October 16, 2007

FLASH: This just in: Ben Bernanke has screwed America and made the US dollar worthless. In related news, Oil at $88 a barrel and gold at $760


One more time... It's not how many dollars you accumulate, it's what they can buy. And if you've accumulated lots of dollars, better get them into other things, because they're becoming worthless, and fast.

Ben Bernanke is a traitor to America. His shameful bailout of mortgage gamblers (banks, hedge funds, traders) screwed poor and middle-class America by wiping out the value of their savings and purchasing power of their dollars. And when the government reports their bogus inflation numbers (excluding food and energy of course), and Bernanke cuts rates again, remember to ask yourself why you believe in that dollar in your pocket. Because you shouldn't.

Oil Prices Rise to New Intraday Record

Gold, Platinum And Oil in Orbit As the Dollar Sinks

Bernanke Says Housing Slump Will Probably Be a 'Significant Drag' on Economic Growth

45 comments:

Anonymous said...

The Fed's next move will be determined by what is best for the economy, Bernanke suggested. As he has said previously, it is not the Fed's job to shield investors from the consequences of bad financial decisions.

"The truth is that it (the Fed) can hardly insulate investors from risk, even if it wished to do so," Bernanke said. "Developments over the past few months reinforce this point. Those who made bad investment decisions lost money."

The worst carnage has affected investors in "subprime" mortgages -- those made to people with spotty credit or low incomes. Some lenders have been forced out of business and some investors in those and related mortgage-backed securities have taken a huge financial hit.

Asked about what financial or economic information he would like to have but doesn't, Bernanke responded, "I'd like to know what those damn things are worth," referring in general to complicated financial instruments that repackaged debt -- bad debt, in some cases.

Overstretched homeowners with subprime loans got clobbered by the mortgage meltdown, too. Foreclosures and late payments have soared.

Anonymous said...

I went to an open house for an auction home this weekend. Built in 2006, it once sold for 1.2 million. The starting bid is 389k.

The person taking names at the open house told me that the guy who owned it has lost four others in the area also.

The house is in Corona Ca. just outside of Orange County.

I'm beginning to think that this thing is going to unravel faster than most of us could have hoped for.
Ill check back in with the winning bid price in a few weeks.

Lee from Irvine

Anonymous said...

Great video over on

http://housingcrashtv.blogspot.com

Everyone loves the bubbleman!

There is a wonderful line about a helicoptor suddenly arriving, full of money.

Very funny.....

Anonymous said...

Yawn. You've been yapping about this for months. OK oilis at $85. And gas is cheaper now than when it was $75 6 months ago.

And here is how awful the economy is. On Sunday I was flying and missed my flight. The flight was at 10:45am. Next flight at 12:15. Booked. At 1:45 booked. I finally got on the 3:20 and that flight was full as well.

You idiots talk about depressions and I have to wait at the airport all day to find a seat on a flight. Some depression. Some economic collpase.

Roccman said...

Keith..

It is called peak everything.

This should not be a surprise to those that have followed me here.

Buy gold...buy food...buy ammo...

Dig a hole and put a bunker in it....then fill it with everything you can get your hands on.

When done...grab a handful of popcorn and enjoy the die off.

www.dieoff.com

Cheers

keith said...

Bernanke stupidly and naively at his 2005 confirmation:

"It seems to be the case — there are some straws in the wind that housing markets are cooling a bit. Our expectation is that the decline in activity or the slowing in activity will be moderate; that house prices will probably continue to rise but not at the pace that they had been rising.

So we expect the housing market to cool but not to change very sharply."

Bernanke yesterday:

"The further contraction in housing is likely to be a significant drag on growth in the current quarter and through early next year."

Anonymous said...

Bernanke doesn't care about the dollar.

"Answering questions after his speech, Bernanke said while central banks can't be ``indifferent'' to exchange rates, data show the effect of a falling dollar on prices is ``relatively small."

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aS6FmilGyl8E

Anonymous said...

http://tinyurl.com/yoc2nj

And here is another juicy tidbit!!

Anonymous said...

Well, that is kind of a yes and no economic argument. The concept of Price exists for a reason. When your dollar won't buy much of one product (such as Wheaties), you either don't buy or you switch to a less expensive substitute. Novel idea, huh? I mean, it wasn't too far in our past when the American way was to look at the price of a product, good or service, make a logical decision about paying same and if the price was too high, telling the seller to go "f" himself - oh, wait, that is kind of what some of the HP crowd did where real estate was concerned and look where that market is today - fresh out of idiots and willing, greedy enablers. So, if your dollar won't buy much in gold but it will buy quite a lot in real estate... One opinion for future (2008 - and beyond) real estate buyers in the crowd; buy a property that will give some sort of economic return to the owner (decent soil that allows for a good garden, space for a small orchard, a flock of chickens or ducks) and that is close to a form of public transportation such as a train or bus line.

Economic Coyote

Budvar said...

"Answering questions after his speech, Bernanke said while central banks can't be ``indifferent'' to exchange rates, data show the effect of a falling dollar on prices is ``relatively small."


Oh yes, the "Pound in your pocket" speech given by Wilson in UK about 1966.

It basically said devalueing the pound abroad wont effect the pound in your pocket. Then inflation went stratopheric and we then changed the money system to a decimal system, and prices doubled in about a year. We had wage rises every few weeks to help cover the rises in prices of goods in the shop.

This was when we still had a manufacturing base, that made ships, machine tools, vehicles etc. All we do now is sell each other double glazing, and cut each others hair.

The entire economy over here is finance based, and once this all turns to shit (which it will, it can't do otherwise) we have nothing to replace it with as we've put all our eggs in one basket.

We cant cut benefits/entitlements, as riots that can't be controlled will break out everywhere, and an old Saxon saying that's as true today as it was 1000 years ago is, "Once you start paying Danegeld, you cant stop".

Anonymous said...

You idiots talk about depressions and I have to wait at the airport all day to find a seat on a flight. Some depression. Some economic collpase.

October 16, 2007 12:39 PM

============================
Perhaps it is because there are fewer seats available because there are fewer active carriers.
Pan Am
Braniff
Eastern
Republic
TWA
..... you get the picture. You dont have any idea what kind of collapse is in progress. There is no bottom to this collapse. Youre still smug because you have hit bottom yet. SPLAT!!!

Anonymous said...

"And here is how awful the economy is. On Sunday I was flying and missed my flight. The flight was at 10:45am. Next flight at 12:15. Booked. At 1:45 booked. I finally got on the 3:20 and that flight was full as well."

That may just be the worst argument I've ever seen on the internet for anything. Ever....

Well done sir!

cobra2411 said...

http://financialpetition.org/

Here's a petition to try and fix all the crap that's been going on out there.

MrBill said...

Oil and gold will be the next speculative bubbles to pop.

Anonymous said...

hmmm, looks like cfc, imb and the like are still struggling... time for another rate cut....

Anonymous said...

Hi all,


I need your advice on a potential purchase of a new condominium located in Skokie Illinois. I recently stopped by a development that has been selling condominiums and townhouses for an average price of 450K to 509K. After observing that there were not selling much, I offered the realtor, who represents the developer, 200k for a 1750 square foot townhome ($115/SF.)

To my surprise the realtor did not throw a fit like some others have done , but said that if I was serious he would take the offer to the builder.


This is an area where you cannot find anything priced less than 350K at this point.


What do you guys think, how much should we be paying, per square foot, given current and anticipated market conditions?

Anonymous said...

WHY ON EARTH IS THIS STOCK MARKET NOT CRASHING??????

WTF IS GOING ON???????

OIL 88
GAS 3+
HOUSING TANKING
LAYOFFS EVERYWHERE
38MM ILLEGALS.

ROME IS BURNING PEOPLE.... JUST THAT YOU ARE ALL TOO DUMB TO SMELL THE SMOKE

Edgar said...

...and Bernanke cuts rates again, remember to ask yourself why you believe in that dollar in your pocket. Because you shouldn't.

Sage words, Keith. The foreign pig men don't trust dollars anymore, so neither should we. The FBs have been skinned. The solvent sheep don't feel the clippers yet, but they will before this episode is over.

Anonymous said...

Anonymous said...
"And here is how awful the economy is. On Sunday I was flying and missed my flight. The flight was at 10:45am. Next flight at 12:15. Booked. At 1:45 booked. I finally got on the 3:20 and that flight was full as well."

That may just be the worst argument I've ever seen on the internet for anything. Ever....

Well done sir!

October 16, 2007 4:09 PM

-------------------------------

LOL!! I don't think I've seen anything worse either.

tangelo Mozilo said...

Mr. Bill, in what way are oil and gold speculative bubbles? They are hedges against speculative bubbles.

brokersleaveyoubroke said...

Troll said:
You idiots talk about depressions and I have to wait at the airport all day to find a seat on a flight. Some depression. Some economic collpase.

Airlines can no longer afford to fly empty seats like they did in the past. This is not an indication of prosperity.
You sound like the poster that touted iPhone sales as an indication of prosperity, that is, until they slashed the price due to poor sales.

Anonymous said...

More Halloween shock-and-awe from the Fed.

Some ten percent downturn in the market in the next two weeks, led by shorts played by Oldman Slacks, and Dow 12k will get us 50bps cut.

What will happen next could be catastrophic? Foreign capital flight, yen carry trade unwind, dollar collapse.

Same thing happened in '87 when James Baker opened his big Texas trap and said we didn't need a strong dollar.

The shock and awe will be when we hit Dow 7k by the end of the year.

Hope those gambling banks with their 23A exemptions, like Citigroup will still be around, playing the stock market with your deposits.

Time to put your silver pieces in the mattress.

King of the Bitter Renters

Anonymous said...

More Halloween shock-and-awe from the Fed.

Some ten percent downturn in the market in the next two weeks, led by shorts played by Oldman Slacks, and Dow 12k will get us 50bps cut.

What will happen next could be catastrophic? Foreign capital flight, yen carry trade unwind, dollar collapse.

Same thing happened in '87 when James Baker opened his big Texas trap and said we didn't need a strong dollar.

The shock and awe will be when we hit Dow 7k by the end of the year.

Hope those gambling banks with their 23A exemptions, like Citigroup will still be around, playing the stock market with your deposits.

Time to put your silver pieces in the mattress.

King of the Bitter Renters

Tangelo Mozilo said...

Mr. Bill, also see the link below.

Dump your dollars.


http://tinyurl.com/2sgk2d

Anonymous said...

i can fly all day and still not find an affordable place to stop, so pardon my not letting the airlines bleed me

Anonymous said...

I phones = 8 dollar transistor radio with intellectual property rights, hype and patent royalties or 600 dollars

Frank@Scottsdale-Sucks.com said...

The price of oil gives me some little bit of satisfaction knowing all those phony liar's loan homedebtors are driving around in big SUVs they couldn't afford in the first place.

Anonymous said...

Saith The Troll:

"You idiots talk about depressions and I have to wait at the airport all day to find a seat on a flight. Some depression. Some economic collpase."

Yeah. All those rising foreclosure are causing folks take trips with the money freed from their status as foreclosed upon, newly-liberated ex-homedebtors. Foreclosure sure is sweet!

LOL

Anonymous said...

This says is all:

http://tinyurl.com/36s7bq

k.w. - southern ca. said...

If you're not really careful, you can end up paying too much for an auctioned home - bidders tend to compete with one another, driving prices up irrationally.

Anyways, it's interesting to see that the bidding *started* at 389k.
I know the area you are speaking of, and I don't know of too many houses in the area that are even worth more than 400k.

Pricing just became so ridiculous these past few years, and now we're *just beginning* to see the fall-out from all this - residential housing has a long, long way to crash before approaching reasonable pricing.

Anonymous said...
I went to an open house for an auction home this weekend. Built in 2006, it once sold for 1.2 million. The starting bid is 389k.

The person taking names at the open house told me that the guy who owned it has lost four others in the area also.

The house is in Corona Ca. just outside of Orange County.

I'm beginning to think that this thing is going to unravel faster than most of us could have hoped for.
Ill check back in with the winning bid price in a few weeks.

Lee from Irvine

anon666 said...

"And here is how awful the economy is. On Sunday I was flying and missed my flight. The flight was at 10:45am. Next flight at 12:15. Booked. At 1:45 booked. I finally got on the 3:20 and that flight was full as well."

Also, I got stuck in traffic the other day at 5pm. Apparently, this was due to the fact that people were driving home from their jobs. The economy is doing great.

Anonymous said...

Imagine the world after a pandemic flu, and restarting the US economy with worthless dollars. Hell, imagine just trying to pull out of that kind of crisis. Uncle Sugar might have some problems saving you... Think Katrina everywhere.

Here's a clue. Invest now, buy on sale if you must, in the kind of stuff you will need during a pandemic flu. Don't get caught short; your family will never forgive you if you fail to protect them!

Get cold and flu stuff so you aren't as weakened when you get flu on top of it. Get your flu shots and hope there is some cross-reactivity to the pandemic strain. Buy long shelf-life protection in sufficient quantity when it's sufficiently cheap (a few % off and protection against inflation are a good deal even factoring out saving your kids' lives): canned food, bleach, alcohol hand sanitizer, etc.

Don't count on being able to get what you need in a declining economic and political environment, even well before the pandemic actually hits.

Lost Cause said...

Orange County, CA -- home to and inventor of the subprime mortgage market. The largest industry is real estate. I have said it before and I will say it again -- this place is going to get slaughtered.

Lost Cause said...

Japan and China led a record withdrawl of foreign funds from the United States in August, heightening fears of a fresh slide in the dollar and a spike in US bond yields.

The US requires $70bn a month in capital inflows to cover its current account deficit, but the key sources of finance are drying up one by one.


Spike in US bond yeilds == more tax dollars to pay the debt.

Anonymous said...

Analyst tells EIR: "Super-Conduit M-LEC Scheme Won't Come into Existence"
Increase DecreaseOctober 16, 2007 (LPAC)--One of the United States' leading analysts on financial risk, told EIR on October 16, that the proposed Master Liquidity Enhancement Conduit (M-LEC) scheme will not function, and probably won't even get off the ground. He predicted a wave of bank failures. "What is so good about rolling up hundreds of billions worth of illiquid assets-- these SIVs [Structured Investment Vehicles] and conduits-- into one super-conduit?

"Seriously, this won't even come into existence. Once you go over the terms of the new super conduit [M-LEC], who would purchase from it? Why would investors purchase Citigroup's SIV assets when they are in a super-conduit, when the same investors wouldn't purchase Citigroup's SIV assets, when Citigroup offered them separately?"

He said that "In Europe, the banks are done with SIVs, they have already been hit. I understand that within a few weeks, Moody's and some Europeans are going to come down hard on the SIVs."

This source said, "the banks created this. They created assets and liabilities off-balance sheets, like SIV's and derivatives. They made a lot of money, now there is a problem."

He warned, "This is going to get worse. By the middle of next year, banks are going to have solvency crises-- bank failures. The banks have two types of risk. First, trading book risk from the SIV's/conduits that they set up. Second, they have problems on their books, like from home mortgage loan defaults, and other types of default, which are going to get bigger. As they mix, banks are going to fail, like we had in the 1990s [the S&L failure]."

He underscored that Citigroup is in serious trouble, saying "the U.S. banks don't have sufficient equity for what's ahead. The ratio of their equity to their assets is 8%; they need 25%. All of America's bank holding companies have collectively $110 billion in capital. But Citigroup could suffer $20 to $40 billion in losses; they don't have enough capital. The U.S. banks don't have enough capital to handle their on-balance sheet and off-balance sheet losses."

The source called a "legal fiction" the banks' claims that the banks, and the SIVs and conduits that they have set up, are "separate entities." He observed, "the banks sponsored the conduits; picked the Trustee and directors of the conduits; set up the service provider for the conduits, and lent the conduits money. The conduits issued commercial paper to pay back the banks." They are one and the same.

He asserted that one of the directions in which the crisis may be heading "is a federal bail-out. But the banks' problems are too big; it is too big to bail out."

FlyingMonkeyWarrior said...

@ Anonymous,

This says is all:

http://tinyurl.com/36s7bq

October 16, 2007 8:20 PM
RE;

snip;

David Woo, an analyst at Barclays Capital, said Washington was happy to see the dollar slide. "They don't care so long as the fall is not disorderly. They see it as a way of correcting the deficit. " he said.
----------------------
Been sayin this since last Nov. right here. Nice to see it in the press.
Better late than never.

Anonymous said...

Acutally, the decline of the dolllar and starting from a clean slate will be our salvation.

Long before the housing scam the dollar was still based on nothing but speculation and hype. Purchasing power has been on the decline ever since we went off of the gold standard.

The average American used to be able to buy a new house and a new car without any trouble up until the mid 1970s. The average home used to cost about 2 years of income. These days the median home price in the US is over 300K while the average income is not over $100K per year.

Sure this will be a hard fall but sometimes you have to destory the entire village to save it. Ben is scum for helping the banks and speculators at an individual level. However, his aceleration of the fall will make it so we have a depression hard and fast instead of decades of recession and then depression.

Anonymous said...

Bernanke has suggested that the Feds' next move will be dependent on "what's best for the economy."

Why all the sudden interest in what's "best for the economy" after years and years of blowing bubbles and letting lenders and bankers run wild and throw the real economy to hell in a handbasket?

The Fed doesn't care about the real economy. They've proved that for several years now. They care about Wall Street and the banks. the rest of the US can go to hell.

Anonymous said...

Anonymous said...
Bernanke has suggested that the Feds' next move will be dependent on "what's best for the economy."

Why all the sudden interest in what's "best for the economy" after years and years of blowing bubbles and letting lenders and bankers run wild and throw the real economy to hell in a handbasket?

The Fed doesn't care about the real economy. They've proved that for several years now. They care about Wall Street and the banks. the rest of the US can go to hell.

October 17, 2007 6:18 AM

It's actually worse than you state. The policy of destroying this country's productive economy is intentional. The Fed is an instrument to destroy the US economy, it is not a case of mistaken policy.

Anonymous said...

>> Acutally, the decline of the dollar and starting from a clean slate will be our salvation.

If clean slate means kicking off a new financial system with a central banking structure, then we're fucked all over again for the next 100 years.

Anyone else ever notice that when we do "nation building", the first thing that gets setup is a central banking system, thus ensuring the financial enslavement of the new nation? I'll tell ya, the bankers have it all figured out...

Osman said...

Keith,

It's starting to look like the dollar's slide is reaching its limits. How about your take on this discussion of where the Dollar is headed?

k.w. - southern ca. said...

Perhaps I'm doing well and you're doing well, but many people across this country are not doing well at all, and are struggling to make ends meet.

It is what happens to the greater masses which will have the most significant effect on the overall health of this country.

Granted, many people made foolish financial decisions these past few years by committing to a house mortgage they simply could not afford without easy access to borrowed money.

However, the Fed has only made the problem worse now by lowering the rate and impacting even more citizens - devaluating the dollar even further.

We will see see a very severe and protracted recession across this nation.


anon666 said...
"And here is how awful the economy is. On Sunday I was flying and missed my flight. The flight was at 10:45am. Next flight at 12:15. Booked. At 1:45 booked. I finally got on the 3:20 and that flight was full as well."

Also, I got stuck in traffic the other day at 5pm. Apparently, this was due to the fact that people were driving home from their jobs. The economy is doing great.

Budvar said...

Anon said.
"I was sat hours waiting for a flight so therefore the economy is booming".

Oh really? Is that why people are plundering their pension funds as now the heloc atm has been shutdown, it's the only way they can keep their head above water?

The word "Complete and utter tit" don't even begin to describe your idiocy.

Budvar said...

Osman said...

Keith,It's starting to look like the dollar's slide is reaching its limits. How about your take on this discussion of where the Dollar is headed?


Basically what the article is saying is that OK the US is printing money like confetti, but so is everyone else.

My young un tries that excuse when caught doing something he shouldn't with the "But young Septimus from down the road does it" and like I tell him, "So, that makes it alright for you to do it, does it?".

This insanity ends the way it always does, it's not different this time, same as all the other times it wasn't different then.

Yes we can have a million dollar dow, but when a loaf of bread is $150 are we any the richer?

Anonymous said...

And here is how awful the economy is. On Sunday I was flying and missed my flight. The flight was at 10:45am. Next flight at 12:15. Booked. At 1:45 booked. I finally got on the 3:20 and that flight was full as well.

Aren't you that guy who had the Krispy Kreme and bought an iPhone another day? Yep, this economy is booming...vote for Giuliani to make it even better!