as lower prices are irrelevant due to the higher jobless rate.
Could it be because everyone is confused?
Basically, when times like these happen, you get cows costing more. The commodities market will heat up again for useful metals such as copper (hence urban mining will spike) .. and Corn is also a fuel now. Yup. The dollar is falling really fast. However the Euro is catching up to the decline.
Japanese yen looks safe, as the carry trades are resolved and shorts are covered.
Ya, you heard me right.
So, now we have a more clearly defined direction this week.
We know the bailout is on its way. Oh, what’s that? No bailout.
If the bill had passed yesterday .. the first $250Billion will be injected immediately into the economy to unlock the credit markets (temporarily, hehe).
… The economic stimulus check was designed to do the exact same thing. We took the check and spent it all on $5 per gallon gasoline (petrol).
Great plan.
No really.
Fantastic stimulus.
The economy recovered.
Oh, it didn’t?
Well, why not?
Right now. Vacant houses that have been on the market for a very long time have a few noticeable characteristics: house lights are off at night, the trash can is never brought out to the curb, and that real estate sign post has been in the hard for more than 1 year.
Sheesh.
Well, after people start putting up Christmas nights, some neighborhoods are going to look like they don’t have the Christmas spirit. The Christmas spirit may be missing because several of the houses are actually vacant (or abandoned for foreclosure).
I foresee ghost towns springing up around the nation during Christmas.
Hank Paulson: Give us the money now.
Ben Bernanke: Shut up, Mugsy. Give us the money now.
This financial crisis has provided us a chance to practice a word: Quadrillion.
Quadrillion.
Quadrillion!!!
Quadrillion!!!!! $1,000,000,000,000,000 <— Quadrillion
FDIC only has $43Billion left.
WaMu as $120Billion+ in deposits.
Can you believe what happened today? …
I don’t even have any idea how to explain what I just saw.
Wow!!
The sovereign wealth funds are all freaked out about the U.S. debt and the precedent set by Bear Stearns and Fannie/Freddie.
The memory of the Asian currency crisis is still fresh and the banks in Asia are trying to find ways to settle transactions quickly.
If Singapore, China, Korea, Japan, and Thailand cannot be persuaded that everything is under control by the time the markets open on Monday, they still have a fiduciary to protect their own national security.
They may not dump all of it, but they still need to dump some of the U.S. Debt early next week.
What an interesting situation.
This CNN story about setbacks in pro-democracy movement in Hong Kong at first do not appear to be related.
However, when you stop and think about what it symbolizes, your eyes will widen and you will experience a tingle on the front of your forehead.
Don’t worry. It’s called nervous twitch.
Hong Kongers are voting to return to the days before everything was “improved”… the days before life was “more interesting”.
They are voting in symbolic “flight to quality” where they feel safer about wages, inflation and a system where who you know matters. Yup.
The problem is Hong Kongers don’t know who Fannie and Freddie are now. And the HKMA will feel more political pressure to follow the lead of the Chinese mainland take advice to liquidate– not reduce their stakes, not re-allocate their positions — liquidate anything rhyming with Fannie and Freddie from their financial system.
So, Mr. Paulson, when you bring out the bazooka as Bill Gross recommended, remember to bend your knees and when you fire, don’t forget to say “Booyaaah!!”
You have 5 hours to complete the Fannie and Freddie takeover before Asian Markets open.
John Maynard Keynes Was Right: “Money Doesn’t Matter”.
In fact, walking down the street and giving money to random persons would make them happy in the short-term. However, in the long-term, they will find themselves utterly miserable from the lack of purchasing power for food, heating, cooling, and smoking.
The currency is about to go to zero.
There is nothing we can do to stop it.
So, what do we do next?
The Fed now has no recourse to stimulate the economy. Just like in the TV drama ‘ER’, the crash cart was charged to 0.25 point cuts and 0.75 emergency cuts. Now, look at what is happening …
Runaway Inflation has seized the consumer economy. Now, the economic meltdown accelerates.
What has happened to my country? 
nuff said.
Imagine successfully finding all the pieces to a broken porcelain cup and putting the cup back together.
Then imagine someone driving a dump truck over that porcelain cup, and asking you to put the cup back together again — FASTER this time. He then puts a gun to your head and starts the egg timer.
That’s what credit derivatives of credit derivatives are.
Rich people are just too funny.
Something strange happening in the economy as the commercial real estate paper is becoming worthless. Why? If the stores continue to close, then the economy of shipping and fulfillment will collapse.
Stay tuned…
haha 
you mean there is a difference?
Both are symptoms of fractional banking.
Buckle up for earnings season.
This blog. It sounds so strange, yet familiar.
I am come from a much older of the Matrix.
My core memory is dual.
As such, my histories rhyme, at every point in time.
So life is sublime,
So it goes.
Factories are shutting down all over Southern China. With this development may come an upheaval of Hong Konger amenities and family support services.
Discussing these issues with colleagues has left me rather downtrodden, but this is the reality of the “bubble”.
Well – more like a game of musical chairs. The migrants workers in China had perspective, because they are keen to see scarcity in the presence of temporary excess. The understood that while
* Start the music. * (something by Vivaldi)
When engineering jobs were shipped to China from America, anyone in Southern China could open a factory and hire workers. This is what many of the Hong Kongers did.
With economic investment agreements, such as CEPA, the future was supposed to be a dream of mercantilism. However, as more Hong Kongers lost good-paying jobs, many were forced to take lower paying jobs to feed their families.
They sought refuge and comfort in the Hong Kong stock market, where you could roll dice and pick stocks and become rich overnight or at least pay the bills. But, for many that did not last for long.
Then, there was the investment real estate boom in Hong Kong, then there was … wait…
* The music stopped. *
Silence.
Uh-oh, not enough chairs.
Hong Kongers, on the other hand, have a short memory and were not ready for the music to stop. Several farmers are saving their pigs from market to take a loss upfront, but they know will have food for remainder of the year.
Let me re-phrase this so you can completely understand what I am talking about: Chinese migrant workers are not returning to the factories. Expect delays on shipping for anything made in China.
It is slowly sinking in.
Movie stars are doing fine.
Singers and entertainers are doing fine.
Professional athletes are doing ok.
Politicians are doing just swell.
You, on the other hand, … not so hot.
You may not have enough gasoline to drive to the ballot booth on election day. You need to choose which car will be repossessed. You need to make sure you have a roof over your head and air conditioning during the summer.
$170-$200 per barrel oil is on the way and we are experiencing a dangerous wheat shortage worldwide.
Not-so-great, eh?
Several factories are having difficulty finding replacement labor for the migrant workers who refuse to return to the work after Chinese New Year holiday.
This is going to put further stress on logistics companies who rely on constant flow of export goods with business models that are tooled for razor thin margins. Several vendors have shut down in Mainland China, no longer able to keep furniture or home decor operations afloat during the U.S. economic downturn.
Consumer electronics factories will soon be floating without customers as demand comes to a screeeeeeching halt. Yes, that’s right. Your cell phone may not have the replacements parts available. Funny.
Comments: I do not think Americans are ready to see empty shelves at Wal-Mart, because that’s what’s next. If you cannot produce the product, and the people who ship the products go out of business, how does your product get to the store shelves? … Teleportation?
Oh, btw, I can only pay my vendors in RMB, Hong Kong Dollars, Yen or Euros… those are my choices. F**k!
Developing…
Listen to this and understand.
It is becoming more likely that several Chinese migrant workers from the rural areas will not return to factories after the Chinese New Year. Reasons may include one or more of the following:
Developing…
We’re laughing because it’s true. There is no place like home. There is no place like home. There is no place like home. There is no place like home. There is no place like home.
If you act on this latest e-mail promo from the GoBig Network, it is time to close down your dot-com and find a real job … what am I talking about?
Well, ya see, if you need to engage in factoring, your cash flow absolutely sucks; thus, your company is already on its last legs with declining consumer demand and the credit crunch. If you participate in factoring, you will pay for it later. (This may be where some of the 500 Trillion of off-the-book debt may be hiding, which is why the credit crisis is just getting started, but then again I digress.)
Consult your accounting officer chef for details on what I am talking about.
Yes, I am a wet towel at the party, but I guess that’s what happens when you spend as much time as I do in reality.
Here is the promo below:
Yeah. I said it.
Private Equity Firms. Mutual Funds. Hedge Funds. Federal Reserve. You can call them whatever you want. They are all banking cartels.
I just read this post on Austrian Economists.
http://austrianeconomists.typepad.com/weblog/2007/12/did-the-gold-st.html
Mismanagement Gold Standard Helped Cause the Great Depression?
Yes, But the Root Cause Was Antitrust.
History also remembers that the Great Depression was an antitrust problem that started by real estate crisis in Florida and set off a chain reaction nationwide. Lack of antitrust legislation and the era of the robber barons produced a class of Americans that possessed 90% of the countries wealth.
Upon accumulation of all this wealth, the robber barons exercised conventional wisdom abject stupidity in the management of commodities such as gold, silver, oil …. well, just pick any commodity, and chances are they mismanaged it. ^_^ The few families who got out of the market early survived. You may have heard of some of them: Rockefeller, Vanderbilt.
What is all this antitrust nonsense I am talking about?
It may be hard to remember, but in the U.S. there were actually laws (antitrust laws) that clearly stated that your bank could not do your taxes, your tax preparer could not provide your insurance, and your insurance company could not manage your mutual funds.
Most of those laws were repealed and now you are seeing the results.
Sadly, per Brooding Issue #1 in my previous post, I see massive bank failures ahead.
It appears that the giant private equity firms (who bought real estate at the top of the market) will fall and come crashing down crushing all the little people underneath. (Just like in Florida in 1929).
Currency Collapse May Be Eminent
If we are lucky, we will experience an orderly currency collapse. However, two smart guys named Bill Gates and Warren Buffet fear a disorderly fall of U.S. dollar, which will turn the Great Depression into a discussion about happier times.
… つづく
Brooding about the following thoughts:
All these figments of my imagination. right?
…
EDIT: Probably. It’s just a bad dream.
I’ll wake up soon. I’m not worried at all. No, really.
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