. Landis82: This guy South America is a joke. ***** SouthAmerica: I am a joke and you are the person who thinks that he knows exactly which banks are going to fail in the coming months. I donât care how many banks you have on your list. When the average American starts seen lines of people on television of people trying to get their money from a failing bank it does not matter the size of the bank. After a while people starts to Panic and they stop trusting even a bank that had the chance to survive the credit crunch. If your bank is one of the 107 banks on your list then it is time to play safe. It is better to be safe than sorry later on. I remember seeing on the BBC News the same type of run on the bank in Argentina a few years ago and afterwards people being interviewed saying that they were sorry they did not react quick enough when they had the chance to do it. I know we have the FDIC here in the US and so on, but even then it is a hassle to get your money back from the government during such a crisis. And after the Panic gets out of control what good is going to be the list that you have shown on your posting? And if the media gets hold of a story of someone who commits suicide because of the money he/she lost during the run on the bank, if the bank is not insured by the FDIC then memories of the Great Depression would be all over the news feeding the negative news like never before. But you are very smart, or at least you think you are, and you have figured out all the possible angles to the coming banking crisis, and you also have all the right answers. Good for you. .
Ummm, if you were familiar with the FDIC you would know that it is NOT a hassle to get your money back during a crisis. IndyMac closed on Friday, by Monday the take over was complete and customers had full access to the FDIC insured portion of their money. That means ATM, online access, etc. The people you see lining up are either (1) too dumb to realize that you don't need to go to the bank after FDIC has taken control (2) people with more than the FDIC insured amounts I also find it interesting that you made the statement "After that there are about 1,000 other banks around the United States in the edge of the abyss and ready to go under at any time." Note that you didn't quote anyone or say that you were repeating what you heard - you stated it as a fact without qualification or reference. When called on this kind of misinformation, you back-pedaled and said you were simply repeating something you heard on the radio which you assumed to be true (although by your own admission what you heard on the radio didn't match your statement, e.g. hundreds vs a thousand). Then you go on and make assumptions about what others think and attack them for pointing out the flaws in your statements. This in the same post where you complain "Misinformation is all around us". You really need to go back and re-read your own posts before you go around complaining about others.
Quote from Roubini about brokerage firms.... In a few years time there will be no major independent broker dealers as their business model (securitization, slice & dice and transfer of toxic credit risk and piling fees upon fees rather than earning income from holding credit risk) is bust and the risk of a bank-like run on their very short term liquid liabilities is a fundamental flaw in their structure (i.e. the four remaining U.S. big brokers dealers will either go bust or will have to be merged with traditional commercial banks). Firms that borrow liquid and short, highly leverage themselves and lend in longer term and illiquid ways (i.e. most of the shadow banking system) cannot survive without formal deposit insurance and formal permanent lender of last resort support from the central bank. ............................................................................................... These firms have been through quite a few phases.... ...................................................... Remember Merrill Lynch Pierce Fenner & Smith Bullish On America ..................................................... EF Hutton When Hutton Talks, people listen .................................................... Smith Barney We make money the old fashion way, we earn it... ....................................................... They went through all this because of the money to be made on tranferring names on a security name. Electronic direct access can do this now for almost nothing. .............................................................. Nowadays......they got into widely distributed, nonaccountable passed on grayly priced securities....created funny money bonuses from third tier in house evaluation...called the Paulson way to profitability....game over.... ............................................................ Because of legal largesse...the ipo business is moving to other exchanges.... .......................................................... Because of legal largesse.....trading volume is building to non US domiciled electronic exchanges.... ........................................................... Company research has always been a spanking boy in the way of profits....thus was moved out or compromised a long time ago... .......................................................... So just where is brokerage firm money going to come from ? ........................................................
. October 1, 2008 SouthAmerica: I did watch CNBC TV for a few minutes this morning they were interviewing 3 fellows about the Wall Street bailout â one of the fellows was George Magnus. He was saying that the global economy is declining into a global recession. Then the CNBC anchorwoman mentioned how many countries around the world were fine and she mentioned that the Brazilian economy is expected to grow in 2009 at 5.5 rate. She was not aware that there are new estimates regarding the Brazilian economy and the growth rate for 2009 has been revised from 5.5 to 3.3 Basically the growth rate for the Brazilian economy has been cut in half because of the global economic slowdown. According to CNBC TV the economic growth of many countries for 2009, that is no longer there including in Brazil, is part of the optimistic scenario that is going to help the US economy in 2009. On the other hand, last night Charlie Rose interviewed Mort Zuckerman and Andrew Ross Sorkin and both of them gave an excellent overview of the current state of the real estate market in the United States and its prospects for the coming years, and also of the economic scenario of the US economy for 2009 and beyond. These guys gave a very credible forecast for the US economy and the limited benefit that the Wall Street bailout is going to have on the unfreezing of the US financial markets. Basically the Wall Street bailout is not going to fix much of anything regarding the problems that are at the core of this massive US financial and economic crisis. ***** I also watched for a few minutes some clown being interviewed on Bloomberg television (another Wall Street mouth piece) and this fellow was in favor of passing some kind of bailout and the reasons for the bailout is: 1) I hope we are doing the right thing. 2) I hope we have the right people to implement the bailout. 3) After the bailout is approved I hope they do the right thing. Basically this guy was all wishful thinking and nothing more. Let's pass the bailout and hope for the best. I was thinking this moron is a good representation of the majority of talking heads on TV that are trying to sell this Wall Street bailout to the public. .
. October 3, 2008 SouthAmerica: Yesterday morning I was watching CNBC and its major effort to scare the American people into supporting the Wall Street bailout bill. CNBC used to be the free market economy champion â now CNBC is the government intervention champion and also the company nationalization champion. Today there is no US government bailout small enough that CNBC does not support. I donât know why CNBC decided to leave 100 percent out of the discussions one of the major players for this Wall Street bailout to be able to go forward. â I wonder why representatives of China and Japanâs government are not participating on all these bailout discussions since at the end of the day they are the ones who are really going to finance the entire fiasco. I can imagine what is going through the minds of Asians central bankers and Finance Ministers as they watch this Wall Street Bill get even bigger than before in LaLaLand.. Ah, Ah, Ah â Americans think Asians are real Fools. .
. October 4, 2008 SouthAmerica: I just posted the following on the Charlie Rose Show comment section regarding his appearance on CNBC to promote Warren Buffettâs opinions. Here is the info that I posted on the CRS: Reply to Tabs â This comments section is an outlet for viewers of The Charlie Rose to exchange opinions about the guests that appear on that show on a daily basis. I doubt that Charlie Rose himself reads these comments, he must be a very busy man and he probably has one assistant that reads the information on a daily basis and just let Charlie know if the viewers liked the interview or not. Regarding the $ 850 billion dollar Swindle that Congress just approved I understand that the world are full of fools that is why the United States has been able to waste 89 percent of world savings year after year but now the free lunch is about to end and the world is in the process of realizing that the US dollar is as good as Confetti and is becoming very fast a worthless currency. I advised my readers on Brazzil magazine about 4 years ago for them to move their assets from US dollar to euros or a more sound currency at that time Brazilians had close to $ 200 billion dollars invested in US dollar assets. Since then the US dollar lost 40 percent against the real the Brazilian currency, and the US dollar also lost a lot of value against the euro. Now talking about a currency that is turning into Confetti as Mr. Buffett says. One of the few people in the financial world that I still trusted was Warren Buffett, someone who I have been following his investments activities since 1969 when I started working for Mr. John M. Templeton. After the latest interview of Warren Buffett by Charlie Rose I lost that trust that I used to have regarding Warren Buffett, and I am sure that many intelligent people around the country also lost trust on Mr. Buffett on that particular evening. It is no coincidence that Mr. Buffett is the richest man in the United States and during the interview with Charlie Rose he did not beat around the bush since he was straightforward about what he had on his mind, he showed to me that he is a self-serving man that does not miss a great opportunity to make lots of money. Mr. Buffett suggested during the interview that Congress give a blank check to his friend Secretary of Treasury Paulson regarding the $ 850 billion Wall Street bailout. Since Mr. Buffett has a lot of cash and the right connections he would be first in line to dig through the toxic waste and get some valuable stuff that is buried on this toxic financial mess. I am sure Mr. Buffett is going to come up ahead on his search for a quick killing. Now that the Wall Street bailout has passed in Congress after Mr. Buffett makes a ton of money from his self-serving advise on The Charlie Rose Show people canât accuse him of being just a self-serving old billionaire and nothing else. This is a capitalist country and the richest man in the land is making a hard sell on a popular TV show for Congress to pass a bailout that would help him make a ton of money. He was there to help scare to death the politicians into passing a bailout that he would be one of the major beneficiaries. He was there to promote his self-interest and nothing else. What surprised me was Charlie Roseâs appearance on CNBC the Wall Street TV channel in the next morning to promote Warren Buffettâs self-interest position regarding the Wall Street bailout. Usually people get a commission to do this kind of stuff. The Warren Buffett interview on The Charlie Rose Show instead of giving Americans a sense of trust in the American financial system, the interview put the spotlight on what is wrong with the American system; greed beyond limits and nothing else. Warren Buffett has become a very big disappointment to me since I used to look at him as a symbol of integrity, as someone who you could trust, as someone highly ethical and so forth. And I just realized that it was a misperception, an illusion, and a wake up call. .
. October 6, 2008 SouthAmerica: I was watching CNBC TV and their talking heads were trying to spin every way they could for people to go back into the market. Basically, only idiots would invest their money right now since the market is heading South and nobody have any idea where the bottom is regarding the current stock market MELTDOWN. The market is littered with nuclear mine fields called âDERIVATIVESâ and these devices are exploding all over the place, but nobody can get even an estimate of the carnage that these devices are going to inflict in the financial institutions, and also on regular corporations. Here is only one example of what is in store for companies around the world. When the new earnings season starts the new estimates are going to be full of surprises, but Real bad surprises â the type of surprise that the stock market does not like it. Not little surprises, real big surprises as in the case of Sadia â they lost almost $ 500 million dollars in Derivatives and Lehman Brothers. You can bet that the major American corporations are also going to disclose that they incurred a massive amount of losses in the derivatives market. ******** September 26, 2008 Sadia shares plunge 28 pct on Lehman, derivatives collapse (guardian.co.uk) Shares of Brazil's largest poultry and pork processor Sadia plunged on Friday after the company reported serious losses due to forward derivatives positions taken on the currency exchange markets⦠Sadia said it had 760 million reais in losses (US$ 410 million) due to foreign exchange positions and Lehman Brothers Holding Inc bonds. That was more than the 689 million real profit the company had in 2007. .
. October 7, 2008 SouthAmerica: Today I was watching CNBC TV for a few minutes in the morning, and a group of talking heads were discussing the growth in the U.S. GDP in the coming year. I donât know why these guys donât understand that â not only the financial markets is going through deleveraging, but also the U.S. GDP. I guess that is a hard concept for people to understand. Kevin Phillips mentioned on his book that over the last five years, financial services has reached a swollen 20-21% of U.S. GDP -- the largest sector of the private economy and that translates into approximately $ 3 trillion dollars worth of GDP. The US government claims a GDP of around $ 14 trillion dollars, if we adjust it for the Fairy Tale figures added to this number â Paul Krugman calculates that it is at least 15 percent = $ 2.1 trillion â and if we adjust the financial services section for the current deleveraging that is underway in the US financial sector then that number probably will be closer to $ 1 trillion dollars worth of GDP. If we make the following adjustments and donât even consider that the rest of the U.S. economy it is shrinking by the day and is getting into a very deep recession (and the real estate sector of the economy which has represented a real engine of US economic growth for many years is no longer there, since the US has a very large inventory of available real estate around the country â then we come to the conclusion that the U.S. GDP should be lower than $ 10 trillion dollars and still declining even further. And I would not be surprised to find out that today after all these adjustments are taken in consideration the real U.S. GDP is around $ 9 trillion dollars. If that is the case then Defense spending in the United States is completely out of line and it is hurting the future of the US economy - and in economic terms the United States has turned itself into just a dying Soviet Union. And these guys at CNBC are talking about a U.S. GDP that is going to grow on top of the Phantom number of $ 14 trillion dollars. Talking about misinformation: The Financial mainstream media makes Americans and investor think that the U.S. economy is at least 40 percent bigger than the U.S. economy really is. No wonder the entire U.S. financial system is collapsing and completely out of touch with reality. Then if you adjust the earnings and its potential for the future then the entire financial system in the United States is inflated by at least another 30 percent, even if the market is already pricing earnings from future years on todayâs prices. Today all the U.S. stock market averages still are inflated by at least 30 percent or even more. ***** The Washington Post published an article on May 18, 2008 by author Kevin Phillips âThe Old Titans All Collapsed. Is the U.S. Next?â He said the following on that article: âIn the United States, the financial services sector passed manufacturing as a component of the GDP in the mid-1990s. But market enthusiasm seems to have blocked any debate over this worrying change: In the 1970s, manufacturing occupied 25 percent of GDP and financial services just 12 percent, but by 2003-06, finance enjoyed 20-21 percent, and manufacturing had shriveled to 12 percent. The downside is that the final four or five percentage points of financial-sector GDP expansion in the 1990s and 2000s involved mischief and self-dealing: the exotic mortgage boom, the reckless bundling of loans into securities and other innovations better left to casinos. ***** Part 1 of 2 .
. Part 2 of 2 I had posted this information on this forum in April 2008: April 30, 2008 SouthAmerica: I was watching CNBC around 8:30 AM when the US Government released the GDP figures for the 1st Q 2008. I found interesting all the discussions on that television show about such meaningless information. A few days ago I was talking with a friend of mine that has traveled all over the world and have seen the economy of most countries first hand and he also has a solid knowledge of economics. We were talking about the latest book by Kevin Phillips and also about his article on Harperâs magazine and we both agree that most of the information published by the US government has become completely meaningless including the GDP figures. Today April 30, 2008 the US government has just released the latest GDP figures and the US Government claims that the current-dollar GDP = US$14.2 trillion. My friend and I believe that after you adjust this fairy tale figure the real GDP of the US economy might be on the range of US$ 9 to US$ 10 trillion â the difference between these figures are all the meanings adjustments that they make to inflate the GDP figures calculated by the US Government to show a better performance and a larger economy than the reality. http://www.elitetrader.com/vb/showthread.php?s=&threadid=126048 ***** April 22, 2008 SouthAmerica: â¦The world of illusion has worked well for Wall Street and also for the United States economy for a number of decades and people from around the world also have been rushing with their money and they want to participate on this massive economic illusion; as we can see by foreign lending and investments that continues to come in into the US even when these foreigners start losing their shirt as soon as the money arrives in the US. Americans should be glad that there are so many naïve suckers around the world who believe on the illusion at hand. Yesterday I bought a copy of the May issue of Harperâs magazine after reading a terrific article by Kevin Phillips âWhy the economy is worse than we know.â Here is what Paul Krugman (one of a hand full of economists that I respect) said on his NYT column on April 11, 2008: âHave you seen the awesome article by Kevin Phillips in the latest Harpers: âNumbers Racket â Why the economy is worse than we know. ...â Here are some excerpts from "Numbers Racket: Why the economy is worse than we know" by Kevin Phillips, from the May 2008 issue of Harperâs Magazine: ââ¦The effect, over the past twenty-five years, has been to create a false sense of economic achievement and rectitude, allowing us to maintain artificially low interest rates, massive government borrowings, and a dangerous reliance on mortgage and financial debt even as real economic growth has been slower than claimed. If Washingtonâs harping on weapons of mass destruction was essential to buoy public support for the invasion of Iraq, the use of deceptive statistics has played its own vital role in convincing many Americans that the U.S. economy is stronger, fairer, more productive, more dominant, and richer with opportunities than it actually is. â¦The truth, though it would not exactly set Americans free, would at least open a window to wider economic and political understanding. Readers should ask themselves how much angrier the electorate might be if the media, over the past five years, had been citing 8 percent unemployment (instead of 5 percent), 5 percent inflation (instead of 2 percent), and average annual growth in the 1 percent range (instead of the 3-4 percent range). We might ponder as well who profits from a low-growth US economy hidden under statistical camouflage. Might it be Washington politicos and affluent elites, anxious to mislead voters, coddle the financial markets, and tamp down expensive cost-of-living increases for wages and pensions? Let me stipulate: the deception arose gradually, at no stage stemming from any concerted or cynical scheme. There was no grand conspiracy, just accumulating opportunisms. As we will see, the political blame for the slow, piecemeal distortion is bipartisan--both Democratic and Republican administrations had a hand in the abetting of political dishonesty, reckless debt, and a casino-like financial sector. To see how, we must revisit forty years of economic and statistical dissembling. â¦The GDP has been subject to many further fiddles, the most manipulatable of which are the adjustments made for the presumed starting up and ending of businesses (the âbirth/death of businessesâ equation) and the amounts that the Bureau of Economic Analysis âimputesâ to nationwide personal income data (known as phantom income boosters, or imputations; for example, the imputed income from living in oneâs own home, or the benefit one receives from a free checking accountâ¦). During 2007, believe it or not, imputed income accounted for some 15 percent of GDP. â¦"...if you were to peel back the changes that were made in the Consumer Price Index (the inflation rate) going back to the Carter years, you'd see that the CPI would now be 3.5 to 4 percent higher -- meaning that, because of lost CPI increases, Social Security checks would be 70 percent greater than they currently are. â¦The real numbers, to most economically minded Americans, would be a face full of cold water. Based the criteria in place a quarter centruy ago, today's U.S. unemployment rate is somewhere between 9 and 12 percent; the inflation rate is as high as 7 or even 10 percent; economic growth since the recession of 2001 has been mediocre, despite a huge surge in the wealth and incomes of the superrich, and we are falling back into recession. If what we have been sold in recent years has been delusional "Pollyanna Creep," what we really need today is a picture of our economy ex-distortion. For what it would reveal is a nation in deep difficulty not just domestically but globally. Undermeasurement of inflation, in particular, hangs over our heads like a guillotine. To acknowledge it would send interest rates climbing, and thereby would endanger the viability of the massive buildup of public and private debt (from less then $11 trillion in 1987 to $49 trillion last year) that props up the American economy. Moreover, the rising cost of pensions, benefits, borrowing, and interest payments -- all indexed or related to inflation -- could join with the cost of financial bailouts to overwhelm the federal budget. As inflation and interest rates have been kept artificially suppressed, the United States has been indentured to its volatile financial sector, with its predilection for leverage and risky buccaneering. Arguably, the unraveling has already begun. As Robert Hardaway, a professor at the University at Denver, pointed out last September, the subprime crisis "can be directly traced back to the (1983) Bureau of Labor Statistics decision to exclude the price of housing from the Consumer Price Index...With the illusion of low inflation inducing lenders to offer 6 percent loans, not only speculation run rampant on the expectation of ever-rising home prices, but home buyers by the millions have been tricked into buying homes even though they only qualified for the teaser rates." Were mainstream interest rates to jump into the 7 to 9 percent range -- which could happen if inflation were to spur new concern -- both Washington and Wall Street would be walking in quicksand. The make-believe economy of the past two decades, with its asset bubbles, massive borrowing, and rampant data distortion, would be in serious jeopardy. The U.S. dollar, off more than 40 percent against the euro since 2002, could slip down and even rockier slope. The credit markets are fearful, and the financial markets are nervous. If gloom continues, our humbugged nation many truly regret losing sight of history, risk, and common sense.â Source: http://harpers.org/archive/2008/05/0082023 .
. October 9, 2008 SouthAmerica: No wonder Warren Buffett invested a few billion US dollars in Goldman Sacks then he became part of the hard sell for the $ 700 billion dollars Wall Street Bailout â And Wareen Buffett recommended on the Charlie Rose Show that Congress give a blank check for his long time friend from Goldman Sacks Treasury Secretary Paulson. Since the world markets are in complete turmoil and in the middle of a major crisis of confidence these â¦â¦â¦ to inspire confidence, as soon as the bailout were approved by Congress Secretary Paulson announced that one of his old cronies from Goldman Sacks was going to be the person assigned to distribute the loot. Last night I was watching the Lou Dobbs show on CNN and he mentioned that AIG was getting another $ 38 billion dollars from the US government on top of the other $ 85 billion that AIG got just a few days ago. Lou Dobbs also mentioned that AIG has become just a past through vehicle and the money goes from the US government to AIG and to Goldman Sacks. Basically this is the ultimate in conflict of interest and lack of transparency. Then everybody wonders why the entire US financial system still is frozen and nobody trusts anyone else? It could be that the reason is because the shenanigans by major Wall Street is continuing in full force. With the first loan the US government had acquired 79 percent of AIG, with the new loan arrangement the US government should own 100 percent of AIG. Now that AIG belongs 100 percent to the US government then Treasury Secretary Paulson has the authority of selling the profitable parts of AIG to Warren Buffett for a song. To build the trust in the US financial system the US government should comply with all the changes in accounting rules as requested by the rocket scientists of Wall Street and help Wall Street by making official the distorted information that they want to add to their financial. That would represent a big step in the wrong direction and would help magnify the Panic that is already underway. The world is watching the United States reach a new level of deception and stupidity and how to destroy the entire global financial system. ************ Fed grants AIG $37.8 billion loan Associated Press - Thursday October 9, 2008 By Ieva M. Augstums, AP Business Writer Fed grants AIG $37.8 billion loan besides one made last month to giant insurer CHARLOTTE, N.C. (AP) -- The Federal Reserve on Wednesday agreed to provide insurance giant American International Group Inc. with a loan of up to $37.8 billion, on top of one made to the troubled company last month. Under the new program, the Federal Reserve Bank of New York will borrow up to $37.8 billion in investment-grade, fixed income securities from AIG in return for cash collateral. These securities were previously lent by AIG's insurance company subsidiaries to third parties. The arrangement will help AIG secure funds on an as-needed basis, the New York-based insurer said in a statement. As of Monday, about $37.2 billion of securities were available for loans under AIG's securities lending program. On the brink of failure last month, AIG was bailed out when the government offered it an $85 billion loan during the ongoing credit crisis that saw Lehman Brothers Holdings Inc. file for bankruptcy protection and the sale of Merrill Lynch & Co. to Bank of America Corp. In return for the two-year loan, the government received warrants to purchase up to 79.9 percent of AIG. As of Sept. 30, AIG had drawn $61 billion on the credit facility, of which about $54 billion has gone toward its securities lending and AIG's financial products area. The rest of the money has been for other liquidity needs amid an "unprecedented" freezing of credit markets, Chief Executive Edward Liddy said last week. Last week, AIG said it would sell off a number of business units to pay off its massive government loan. The company didn't specifically disclose all the assets it would sell or the expected prices from the sales. However, the New York-based insurer said it plans to retain its U.S. property and casualty and foreign general insurance businesses, and also plans to retain an ownership interest in its foreign life insurance operations. The deal for the additional Fed loan comes as AIG has been castigated by lawmakers and the White House for spending hundreds of thousands of dollars on a posh California retreat just days after getting the federal bailout. Lawmakers investigating AIG's meltdown said they were enraged that executives of AIG's main U.S. life insurance subsidiary spent $440,000 on the retreat, complete with spa treatments, banquets and golf outings. White House press secretary Dana Perino on Wednesday called the event "despicable." AIG issued a statement Wednesday saying that the "business event" was planned months before the Sept. 16 bailout and that it was held for top-producing independent life insurance agents, not AIG employees. Of the 100 attendees, only 10 worked for the AIG unit hosting the event, it said. The insurer said its Chief Executive Edward Liddy sent a letter to Treasury Secretary Henry Paulson "clarifying the circumstances" of the event. In the letter Liddy assured Paulson that AIG is "reevaluating the costs of all aspects of our operations in light of the new circumstances in which we are all operating." Shares of AIG closed down 32 cents, or 9.1 percent, to $3.19 in trading Wednesday. Source: http://biz.yahoo.com/ap/081009/fed_aig.html .