Stock Market collapse: Prepare For The Bear

[Crazy Buddhist]

Two weeks and one day ago I predicted this collapse in markets. Aside from solving computer issues h/w s/w user :D etc and being a Buddhisty type, I am a former stockmarket analyst, stockbroker and merchant banker.

If you have debts reign in your costs people and if you have lots of stockmarket investments you are relying on hold on for the ride. It is going to be a bad one for the reasons I explain in the original prediction:


US Economy: Prime Down, Private Equity Short: It’s Here: Prepare For The Bear (http://freedomforall.net/us-economy-prime-down-private-equity-short-its-here-prepare-for-the-bear/)

[AJ@PR]

Gonna read your blog now. :) cool

I got a quick glance at the ticker today, while I was at a client's site... and I would see it slide... and slide... triple digits... then 10 minutes later, it was in the four digits.

I knew it wasn't good.

I wonder if I sent my self a subconsious message from the future to get out.
Less than 3 weeks ago I removed all but a small portion of my money from UBS (stock brokers). =\

[progbuddy]

Yeah... Well we did hit a peak not too long ago, and it is natural to have a slight recession.

[Redundant]

I doubt it will collapse, it's just the real estate market is unusually low.

Anyone know if it's easy to invest money in a company? I'm very confident that if I invest money in Microsoft around September 20th, it will go up, up, up. *cough*Halo 3*cough* Then I'd take it out in January and probably have a good increase. (I'm a noob when it comes to the stock market, but that's how it works, right?)

[Crazy Buddhist]

Nah this is going to be a big bad nasty bear. Not a blip.

[Ironcat]

Yeah... Well we did hit a peak not too long ago, and it is natural to have a slight recession.

He's right...

You say it's going to be a bad bear but don't say how bad, when, or for how long.
In the next 2 to 3 years something will happen that will be bad and then in the next 1 to 2 years after that, something good will happen.

I know nothing about the stock market or bulls and bears or anything else, and I don't mean to talk out my ass, but vague predictions mean nothing.

I might as well invent a Nostradamus quatrain.

"On the street of walls, a mighty fall.
In the city of (insert blather here) the bear will roar.
For two years will he trample the vineyards,
slowly the people will rebuild."

[Crazy Buddhist]

He's right...

You say it's going to be a bad bear but don't say how bad, when, or for how long.

Err ..... nah .. actually you are wrong there dude, if you had read the prediction I linked to you would know I stated that it will be a deep bear lead by the US economy with worldwide knock-on effects and lasting nearly five years - but that the UK would be somewhat protected:

"The Democrats will be handed a Basket economy on the point of implosion and two wars they can neither win, withdraw from or pay for. When I was at Las vegas airport earlier this year a Trucker from New Jersey gave me a light. We chatted as we smoked outside the terminal. “You watch”, he said, “The Democrats are down to a black and a woman for President. The Republicans aren’t gonna let a black or a woman run the show. There will be another major terrorist attack”. I do not believe he is right there. Another terrorist attack would only ensure the Democrats are in for ten years, whomever they chose. Without it they will be in for five, crisis managing through the bear to the beginning of the upside, before a shiny young besuited whiter than white Republican can take over to ride the good times."


I know nothing about the stock market or bulls and bears or anything else, and I don't mean to talk out my ass, but vague predictions mean nothing.

As you admit you know nothing about the subject you probably realise, I hope, that you are in danger of talking outta yr ***. I am a qualified and registered stockbroker and qualified investment analyst. My predictions are not vague and - again you would know this if you had read the piece:

"Prepare for the bear because it is coming. Luckily we will be protected from the wash to some extent by the trading block of Europe and the trade we have with China and India who are of course leading world growth. But any major remolding of the shape of the US economy will not be without knock on effects. In the UK we can expect inflation up 1 -1.5% over the next two years and interest up 2 - 3 points. At the same time many people are coming off low fixed rate mortgages set five or ten years ago. The effects on consumer spending will be quite significant, slowing growth to near zero for a short sharp spell.
"

Those are pretty specific.

Matthew

ps It isn't about peaks and troughs it's about something deeper. If you have never heard of the South Sea Bubble then search the net and read about it. Asset inflation has spiralled and now you can't use dollars effectively because you owe too many already. the US will suffer a materials shortage next. The US economy is in a position somewhat akin to the SSB but not quite as awful.

[Airbozo]

Here is where I sit;

Real Estate = Protected. My investments were made many years ago while the market was low and things would have to get _extremely_ bad to even make me worry (I am talking 1/3 of what the value is now. Not gonna happen in cali...) All my interest rates are ~4.8% - 5.1%. Glad I did not take any money out of these. We leave them alone for the future...

Stock market = Neutral. Diversified investments managed by someone who knows what they are doing.

Other (bonds, money market, short term stuff) = neutral to upside. Again, managed by a company that knows what they are doing and have a very good track record during bear and bull markets (long and short term).

My only concern is my 401k since I know the company that manages it is slow on the draw. I am working to protect those investments now.

The other way it will affect me is in interest rates. The SO and I were hoping to do some remodeling on the kitchen and wanted to use the equity loan we have, but due to interest rates I am not even touching that. Looks like the kitchen will happen one cabinet at a time...

[Ironcat]

Don't get grumpy now, I was just stating my opinions.

Okay, let's see... firstly I did 'read the piece'.
Some of it I didn't understand but that's okay, if we all knew the same things the world would be a boring place... What's a Basket economy? You capitalized it as if it were a proper term but I can't find it anywhere except in one article about Peruvian weavers being cheated out of their textile profits.

Secondly, the type you emboldened merely referred to the time you predict the democratic party to be in power and 'managing through the bear to the beginning of the upside'.
So what you're saying is sometime between your prediction and the next election something bad will happen and sometime between 5 and 10 years from then it will start to get better?
That's what I am talking about when I refer to your vague timetables...

Again, I freely admit to not knowing how the stock market works at all, but in my humble opinion, a prediction doesn't cover a half a decade or so. A prediction is where you say "Okay, sometime around last 3 months of such-and-such year, the interest rate will start rising, and continue to rise until such-and-such month of X year, when it will drop down because of blah blah blah.
Otherwise I can just say that I am in touch with the economy of the agriculture and predict that milk prices will continue to rise causing more and more kids to drink koolaid. I see this rise in prices lasting a few years before levling off somewhere down the road.


the US will suffer a materials shortage next

What sort of materials shortage? Construction shortages have been happening since at least 2000, China has been buying up all the good concrete and steel since at least then, and probably won't stop anytime soon.

[Luke122]

Break this down for me: WHAT SHOULD I DO WITH MY MONEY? (I'm in Canada btw)

[progbuddy]

The bear market may be bad, but the resulting bull market will be equal and opposite.

The whole economy is an equation based around waves.

[Crazy Buddhist]

Break this down for me: WHAT SHOULD I DO WITH MY MONEY? (I'm in Canada btw)

Don't worry too much. If you aren't in $$'s and aren't in great debt you won't suffer greatly.

[Quakken]

There is no stock market equation. Anybody that says there is a definitive answer is very wrong.

But i do think that it is time for the stock market to fall back a bit. We're very high, big companies have made big gains (apple is crazy high, google is still hangin in there) and it's time for a decline from this bull.

I don't think terrorists really care that much about america as they say they do and we think they do. Nothing has really happened since 9/11 except some cockamamie schemes and idiotic tries (like that car-bombing, with the gasoline and nails. Gas doesn't explode, it burns, you idiots).

They could blow up buses, blow up gas stations, shoot people, have car bombs, or any other number of things. If they really wanted to cause terror, they would. If they really wanted to kill as many americans as they could, they would. They would at least be trying. They care about the middle east and Israel.

I'm not saying that they aren't going to try again, of course they are. We have to remain vigilant and try to keep ourselves safe.

What am i saying?

I wouldn't worry that hard about another terrorist attack crippling the economy again. It could happen. I don't think it will.

But the stock market and economy with have a bear market again. Not a crash, but i bet that it will go to about 3/4 of it's current size. Then, we start to buy like crazy and it goes up again. It's just how it works.

[progbuddy]

There is no definitive answer, yet there is a trend that has been going on for decades now.

[Crazy Buddhist]

But the stock market and economy with have a bear market again. Not a crash, but i bet that it will go to about 3/4 of it's current size. Then, we start to buy like crazy and it goes up again. It's just how it works.

I say 50% loss or more at the trough which may take 9 - 12 months to arrive.
It will be a rollercoaster from now until then.

Matthew

[Airbozo]

I say 50% loss or more at the trough
Matthew

I (and every other analyst) doubt this very much. If the US stock market dropped to 50% of it's current value the WORLD will be in trouble. This just will not happen. "."

Of course if you turn out to be correct, none of us will be able to validate this post because the economy will be so bad that none of us will be able to afford any sort of internet connection.

[Crazy Buddhist]

Airbozo

It's happened before.

Jeremy

Take professional advice and follow your nose.

Matthew

[Airbozo]

Airbozo

It's happened before.


Matthew

When?

[Crazy Buddhist]

1720 for one:

(http://en.wikipedia.org/wiki/South_Sea_Bubble)"The price of the stock went up over the course of a single year from one hundred pounds a share to over one thousand pounds per share. Its success caused a country-wide frenzy as citizens of all stripes – from peasants to lords – developed a feverish interest in investing; in South Seas primarily, but in stocks generally. Among the many companies, more or less legitimate, to go public in 1720 is – famously – one that advertised itself as "a company for carrying out an undertaking of great advantage, but nobody to know what it is".[1] (http://thebestcasescenario.com/forum/#_note-0)
The price finally reached £1,000 in early August and the level of selling was such that the price started to fall, dropping back to one hundred pounds per share before the year was out, triggering bankruptcies (http://thebestcasescenario.com/wiki/Bankruptcy) amongst those who had bought on credit, and increasing selling, even short selling (http://thebestcasescenario.com/wiki/Short_selling) - selling borrowed shares in the hope of buying them back at a profit if the price falls."

[Airbozo]

Ok, fair enough, but that is _old_ history and the checks and balances put in place after the stock market crash of 1929 prevents anything like that from happening again.

Hell even the housing market would not fall that much. In Norcal, housing sales slowed (just recently), but the prices went up. All those foreclosed homes still have value, although not as much as the bank would like, since a lot of them were purchased on 100-115% of value loans (forgive me for not knowing the technical loan name). Once the majority of those houses are foreclosed, they will still have buyers that need loans and someone will buy those loans, but again, the finance company will not make the profit they were making. I am waiting for the worst of days in the housing market to utilize my equity to purchase another home. Predatory? Maybe. More like smart investing.

Then we have China fueling several different sectors of the market due to their massive economic growth and that juggernaut will NOT be stopped or barely even slowed.

Now take this as it is presented, by a computer engineer with no formal financial training. Anything can happen, I personally believe that if the US was not in Iraq right now, the economy would be worse, and that was Shrub's puppet master(s) plan.

[xRyokenx]

On the bright side, if and when it crashes/drops, I could buy some stocks to help myself get going.

[Crazy Buddhist]

I say 50% loss or more at the trough which may take 9 - 12 months to arrive.
It will be a rollercoaster from now until then.

Matthew

Having been somewhat trashed for my analysis please be assured I do not take any comfort from this, but;

I have no idea of the current views of US based pundits and media but as of this weekend the media and pundits in the UK have caught up with my realisation of the state of markets.

The specific predictions being widely touted: a drop of probably 50% or so in market capitalisation ... over the next nine months or so.

Oh ... and someone asked what kind of materials shortage: take your pick.

Oil and food may be those causing the greatest international conflict by this time next year.

[Crazy Buddhist]

Having been somewhat trashed for my analysis please be assured I do not take any comfort from this, but;

I have no idea of the current views of US based pundits and media but as of this weekend the media and pundits in the UK have caught up with my realisation of the state of markets.

The specific predictions being widely touted: a drop of probably 50% or so in market capitalisation ... over the next nine months or so.

Oh ... and someone asked what kind of materials shortage: take your pick.

Oil and food may be those causing the greatest international conflict by this time next year.

UPDATE:

Each new year BBC Journalists have a meeting and predict the years events. One of their main predictions for 2008 was "food riots" in China, Africa and South America.

Then I came across this:

Forecast for 2008
James Howard Kunstler
Author of The Long Emergency
Jan 4, 2008

Down and Dirty

I shudder to imagine how things will play out now as we turn the corner into 2008. Not to put too fine a point on it, but my little walnut brain can't imagine any scenario in which the US economy doesn't end up on a gurney in history's emergency room. It's not necessary to rehash the particulars of the Greenspan bubble-blowing disaster. The outcome is what concerns us. The web cables have been blazing for months with arguments as to what form the workout will take. There's little disagreement about the fundamentals at the housing end of things.

The housing market is in a death spiral. Eventually, the median price of a house will have to fall back to the median income, and it has a very long way to go, perhaps 50 percent. Until that happens, houses will be generally unsellable. At the same time, of course, an anxious finance sector will be offering fewer mortgages and on much more rigorous terms, so there will be far fewer qualified buyers even for distress sales. And the median income itself may soon not be what it has been. The whole equation has changed. As the painful re-pricing process plays out, many owners/sellers will be upside-down and under water in what they owe on the mortgage in relation to the value of the house they occupy. Quite a few may have lost jobs and incomes along the way. Most of these unfortunates would be better off just mailing in the keys and walking away. But in so far as these awful liabilities are peoples' homes, full of all their stuff and their childrens' stuff, not to mention being the repository of all their previously-imagined wealth, as well as their hopes and dreams, walking away is psychologically more easily said than done.

....

One thing the public doesn't get about the housing debacle is that it is not just the low point in a regular cycle -- it is the end of the suburban phase of US history. We won't be building anymore of it, and those employed in its development will have to find something else to do. Now, unfortunately the whole point of the housing bubble was not really to put X-million people in so many vinyl and chipboard boxes, but rather to ramp up a suburban sprawl-building industry as a replacement for America's dwindling manufacturing economy. This stratagem ran into the implacable force of Peak Oil, which not only puts the schnitz on America's whole Happy Motoring / suburban nexus, but implies a pervasive trend for contraction in everything from the daily distances we can travel to the the very core idea of regular economic growth per se -- at least in the way we have understood it through the age of industrial capital. But to return to my point, something like 40 percent of all new jobs after the year 2000 were created in the final burst of suburban expansion -- everything from the excavators to the framers to the sheet-rockers, and then the providers of granite countertops, the sellers of appliances and furnishings, and cars to service the far-out new subdivisions, and so on. This is the end, therefore, not only of the production "home-builders," but perhaps everything from Crate and Barrel to WalMart, too, eventually.

cont /...

[Crazy Buddhist]

cont /...

...

What happens out there on the housing market scene will certainly redound in banking and finance and whatever still constitutes the US economy generally. The fears and uncertainties surrounding all credit-backed tradable securities derive first from the millions of troubled home mortgages dangling slowly in the wind. These fears and uncertainties will multiply as defaults commence in commercial real estate, and desperate individuals next enter a wave of credit card default, all of it, too, securitized and sprinkled all over the world. None of this stuff has yet been priced into the public disclosures of the many troubled banks and bank-like companies holding it. Nor does anyone really know how this is affecting the hedge funds, and their staggering leveraged positions in things that are looking more and more like quicksand. I can't imagine that quite a few major banks will not collapse in the first half of 2008. It is hard to escape the conclusion that many hedge funds will also blow up, given the unsoundness of their counter-parties' positions, not to mention the frailty of the bond reinsurers. But the death of more than a few hedge funds could easily unwind the entire global finance system -- meaning a period of destructive chaos followed by a set of severely different institutional arrangements, with untold loss of imagined capital wealth along the way and big changes in everyday life. The world has never really been in a situation like this before and it is impossible to say what it might lead to. But there is no doubt that the American public has enjoyed an artificially high standard of living in relation to the value of what we actually produce -- fried chicken, hair extensions, and the Flaver Flav Show -- so the conclusion is pretty self-evident.

Others have said (and I concur) that 2008 will be the year that the issue of Peak Oil not only takes stage in the forefront of American politics, but pushes global warming aside as the most immediate threat to the "modern" way-of-life. There is every reason to believe that the world has arrived at its all-time oil production peak -- and some statisticians would even pin-point the exact moment as July 2006. Since then a few new and crucial story-lines have emerged to allow us to understand what is happening out there on the world oil scene.

One story-line is that only "demand destruction" among the world's poorest nations has kept the oil markets functioning "normally" among the OECD nations and the rising Asian players. Even so, oil priced in US dollars more than doubled in 2007. It remains to be seen whether demand destruction in a wobbling US economy -- with the suburban builders crippled -- will keep oil prices from jumping into the uncharted territory beyond $100-a-barrel. But two other forces are in operation now.

One is the growing oil export problem, soon to be a crisis. It now appears that exports, in nations with surplus oil to sell, are going down at an even steeper rate than production declines. Why? They are using more of their own oil. The population is growing robustly. The Saudi Arabians are building the world's largest aluminum smelter and many chemical factories. This takes a lot of oil. Russia, another big exporter, saw its car sales jump by 50 percent in 2007. Mexico is depleting so rapidly, and using so much more of its own oil, that it might be out of the export game altogether in three years. That will be bad news for the US, since Mexico is tied with Saudi Arabia as America's number two leading source of oil imports. Remember, the US now imports close to three-quarters of all the oil we use.

The second new factor on the Peak oil scene is "oil nationalism." It is prompting countries like Norway and Russia to husband more of their own resources as the awareness hits that they are past peak and might want to keep their own motors humming further into the future. Oil surplus nations are also trending more toward selling their oil on the basis of long-term contracts with favored customers rather than just auctioning the stuff off on the futures market. This makes oil a much more important element in geopolitical power politics. Note that the US may not enjoy "favored customer" standing among many of these nations.

Matt Simmons, the leading investment banker to the oil industry, predicted at a major conference in October that the US is much closer to encountering a problem with chronic spot shortages of oil (and gasoline, of course) than the public realizes, and Simmons says that this supply problem will be extremely disruptive in every imaginable way -- economically, politically, and socially. Most of the commentators I take seriously see the price of oil oscillating in 2008 between $80 and $160-a-barrel. Simmons says Americans will keep sucking up the price increases, but they will probably freak out over spot shortages.

I have no idea how presidential election politics will play out in 2008. It must be obvious that so many nasty pitfalls lie out there in the months ahead that something's got to shake up the current scripted mummery among the contenders. The current batch of candidates will soon find their story-lines and pre-cooked messages out-of-date as the nation faces crises in finance and energy (at least). Given the uneventful geopolitical scene of the past 18 months (since the Hezbollah-Israel War and up to the murder of Mrs. Bhutto in Pakistan), odds are that the US will have more rather than less trouble from the rest of the world in 2008 -- especially if our own financial recklessness trips up the global economy.

Back in the early days of George W. Bush, even before 9/11, I used to joke with my friends that Bill Clinton would return as the Emperor Bill the First. The joke doesn't seem so funny anymore with Hillary off and running. I never liked the way she muscled her way into a US senate seat -- sending the message, in essence, that there was not one genuine New York resident qualified for the job. But there is so much more about her I dislike now, starting with her presumption of dynastic entitlement to the annoyingly phony way she nods her head (like one of those old "drinky-bird" toys) to put across the idea that she is a fabulous "listener." I write this a few days before the Iowa caucuses and then the New Hampshire primary. New York's Mayor Bloomberg is suddenly making noises again about entering the race as an independent. That might lead to a situation as fractured as the one in 1860 that saw a multi-party scuffle send Lincoln into office (or the election of 1912 when Teddy Roosevelt made a credible run on the independent Bull Moose line). At the moment, I'd like to see both John Edwards and Barack Obama roll on. The mere thought of a president Huckabee gives me the chilblains, and the rest of the Republican pack I would not want to have as my county supervisor.

In any case, whoever ends up in the oval office will preside over one king-hell of a cluster*uck. In the immortal words of TV's erstwhile "Mr. T," I pity da fool who gets elected into this mess. There will be a whole continent full of bankrupt, re-poed, and idle former WalMart shoppers, many of them with half of their skin tattooed and many of that bunch all revved up to "roll heavy and gun up" against the folks who screwed them.

Which leads me to my penultimate observation of the moment: 2008 will be the year that celebrity wealth goes into hiding. A land full of people crying into their foreclosure notices will take a dim view of the Donald Trumps and P. Diddys luxuriating out there and may come looking for scalps -- though in the case of Mr. Trump they'll be sorry they woke up the wolverine that lives on his head. Basically, though, I'm not kidding. Conspicuous displays of wealth will be so "out" that Mr. Diddy might take to club-hopping in a 1999 Mazda. Lindsay Lohan and Paris Hilton may have to double-up living in a minuteman missile silo to keep the angry mobs of fans-turned-vengeful-berserkers away.

Okay, my final comment. After being chastised endlessly about mis-calling the DOW in 2006 (I said 4000), I have learned my lesson about making numerical predictions for the stock markets. So let's just say there is no *ucking way that the DOW, the NASDAQ, and the S&P will not end the year 2008 absolutely on their asses. The charade of permanent prosperity based on getting something for nothing is over. That sound you hear out there is reality knocking on the door. It has been standing out in the cold for a long time and it is not happy with us.

James Howard Kunstler
email: kunstler@aol.com
website: www.kunstler.com

Jim Kunstler is the author of The Long Emergency, The Geography of Nowhere and many other books. He lives in upstate New York.

www.321gold.com

[Quakken]

Those last two posts... I understood about 15% of them. Apparently, the american educational system has failed in educating me in economics.

[Crazy Buddhist]

Those last two posts... I understood about 15% of them. Apparently, the american educational system has failed in educating me in economics.

But not statistics so there is some hope ! :D

ps Sorry for the double post but that (cut down) version was 14,000 characters and I had to split the post. The full article is well worth a read.

Anyone that wants an upside protection would do well to look into buying gold.

[Ichbin]

Well, this kinda dampens my mood...

What should we do to prepare ourselves? saving money wont help, or should we invest in more international markets?

[Quakken]

Lets move to canuhduh.

[Crazy Buddhist]

Well, this kinda dampens my mood...

What should we do to prepare ourselves? saving money wont help, or should we invest in more international markets?

Tighten the belt. Reduce debt quickly. Get "off the grid" if you can. If you have investments I would talk to your broker about taking out some downside protection using put options (6 month view big drop). Switch equity that has to stay as equity towards blue chips the Gov must support ... and as I just said Gold may provide an upside protection as the full force of collapse of the financial markets gets priced in to commodities.

Nothing I say should be taken on board without consulting your financial adviser (disclaimer to protect myself and TBCS).

Matthew

[Ichbin]

I'm just worried cause I live in michigan....the ****tiest state in the US involving economy

[chaksq]

Ok so say this happens, which I don't doubt. I've seen serious issues coming to pass in this country for a while now, the government keeps digging the holes deeper and everyone acts so arrogant that nothing could really damage the US. What should I do? Reducing debt is not completely viable option as I'm in school paying a very large amount each year, the majority of which is going into student loans.

Also what exactly are we supposedly looking at? Is this going to be like a repeat of the Great Depression. I firmly believe that history repeats itself, I've seen too much evidence for me not to.

[Crazy Buddhist]

Also what exactly are we supposedly looking at?
Worse case? No one knows. It never happened to an information society.

... but lots of people with nothing, no money, no work and no hope isn't ever going to be pretty. We could end up quite quickly in a bout of old fashioned stagflation with a stagnant or shrinking economy and inflating prices. Effectively money becomes worthless. Fewer and fewer goods being chased by poorer and poorer people. Given we've moved on 80 odd years from the Great Depression in terms of knowledge I suspect things will not be as extreme but no one really knows. It could be worse. It could be a blip and after a year things get better, could last years. We've lost all our manual skills as a populace. there are so many factors.

[NightrainSrt4]

Hopefully this won't be too bad. Least I hope. Because if it is, I am screwed. Big college loans on a fluctuating interest rate. I am trying to get some nice scholarships for the next year because as it is, by the time I pay off the one 20k loan I took out for this year, I will have payed them 70k. A few more years of that and I am screwed if things get worse. Because if they do get worse, getting a nice job is going to be even harder.

Just gotta keep my head up and take it in stride.

...

And maybe move to Canada... ;)

[Crazy Buddhist]

As long as you keep the loans and earn enough to pay the interest and buy food you'll be fine. Massive inflation will reduce the value of your loan.

[Quakken]

Well I guess I will have to start work on that cabin in that cabin in the woods so I can live off the land while the country remakes itself.

I'll have to bring a girl though. Wouldn't want to be lonely up there...

Or how about this- Storing gasoline. Make a million gallon tank, fill it up now before gas prices go any higher.

Then once they start peaking at 10 dollars a gallon, you prosper.

A 7 million dollar increase, and you only have to wait until money is so overinflated that its worthless anyway!

[Crazy Buddhist]

If anyone is wondering where the money all went the British Private Banking Association released figures this week showing a 128% increase in deposits over the last year (yes they more than doubled).

We all been pwned by "The Man".

CB

[Drum Thumper]

If anyone is wondering where the money all went the British Private Banking Association released figures this week showing a 128% increase in deposits over the last year (yes they more than doubled).

We all been pwned by "The Man".

CB

I knew this in 2006 when gas prices dropped right before the election.

[Greco101]

Buddy just sent me this: "Stocks Tank - Dow plunges more than 300 points; Bush, Bernanke support short-term stimulus "

http://www.foxbusiness.com/markets/article/recession-fears-blanket-wall-street-dow-drops-300-points_440155_2.html

[haha49]

The thing about this is alot of baby boomers are retirueing puting more strain on the system meaning the average person needs to spend more and more.. the houseing market is going down but that can be a good thing as people who couldnt afford a house to start with now can.. the stock market prices going down could be a good time to invest as it gets lower and lower its cheaper to obtain more shares of the market and when it bonces back which it will you then cash in on it.. the key is not to panic just save money and make sure you have a stable job

[Crazy Buddhist]

The thing about this is alot of baby boomers are retirueing puting more strain on the system meaning the average person needs to spend more and more.. the houseing market is going down but that can be a good thing as people who couldnt afford a house to start with now can.. the stock market prices going down could be a good time to invest as it gets lower and lower its cheaper to obtain more shares of the market and when it bonces back which it will you then cash in on it.. the key is not to panic just save money and make sure you have a stable job

I think you are wearing rose tinted spectacles.

The rich get richer during recessions and the poor get poorer. Because as the economy collapses lots of people lose their jobs, fail to make mortgage payments, lose their houses, no-one has cash to enter the market - except the rich who don't have jobs to lose or debts to finance. Companies stop spending and hiring. And the economy goes plop.

The london stock market at this moment is down 8% in two days. It may rise again. But by the end of this year this will look like the good times.

Matthew

[Omega]

So wait.

CrazyB predicted all of this basically.

Holy crap.


Now is a good time to know that your parents simply can't lose their jobs (the company needs them more) and to not have to worry about your own finances.

Any chances we'll get a deflation? that'd be nice.

[Crazy Buddhist]

Stagflation is more likely and that is not pleasant.

Thanks. Yes I predicted this and long before most of the pundits. Dow Jones not doing well today but I'm unconvinced this will be the big drop. Central Banks are still holding liquidity in the markets (just) and the veil of delusion of possible stability is still being clung to by many people (read this thread for example). These things mean a bounce back is likely at this point. However end of the year I put the dow in the range of 5 - 8,000 and probably at the lower end of that.

CB

[luciusad2004]

Um... I didn't read the thread but I had a question. Is this sorta stuff the kinda thing I would want to get to understand? I'm not rich, and i don't invest in things, I'm just an average 19 year old guy. Does all of this effect me enough that i would want to know what you guys are talking about?

\Edit: People talk stocks and economy and i just get lost.

[XcOM]

basicly the world is looking at a resession, as such meny companys start to lose money, when they do, the let people go, stop spending there money else where creating a knockon effect with the next company, They also stop hireing people,

Banks stop lending, and start calling in there debits so to speak, they get very hard on people that miss payments, even if its there first. There was a rumor that some banks would call in all there overdrafts if a recession did start.

Edit
------

Also thanks for the tip in the first post CB, after you mentioned this i looked into and i starting clearing my debts, i now only old £150 to the bank in the form of my overdraft, and have myself a steady job that should be good as its producing food, and everyone needs food.

[Crazy Buddhist]

Um... I didn't read the thread but I had a question. Is this sorta stuff the kinda thing I would want to get to understand? I'm not rich, and i don't invest in things, I'm just an average 19 year old guy. Does all of this effect me enough that i would want to know what you guys are talking about?

\Edit: People talk stocks and economy and i just get lost.

Will a nineteen year old understand what happens when the gas tanks are dry for a few days every month? Will a nineteen year old understand what is happening when people in Africa, Asia and South America are starving and rioting for food? Will a nineteen year old be affected if the bank his college is banking with goes down losing all their money? Or his dad's employers bank? Or all the banks? Or if the shops get short on food?

If some or all of these issues seem relevant to your life I'd suggest you read the headlines at http://news.bbc.co.uk/ once or twice a week and keep up with current events. Having seen American TV news during my lovely trip to Orange County last spring I can assure you that if you want to know what is actually happening in the world the BBC is still the best place to stay current.


Just a thought. ;)

Matthew



Also thanks for the tip in the first post CB, after you mentioned this i looked into and i starting clearing my debts, i now only old £150 to the bank in the form of my overdraft, and have myself a steady job that should be good as its producing food, and everyone needs food.

YW mate :)

[xRyokenx]

Time to sell some unneeded organs for cash! lol, jk... I hope I get hired somewhere soon, otherwise I'm gonna be stuck here with my jerkass dad (not going into more detail than that) for a while... lol Any ideas as to what I can do?

[luciusad2004]

Ahhh, sorry. I wasn't trying to be rude. Was just asking because i never really payed attention to this stuff but i always hear people talking about it. I actually thought about all the student aid i get after i posted it and realised my education is probly heavily dependent on the market. Sorry for the stupid question : \

[xRyokenx]

(Reminds everyone that tones of voice and how things are said and all that isn't always conveyed as meant in text. Many a misunderstand has occurred from textual communication. :))

[Crazy Buddhist]

Sorry for the stupid question : \

lucius

Sorry bro. Don't let my sarcastic British accent make you think I was bein serious with you. But yeah that's the point. It may not get that bad but at it's worst, people are only just starting to realise how bad it may get.

There are reasons it might. There is the question of ecological and resource limits having been hit years ago in reality. If that whammy's us on the arss and a few hurricanes hit the US this year after the first couple of banks fail then we will be looking at something on the heavier end.

Also it could mean, at the end of the day, a serious global realignment of power. The Chinese currently owns the US holding maybe $500 trillion of Uncle Sams Govt issue bonds.

Basically if the $hit really hits the fan we would see the IMF, World bank and united Nations all reformed and a new global economic and financial system developed. Only question would be, in whose interests?

Maybe this is where the Project For the New American Century (http://www.newamericancentury.org/) founded by Jeb Bush and others would step in.

"The Project for the New American Century is a non-profit educational organization dedicated to a few fundamental propositions: that American leadership is good both for America and for the world; and that such leadership requires military strength, diplomatic energy and commitment to moral principle."

Matthew

[simon275]

Going back on topic. To give you an idea of what has happened here. The gains on the Australian Stock Market made in 2007 where wiped out in the last two weeks. At least the interest rates in the US have been lowered and the Futures Market was up last night so heres hoping we regain some ground.

[luciusad2004]

Sorry for the misunderstanding : )

I see what you are getting at though with the profound effects economics could have on the world. I guess i never really thought about it on that level.

[Crazy Buddhist]

Dow Jones not doing well today but I'm unconvinced this will be the big drop. Central Banks are still holding liquidity in the markets (just) and ...

By doing this:


At least the interest rates in the US have been lowered and the Futures Market was up last night

However,


... the veil of delusion of possible stability is still being clung to by many people (read this thread for example). ...

People are still clinging to the illusion of possible stability:


... so heres hoping we regain some ground.


...These things mean a bounce back is likely at this point. However end of the year I put the dow in the range of 5 - 8,000 and probably at the lower end of that.

So .. we've had a bounce with a 3/4 point rate cut in the US but that held the liquidity problem at bay for only one week ... another cut of half point expected today. How long will that keep the engine running? Another week?
Further cuts risk inflation. There is a limit to how long central banks can play this game and I believe they are hitting it.

The British Government has just announced legislation so they can keep banks afloat without publicising their interventions. This, remember, is called "free market capitalism". What is free about a market that collapses and is not allowed to fail? What is free about a market that is permanently subsidised by tax dollars/pounds/euro's?

Free market theory rests upon the flow of information about matters in the market between market players. Now the turf the players are playing on will be constantly moving under their feet and they will not even have the information needed to make informed decisions about the market because there will be strong market forces of which the players have no clue.

And this is not just any market remember, this is the market of all markets, the market in money: the one that facilitates all other markets and underpins their functioning.

For this reason I propose that the impending financial implosion will historically be seen to have marked the end of "free market capitalism" - as we know it. It may be five to ten years before it is publicly recognised as being such but probably not given the total rearrangement of global financial institutions likely to follow.

The question remaining is whether the international agenda that emerges will be based on common ground between all people (i.e. we live in the same ecosystem) or the selfish interests of the few (i.e. parasites on that ecosystem).

"May you live in interesting times" was a Confucian curse. I say curse Confucius.

CB

[TheGreatSatan]

Buy Gold. You just can't lose!

[Crazy Buddhist]

Buy Gold. You just can't lose!

Probably not wrong. I mentioned that some time ago too.

[luciusad2004]

Wait so... the British government is going to help out institutions in financial peril... but they are going to do it under the table? Did they give a reason as to why? Or how this is going to help? Why can't they disclose the information w/ tax payers. Are they just hiding it so that people don't see who they are helping and then get nervous about dealing w/ that organization?

[Crazy Buddhist]

Are they just hiding it so that people don't see who they are helping and then get nervous about dealing w/ that organization?

Yup.

[luciusad2004]

Thats stupid. People should have the right to know about a company before they drop money to invest in it.

I guess i can see the logic. Don't let the people get nervous, spur them to invest more, hope it saves the economy. I can't say i agree w/ how its being handled though. I wonder if we do anything like this over hear in the states.

Is this (the stock market crash) something that could be avoided through better business practices and politics or is it just something natural that is happening for uncontrollable reasons? I guess what I'm asking is, is this somebody's fault? (big business, politician, apathetic poor people like me?)

[Crazy Buddhist]

Is this (the stock market crash) something that could be avoided through better business practices and politics or is it just something natural that is happening for uncontrollable reasons?

It's inherent in our personalities and economics. We get greedy, we use more than we can afford, we borrow, we have to tighten the belt.

[xRyokenx]

I just had a thought... since the US keeps borrowing money from people... and doesn't seem to be paying anything back... don't these other people technically own the US? ...if that's even possible? :think:

[Crazy Buddhist]

The Chinese currently owns the US holding maybe $500 trillion of Uncle Sams Govt issue bonds.

Yes.

[xRyokenx]

Look out Canada here I come! Seriously... and I guess it now makes sense that we buy so much of their cheap crap.

[Crazy Buddhist]

Told ya so. Bear Stearns OUCH!!!! and they reckon J P Morgan might be next to hit the wall(street).

CB

[Ichbin]

Well, thats because JP morgan decided to spend a crapton on buying a ton of shares of Bear.

Wonder why?

[Crazy Buddhist]

Well, thats because JP morgan decided to spend a crapton on buying a ton of shares of Bear.

Wonder why?

That is not the most interesting question. The most interesting question is ..... who spent a crapton buying shares in J P Morgan .... the whole thing is a charade, a house of cards .... and the wind is getting stronger daily and the house of cards more shaky too ....

Watch this space!

CB

[Ichbin]

Is it a buyers market right now? or should I particulary wait to see if companies fall through or not?

[Crazy Buddhist]

Is it a buyers market right now? or should I particulary wait to see if companies fall through or not?

Nothing I say should be taken as investment advice. I put this disclaimer here for my benefit and TBCS's. You are best consulting your own qualified investment adviser before taking any investment decisions.

Having said that as a member of any community I act out of what I consider to be the best interests of my comrades. This community is no different in that regard. I am a qualified investment analyst and still have good contacts in the financial world. My personal take (and that of my contacts) is that it won't be a buyers market for another 9 months to a year or more. That is likely to be the trough period when all the s@@@ has hit the fan and the waves have worked their way through the system. Your investment advisers position may be different. However, it is also always worth bearing in mind that people who work in the markets have a habit of "talking them up" - after all, when things get really bad their jobs are ultimately at risk so they don't like to see how dark it might really be.

CB

[Airbozo]

Hehe thanks for the post Crazy.

I always believe that when you pay a financial analyst there is some sort of conflict of interest (just like a real estate agent). After all they are in business to make money, whether or not you make money. They have a habit of recommending plans that pay them for signing you up even if they tank. Not all are like this. Some truly are interested in helping you make a good investment, but those are hard to pick out.

The SO and I are trying to plan for our future (financially) and have been through 3 advisor's so far because they keep trying to sign us up for all of their companies plans when what we are really looking for is _how_ to invest and where. It has become more of a headache and we really hope it pans out. **** I just say we stuff our cash in the mattress until things cool down, but it would be a pretty flat mattress right now.

[Ichbin]

(This is like...CBs MAD MONEY hour on TBCS lol)

Would you recommend the E*Trade program?

[Crazy Buddhist]

(This is like...CBs MAD MONEY hour on TBCS lol)

Would you recommend the E*Trade program?

1. See post above re disclaimer

2. lmfao

3. No. Trading programs only really "work" for the people who sell them to you.

One of my best buddies has been in the markets non-stop for over twenty years working as a trader of derivitives and now as a programmer of trading tools on a trading desk at one of the most profitable banks in London. He earns around $2,000 per day for his programming work (yes 2 x one thousand dollars US per day). His first degree at university was in economics and his masters is in computer programming.

He has been trying for the last ten years to develop a program trading system that consistently shows results. The man is a genius. It can not be done, he says.

I could have saved him ten years work however, because, if any program trading system really worked then everyone would use it - and as a result no one would make money from it because it would stop working. The prices in the market would adjust too quickly. This is inherent in the nature of markets.

The best trading system there is, frankly, is a damn good nose. You have to smell the air and see if it's good or not. Right now it's worse than the sewers of 17th century Paris.

Personally if I were buying anything right now it would be put options (not futures) on the major markets with a longevity of around 6 - 9 months. I can't see those losing money, if you buy right and sell without being too greedy - an old saying from the exchange "leave something for the next man" - it means take a reasonable profit because greed comes before a fall in these matters.

Matthew

[Crazy Buddhist]

I say 50% loss or more at the trough which may take 9 - 12 months to arrive.
It will be a rollercoaster from now until then.

Matthew

The UK housing prices have fallen 10% in the last year, are predicted to fall another 35% over the next two years. Also next year the UK is predicted to experience negative growth (i.e economic contraction).

BEAR MARKET AS PREDICTED. WORST CASE: NEGATIVE GROWTH, INCREASING INFLATION, AND THE CREDIT CRUNCH HAS NOT EVEN BITTEN OUR TOES YET: COULD BE LOOKING AT THREE YEARS OF ECONOMIC HORROR.

[XcOM]

......: COULD BE LOOKING AT THREE YEARS OF ECONOMIC HORROR.

and the rest,

[Crazy Buddhist]

" "The stock, bond and foreign-exchange markets continue to trade essentially on the theme that the global economy is weakening, but that the U.S. has dodged a recession," Hussman wrote in his weekly market commentary in late August.
Investors' consensus is mistaken, Hussman contends. He said the U.S. is mired in recession, and once investors realize that earnings expectations are overblown, stocks will take another major hit.
"The potential downside could be abrupt, leaving little opportunity to make defensive changes after the fact," Hussman wrote. "

From: MarketWatch (http://www.marketwatch.com/news/story/four-horsemen-market-why-you/story.aspx?guid={7E15D43B-33E7-4179-87A5-06BCD94C6BF3}&dist=TNMostRead)

[Quakken]

Christ. This is the world that I am inheriting from the last generation? I want to believe that the earth will finally learn that greed is NOT a way to live. I know it won't. This won't be the only depression that I will be in in my life, either. That's right. Depression.

Damn. The sad thing is, it's nearly unstoppable at this point. The housing and oil markets are constantly deflating, and with rampant government spending of the money that china owns, inflation isn't going to help either. Well, let's hold onto our hats. It's going to be a bumpy ride.

[Crazy Buddhist]

Quakken,

No, the people of the earth are learning these lessons.

Borrow a copy of "The Turning Point" by Fritjof Capra and you will understand not only this recession, this mess of a world, but how and why it will be getting better much more quickly than most people realise.

Yes the ride will be bumpy. There was a Confucian curse: "May you live in interesting times". Why a curse? Because interesting times are changing times and changing times offer bumpy rides. We live in interesting times.

Matthew

[blueonblack]

Christ. This is the world that I am inheriting from the last generation?

Look at the world that countless generations before yours inherited and be glad you got this one.
________
Vaporizer help (http://vaporizer.org/forum/vaporizer-questions/)

[Quakken]

Ah well. At least we probably won't be having food rationing or something like that. We're going to be hit hard, but not as hard as some other places.

[Crazy Buddhist]

Gas rationing is a more likely scenario for the US than food rationing.

[Airbozo]

Gas rationing is a more likely scenario for the US than food rationing.

I doubt there will be any sort of gas rationing. Petrol use in the US has dropped significantly over the last year. Besides it's not a supply issue this time (like it was in the '70's), rather more of an economical issue. The gas is there, but for some the money to buy it is not.

Interesting thing though is that some people are not being adversely affected by the economy besides the cost of gas. Certain costs have gone up due to the cost of shipping goods and services but that is the extent of the pain for a lot of folks. The company I work for has doubled or even tripled in volume over the last couple of years (we are on par to make more than during the .com boom) and several companies I know of are hiring and expanding. We are moving because we ran out of space to do our jobs.

Personally the gas costs are my only gripe...

[blueonblack]

Same here. It's interesting that I work at a transportation company, and those have been folding all over the US, but ours has actually bought out several of them. Our fleet is over four thousand trucks now and growing every day. Interesting circle, the fact that things are costing more in the US due to the increased cost of transport is what keeps my company not only afloat but prosperous. Which in turn keeps me employed.

As an example of increased transport costs, I recently saw a freight bill (I don't normally see those) for a trailer load of produce of some kind (not sure what specifically) that was being sent from Florida to Washington, just about the longest haul we make. Our customer paid my company just barely under $10,000 to get that single load delivered.
________
VAPORIZER (http://vaporizers.net/vaporizers)

[Crazy Buddhist]

Both of you have quoted normal situations: In a downturn not everyone loses out. Well managed companies which are adequately funded often do quite well in recessions, building market share and growing as you have described.

As blueonblack has pointed out, in his industry his company is bucking the trend. It is probably due to these reasons.

The same is true for individuals. Wealthy individuals tend to become much wealthier relative to the average during recession whereas those who are struggling just drown.

Matthew

[Crazy Buddhist]

I (and every other analyst) doubt this very much. If the US stock market dropped to 50% of it's current value the WORLD will be in trouble. This just will not happen. "."

The Dow Jones industrial Average is currently down 21% from it's peak and the momentum indicators show the trend is still strongly downwards. The problems of credit still have not fully been reflected in market prices.

We're nearly half way to the drop I predicted, though I happily admit my timing was not quite right and it is taking longer for the fundamental weaknesses in the system to fully come through.

Market volatility is on increasingly upward trend signifying a turn one way or the other. I predict it will be another downturn bringing us close to the 50% drop I proposed. Ouch.

Matthew

[XcOM]

it seems that the world banks and the goverment have infused a huge ammountof money in the markets, this is the biggest rise in value ever.

i admit we still havent seen the last of this but i feel that after looking at the markets everynight at work, i think it will be over in a year or so when its over and settles down

[TheGreatSatan]

Before or After we pay all those Billionaires debt?

[Crazy Buddhist]

it seems that the world banks and the goverment have infused a huge ammountof money in the markets, this is the biggest rise in value ever.

i admit we still havent seen the last of this but i feel that after looking at the markets everynight at work, i think it will be over in a year or so when its over and settles down

What you are seeing is volatility - rapid and large movements of prices due to uncertainty in the markets.

Injection of capital is a temporary fix and always within a few weeks the markets continue their decline. Today the Dow is down 370 points.

The markets have no idea any more how to price securities. What the governments have done is ensure the short term survival of the banks and the rich and undermined capitalism to an extent it may never recover.

And TGS is right we will all be paying for this - principally through inflation which is now going to spiral at exactly the same time the world economy is actually heading into the depth of the recession. This means 2009 could be a year of stagflation - large inflation with negative economic growth.

The markets have a lot further to fall yet. I'm putting the Dow Jones Industrial Index at around 8 -9,000 by Christmas. Thats another 20 - 30% fall from current stock valuations.

Matthew

[luciusad2004]

Is there a Light at the end of this tunnel? Does it ever bounce back up? Am i going to bring kids in to a world of misery and depression? :(

[Crazy Buddhist]

That's up to you. We collectively make our world. The money system as it has existed has created more misery and depression than anything good. the fact that it is collapsing is part of the end of one era of social organisation and the beginning of another. The collapse may be longwinded but hopefully not.

An economics based on sufficiency (i.e enough is enough) is the only thing that can save us from these problems. Not technology, market interventions or government - people being less greedy. That's something everyone can work on.

Crazy

ps made $18,000 on the falling market today. Just getting back into trading on the current volatility. Unfortunately it was fake money in my dummy trading account. Looking forward to doing some real trading again as I need to get to around $200K before the end of the year (for necessities not a Mercedes Benz).

[TheGreatSatan]

The dollar is going right in the toilet. BUY GOLD NOW!!!

[XcOM]

don't buy gold, buy nickle or othjer alloys, my bro works for a scrap recuceling, the price is going through the roof like never before!

and its good to hear from you again CB, its been a while, you doing any better now?

[Crazy Buddhist]

Anything I say in this post should not be taken as investment advice or acted upon. You should see your own qualified investment advisor, aware of your particular circumstances, before making any investment decisions. This disclaimer is here for my benefit and that of TBCS. The opinions contained herein are my own and if you act on them without taking advice from a qualified person in your own jurisdiction you are doing so at your own risk and have been duly warned.



don't buy gold, buy nickle or othjer alloys, my bro works for a scrap recuceling, the price is going through the roof like never before!

and its good to hear from you again CB, its been a while, you doing any better now?

Commodity shortages was one of the things I mentioned at the start of this thread last year. That, the huge inflationary influx of government cash to the markets and a (correct) perception of inevitable economic recession will undoubtedly lead to increased prices across the board.

If you want to make money off the markets in the next six months just wait for the rally that follows every governmental cash injection to top out and then buy slightly out of the money put options - a week later when the market has eaten the government money and is falling again you can be sitting on huge profits.

This is what I did to make the $18,000 dollar nominal profit yesterday which has now risen to around $32,000. The investment was a nominal $50,000, so I already have an 60% unrealised nominal return on investment in less than 35 hours.

If it hits where I think its going this week (Dow Jones at around 10,000 - probably just above), then the nominal profit will be around $160,000 on a $50K investment. It's about timing.

Thanks XCoM for asking. I'm alive, but not well. I was forced back to the UK when the French and UK governments started arguing about who was going to pay for my healthcare and at the same time the benefits agency cut off all my financial support and my home was threatened with repossession. I was left for a while begging on the street in France for money to eat. This has delayed the needed medical intervention by months and made my needs much more significant.

This is what I want the $200K for - to pay for private medical treatment abroad before I am pushing up daisies.

Matthew

[XcOM]

i wish you the best of luck in the future and if you need any help from me in the uk i will always be happy to help,

[luciusad2004]

I keep hearing news about people wanting the government to help bailout wall street. Is this a good thing or is this one of those lipstick on a pig scenarios were your just covering up the root of the problem and making ppl happy for a while until it gets even worse? Maybe a better analogy would be band-aid on a knife wound. Does a government bail out really have the potential to help or does it just sink more money in to a failing system? Just thought i would ask... I don't really understand any of this stuff.

[xRyokenx]

I was listening to the news earlier and I think that the bailout thing did not pass... but I might be wrong.

[nevermind1534]

It pssed the Senate, but not the House

[luciusad2004]

Yeah, thats what i heard. So i guess my question is sorta pointless. I was just wondering though lol.

[nevermind1534]

It would only be a temporary, short term solution. The said no more "golden parachutes" for executives and no more bailouts, hoping to get it passed, but they didn't, and the dow dropped today after news of that.

[Cymae]

It means they will amend it again and put it through again. Most people think it's a bad idea, especially the democrats. I tend to agree. The bailout can't help at the rate it's deteriorating as is and the money will go up in smoke within weeks, and they will STILL go under.

[nevermind1534]

I also agree, even though I'm not a democrat. It will increase the national debt, and will only help for a few weeks, if not days. remember, too, that if we (the United States) go into a depression, china will go belly up.

[XcOM]

the bailout got rejected.

Now i am not a market expert and i am sure CrazyB will correct me when i say that this bailout bid would be a bad idea, if they did it all they would do a prolong the enevitable, and when that does happen it would put everyone all over the world in the crap,

We, the tax paying people would end up footing the bill, the goverment would be bankrupt from trying to stop everyone/thing else fall,

We would end up worse off in the longrun, I myself am doing everything in my power to pay off any debit i still owe (Luckly i only owe to 2 building socitys, both of which appear to be finacialy secure compaied to the rest) and keep it that way,

[mittelmeier]

If the bailout passed now it would have been prolonging the inevitable. I thinks it good that the government wants to help fix what they caused, but now is the wrong time. All the money they give out now will just get lost and then we the tax payers are out all that money. If Bush would've been able to pass his bill in 03 to help the Fannie and Freddie corporations this may have been avoided but congress didn't deem it necessary at the time.

[TheGreatSatan]

Remember it's the Democratic House that shot it down this time. It's mostly Polosi's fault

[XcOM]

even so this would still of happened, we have become a world used to living on credit, and now this credit has run out, and banks are afraid to lend to one and other, everyone is running out of money, but its still there somewhere (The executives paychecks?)

ALOT of companies are going to fold, and meny banks will become bankrupt or be bought out by bigger banks, until people start lending again we won't go back to how we were, and i think the best thing would be for this to continue (Please don't stone me) and everyone to pay off what they owe, and don't live on credit anymore,

I myself have done this for a long time, i bought a car on credit, my insurance for said car is monthly paid so that is classed as credit, when i was out of work last year i used my overdraft to pay my bills and i have been trying to pay it off since, now stangly i am in a position to start doing that, i will hopefuly pay off over £200 ($400) this month, the same next month providing i can get some overtime in at work, then it will be paid off with some left over to pay a lump sum off of something, the month after that i can pay off the laptop completly (of i forgot to mention i got my laptop on credit)

then its just the car and insurance i have to worry about.

[Omega]

I am actually enthused, as a republican, that the bail-out didn't pass. It's being fiscally irresponsible to put MORE stress on the tax-payers (who will already feel the effects of the depression the worst, as we can tell by looking at history) and trying to bail out companies that, ultimately, brought this upon themselves. If you make a bad decision and end up losing everything over it, it's your fault because it was avoidable, and I don't believe anybody should help you out. Same sort of thing here. Some people (corporations, banks, etc) made poor decisions and are, as a result, dealing with the repercussions.

While I hope we don't go in to a depression, perhaps it will teach some people a thing or two about responsibility.

[XcOM]

it sounds stupid but the world needs a depression every now and again to reset the balance in the world, this time how ever the goverments are trying to prevent it and there is nothing they can do about it, but they seem deturmened to give it there all, even if it does mean we will be screwed for a next billion years paying it off.

[Crazy Buddhist]

If it hits where I think its going this week (Dow Jones at around 10,000 - probably just above)


Dow Jones Industrial 10,365 down 777 on the day. Ouch. Watch it dump below 10K next week or the week after.



It means they will amend it again and put it through again. Most people think it's a bad idea, especially the democrats. I tend to agree. The bailout can't help at the rate it's deteriorating as is and the money will go up in smoke within weeks, and they will STILL go under.

Exactly. This money goes straight from Joe Average taxpayer to Joe not so average millionaire via the banks and gets sucked out of the system in no time.

[XcOM]

what is the likelyhood of the marks collapsing in on them selfs? i know its far from going to happen anytime soon, but if this keeps loosing value like this it going to hot rock bottom prity soon

[Crazy Buddhist]

I think there is another 2,000+ points to fall from the Dow Jones this year - that would makes it half the Index it used to be. The markets per se won't collapse. Money may just grind to a halt - a bit like gridlock on a city's streets.

[XcOM]

fair enough mate, i always trust what you say as your wiser then me in meny ways, esspecaly when it comes to understanding the markets.

My bro is still adermant were not in a recession and all will be well by Xmas back to the way it was

[nevermind1534]

My bro is still adermant were not in a recession and all will be well by Xmas back to the way it was

lol. Everybody keeps buying all of their Chinese-made s***, making the executives rich, although, at this point, most people don't have much choice, as that's all that you can really get. There's also people buying too much stuff that they can't afford, and there were too many people buying houses that they couldn't afford.

[Eclecticos]

I am surprised our President has not addressed the
Nation urging American consumers to buy, As he has done before.

[nevermind1534]

I don't like how he lets the VP and his advisers run everything as much as they do. It seems as though he is afraid to, and figures that they are "experts" although, as most of us can see, this hasn't worked out too well.

[Crimson Sky]

Without this bailout, we are screwed. There is NO OTHER OPTION. IT's too late for any other solutions.

[Crimson Sky]

While I hope we don't go in to a depression, perhaps it will teach some people a thing or two about responsibility.



Are you joking? You obviously have no clue what a depression will do to this country...and to the world. My GOD you better pray it doesn't happen. You don't seem like the kind of person prepared to 'live off the land' if you had to. There is no Nintendo n' nacho nights in a depression, because you will not be able to afford electric power. those with hunting and gathering skills will be the only survivors of a 21st century depression.

[XcOM]

Are you joking? Y.....you will not be able to afford electric power. those with hunting and gathering skills will be the only survivors of a 21st century depression.

that is providing you can keep up the payments to keep a roof over your head!

[Crazy Buddhist]

Nothing I say should be taken as investment advice and it is not intended as such. These are my personal reflections on the market. You must take advice from a qualified investment adviser in your own jurisdiction before making investment decisions.

================================================== ============

The general consensus is that we are already in recession and a depression is a real probability. The marked difference between a 21st century depression and the great depression is technology and communications have advanced so far they will allow micromanagement of resources by governemnet on an effective basis and effective exchange mechanisms to develop between citizens to fill the gaps.

It's less likely to be living off the land and more likely to be living off the ration packs and your wits and friendships if things get that bad.

They won't get that bad just because of the economics however. It would take either natural disaster or a terrorist act to push things over that edge. Either of those things would do it. Interrupt 5 - 10% of the worlds oil supply and that would tip the balance.

The situation is that we are in a "market correction". Asset prices across the board lost touch with reality in about 1992 and have never returned to a realistic pricing level (realistic pricing means when an ordinary person can actually afford a housing mortgage for example).

Realistic pricing now of assets is approximately 40 - 60% of the highs reached during the last years. Long term support for the Dow Jones Industrial Average is probably somewhere in the 5,500 - 7,500 range and housing prices at around 40 - 60% of high values, depending on the market segment.

While the Dow readjusts to it's long term support you will see big falls, big rallies and sideways movements as the real sate of affairs sinks in. But the overall trend between now and sometime between Christmas and March is down and bottoming out at under 5,000 before starting to slowly and reluctantly rise again. As one famous market analyst said yesterday "I see no reason for buying equities in the current conditions". No reason - not one.

[TheGreatSatan]

Happy news is that gas dropped $10 a barrel. And the dow jones is already back up around 200 points.

[Crimson Sky]

The marked difference between a 21st century depression and the great depression is technology and communications have advanced so far they will allow micromanagement of resources by governemnet on an effective basis and effective exchange mechanisms to develop between citizens to fill the gaps.

It's less likely to be living off the land and more likely to be living off the ration packs and your wits and friendships if things get that bad.


This is exactly my point. This 'technology and communications' you speak of and have far too much faith in is for the most part made up of many small businesses. Add an economic depression into the picture, and these businesses will be hardest hit; No new loans for replacing failing cooling equipment, and no new customers to support growth. Down go these little telecom and datacenters all over the planet and as they wink out existence so does the connections we have all come to blindly rely on.

If I were you, I wouldn't be leaving baskets full of digital fruit at the Altar of Technology in the hopes that it will somehow appease this fickle god. What we made, we can take away, through our own short sidedness and greed.

[Crazy Buddhist]

This is exactly my point. This 'technology and communications' you speak of and have far too much faith in is for the most part made up of many small businesses. Add an economic depression into the picture, and these businesses will be hardest hit; No new loans for replacing failing cooling equipment, and no new customers to support growth. Down go these little telecom and datacenters all over the planet and as they wink out existence so does the connections we have all come to blindly rely on.

If I were you, I wouldn't be leaving baskets full of digital fruit at the Altar of Technology in the hopes that it will somehow appease this fickle god. What we made, we can take away, through our own short sidedness and greed.

I agree with you whole heartedly on the last part, however, the majority of key data-related infrastructure is owned by large communications corporations that won't fail. There is also the way the internet functions with in-built redundancy and work-arounds that mean even if one of the major carriers went down most of the network would continue working.

One thing I can see, Paul, is why you are putting more emphasis on your hunting skills these days. That's as good an investment as gold for sure because it could get that bad. ;)

[Crimson Sky]

I agree with you whole heartedly on the last part, however, the majority of key data-related infrastructure is owned by large communications corporations that won't fail.

One thing I can see, Paul, is why you are putting more emphasis on your hunting skills these days. That's as good an investment as gold for sure because it could get that bad. ;)

LoL..Enron was pretty big, eh? And so was Rome.

Epic Fail.

This kind of blind faith is exactly why I learned how to shoot a tick off of a rabbit's ass at 50 yards...you know...just in case.

[Quakken]

So worse case scenario, we're looking at total collapse having to be built up again by essentially starting over. I need to stock up on ammo...

But anyway. What's likely to happen over the next 6 months? A market "reset" to values that aren't unrealistically high? Will the price of things actually go down to a realistic level again, after some serious economic pains in this recession? Or is it very likely enough that I should be scared of complete depression happening?

[DaveW]

This kind of blind faith is exactly why I learned how to shoot a tick off of a rabbit's ass at 50 yards...you know...just in case.

Or a CO2 canister up the jacksie.


There is also the way the internet functions with in-built redundancy and work-arounds that mean even if one of the major carriers went down most of the network would continue working.

The internet will not break. Trust me on this. The very, very worst you could do is fragment the network-maybe into an 'east' and 'west' network, for example. But it's so incredibly unlikely...it's just unlikely. I don't want to go into too much detail.

Crimson is a prepared guy though. If the world does go to hell in a handbasket, I'm grabbing my hot Russian chickadee and heading to Camp Stogie, where I can carry logs, catch fish, and hunt bats till I'm a happy old coot. :D

-Dave

[Drum Thumper]

Without this bailout, we are screwed. There is NO OTHER OPTION. IT's too late for any other solutions.

Seems somebody forgot to tell this to Wall Street. 3rd largest one day gain ever. If my math is right, nearly 800 billion dollars, which coincidentally, is a 100 billion more than Dubya wants to fix this mess.

To me, it seems that the markets are run by nothing more than a bunch of Chicken Littles carrying on with their particular brand of doom and gloom. Just imagine how different things on Wall Street would be if Patton or John Wayne was running the show.

EDIT--just so I don't double post, I mean no offense to you Boss. And like you, I can shoot a tick off of a hare's ass at 50 yards as well. I know how to live off the land quite well due to my upbringing (ranch life). Regardless of what happens, I like to think that me and mine will survive.

[nevermind1534]

That is the people who want the bailout plan passed manipulating the market to get what they want.

[jdbnsn]

The situation is that we are in a "market correction". Asset prices across the board lost touch with reality in about 1992 and have never returned to a realistic pricing level (realistic pricing means when an ordinary person can actually afford a housing mortgage for example).
-Crazy B.

I think this statement is very important to consider when we look at the bailout package. I'm skeptical myself, and I'm no economist so many of the details are beyond me. But looking at the situation from a layperson's point of view, I agree with Allen Greenspan's view that regulation (and bailouts) undermines and disrupts the natural course of the market itself. We are talking about loaning financial institutions 100's of billions of dollars so that the value of real world assets can be purchased and secured for future redemption. But many of these financial institutions have records of unprecedented CEO retirement handouts and unsound financial planning. CB stated, the DOW and other financial markets have become "out of touch" with asset prices/value. I don't know if they were out of touch so much as they have been overestimating asset value and treating a market which places tangible economical value on anticipated trends, borrowed dividends, and the assumption that future savings equals money in the pocket today. The markets label assets as valuable, but the value is clearly driven by emotion just like yesterday. Pumping more taxpayer money into the current system may just be postponing the inevitable (which does not necessarily mean a depression, remember that the values are designated by human stock brockers under stress and what you own is only worth what the next guy is willing to pay regardless of what the market says). But I surely don't know anyone who won't be severely hurt by a real collapse and depression so I would like a solution. I'm just not entirely convinced a cash advance is the correct solution.

[Xpirate]

We are seeing the effects of having a simple majority of republicans in the senate and the house and having a republican president. They deregulated energy. The laissez-faire approach to the economy that conservative republicans subscribe to hurts poor people and enables the elite to become gain even more wealth. Think about why labor unions exist. Less money is dedicated to Pell grants now.

Now they need lots of money to clean up the mess they made.

[mittelmeier]

I'm just not entirely convinced a cash advance is the correct solution.

That's the best terms I've seen the bailout put in yet. Not too many people would be willing to get a cash advance unless there was absolutely no other option and still then most people don't consider it an option because it isn't very effective in solving money issues.



We are seeing the effects of having a simple majority of republicans in the senate and the house and having a republican president.

Actually the senate has been controlled by Democrats since 2006.
http://www.usatoday.com/news/washing...ats-iraq_x.htm
Bill Clinton passed the legislation that made the banks and lending institutions give credit to people that shouldn't have qualified for it in the first place.

In 2002 Bush tried to take control or Fannie and Freddie to help them before it got anywhere near this bad and then again in 2005 John McCain tried and both times the bills were voted down by a Democratic majority.

[Crazy Buddhist]

LoL..Enron was pretty big, eh? And so was Rome.

Epic Fail.

This kind of blind faith is exactly why I learned how to shoot a tick off of a rabbit's ass at 50 yards...you know...just in case.

Paul,

This is not about blind faith - it's about two basic realities.

AT&T, British Telecom, Deutsche Telecom, Opal Networks ... The major network carriers will not fail because they will be re-nationalised if they come to the point of failing - they are mostly former government owned entities in any case and no government anywhere will allow such an important infrastructure to go down the pan as the telephone and data network, full stop.

Secondly as Dave points out the Internet is very unlikely to fail - this is as a direct result of the technical specifications and protocols it uses.

No blind faith, two basic facts of reality.

And Enron? Yes, Enron was allowed to fall - hidden in their accounts were some very dodgy dealings linked to the current American administration and it's cronies that couldn't be covered up - oh, until the single copy of all the relevant records was unfortunately destroyed in the 9/11 disaster.

Matthew

[Xpirate]

Actually the senate has been controlled by Democrats since 2006.

Bill Clinton passed the legislation that made the banks and lending institutions give credit to people that shouldn't have qualified for it in the first place.

You are correct. Deregulation has been a bi-partisan blunder. Our congress and senate have worked hard at trying to undo all the things that was done to correct the Great Depression. Now we are seeing the effects of their efforts.

[Drum Thumper]

And Enron? Yes, Enron was allowed to fall - hidden in their accounts were some very dodgy dealings linked to the current American administration and it's cronies that couldn't be covered up - oh, until the single copy of all the relevant records was unfortunately destroyed in the 9/11 disaster.

Matthew

I find that hard to swallow in this day and age. There has to be another copy somewhere. If I were to guess, I would say it's on some teenager's hard drive, right next to the Britney Spears he just downloaded illegally.

[Crazy Buddhist]

Seems somebody forgot to tell this to Wall Street. 3rd largest one day gain ever. If my math is right, nearly 800 billion dollars, which coincidentally, is a 100 billion more than Dubya wants to fix this mess.


Well the Dow broke the 10,000 barrier today, currently down 493 points. As I said before it will be a bumpy ride. Yes there will be days when it rises and days when it falls - it is called volatility and related to market uncertainty about the true value of assets.

It's heading down. It will bottom out at under 7,500 between now and March.

Crazy.

[TheGreatSatan]

So buy now to secure stocks on the cheap?

[XcOM]

i would say yes as they are cheap, butif the company goes bust your screwed!
also your stock will lose value before it gains (Provided it does)

but please remember, as CrazyB said:
Nothing I say should be taken as investment advice and it is not intended as such. These are my personal reflections on the market. You must take advice from a qualified investment adviser in your own jurisdiction before making investment decisions.

[Crazy Buddhist]

Nothing I write may be taken or is intended as investment advice. Take advice from a qualified investment advisor in your own jurisdiction familiar with your circumstances before making investment decisions. If you act on anything I write you do so entirely at your own risk and neither I nor TBCS bear any responsibility for your actions.


So buy now to secure stocks on the cheap?

No the opposite: buy now or throw your cash down the toilet - they are equally well based investment decisions.

The market is only just accepting recession when we have been in one for a while. The market is starting to talk of depression when it has been inevitable for the last ten years.

There is some simple exponential mathematics to blame. We are running out of resources quickly and ways to use them effectively and the world can not support it's population within the current economic model.

Once the DJI is under 7,500 would be the time to secure stocks "on the cheap" - even then you may see a further 20% or more decline before the investment starts rising again, so a true bear such as me would tentatively start investing cash back into the market at around 6,000 and then dribble the money in so you "average out" your buying price over a period.

There may be other factors that change these relationships that emerge in the short - medium term but the long term valuation of the DOW on economic fundamentals (not the false debt economy) is somewhere in the 5,000 - 7,500 range.

Just remember economic fundamentals can change.

Notice how governments are using your money to bail out banks. It would be better economically if they let the bad banks fail and used your money to bail out you !

Crazy

[TheGreatSatan]

Meanwhile I buy more gold, silver and gems.

[Drum Thumper]

Notice how governements are using your money to bail out banks. It would be better economically if they let the bad banks fail and used your money to bail out you !

Crazy

Oh heavens no, we can't expect our Government to do something responsible!

gnbNm6hoBXc

Fear mongering by the Dems. Priceless.

[Crazy Buddhist]

Meanwhile I buy more gold, silver and gems.

Yes that is one possibility, and long term investments in making your property/lifestyle self sustaining and "off the grid" are good ones. Wind power, water power, dig a well, plant a garden, put razor wire round it etc.

And here's one for Crimson ... I'd say buy a gun and learn how to shoot a tick off a rabbits ass at 50 yards. I hear tick soup is a good form of protein ;)

[Crazy Buddhist]

I (and every other analyst) doubt this very much. If the US stock market dropped to 50% of it's current value the WORLD will be in trouble. This just will not happen. "."

The market right now is 33% down on its all time closing high of 14,164 reached on October 9th 2007. Not far to go. Another 2,400 point drop to the 7,000 level and it will be at 50% of peak.

If the Dow hits the lower end of the range I am predicting of under 5,000 that will represent a drop of 65% from peak.

Following the 1929 Crash it took the Dow Jones 25 years to reach the previous high again.

As I said earlier "Once the DJI is under 7,500 would be the time to secure stocks "on the cheap" - even then you may see a further 20% or more decline before the investment starts rising again, so a true bear such as me would tentatively start investing cash back into the market at around 6,000 and then dribble the money in so you "average out" your buying price over a period."

Terry, the world is in trouble. BIG TROUBLE.

Forgive the double post but developments in the market are happening fast.

CrazyB

ps just after posting this the DOW closed at 9,447 having dropped through another significant psychological barrier of 9,500 several times today then having false rallies. Tomorrow there may be a knee-jerk buying reaction by ostriches with their heads buried deep in the sand. Don't be thinking it's the start of recovery. We have only just entered the middle period of the fall.

Nothing I write may be taken or is intended as investment advice. Take advice from a qualified investment advisor in your own jurisdiction familiar with your circumstances before making investment decisions. If you act on anything I write you do so entirely at your own risk and neither I nor TBCS bear any responsibility for your actions.

[Airbozo]

The world got in this mess by being greedy. Too bad the little guy has to pay for it. And if you ask me, there should have been no checks from the feds or bailouts to the tycoons. The longer they try to prevent this "market correction", the worse it will be and the longer it will last. JMNSHO

I am still in an OK position. Real estate investment is still 3x what I paid for it (and I owe very little). Extremely minimal loss on any of my 401k's (under $1k for the last year), only gains on my long term investments. Actually thinking of buying more property in the next couple of months due to the housing market collapse and eager sellers. The bank that holds my second (which has no balance currently) called me to let me know they will drop my rate by 1 full point if I start using it in the next month... (currently prime -.5)

My comment about not dropping by 50% was based on the short term and the protections that exist in the market to prevent that. Long term is any ones guess right now.

BTW: Given my own situation at home and work (business has tripled in the last year), if I was not watching the news every night I would not even know there was a financial problem in the world/country. I am very prudent about how I spend my money and hire someone to manage my investments. Others should be as well or suffer the consequences. But consequences only seem to be for the little guys, not the corporate political good ol boys...

[Crazy Buddhist]

Great Analysis Terry - I'm glad your position has remained stable.

You are right that the little man pays - as I said above the Governments concerned would be better letting the market rule, banks collapse, then bailing out the individual taxpayer who elects them.

However, my post proposing that this would be a big nasty bear with a 50% or more collapse of stock prices at the bottom is looking more than likely now to come true.

With regard to real estate investments I think you may be better off holding back another 6 - 12 months before the full market correction has happened (the housing market being more illiquid can take longer to correct than the stocks).

However there is also the well known investment strategy of buying across time to average your prices and in volatile conditions it's a good strategy because it allows for you to mistime the bottom, but by staging investments the average "in" price will still be near the bottom, making for a good long term investment.

And yes - the long term problem is greed - or more precisely our economics of "growth and greed". We need to replace this economic system with one that is based on adequacy or an economics of "enough is enough" - one that recognises we live in a finite world and compound growth forever is IMPOSSIBLE.

Here is a great video that explains the basic math behind the issues in a way anyone can get.

F-QA2rkpBSY

And here is one specially for Paul, titled "Don't buy gold buy bullets" !!!!!

JQcym9cbo7Q

Matthew

[Drum Thumper]

I've been thinking alot lately about the skills that I have accumulated as a Montanan. Off the top of my head I can:


Create shelter
Start a fire
make leather
clean an animal carcass
butcher said carcass
find north at any given time of day
cook


And that's just off the top of my head. If I were to sit down and make a very complete list, I'd be asked why I'm not taking part in mountainman rendevous (http://www.crazycrow.com/events_rendezvous/).

My inlaws say this is going to be worse than the 1930s. I'm still skeptical, but if they do end up being right, I feel I am adequately prepared for it.

[Crazy Buddhist]

Oh heavens no, we can't expect our Government to do something responsible!

...

Fear mongering by the Dems. Priceless.

Actually that was a democrat no? He was describing scaremongering by the Republican lobbyists as I understand it.

Interesting he said they were told if they did not pass the bill that "the market will drop 2000 points on Monday .... etc" then he mentioned they had been warned of .... "MARTIAL LAW" !!!!!!!!!!!!!!!!

Watch this:

lTpx5sj3iOo


My inlaws say this is going to be worse than the 1930s. I'm still skeptical, but if they do end up being right, I feel I am adequately prepared for it.

They are probably right and you sound well prepared.

Matthew

ps This guy is pimping his book but ignore that and watch it anyway. He is very accurate in his analysis and gives enough real information to average Joe understand much better where we are and why. He also confirms something you will not have believed if you watched the video above. What is happening to the markets now is Government policy.


r5ifr0iskSc

[Drum Thumper]

Actually that was a democrat no? He was describing scaremongering by the Republican lobbyists as I understand it.

Interesting he said they were told if they did not pass the bill that "the market will drop 2000 points on Monday .... etc" then he mentioned they had been warned of .... "MARTIAL LAW" !!!!!!!!!!!!!!!!


Sherman, along with a few other Democrats, from what I understand, voted against this joke of a bill both times. And the Dems were the ones who wrote it. Head of the Senate Finance Committee is non other than my senator Baucus. And this bill will hopefully cost him his job--80% of Montanans didn't want this trash in the first place. They (the Dems that is) are the ones who started this whole "Martial Law" brouhaha.

One other interesting note: Baucus was the only Montana delegate who was for this bill. Sen Tester and Rep Rehberg voted against it.

Alright, I'll get off my political soapbox now.

[Crazy Buddhist]

LOL Hey, Drum, I'm a Brit who doesn't watch the news much or read newspapers ever.

My understanding of the finesse of American politics is ...... non-existent.

:)

CrazyB

[Drum Thumper]

CB, I'm beginning to think your prediction of the DJIA being in the 7500 range to be a bit on the high side. How much is yet to be seen.

[Airbozo]

LOL Hey, Drum, I'm a Brit who doesn't watch the news much or read newspapers ever.

My understanding of the finesse of American politics is ...... non-existent.

:)

CrazyB

Hehe As is most Americans...

I wish it was closer to the House of Commons method. As it stands 90% of Congress and the Senate would crumble if they had to actually stand up and argue the way the House of Commons does.

"My Right Honorable Gentleman from Texas requires a plexotimy!"*

(OK so I substituted an American state...)


* Plexotimy: An operation to install a pane of Plexiglas in the abdomen, so a person with their head up their arse can see where they are going.

[Drum Thumper]

OK, CB, I realize I've read your disclaimer. Percentage wise, how much cash on hand should we be looking at keeping around?

[TheGreatSatan]

At least gas prices are down :)

[noopypoop]

I dont really have a great understanding of the stock market but from what I understand the only way stocks go down is if everyone starts selling them. So the only way for it to keep going down is if everyone keeps selling. If you dont sell then you lose money, but if you sell then its just gunna keep going down.

Couldn't they make it so that to get the market back to where it was they could make it a buy-only market? That way only the companies will be able to sell their stocks and the market will go up.

[Drum Thumper]

Meanwhile I buy more gold, silver and gems.

I'd love to be able to do the same, but those prices are a bit out of my reach. However--a box of .30-.30 shells set me back $12.50 at the local Wally World.

And so begins the stockpiling.

[Crazy Buddhist]

CB, I'm beginning to think your prediction of the DJIA being in the 7500 range to be a bit on the high side. How much is yet to be seen.



Once the DJI is under 7,500 would be the time to secure stocks "on the cheap" - even then you may see a further 20% or more decline before the investment starts rising again, so a true bear such as me would tentatively start investing cash back into the market at around 6,000 and then dribble the money in so you "average out" your buying price over a period.

There may be other factors that change these relationships that emerge in the short - medium term but the long term valuation of the DOW on economic fundamentals (not the false debt economy) is somewhere in the 5,000 - 7,500 range.

As you see 7,5 is the upper limit I am suggesting of the range 5,000 - 7,500.

Some analysts are saying 4,500 is the "right" market value. Some are suggesting 2,500.

I have been trading on two nominal investment accounts for three weeks (not real money). On one a total investment of ~ $10,000 is now worth ~ $128,000. The other with a nominal investment of $80,000 is now valued at $445,000.

It is very easy to make a lot of money in these markets.

CrazyB

[Crazy Buddhist]

Couldn't they make it so that to get the market back to where it was they could make it a buy-only market? That way only the companies will be able to sell their stocks and the market will go up.

No because for someone to buy it someone else has to sell it. That is the definition of a market. And companies can not sell new shares without their shareholders permission. When they get it and do it the value of all the other shares in the company are devalued (more shares each one is a smaller share).

CrazyB

[Drum Thumper]

[B]As you see 7,5 is the upper limit I am suggesting of the range 5,000 - 7,500.
<SNIP>

CrazyB


What you are seeing is volatility - rapid and large movements of prices due to uncertainty in the markets.
<SNIP>

The markets have a lot further to fall yet. I'm putting the Dow Jones Industrial Index at around 8 -9,000 by Christmas. Thats another 20 - 30% fall from current stock valuations.

Matthew

Here's my disclaimer: I'm writing this for two reasons: I need to clear my head (reason #1) so I can get my homework done (reason #2). As always, your mileage may vary depending on your location.--Joe

8-9,000 and it isn't even Halloween yet. Based on the Chicken Little mentality we saw today on Wall Street (and honestly I cannot blame them), I would venture to say that even your 5k prediction even might be a bit on the high side.

I'm personally playing the waiting game at work (I'm currently in the grocery business)--sales are down across the board here in town, some places upwards of 50 to 60%, yet we're still getting our 40 hours a week where I work. This might change starting tomorrow, as next week's schedules come out on Fridays. This, coupled with the fact that if I were to take an IT job in this damn town meaning I'd be taking a $3/hour pay cut pretty much keeps me stuck where I am at for the time being. As much as I hate my job, it is a union job (for better or worse, and in the case of UFCW, that tips towards the worse side of the equation) which means if hours do get cut, I file partial unemployment and don't have to be actively looking for other work since I am both job and union attached. And since Montana is currently projecting a roughly $1 billion dollar surplus for the upcoming fiscal year, my thinking is that there will be unemployment funds for at least the next twelve months.

I keep wondering who our financial savior is going to be--I highly doubt it will be Paulson; hell, at this point I am wondering if he or she will even be American. This is one field that I honestly do not have much knowledge in regarding current events, nor do I want to have all that much knowledge to be honest. It seems to me the less I know, the better. I also watched that Zeitgeist movie that Paul linked to last night, and my views on that are rather mixed--a little too much conspiracy theory for my liking. Plus, the Venus Project looks good on paper, but paper isn't always the best. I won't lie to anyone, I've been having what I guess would be considered "romantic" thoughts about how it might be in the classic sense of the word in the next few years--really hard to explain, but imagine a "Mad Max" scenario without the nuclear war beforehand (although that could always be a possibility as well); that's what I keep seeing. It's going to be rough, and it will separate the men from the boys, that is for sure.

Martial law is something that I brought up--if it does happen (and I don't doubt that it will) it's going to happen in the more metropolitan areas--probably DC first, then I would guess one of the Californian cities--Los Angeles most likely (remember Rodney King anyone?). Again, Montana *should* be spared, but Billings and/or Missoula could see some civil unrest. Its a tossup between the two--Billings is pretty rough and tough (was once considered the meth capital of the world), whereas Missoula is a college town with a very small population of radical liberals (an oxymoron if there ever was one, but hey, only in Montana as we say).

Sorry for the longwinded rambling post, but my mind has been going nonstop since this afternoon.

Oh, and on an interesting side note--I've noticed that we're selling a helluva lot more canning supplies than normal this year. I'm going to see if I can get on the computer at work and get some numbers, but I'm guessing at least a 50% increase over last year.

[Crazy Buddhist]

I think this process is now coming to fruition. I was conservative with my "by Christmas" forecast because there seemed to be sooo many ostriches around with their heads in the sand and their bums in the air.

Now all the ostriches have pulled their heads out of the sand all of a sudden and the reality of the situation we are in, I first described more than a year ago, is dawning on them.

Suddenly they are shape-shifting !!! They are no longer ostriches ... they have become lemmings !!!

CrazyB

ps By canning supplies do you mean canned goods or the materials to store and preserve food oneself? Either one would be a definite sign that people are finally waking up.

[mittelmeier]

It wouldn't surprise me if it was a 50% increase. My wife has started to can a lot of things for us and we've had hard times finding jars or other canning supplies because the stores are sold out. Normally they can't give canning supplies around here, that's scary.

[Crazy Buddhist]

I have been trading on two nominal investment accounts for three weeks (not real money). On one a total investment of ~ $10,000 is now worth ~ $128,000. The other with a nominal investment of $80,000 is now valued at $445,000.

It is very easy to make a lot of money in these markets.

CrazyB

The $10,000 account is currently valued at $203,589

That's a 2000% return on capital in three weeks. If I had had a real $10,000 bucks three weeks ago I would now be on my way to the Mayo Clinic in Rochester Minnesota for the life saving surgery I am in need of.

Life's a beach you just have to learn to :) @ her. Whatever comes along.

CrazyB

[Drum Thumper]

ps By canning supplies do you mean canned goods or the materials to store and preserve food oneself? Either one would be a definite sign that people are finally waking up.

The materials to do it yourself. We always have a decent run on it, but I've never seen it like this. Past years it was perhaps one in five shopping orders. This year I would venture to say nearly every other order.

I'm also seeing younger generations per se (baby boomers, not the remaining New Deal era folk) buying a lot more powdered milk as well.

[Crazy Buddhist]

If anyone has had their interest in the issue of economics sparked, there is a free textbook available in PDF format here (http://www.introecon.com/).

The book "Introduction to Economic Analysis" was written by R. Preston McAfee who holds the J. Stanley Johnson Professor of Business Economics and Management chair at the California Institute of Technology.

He wrote the book and distributed it freely because he said he was fed up of having to tell his students to pay $200 for a textbook for every course. A printed version is available for $11.10 plus shipping.

CrazyB

[TheGreatSatan]

The government keeps trying to implement new things to fix this mess. Is there something that can actually be done to turn the tide or does it just have to run its course?

I'm still happy that gas prices keep dropping.

[Crazy Buddhist]

Currently inter-governmental discussions are under way proposed at closing all world financial markets for three months while a "solution" is put in place.

This would be the final nail in laissez-faire corporate Capitalisms' nearly completed coffin. The announcement of these discussions is likely to mean enormous falls on global markets on Monday if there proves to be any substance in it - and if they let the markets open on Monday.

CrazyB

EDIT TO AVOID DOUBLE POSTING:

"(We must) redirect the markets so that they serve the people, and not ruin them"

Angela Merkel,
German Chancellor

There is some hope yet. Who thought it might be the Germans that saved us??

2nd EDIT: For anyone thinking they might buy a house in the UK soon read this:

http://www.fsponline-recommends.co.uk/page.aspx?u=mwkpropertyendo&tc=EMYKJA10&PromotionID=2147065289&

[TheGreatSatan]

The whole world needs to adopt the euro, that'll help.

[Drum Thumper]

"(We must) redirect the markets so that they serve the people, and not ruin them"

Angela Merkel,
German Chancellor

There is some hope yet. Who thought it might be the Germans that saved us??





Fate, it seems, is not without a sense of irony.


Once again, the Matrix proves a valuable real life lesson.

[Crazy Buddhist]

Once again, the Matrix proves a valuable real life lesson.

LOL I love the first Matrix film. It is influenced by a great number of Buddhist understandings of how reality functions.

This whole affair is like a glitch in the matrix. Some market analysts are now starting to propose that, far from being an accident waiting to happen, this recession could only have been deliberately engineered.

Certainly over the last year the Central banks have injected many trillions of dollars into the financial markets to "try and maintain liquidity" and "re-establish inter-bank lending" - the main activity that ceased and is causing such trouble, as no banks trust each other any more. And, all to no avail.

Now they are trying to inject a few hundred billion dollars into the system and convince everyone it will hold the system together. It won't. Anyone buying into the market now is likely putting their money directly into the hands of the wealthiest who are making incredible profits from this downfall and will become even richer in the following upturn - even though that may take 2 - 4 years to begin.

The timing is all depend on how realistic the measures taken are and at the moment the measures being taken come straight out of fairy stories or the Marvel comics. SUPER-BANK-BAIL-OUT MAN to the rescue !!!! YAYA

http://www.vipassanaforum.net/bankbailoutman.jpg

Gonna flop. Even if the markets bounce up today - following those in Asia - this will just be seen as another selling opportunity by the wealthy and all the capital injected to the markets over the next week or two will be leeched from the system in days.

Read an interesting statistic yesterday: In the UK the number of different mortgage products on offer to consumers has dropped in the last 12 months from over 16,000 to under 5,000. Also house sales are at an all time low with an average of one sale per week per agent in the industry.

Mortgage is derived from old French (I might have said this before): "Mort" - death and "gage" grip.

Mortgage = Deathgrip. Nice :)

CrazyB

Disclaimer: Nothing I say is intended to be or should be taken as personal investment advice. You should not make investment decisions without consulting a duly qualified investment adviser in your own jurisdiction who is aware of your personal circumstances. If you act on any information I have published here you do so at your own risk. You have been duly advised that neither I nor TBCS may be held responsible for your actions.

[nevermind1534]

In my opinion, everything that the governments are doing is dragging this whole thing out, and making the drop slower, causing it to take more time until it starts to rise again.

[xRyokenx]

I was discussing this $750 billion "bailout" handout yesterday and we both agree that this money should have gone towards energy... get solar and wind power set up along with a bunch of nuclear (not nucular) power plants... by the way, those things are not an accident waiting to happen so long as you don't slack on safety.

[Airbozo]

...

"(We must) redirect the markets so that they serve the people, and not ruin them"

Angela Merkel,
German Chancellor

There is some hope yet. Who thought it might be the Germans that saved us??

...

Why not. They would be at the top of my list for financial stability and strength. Hell about 10 years ago the Germans owned more property and business in the US than any other foreign investor. They just did not brag about it like other countries do. There was a huge uproar in the US many years ago about the Japanese buying so many US landmark properties and golf courses. They still only had about 1/2 - 2/3 of the holdings as Germany did.

I always thought it was ironic that Japan was defeated in the war, but would end up owning the US (and other countries) financially. Same with Germany. We took away the weapons that went boom, but not the ones that went Cha Ching!

[Crazy Buddhist]

<snip>

Same with Germany. We took away the weapons that went boom, but not the ones that went Cha Ching!

Actually not true. We did take away the weapons that went "Cha Ching" (or "ker-ching" in English English). That is to say that after the second world war almost every working piece of manufacturing equipment was taken from Germany as reperation.

Thus we had the German economic miracle - because Germany was forced to re-tool with new equipment following the war - whilst machinery taken from Germany built in the 1930's and 1940's was still in use in the UK in major manufacturing plants well into the 1970's and even possibly 80's.

This is the main reason the UK endured a manufacturing disadvantage against German firms throughout the last half of the last century. German workers were paid better, had more holidays and all because they were working more efficiently with newer machinery.

However, the entire economic savings of west Germany accumulated in the 40 post war boom years were spent in less than three years following re-unification with East Germany - it just disappeared into a black hole to try and pull the two Germanies into one country.

CrazyB

[Airbozo]

Part of the post war agreement was that Germany would dismantle ~50% of its total manufacturing infrastructure, but after negotiations that followed, the amount ended up being more like 35-40%. Then the Marshal Plan pumped ~1.4 billion dollars into Germany for rebuilding. Third behind the UK (3.3 Billion) and France (2.3 billion).

Then when Germany could not pay it's reparations, the US made them a HUGE loan so it could. The final payment to the US for all of this was made in 1971 (if I remember right), but they were only required to pay back a portion of that loan.

To swing somewhat back on topic, I find these quotes to be interesting given the fact they were made in the late 1940's;

Henry Hazlitt criticized the Marshall Plan in his 1947 book Will Dollars Save the World?, arguing that economic recovery comes through savings, capital accumulation and private enterprise, and not through large cash subsidies.

Ludwig von Mises also criticized the Marshall Plan in 1951, believing that "The American subsidies make it possible for [Europe's] governments to conceal partially the disastrous effects of the various socialist measures they have adopted." He also made a general critique of foreign aid, believing it creates ideological enemies rather than economic partners by stifling the free market.

[Crazy Buddhist]

Minsky:
Dr. Michael Hudson - global research dot ca wrote:

"A generation ago, for instance, Hyman Minsky gained a following by describing what he aptly called the Ponzi stage of the business cycle. It was the phase in which debtors no longer were able to pay off their loans out of current income (as in Stage #1, where they earned enough to cover their interest and amortization charges), and indeed did not even earn enough to pay the interest charges (as in Stage #2), but had to borrow the money to pay the interest owed to their bankers and other creditors. In this Stage #3 the interest was simply added onto the debt, growing at a compound rate. It ends in a crash.
This was the flip side of the magic of compound interest – the belief that people can get rich by "putting money to work." Money doesn’t really work, of course. When lent out, it extracts interest from the "real" production and consumption economy, that is, from the labor and industry that actually do the work. It is much like a tax, a monopoly rent levied by the financial sector. Yet this quasi-tax, this extractive financial rent (as Alfred Marshall explained over a century ago) is the dynamic that is supposed to enable corporate, state and local pension funds to pay for retirement simply out of stock market gains and bond investments – purely financially and hence at the expense of the economy at large whose employees are supposed to be gainers. This is the essence of "pension-fund capitalism," a Ponzi-scheme variant of finance capitalism. Unfortunately, it is grounded in purely mathematical relationships that have little grounding in the "real" economy in which families and companies produce and consume.
Mr. Paulson’s bailout plan reflects a state of denial with regard to this dynamic. The debt overhead is self-aggravating, becoming less and less "solvable" and hence more of a quandary, that is, a problem with no visible solution. At least, no solution acceptable to Wall Street, and hence to Mr. Paulson and the Democratic and Republican congressional leaders. The banks and large swaths of the financial sector are broke from having made bad gambles in the belief that money could be made to "work" under conditions that shrink the underlying industrial economy and stifle wage gains, eroding the market for consumer goods. Debt deflation reduces sales and business activity in general, and hence corporate earnings. This depresses stock market and real estate prices, and hence the value of collateral pledged to back the economy’s debt overhead. Negative equity leads to bankruptcy and foreclosures."
He also states:
The main impact will be to reinforce the concentration of wealth in the hands of creditors (the wealthiest 10 percent of the population) rather than wiping out financial assets (and debts) through the bankruptcies that were occurring as a result of "market forces". Is it too much to say that we are seeing the end of economic democracy and the emergence of a financial oligarchy * a self-serving class whose actions threaten to polarize society and, in the process, stifle economic growth and lead to the very bankruptcy that the bailout was supposed to prevent?Everything that I have read in economic history leads me to believe that we are entering a nightmare transition era. The business cycle is essentially a financial cycle. Upswings tend to become economy-wide Ponzi schemes as banks and other creditors, savers and investors receive interest and plow it back into new loans, accruing yet more interest as debt levels rise. This is the "magic of compound interest" in a nutshell. No "real" economy in history has grown at a rate able to keep up with this financial dynamic. Indeed, payment of this interest by households and businesses leaves less to spend on goods and services, causing markets to shrink and investment and employment to be cut back."

We all should be organizing to take our democracies back."

As I have written before this recession is Government policy, with Governments being made up of or puppets of the super rich. These people profit handsomely from what is happening now as the above aptly describes.

CrazyB

[Drum Thumper]

We all should be organizing to take our democracies back."



A bit off topic here, but I thought I would share this: if the state of Montana were to secede from the United States, it would instantly become the fourth or fifth largest nuclear capable super-power (depending on what numbers you look at).

Of course, numerous things would have to happen in order for Montana to keep the nukes....but still, that's a ****load of nukes.

It's going to prove to be a very interesting next few months--I have said repeatedly since 2000 that there is a very strong possibility that Bush invokes martial law before he leaves office.

[jdbnsn]

Lol, nothing says democracy like "lower your weapons, we have more nukes than you!"

[mittelmeier]

Lol.

I've been wondering if Bush would declare martial law when the economy started to get worse. I think if things get to bad he may. Of course it may be hard to impose martial law when most of the military isn't in the US.

[Crazy Buddhist]

Martial law is unlikely until there is a good excuse: both gas and food shortages and resulting public panic or; if the banking system collapses completely - in which case it is the only law that can be used to keep the basics functioning.

CrazyB

ps I deliberately use the word excuse rather than reason.

[Crazy Buddhist]

Lol.

I've been wondering if Bush would declare martial law when the economy started to get worse. I think if things get to bad he may. Of course it may be hard to impose martial law when most of the military isn't in the US.

Ron Paul, Mar 2008 "Inevitably under these conditions the people lose their liberty":

PoxlzPGIPt4

[Drum Thumper]

Of course it may be hard to impose martial law when most of the military isn't in the US.

Not really that big of an issue. The draft is still a viable option.

[mittelmeier]

Not really that big of an issue. The draft is still a viable option.

That's true. The draft is always a viable option, the government will make sure of that.

[Crazy Buddhist]

Democracy: rule of the people, by the people, for the people.

Modern capitalist democracy: rule of the people, by the state, for the state. AKA Fascism.

We're not far from fascism, Nazi-ism, Orwell's 1984 and Huxley's Brave New World. The Project for a New American Century is well on target. Ron Paul is right. America has to stop colonising the world, trying to police it, rule it, run it, master it. Empires always fail. The erosion of your human rights will be the keystone in this. The monetary solutions being proposed bring absolute power closer to government than ever before.

In addition it was announced this week that all pay-as-you-go mobile phones will have to registered with a passport from next year. This is part of the completion of a government database project based at GCHQ (Government Communication Headquarters) in Cheltenham, Gloucester. The database will track the telephone calls, web traffic and any other communications of all UK residents and visitors.

Nice Big Brother :) I won't be buying a VPN Proxy service when you turn the database on. I promise :D

[luciusad2004]

Democracy: rule of the people, by the people, for the people.

Modern capitalist democracy: rule of the people, by the state, for the state. AKA Fascism.

We're not far from fascism, Nazi-ism, Orwell's 1984 and Huxley's Brave New World. The Project for a New American Century is well on target. Ron Paul is right. America has to stop colonising the world, trying to police it, rule it, run it, master it. Empires always fail. The erosion of your human rights will be the keystone in this. The monetary solutions being proposed bring absolute power closer to government than ever before.

In addition it was announced this week that all pay-as-you-go mobile phones will have to registered with a passport from next year. This is part of the completion of a government database project based at GCHQ (Government Communication Headquarters) in Cheltenham, Gloucester. The database will track the telephone calls, web traffic and any other communications of all UK residents and visitors.

Nice Big Brother :) I won't be buying a VPN Proxy service when you turn the database on. I promise :D

The way things run in the UK lately makes me quite nervous. I can't proclaim to know much about it but the trickles of news i do get seem to indicate a government running in that direction. I don't look forward to the day I end up living in a surveillance society. Of course as far as I'm concerned I don't really trust any politicians republican or democrat. There's something about that Ron Paul vid, it just makes sense to me.

[xRyokenx]

I read about 1/2-3/5 of the way through 1984 and had to stop reading because it was making me very afraid and very depressed. To me, this current political/economic/etc. situation is very frustrating and confusing... so I plan on not worrying about it and going about my business while keeping an eye on things.

[Quakken]

The biggest problem I have with the current officials to be elected in america is how they don't mention on their webpages that they will do their best to uphold the rights outlined in the first 10 amendments.

I know that Mccain would never have that on his (except for "gun rights"), after looking at Obama's, does it mention it at all? I can't find it.

the biggest threat facing america, after the fact that we are still sitting on the edge of total financial collapse, is the fact that there are still people being held in guantanamo without habeas corpus, and that people's rights ANYWHERE we hold power are being diminished.

Slowly but surely, america will turn to complete fascism at some point if we stay on the current track.

[Crazy Buddhist]

The market right now is 33% down on its all time closing high of 14,164 reached on October 9th 2007. Not far to go. Another 2,400 point drop to the 7,000 level and it will be at 50% of peak.


41.5% down from peak at yesterday's close of play. Ouch.

[Crazy Buddhist]

Peter Schiff: "The only change you will have is the 'change' in your pocket".

GBguOFr2lrI


There's something about that Ron Paul vid, it just makes sense to me.

Yup, he and Peter Schiff are about the only two people in America with a rational and accurate view of the situation.

The whole crisis we are in is a typical asset bubble bursting, caused by cheap capital (artificially low interest rates). Obama is planning to increase money supply at a time when all that can do is DELAY collapse and INCREASE the endgame pain.

The market (DJI) hit a low of 44% down from peak on Friday before afternoon closing of short positions lifted it back over 8000. Many investors are shorting on a weekly basis but closing those positions Friday afternoon - this has been a consistent trend in the market for the last three months.

The bankers are using the bailout money to pay themselves bonuses (Merrill Lynch just paid $5 billion in bonuses and they are bankrupt!), redecorate their offices and install new bathrooms. Just shows, you bail out bad companies and they stay bad. Bear Stearns and Merrill should have been allowed to go to the wall: A precedent has been set.

Obama will produce big government, nationalise almost the entire US banking sector and large parts of the Automobile industry. The damage will come when Japan, China and Saudi Arabia stop buying US treasuries.

This day may be closer than you think. There is already a move in the middle east and other oil producing nations to stop pricing oil in dollars. Why? Because despite the temporary rise in the dollar it is going to fall and fall hard within the near future.

CB

[Crazy Buddhist]

I say 50% loss or more at the trough which may take 9 - 12 months to arrive.
It will be a rollercoaster from now until then.


I (and every other analyst) doubt this very much. If the US stock market dropped to 50% of it's current value the WORLD will be in trouble. This just will not happen. "."

Of course if you turn out to be correct, none of us will be able to validate this post because the economy will be so bad that none of us will be able to afford any sort of internet connection.

Well as of today the Dow Jones hit an intra-day low of 7484. Clearly it is still headed down, however this means that at 10.12am NY time the DJI stood at at 52% of the all time closing high of 14,164.

I think a 48% drop in value meets the target ... and amazingly we are still here with internet connections.

It's going further down by the way. It will bottom somewhere between 3,000 and 5,000 is my current guess.


The government keeps trying to implement new things to fix this mess. Is there something that can actually be done to turn the tide or does it just have to run its course?

I'm still happy that gas prices keep dropping.

Personally I am in agreement with Peter Schiff on this one. EVERYTHING THE GOVERNMENT DOES MAKES IT WORSE. It would have been better to let a few banks die and let GM and Chrysler break up (other companies would have purchased the plant and the US would not have lost it's auto industry).

The problem is that all the money being thrown at these entities is not doing any good.

The right way out of this would have been for all governments to blockade physically and with communications all of the worlds tax havens so the rich could be forced back into paying taxes. The fact is that only the middle class pay any significant taxes. The wealthy do not and they own the most and have the greatest share of income.

This could have been used as an opportunity to force all the legal and semi-legal tax dodgers back into paying taxes. Government revenues would have rocketed and the money could have been used to write down the debts of those in trouble.

Redistribution may not be popular however what we are seeing is a crisis of wealth moving out of taxation over a long period creating greater and greater burdens on the middle classes and governments and thus undermining the economic base of the poorest - which was pretty low anyway as they are dependent on Government in many ways.

The truth is that the wealthy have been redistributing wealth to themselves - through avoiding tax - for years. Taking this money back from them now and letting markets run their course would have been the only sensible strategy.

Of course, politicians can not do that because, as Ron Paul said recently, US international policy is made by "the same people who control both the Democratic and Republican parties" - i.e. the super-rich.

CrazyB

[XcOM]

nice read CB, good to see your still about, doing ok?

also i see your view about letting a few banks go under, now banks are too afraid to lend any money incase they go under, what we need is if the gov wants to throw money at the banks, buy a banks 100% share, run it like a bank should be run, gurantee all the loans using the old scoring system and get money flowing.

on a side note the UK housing market rose last month, i can't see feb's rising but its a sign that the slow down of the slow down has begun if you understand what i mean

[Crazy Buddhist]

Cheers XcOM ...

I'm alive and kicking m8 ... but only one leg really works now :D walking is quite funny because I have to sort of balance/swing on the one that works, then hop on the one that doesn't. I'm laughing more about it and in good spirits. Using some of that memory you sent me to build a couple of machines at the moment - an ipcop firewall and a small linux based fileserver. Thanks for that :) And deskpooter has a major remodelling in the works .... even in the depths of recession and ill health my modding mind will not be beat !

I think the rise in house prices was a temporary blip. In the words of the Carpenters:

We've only just begun to live,
White lace and promises
A kiss for luck and we're on our way.
And yes, We've just begun.

This recession will be deep. Even mainstream economic forecasters and market manipulators are saying growth will not probably start until Q1 or Q2 2010 at the earliest and that may be an underestimation.

The Russian stock market was down 18% at one point this morning and closed with a 15.7% loss in value (in one day).

Matthew

[XcOM]

all that ram should last you a long time i sent soo much, and makesure that rambus goes to good use, its not cheap stuff! bloddy good though!

[Drum Thumper]

I came across an interesting tidbit earlier today--one of the demographers here in the US claims that this mess that we are in could have been predicted 48 years ago.

48 years ago, the last of the baby boomers were born. And now that they are by and far empty nesters, they have no need to spend as much, thus adding to the drop in consumer spending quite significantly according to this guy.

CB, what's your take?

[Crazy Buddhist]

Well as of today the Dow Jones hit an intra-day low of 7484. Clearly it is still headed down, however this means that at 10.12am NY time the DJI stood at at 52% of the all time closing high of 14,164.

.....

It's going further down by the way. It will bottom somewhere between 3,000 and 5,000 is my current guess.


- Last night's close: 7465.95

- If you search google for DJI DOWN my website has the top spot

@XcOM Thanks you were more than generous, I know :)

@Drum can you post me a link - I'll read the piece and give a view.



OK, CB, I realize I've read your disclaimer. Percentage wise, how much cash on hand should we be looking at keeping around?

Not cash. Next is going to come big inflation so the value of cash will diminish quickly. The rescue bill is injecting $9 trillion of liquidity into the markets. This increase in money supply will blow the roof off the US economy. The dollar will collapse at some point in the next year (though they might string that out a little longer with great manipulation, I actually think it's coming sooner).

Just make sure any bank deposits you have are spread across banks so that no one account has more than is covered by the FDIC (I don't know the US limits) but also so that if one bank goes you have access to cash elsewhere while waiting for the FDIC to cut in).

Good investments: Land bought cheap that you can grow food on, a gun (if you can find one), ammunition for it, books on wild food and canning, and supplies: a seed bank, fertilizer, lime, solar and wind power equipment (there are self build solar designs on the net that cost $200 to replace half your electricity consumption with parts from walmart), time and work on developing your land to provide food, chickens, goats, time spent making good local connections for when the BARTER economy comes into effect as the mainstream economy crashes.


At least gas prices are down

They could be much lower. It is rumoured (and confirmed by some good sources) that America has more oil under Alaska than Saudi Arabia but the finds were classified and hidden in the seventies and since as government reserves in case of WW3.

The man in the show linked below, who was the volunteer Chaplain on the Alaska Oil pipeline - and then because of the money he was saving the company was given executive status and was in on the boardroom meetings as an observer - says he knows why the gas prices are down. Specifically this is an attempt to bankrupt the oil producing countries, as he was told by an executive from BP he has known for 30 years - the video's are interesting. This is the first of a four part recording:

http://www.youtube.com/watch?v=flUwh3t2_lQ

Also the problem with Iran is not the Nukes: It is that the Iranians have threatened to start selling their oil exclusively in Euros. In the early seventies Kissinger visited all the oil producing nations and cut a deal: price your oil in dollars, our oil companies will help make you rich, BUT with a portion of the profits you must buy US treasury bonds. The deal has worked until today but is now breaking down. Actually it is being deliberately trashed by bankrupting the oil nations with the drop in crude prices.

The only two countries who refused Kissingers' sweet deal btw: IRAQ and IRAN.

CB

Disclaimer: Nothing I have said in posts in this thread should be taken as investment advice. Take investment advice from a qualified investment professional in your own jurisdiction. Neither I nor TBCS can be held responsible for any actions you may or may not take take based on information in this post or elsewhere in this thread.

[Crazy Buddhist]

Opened this dummy (not real money) trading account in mid November with an initial value of £500,000. It's possible to make a lot of money in these markets.

http://www.vipassanaforum.net/images/market.jpg

Update 05 March. Doing well this week.

http://www.vipassanaforum.net/images/Market2.jpg

[nevermind1534]

The FDIC insured limit is $100,000.

[XcOM]

ye, bank of england said they were looking at other measures to try and get the flow of money going, they were talking about pumping money into our pockets by means of a tax rebate, but if were heading for defelation then pumping a little bit of money to raise inflation is a good thing isn't it?

[Crazy Buddhist]

It's a nice thought ... but ...No, not really ... we got into this mess by pumping too much money. Pumping more money now will lead to more false valuations and temporarily delay deflation, but not stop it. And it will not lead to an increase in savings or the long term productive capacity of the economy which would give us the real means to get out of the hole.

But all this is fictitious book entries on computers anyway. Money is totally corrupt. There is not 1 cent, penny, centime, yen or shekel in circulation that has not been laundered a few times in it's history and no one knows the real value of all money in existence because most of the worlds cash and reserves are held by a small pool of extraordinarily wealthy people through untraceable offshore accounts.

[Crazy Buddhist]

DJI closed 50.145% down on peak last night. .... told ya :P lol

[Drum Thumper]

DJI closed 50.145% down on peak last night. .... told ya :P lol

And we all still have internet access.

[Crazy Buddhist]

And we all still have internet access.

Indeed we do ... but twas not me who suggested we wouldn't ... all I said was that the market would fall to below 50% of peak. It has, the world has not ended, and it probably has another 2 - 3,000 point drop in it yet.

[Quakken]

We're looking at deflation and job loss mostly, aren't we?

[nevermind1534]

We're looking at deflation and job loss mostly, aren't we?

Inflation and job loss. Maybe some stagflation.

[Drum Thumper]

Indeed we do ... but twas not me who suggested we wouldn't ...

True, just felt the need to take a potshot at Airbozo lol.

This too shall pass.

[Crazy Buddhist]

Indeed it will pass.

Probably stagflation rather than deflation but who knows. Problem for America is relatively little manufacturing, and in the great depression 90% of people were already self sufficient of food ... but of course they were trying to avoid deflation so ploughed crops into the ground to avoid prices falling .. (nice trick) hence the starvation of approx 7 million Americans.

Anything Government does makes it worse. Obama is not changing much. Geitner and crew were in on the financial gravy train on the way up ... now they will save their banking buddies with more of the same and all get jobs in banks when they leave the administration - possibly the only institutions still solvent after this mess up of a rescue plan they are implementing. Almost certainly the US Government faces insolvency.

The sheer increase in money supply makes hyper inflation very likely as an outcome. And the dollar will collapse .. only a matter of time. It's not looking good.

If on the day I published the first advice this perfect storm was coming someone had owned assets worth $1,000,000 - half in real estate with a 50% mortgage, 40% in a diversified stock and bond portfolio and 10% cash, their NW that day was $750,000 after debt.

If they did nothing and spent what they earned since:

NW now ~ $450K depending on the house valuation - drop in NW of 40%

If ... the same person sold everything that day, paid off the mortgage, rented and bought gold (risen from $665/oz to $940/oz) with everything but their cash reserve, they would have put $650K into gold at $665/oz now worth $940 oz valuing the gold at $918K + 100K cash =

$1,018,000 - an increase of 35% in NW.

[Crazy Buddhist]

We're looking at deflation and job loss mostly, aren't we?

http://imgsrv.kfwb.com/image/kfwb/UserFiles/rosenberg.pdf

Merrill Lynch agree: 3 - 7 years of deflation in the US market. Scary report, good logic, well thought through.

[Crazy Buddhist]

SoCv1GwXUxc

[TheGreatSatan]

Gold rose $50...


The dollar is S**t

Thank you morons who voted Dem:lick:

[xRyokenx]

Gold rose $50...


The dollar is S**t

Thank you morons who voted Dem:lick:

Well, we're in a hole no matter what and it's going to take some time to slow down enough to start climbing out of this pit. I think it doesn't matter who got in, it's not just the President that helped make this ****ing mess. lol

Just my steadily decreasing in value $.02. And not value word-wise or whatever.

[Crazy Buddhist]

Who got in is irrelevant. Bush and Greensppan laid this foundation, nothing the Democrats could have done would have solved it in the short term they have had.

Unfortunately Obama and Bernanke are following the same recipe that Bush used to make the mess to try and get out of it. That will not work. America will soon be looking at manifestations of inflation and a falling dollar whilst the economy collapses.

Probably be 10 years from now before American economic levels recover if the dollar falls completely.

EDIT: Thank you to whoever +repped me "For calling this whole debacle so far in advance!"

UPDATE: Don't be thinking this has nearly bottomed out. Very unlikely.

The fed have been aggressively intervening in currency, gold, bond and stock markets on a daily basis to manipulate prices (what happened to free markets ? ? ? ? ? ).

They sent Hillary to beg the Chinese to keep buying federal bonds - but the Chinese PM was the only PM other than Gordon Brown at the recent G20 finance ministers meeting and the only reason for his visit seems to have been to make a press conference warning America it's time is running out.

Add to that the likelihood that at some point this year a major oil producer starts selling their oil in Euro's and BANG - that's the catalyst for the cataclysm - if that happens and catches on the US$ is no longer the worlds reserve currency.

This is why the top bankers worldwide are desperately trying to cobble together some deal for more "global" rules and regulators - and maybe even a new global currency. America is insolvent, has spent it's borrowed money on consumer goods and pimping rides for the last ten years and has a seriously undermined manufacturing base. The house of cards is dangerously weak.

[TheGreatSatan]

I'm putting my money overseas

[Quakken]

WOULD it be possible to put all of my money (yes, all $575) into euros, and effectively play the stock market in them? I can see MASSIVE U.S. inflation after the MASSIVE amounts of "money" the fed has pushed into the system starts seeing daylight. And could I do it over the internet? And will it still be viable for my scottrade account... somehow?

[xRyokenx]

What I don't get is why people are saying that deflation is a bad thing. I think it would be awesome if I could afford more crap with less money--as in, stuff I need, such as gas, books for school, art supplies, etc.

[Crazy Buddhist]

Ryoken you have hit the nail on the head.

Deflation was needed - this is the definition of an asset price bubble - overpriced assets which must fall in value. Houses were overvalued. Stocks overvalued. Falling prices is the solution. Government propping everything up will turn it into the greatest depression.

By pumping the cash they may be able to hold it together for a year but I doubt it.

The Chinese formerly announced yesterday "they are still going to buy US$ treasuries but are going to closely watch" US finances .......

The other side of that announcement is that they were VERY close to pulling from the market. What have they been offered as a bribe?

"No more noise about Tibet? - sure"

"Take Taiwan? - if you want it, sure"

Maybe ... but more likely they will still pull from buying US treasuries within 6 months from now, maybe a year at most, whatever the sweetener was. That is if the dollar does not start to implode beforehand.

Matthew

[xRyokenx]

The way things have been going it makes me think that the Apocalypse/Armageddon starting in 2012 is likely. Either that or something else bad will happen...

Pardon my pessimism... things just seem bad from my perspective. Really bad...

[Crazy Buddhist]

apocalypse is ancient Greek it means literally "to remove the cover" or in the biblical sense "revelation of truth".

I think we are already in the apocalypse: we are seeing the transparency of the lies of government and business every day on the television: The truth is being revealed.

[xRyokenx]

Yeah I keep forgetting the meaning of it. One might say that if we live our lives the right way we live an Apocalyptic life, lol.

Then again... isn't the "end of the world" always happening? If I remember correctly, I read somewhere that people have pretty much been saying the end of the world is nigh for a loooong time now lol.

[DaveW]

To think, I didn't believe you when you first posted.

I'm curious CB-what's your diagnosis for the pound? Apparently Gordon Brown has plans for 'Collective Easing' which is government gobbledegook for printing money. I'm no accountant but even I can see the obvious dangers or such a manoeuvre.

Essentially, I own nothing. I have no assets, other than my new car, which I bought from someone who had just lost their job for an absurdly small amount. To my eyes, everything is suddenly cheaper; while banks are not giving loans and mortgages anymore, house prices are at an all-time low.

In addition, the computer industry has so far proved to be remarkably resilient in the face of this recession (or whatever buzzword they're using today). So my chances of finding employment when I graduate in June are only marginally lower than they were last year, when I had the option to graduate but stayed on for the MSci (making me more employable than this year's BSc grads).

Essentially, what's my situation? I'm considering looking for work overseas. I speak a little Russian and French, along with English, so there's a lot of places I could theoretically go if there were jobs.

What's the outlook for the British pound?

Thanks,

-Dave

PS: +Rep for this thread dude.

[Crazy Buddhist]

To think, I didn't believe you when you first posted.

You were mistaken. It happens. We're all human.

[mtekk]

apocalypse is ancient Greek it means literally "to remove the cover" or in the biblical sense "revelation of truth".

I think we are already in the apocalypse: we are seeing the transparency of the lies of government and business every day on the television: The truth is being revealed.

You must not listen/read/watch to the garbage they sell to us as "news" in the United States. Most of it is still propaganda for Obama and the Federal government. The actions of the government are still as transparent as mud despite false promises to reverse that.

[DaJe]

I'm sort of just jumping in randomly to nothing here, but it's also been a while and it's hard to catch up with this whole conversation. I just realized though, that this thread was made all the way back in 2007. I remember reading it when it was first posted, and just shrugging it off, and not really wanting to get into it. I mostly didn't think anything too bad would happen either. And it's just crazy to be here in 2009 now, and have seen all the stuff that's happened with the economy so far, and seeing all the stuff that was discussed before it even happened.

Just seems a little hard to just into this conversation without following it for a bit, unless someone wants to catch me up on what exactly is being discussed at the moment : P

Also, Matt, we should Skype again sometime ;)

[Quakken]

Although it does feel good that we haven't degraded into a tribal society. Yet. But hey, soon will be the time to invest as the economy bottoms out. IF you have any money left.

[Crazy Buddhist]

Although it does feel good that we haven't degraded into a tribal society. Yet. But hey, soon will be the time to invest as the economy bottoms out. IF you have any money left.

"Soon" is likely to be 1 - 2 years from now when the DJI is about 2 - 3,000 points. Or maybe 4 -5 years. Or ten if it's really rough.

Your earlier question: better buying silver dollar coins or gold if you have $575 bucks ....

If the dollar collapses gold and silver will go through the roof ...

This is what gold can do for you in a collapsing economy (Zimbabwe, in this case): buy you something - which the money will not:

7ubJp6rmUYM

Basically all bets are off on the markets now. There has been so much bailout money thrown at the situation no one has a clue what the outcome will be but the most likely outcome for America is stagflation - negative economic growth with massively increasing inflation.

Bush then Obama have made all the same mistakes that lead to the great depression. Now it is a game of global geopolitics that will dictate the future. This is being negotiated by rich bankers behind closed doors. Our elected politicians have little say.

Dave: To answer your question on the pound, I see it strengthening against the Euro and dollar at some point but not yet and possibly dropping further first.

Your future? If I were you I would get a TEFL qualification and go and spend two years in Japan teaching English until your Japanese is good enough to work there. If you can improve your Russian as well you will be set for a great career with many choices.

The medium term and long term future will be better to Asia than Europe and America. Russia will fare reasonably well as Putin kicked the Rothschild and Rockerfeller backed Oligarch's out - and that is why he is demonized.

Matthew

[Crazy Buddhist]

You must not listen/read/watch to the garbage they sell to us as "news" in the United States. Most of it is still propaganda for Obama and the Federal government. The actions of the government are still as transparent as mud despite false promises to reverse that.

Freedom Watch with Judge Andrew Napolitano will give you something real. There is loads on youtube:

http://www.youtube.com/results?search_type=&search_query=freedom+watch&aq=2&oq=freedom+wa

(Yes .. Fox News being more truthful than anyone .... weird times we live in)

Here's a good one:

nIsQLl98KbM

[DaveW]

Dave: To answer your question on the pound, I see it strengthening against the Euro and dollar at some point but not yet and possibly dropping further first.

Your future? If I were you I would get a TEFL qualification and go and spend two years in Japan teaching English until your Japanese is good enough to work there. If you can improve your Russian as well you will be set for a great career with many choices.

The medium term and long term future will be better to Asia than Europe and America. Russia will fare reasonably well as Putin kicked the Rothschild and Rockerfeller backed Oligarch's out - and that is why he is demonized.

To be honest, I'd be happy teaching English for the rest of my days. Money doesn't give you happiness, but it can give you the means and the opportunity to find it. I'm just going to go with the flow and make the most out of whatever comes my way. It's important to keep faith in people too; helping each other out is the only way anything will improve, ever. It's greed that gets us into these messes. At the same time, investment = growing economy = more jobs, so it seems it's greed that gets us out of these messes too.

Not an anti-capitalist by the way, just making a point.

Thanks CB, your input is appreciated. :)

-Dave

[Crazy Buddhist]

To be honest, I'd be happy teaching English for the rest of my days.

A mate of mine contacted me recently through Friends Reunited. We hadn't spoken in 20 years since University.

When he left Uni he didn't know what to do so he applied for two jobs teaching English as a foreign language, one in Japan and one in Manilla.

He never heard from the people in Manilla but was offered the other job and took it. He spent the last twenty years in Japan teaching English and playing Golf.

Matthew

[Crazy Buddhist]

The Dollar, the Government and jobs: how the bailout endangers the economy.

BwzJcWxq7kY

[DaveW]

He spent the last twenty years in Japan teaching English and playing Golf.

He must be minted-Golf is the luxury in Japan. It's certainly an interesting prospect.

-Dave

[Crazy Buddhist]

He must be minted-Golf is the luxury in Japan. It's certainly an interesting prospect.

-Dave

If he is minted he made that cash teaching English in Japan - when I knew him he was a half Welsh half Iraqi kid from the valleys - looked Iraqi, spoke valley Welsh English, not a moneyed family by any means.

Matthew

[Crazy Buddhist]

http://newsimg.bbc.co.uk/media/images/45696000/gif/_45696522_gdp_growth_466.gif

^^^^ that's an ugly picture.

Car sales have halved from last year.

"Decline of UK Economy Worsens" - BBC News (http://news.bbc.co.uk/1/hi/business/8015704.stm)

[DaveW]

Car sales have halved from last year.

I think most people, including myself, are just buying second-hand cars. This £2000 off a new car to trade in an old one might help, but it's just another gimmick in my mind; that new car is still going to cost £4000+, while the second hand one could be as low as £400 (which is what I paid for my current car, and what a belter it is).

-Dave

[Crazy Buddhist]

10 of them will last longer no matter how bad your driving ;)

[DaveW]

10 of them will last longer no matter how bad your driving

New cars are built to break, old ones built to last. We've reached a point where old cars will last just as long as new ones, especially if they're of the VW or Honda family. This incentive is clearly to get those older cars off the roads straight up; you only get the money if you scrap that old car, forcing people to buy new and overpriced cars.

I'll stick with my $400 Tarmacsticator. Brown can smoke his £2000 incentive along with the £5000 he's offering if you buy an electric. Liaise with the fuel companies and manufacturers if you want this thing to work; don't just throw money at the problem and hope it goes away. Of course, I'm preaching to the choir here.

-Dave

[Crazy Buddhist]

The whole world is a choir excluding politicians lobbyists bankers aristocracy and the mega-rich. (not Gates)

[Drum Thumper]

The whole world is a choir excluding politicians lobbyists bankers aristocracy and the mega-rich. (not Gates)

By Gates you mean Bill, and not the current Defense Sec. of the US, am I right?

[Quakken]

In other news, the Dow posted a huge rise today. There's hardly any chance of this keeping up, right? I mean, bear-market rally has to have SOME meaning. The house of cards built up by ridiculous government handouts has to fall eventually, right? There's no way that the dow should be posting gains when every sector is posting losses.

[Crazy Buddhist]

The bailouts will have a negative economic impact. They take resources from well managed businesses and the public and hand them to badly managed businesses which by the law of the jungle should just die.

So yes I would agree this is a bear market rally and will fall again. That is exactly what a bear market rally means. Some folk get suckered into thinking things are ona turnaround and put their $ in the market to see it fall again.

Bear market rallies can be quite extended. All market valuations are guesses now though .. with so much cash thrown at the situation and government debt created to pay for it no one knows the outcome for sure.

My personal opinion is still strongly in line with Peter Schiff that a collapse of the dollar will likeley set off the nexxt phase of decline.

CB

[billygoat333]

Ugh. I really really wish that our government would just let the market run its course. Its my belief that GM and all the other companies that got "bailout" money should either learn to cope with downsizing half their companies or like CB said, die. If you can't manage your company well enough to survive, you shouldn't exist.

or, at least fire EVERYONE and start over fresh.

[Crazy Buddhist]

Ugh. I really really wish that our government would just let the market run its course. Its my belief that GM and all the other companies that got "bailout" money should either learn to cope with downsizing half their companies or like CB said, die. If you can't manage your company well enough to survive, you shouldn't exist.

Exactly. And the biggest issue is this:

They have now put every American adult and child into debt. Every business will face higher taxes.

In a nutshell they are stealing assets from well run businesses and giving them to badly run business which makes NO ECONOMIC SENSE AT ALL.

They are doing exactly the same things now that were done after the crash of 1929. Instead of letting markets run the course, big federal spending and bailouts .... and what did that lead to? Yes - the "Great Depression".

Oh - and a little known piece of history. There was plenty of food in America but because they did not want the prices to fall crops were ploughed back into the ground while good citizens starved.

Then and now this is all about - and only about - maintaining existing power structures and wealth disparities. Keep the rich rich and the poor poor.

When they try and save a situation by doing more of the same you know it won't work. I know it won't work. It's so basic. But then you have to realise. It will work ... because the end they say they have in sight is not the real Agenda.

The wool is being pulled over the eyes of the sheeple that let that happen to them.


or, at least fire EVERYONE and start over fresh.

You watched fight club?

;)

Matthew

[billygoat333]

yes I have. Would be really really nice if there was a big giant reset button (or in Fight Club's case, a ton of explosives made from soap :P ) on debt and the economy.

If only it were that simple. I am hoping and praying for a zombie apocalypse. Or at least a bigtime culling of the human herd. we have outstretched this planet too far. Just think what will happen when our earth has 9 billion people on is as projected in the not so distant future?

If you haven't read it, Read this book. (http://www.amazon.com/Ishmael-Adventure-Spirit-Daniel-Quinn/dp/0553375407) Has some very interesting points on humanity.

[Crazy Buddhist]

If only it were that simple. I am hoping and praying for a zombie apocalypse. Or at least a bigtime culling of the human herd.

So are the rich. Then they won't have to worry so much about being outnumbered by the poor.

[billygoat333]

good point. Maybe we should be causing the uprising of the poor then. haha. I dunno. I have a very cynical point of view when it comes to humanity I have decided. Working in customer service has shown me that my lack of faith in humanity is well founded. There are so many self-serving lying cheating idiotic people in this world that we could probably downsize by about 1 or 2 billion and be much better off.

But of course this goes against humanity's societal boundaries, our sense of compassion towards our fellow humans that others prey upon and profit on.

[Crazy Buddhist]

We are not born that way billy - we learn to be that way. Basically humans are all good. Evil is forced on people by horrific childhoods.

[billygoat333]

We are not born that way billy - we learn to be that way. Basically humans are all good. Evil is forced on people by horrific childhoods.


ahh the old nature vs. nurture debate. I could go on about this for hours... but in lieu of hijacking or diverting this thread, I will just say this:

what is good? Something that is good to me might not be good to someone else. I would argue that people are born a neutral, grey color. Neither good nor bad, black or white. The good or bad comes from culture.

So I guess you can say I agree with both sides of the picture. lol I am a fence sitter! I believe that nature (a la natural instinct) has a role in our predilection to violence, and nurture (a la a bad childhood) has a lot of effect on our social capabilities to do right or wrong as dictated to us by society.

anyways, back on topic:
When do I need to move up into the mountains with my gallons of gasoline, a generator, gold, and my 12 gauge? lol

[Crazy Buddhist]

ahh the old nature vs. nurture debate. I could go on about this for hours... but in lieu of hijacking or diverting this thread, I will just say this:

what is good? Something that is good to me might not be good to someone else. I would argue that people are born a neutral, grey color. Neither good nor bad, black or white. The good or bad comes from culture.

So I guess you can say I agree with both sides of the picture. lol I am a fence sitter! I believe that nature (a la natural instinct) has a role in our predilection to violence, and nurture (a la a bad childhood) has a lot of effect on our social capabilities to do right or wrong as dictated to us by society.

I'd agree - no argument. A baby and growing child will take what it is given.


anyways, back on topic:
When do I need to move up into the mountains with my gallons of gasoline, a generator, gold, and my 12 gauge? lol

You know .. I think the mountains we need to climb now are mountains of a different kind: Philosophical, political and practical. We need to overcome our distrust of other people and start building local communities to be strong. We need to start lessening our greed and making sure those around us are OK. We need to build a world where power and violence is not the key determining factor in man's future.

We need to build a world where a small minority do not hold all the cards.

These are hard mountains to climb yet if we fail to do so we will pay a high cost.

CB

[Crazy Buddhist]

Video made in 1973 ... yes NINETEEN SEVENTY THREE - THIRTY SIX YEARS AGO.

EDIT: this date is wrong, not sure what the date is but it's in the 1990's. EDIT II YUP, 1993 .... still even SIXTEEN YEARS is long term foresight in this area ....

I am not a believer in God but aside from those bits there is a great deal of economic sense AND long term foresight in these vids. A 4 part series:

gNot7kPJsBo

The last words of this one are quite profound:

NKqcdRvoZmU

XhSAof_DEEI

8yEpc94iIC8

[Crazy Buddhist]

Why? who? Where? when?

eAaQNACwaLw

[Crazy Buddhist]

Buy Physical Gold and get it outside the US the dollar will be worthless says Marc Faber also known as Dr Doom:
Source : MarcFaberchannel.blogs...
Speaking at the CLSA Asia Pacific Markets investor conference in Hong Kong. Mr. Faber told the audience to put money in Asian equities and commodities. He said gold is important, but buy real gold, not derivatives, and keep the gold outside the U.S. The U.S. confiscated gold during the Great Depression, he noted.
He, like Warren Buffett, Nouriel Roubini and others, thinks the dollar is destined to erode, though Mr. Faber said it could rebound over the next few months as signs of deflation stick around. “The dollar in the long run is a doomed currency,” he said. “This is the short of the century…The government’s policy is to make it worthless.”

CB