October 29, 2007

¿¡Revolución!? Ben Bernanke and George Bush are killing America. Anyone care?

At what point do screwed Americans take to the streets? At what point in this downfall does violence break out? At what point do people say enough is enough?

Or does that point never come?

Interesting results so far in the HP flash poll on the Fed meeting this week. 95% of HP'ers think the Fed should hold or raise rates. Yet 73% think Ben will cut. Can you say disconnect? Can you say Screw America?

Washington Post: Is Bailing Out Reckless Investors Wise? Don't Bank on It


Last summer, the bill started to come due on our debt-fueled economy. We should have let it -- and let reckless speculators, subprime lenders and banks finally get what they had coming. But instead, the financial authorities let them off the hook. Rather than simply letting markets be markets, they bailed out both the fools and the knaves.

We'll all live to regret it.

But bad investments do not become good ones just because a central bank lends more money to the investors who made the rash choices. Problems caused by too much credit do not disappear when you hand out even more credit. And the syndrome that such moves create only makes our economic woes worse.

39 comments:

phat 1 said...

I think Big Ben is ready to take the hit for the $ US -- another phat BONG HIT.

The only explanation left is that Big Ben's attention has been diverted to more important matters (look -- something shiny!). Or else he has been eating the mushrooms he found.

RUN AWAY!

Princess Mononoke said...

I'm guessing the situation will only become real to "Them" when soup lines begin forming in every city.

I too say, "Enough is Enough".

No lesson has been learned. They keep using the same methods, inducing a vicious cycle of Perpetuity!

Mark in San Diego said...

Probably 90% of Americans do not understand what is going on. I had dinner last night with a very well educated couple (NPR types) and they talked about Bush, the War, Hillary, etc. (they like John Edwards), and when I mentioned the assualt on the dollar, and the credit collapse, there was dead silence. . .not that they disagreed, but they simply had not really thought about it, or heard about it on NPR. They only see it as cutting into their spending once a year in Europe for their two weeks. As for housing prices - they bought 10 years ago, so they have a lot of equity, and just feel the housing "slowdown" will likely be only another year or so. . .what can I say??

Anonymous said...

Fascism is an authoritarian political ideology (generally tied to a mass movement) that considers individual and other societal interests subordinate to the interests of the state. Fascists seek to forge a type of national unity through oppression and coercion, usually based on (but not limited to) ethnic, cultural, or racial attributes. Various scholars attribute different characteristics to fascism, but the following elements are usually seen as its integral parts: nationalism, statism, militarism, totalitarianism, anti-communism, corporatism, populism, collectivism, and opposition to economic and political liberalism.

Anonymous said...

mark in san diego said...

WOW, Mark, I had a similar 'out-of-body' experience this weekend with my own Family members - I'll bet your prediction is LOW at 90% in American public not understanding what is at stake Right Now. SURVIVAL PEOPLE!

Here's an xlnt book: "Bubble$ and How to Surive Them" by John P. Calverley, ISBN1-85788-348-9 (available at most libraries I am told.) It was like reading the current events with a chilling look to the future... Not a pretty picture for those in debt or living above their means with no safety net in place.

If you listen Real Close, you can hear the clock ticking down to action in the streets... Pain, and a lot of it is coming to a town near YOU. Look for a brown lawn...

Thanks for the blog, and everyones input here.

John in Santa Clara, CA

The Iron Duke said...

"I sincerely believe ... that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale." – Thomas Jefferson

"Of all the contrivances for cheating the laboring classes of mankind, none has been more effective than that which deludes them with paper money." – Daniel Webster

"Whoever controls the volume of money in any country is absolute master of all industry and commerce." – James A. Garfield

"All the perplexities, confusion and distresses in America arise not from defects in the constitution or confederation, nor from want of honor or virtue, as much from downright ignorance of the nature of coin, credit, and circulation." – John Adams

"If the American people ever allow private banks to control the issue of their currency first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers conquered".

-Thomas Jefferson

"Give me control over a nation's currency and I care not who makes its laws"

- Baron M.A. Rothschild



"If Congress has the right under the Constitution to issue paper money, it was given to be used by themselves, not to be delegated to individuals or corporations".

- Andrew Jackson

"By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose".

- John Maynard Keynes


THANKS, WOODROW WILSON!

Princess Mononoke said...

Classic quote from the Common Sense Forecaster blog, "In my mind the regulators should have been pushing safe sex so Citi does not get SIVilis."

You can read the full article at:

http://commonsenseforecaster.blogspot.com/2007/10/some-thoughts-about-sivs-or-should-i.html

Anonymous said...

¿¡Revolución!?

To answer Keith's question:

I believe it will be painfully and predictably slow to happen, but shockingly spontaneous when it does.

Anonymous said...

I don't understand where all this negativity comes from. Don't you watch Larry Kudlow? Our Goldilocks Economy is the greatest story never told. Hey, maybe that's the problem: Benny & Dubya watch Larry Kudlow & CNBS before they set policy. It's like a chicken egg thing. Even if there was a massive outcry to change policy and do the right thing, the response from these jokers would be: "let them eat cake". I would love to see every congressman's head in a basket with the exception of Ron Paul. Think about it, if even 20% of these a-hole congressman were like Ron Paul, could these Jokers get away with this crap? You think things are bad now, wait until Billary wins next year.

serindippity said...

"If the American people ever allow private banks to control the issue of their currency first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers conquered".

-Thomas Jefferson

"If Congress has the right under the Constitution to issue paper money, it was given to be used by themselves, not to be delegated to individuals or corporations".

- Andrew Jackson

People ought to know that those two quotes are describing the exact state of affairs in the USA *before* central banking, i.e. the Federal Reserve.

Back then, individual banks issued their own paper currency---yes your note was backed by "Third Chartered bank of St. Louis" or something and that's it. And there were runs on banks, and all sorts of sleazy games, even worse than today, by far.

And because of the gold standard, there were alternating inflations and panics (deflations) where all banks called in their loans. That means everybody has to pay back the entire amount all at once. They obviously couldn't if their assets were illiquid, e.g. factories or farms. The banks ended up confiscating enormous amounts of wealth this way.

No matter the problems with the Fed---many alternatives are worse.

The correct operation is for our representatives to really make sure the Fed is doing its job. It failed in the tech bubble, and it failed now, and the reason was exactly the same:

anti-regulatory ideology.

It isn't interest rates which were the problem (did margin rates dissuade crazy daytraders? no.) it was underwriting standard and availability of credit to speculators and liars.

The Fed has plenty of of authority to stop this, and both times they didn't. Because of Alan Greenspan's juvenile worship of Ayn Rand's baloney.

Anonymous said...

Keith - good for you for creating a blog site that represents the silent majority. By silent I mean those who have no other avenue to express themselves other than a board such as this. I'm often very impressed with the quality and intelligence of the comments posted here. You've begun a grass roots dissentence movement and I'd be curious as to how many followers you now have. You can count me in. I routinely check this board since I know I can get to the square root of current events by your topics. Your insights and commentary are unmatched by any other blog site. I just wanted to put my two cents in for the tremendous job you're doing. Congratulations.

honica jewinski said...

Yeah, some of us care, you're damn right. Some us even care enough to point out the root of the actual problem.

Unfortunately, things are gonna have to get a whole lot worse (and believe me, things will get a WHOLE LOT worse) before people start rejecting what they've been indoctrinated with through the jewsmedia.

Anonymous said...

(NPR types) = SHEEPLE

Mark, NPR types are brainwashed idiots... they are just as bad as the religious fanatics.

NPR types think that Kerry was better than Bush. Kerry and Bush are on the same CFR/ Skullbones team.


wake up!!!

vote ron paul

Anonymous said...

BWA HA HA HA HA

Suckers. Never fight the fed.

Hey good luck with that whole CFC put thing.

Chumps.

Anonymous said...

Mark in San Diego said...

Probably 90% of Americans do not understand what is going on. I had dinner last night with a very well educated couple (NPR types)

===========

No what you mean is you had dinner with a couple of liberal morons who think they're smart because they listen to NPR and read the NY Times.

George Bush was "well educated". Yale and Harvard Biz School. Doesn't mean shit.

Anonymous said...

Keith said
At what point do people say "enough is enough?"
Or does that point never come?"
------------------------------

Sorry Keith! didn't want to spoil your hopes! But that point never comes! No. Americans IN GENERAL dont give a rat's about how we're all going to hell in a handbasket. Seriously, nobody gives a SH&t! We're too busy with shows like "I love New York 11" with the ghetto whore herself (Tiffany Pollard)and that other sexist/racist show (America's Next Top Model - have you ever noticed that the contestants who win have the same skin complexion as Tyra Banks- regardless of race- you have to have HER skin complexion to win the show)!
Ya- that's what sheeple in the US are doing with their time. Oh ya, that and driving their leased Hummer with the rolling RIMS to show how PIMP they are!

Anonymous said...

"Dumb and Dummer"

Anonymous said...

Keith! Revolucion? Are you serious! The only revolucion you're going to see is the complete abdication of California over to Mexico (with Bush handing over the keys of the state to the president of Mexico- on Prime Time-no less! Meanwhile the remaining couple hundred whites in California, i.e. Newport Beach California,will continue to live under the illusion that they're wealthy-their homes are all still worth a cool million, their kids are drug free, and their hair is naturally blond!

honica jewinski said...

text:

http://www.conspiracypenpal.com/rants/other.htm

audio:

http://www.conspiracypenpal.com/rants/other16-16.m3u

Having lost the 78 dollar the prior week, Ben desperately was trying to salvage at least a 77 dollar this past Friday so that people didn't have the weekend to ponder the dollar having dropped more than a full point in uncharted water in just one week. I thought they got started a little later than their normal 11 am, ET, on Friday but then realized, over an hour later, that the legitimate market activity was so huge that it simply was masking the bankers' efforts, normally so obvious and predictable. Wish I could have seen the looks on their faces. Wish I could see the looks on their faces during next week's Fed policy meeting. Like the last one, will they announce the next rate decrease in advance or wait for the meeting, do you suppose?

Anonymous said...

Remember back a couple years ago when Ben B. first became Fed Chair and he sent the banks little notes asking them to "please stop lending money to people who couldn't repay the loans"? Oh yeah, that was some heavy-handedness right there. He was really showing those banks who was boss. NOT.

Then he stops raising rates way too early when everyone knew inflation would take off and the dollar would weaken as a result, not to mention he kept the obscene "buy now or be priced out forever " crowd in tact for two more long years.

Then he CUT by 50 b.p.

Can we just get RID of this imbecile and get someone in there who knows what the f@ck he's doing?

Anonymous said...


Problems caused by too much credit do not disappear when you hand out even more credit. And the syndrome that such moves create only makes our economic woes worse.

That's not what my dealer said! He told me I should just keep shooting up until I felt better.

Why would he lie to me?

Magon said...

President Wilson signed an act passed by majorities in the U.S. House and Senate.
The President and Congress were elected by (primarily) white men.

See? The system worked.

Anonymous said...

"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation."

-- Alan Greenspan

Anonymous said...

‘Zero US effort’ on housing slammed

By Matthew Garrahan in Los Angeles
Published: October 29 2007 23:14 | Last updated: October 29 2007 23:14

Angelo Mozilo, chief executive of Countrywide Financial, on Monday strongly criticised the US government’s response to the collapse of the subprime lending market, saying there had been “zero” effort to tackle the crisis.

“In terms of tangible effort from the federal government...there has been no programme, no federal effort, no legislative assistance – zero,” he said.

He criticised the US government’s refusal to lift caps on the size of loans that can be bought by Fannie Mae and Freddie Mac, the government-sponsored entities created to promote affordable housing.

pwnd

SPECTRE of Deflation said...

I'm thinking financial apocalyse if these jackasses don't handle this right, and I'm not hopeful regarding "Benny and the Inkjets".

Anonymous said...

To answer your question, Keith, it's once China re-values their currency. You see, the debasement of the US dollar is causing rampant inflation, but US consumers haven't seen it. That's because while the USD vs EURO has dropped some 40% in the past 5 years, it's dropped less than 7% in 5 years.

So China is protecting the US consumer right now, subsidizing their debt and shipping them everything and anything.

So when will people take to the street? It won't hit them until China finally decides she is ready to pull the trigger and let her economy stand on its own two feet. Then the price of everything in the US will double, and the revolt will go into full swing.

Anonymous said...

Mark in San Diego said...

Probably 90% of Americans do not understand what is going on. I had dinner last night with a very well educated couple (NPR types) and they talked about Bush, the War, Hillary, etc. (they like John Edwards), and when I mentioned the assualt on the dollar, and the credit collapse, there was dead silence. . .not that they disagreed, but they simply had not really thought about it, or heard about it on NPR. They only see it as cutting into their spending once a year in Europe for their two weeks. As for housing prices - they bought 10 years ago, so they have a lot of equity, and just feel the housing "slowdown" will likely be only another year or so. . .what can I say??

October 29, 2007 10:29 PM<<<<


they think they are smart because they are enlightened liberals.......they think that everything is the republican's fault but they don't understand that parties mean nothing and never did. the only thing that we need to understand is who has the power in this world. money is power and power is money and it matters not who the talking head is that calls himself a leader of some country. the only thing matters is profits and the continued killing of unwanted human beings by various means. it has been that way since the rothchild banking family finally figured out how to take their dog and poney show international. when they did this, in the late 1700's , they achieved dramatic financial success and then after acquiring power, they started making their on going grab for world power through the use of wars to kill unwanted human beings, and to get countries in debt.

Anonymous said...

Axis of Evil. Bush, Bernanke, Cheney, Paulson. The other two are missing from the picture.

Anonymous said...

Lets admit what everyone is tap dancing around here. This is all about cronyism and "haves" and "have nots". Greenspan's pandering (with the Bush admins blessing) to investor cronies and Wall Street types after the dot.com crash is what got us into this mess and now Bernanke (with the Bush admins blessings) is pandering to the same cronies to try and clean up the housing crash too. Republican's will never change, instead of doing the right thing for the people as a whole, they are going to only do what is best for the big investors/cronies again. If more Republicans were like Ron Paul, then I would cut them some slack, but you see by poll results how representative Ron Paul is of his party. The smoke screen of the Republican party is they tout "smaller government and less regulation", but it is really translates to being prejudiced against the poor and middle-class and their desire to have big class distinctions. I've had enough too!

sam said...

Love you HP guys fighting the good fight, but the best answer is no cut. The fed chairman shouldn't be a cowboy- not his role to make political statements, which at this point raising rates would be. His 50 pt rate cut seemed brilliant when we thought it wouldn't be followed up.

The fact that the market now factors in 96% chance that they will cut means that "no action" would send a major signal to the f'ed lenders that their many statements about inflation concerns and not targeting asset value wers not straight doubletalk. It would force a reckoning for any f'ed lender who thought they could push revaluation into 2008.

Maybe, the talk about preemptive strikes against extremely negative outcomes was a retrospective explanation of the last tightening rather than the articulation of forward looking policy.

Needless to say, I doubt this or that BB is up to the challenge. I don't think he hates America (though he might as well), he just doesn't have the balls to stand up to the banks that ultimately employ him. And that is why he will cut 1/4 instead of doing nothing. Ben, hope you prove me wrong here.

Anonymous said...

Mark in San Diego is right. The Bush administration is enjoying the cloak of secrecy they have to navigate through this quagmire with very little notice. The masses are still unaware of the enormity of the problem. They couldn't have a better trained MSM.

sam said...

Let me also say to the survivalists out there- I love you all. Crossbows are awesome. Gold and can-goods too. Lots of guns never hurt anyone. If I didn't live in the city, I'd have an arsenal filled w/ crossbows instead of just a couple handguns.

But the reason tinfoil hat jokes resonate is that survivalists represent a specific state of consciousness that is present through time and space. For example, people thought the same stuff in the '80s and did the same thing (guns, gold, crossbows). of course, they would have earned a 600% return if they bought an index fund instead of an arsenal, but that's an abstraction7.

Fortunately for survivalists, someday they will probably be right someday. They know this, and that knowledge alone provides decades of contentment.

Anonymous said...

Thanks to the builders, the speculators, the lenders, the brokers and the realty clerks housing should be less expensive.. much less expensive...

From Mish,

A record 17.9 million U.S. homes stood empty in the third quarter as lenders took possession of a growing number of properties in foreclosure.

The figure is a 7.8 percent gain from a year ago, when 16.6 million properties were vacant, the U.S. Census Bureau said in a report today. About 2.07 million empty homes were for sale, compared with 1.94 million a year earlier, the report said.

New foreclosures have risen to a record, led by defaults in adjustable-rate loans to people with tainted or limited credit histories, according to the Mortgage Bankers Association. Home- price declines and tougher lending standards are making it difficult for owners who fall behind in mortgage payments to sell or refinance into better loans.

The U.S. homeownership rate fell for the fourth consecutive quarter to 68.1 percent, seasonally adjusted, from 68.9 percent a year ago, the report said.

Let's stop right there. Did you catch it?

* A record 17.9 million U.S. homes stood empty in the third quarter.
* A mere 2.07 million empty homes were for sale.

Let's do the math.
There are 15.83 million vacant homes just sitting there. How long can that last?

Princess Mononoke said...

CBS 60 minutes calls it "The Mother of All Heist". Very appropriate title I might add. It's only 13 minutes long.

http://www.cbsnews.com/stories/2006/10/19/60minutes/main2109200.shtml?source=search_story

California Real Estate Investor said...

It's official. Sacramento has fallen the most since the credit crunch.

norcalbubble.blogspot.com

Anonymous said...

Anonymous said...
Remember back a couple years ago when Ben B. first became Fed Chair and he sent the banks little notes asking them to "please stop lending money to people who couldn't repay the loans"? Oh yeah, that was some heavy-handedness right there. He was really showing those banks who was boss. NOT.

Then he stops raising rates way too early when everyone knew inflation would take off and the dollar would weaken as a result, not to mention he kept the obscene "buy now or be priced out forever " crowd in tact for two more long years.

Then he CUT by 50 b.p.

Can we just get RID of this imbecile and get someone in there who knows what the f@ck he's doing?

October 30, 2007 2:15 AM
---------
Oh, he knows exactly what he is doing!!

Anonymous said...

People who read this blog - please sign the following petition. It auto-generates faxes to send to your state's 2 Senate representatives and your House representative.

http://financialpetition.org/

All you have to do is sign it - and instead of just typing, this site fundamentally takes action.

Anonymous said...

PKK grandma here--I've been dreaming
about those soup lines (I'm feeding
people because I was ready, and
expected it) since I was 3. All manner of people, because of an
economic collapse. Strangers to me.
Outside ( I assume no electricity
or too many people ).

Princess Mononoke said...

PKK Grandma, I too have had those dreams. I see myself outside talking to individuals encouraging them not to lose hope and not to give up on life.

Most of Middle America is right above the poverty line. When a factory closes like Maytag, General Motors or Ford, to name a few, a whole town is affected. Made in America is becoming extinct. Corporations have made the decision that outsourcing or moving factories overseas improves their profit margins. Don’t get me wrong, I believe in Capitalism. It’s what makes this World go round, financially speaking that is. This has become the ethical and moral dilemma.

But what will be done to replace those lost jobs? Blue Collar Workers have always been the foundation of this country’s economic infrastructure. Those of us on the West coast and East coast have alternative options, for now at least.

Then add to that the housing crisis! More jobs lost and other economic sectors being negatively affected causing more jobs lost.

Can you objectively see how this is going to unravel?