US could be due financial and economic Armageddon

Violent, parabolic bull market

 

Hyperinflation with disorder, chaos and martial law. Reflation will finally work... only too well. Not next month, not next quarter. But eventually.

I have seen and lived through one hyperinflation at least once in my lifetime (and a second close call). After collecting my paycheck I had to run to the bank to buy dollars (reserve) to maintain the value of my pay, while on the trip to the bank losing 10% on the same day. The economy doesn't die and people still make money, but the velocity and turnaround is unprecedented as noone wants cash. I suspect a depression is a much darker scenario.

I also hope Roubini is wrong.

 

X = electing first socialist President.

 

Last 8 presidential years were an era of free credit for everyone, massive deficit spending, and now, finally, nationalization of the banks.

The next guy - whichever party wins - is gonna have a hell of a time out-socializing the current President.

 

You are thinking of , of course, Mr. Obama. But after the greatest expansion of Federal power since the New Deal we have just experienced, I hardly think you could call Obama a socialist with a straight face. At least from a fiscal perspective he seems positively parsimonious compared to the profligate Mr. Bush.

 

<i>"Quote from austinp:

<b>Next up is a powerful dead-cat bounce. The Dow will rally +1,000 index points off its intraday low by the closing bell. It will hit 10,000 level soon after that.</b>

The newfound permabears will be shorting all the way up... getting creamed to the same extent they did on the way down while bullish.

A lower high will fail, existing lows will be tested again and then we will see if that's a hard bottom for years to come, or just another speed bump for lower levels from there.
--------------------------------------------------------------------------------

From a traders perspective you're probably right.</i>

What other perspective is there that matters? Last time I checked, this is a trader's forum. Right or right?

 

That's certainly what would make the most sense.

However, I suspect it is also what most people expect.

That's what bothers me, as the crowd is usually wrong.

 

Paulson Doles Out $125 Billion to Wall Street Elite

Kurt Nimmo
Infowars
October 14, 2008


Half of the bailout money will end up in banks that don’t actually need to be “rescued.”

Forbes calls it “Bailout II,” the Treasury Department’s “injection” of capital into selected banks, thus “following in the footsteps of European governments in an effort to restore confidence to the ailing financial system.” Later today, Bush, Paulson, Fed boss Bernanke, Federal Deposit Insurance Corp. chairman Sheila Bair, and “other economic officials will announce details of the revised $700 billion economic rescue plan,” according to Forbes.

But here’s what Forbes does not tell you: half of the money will end up in banks that don’t actually need to be “rescued.” Last month, Bush and his Wall Street cronies told us the bailout would be aimed at the mortgage market, and yet JPMorgan Chase, Bank of America, Wells Fargo, Goldman Sachs, Morgan Stanley, Bank of New York Mellon, and others will walk away with over $125 billion and it has nothing to do with the engineered “distress” of the mortgage market. As the Hartford Courant notes, this “is part of a wider plan that goes beyond the $700 billion rescue package approved by Congress earlier this month.”

“Here’s the kicker,” writes the Economic Policy Journal blog. “The shares will not be dilutive to current shareholders, a concern to banking chief executives, because perpetual preferred stock holders are paid a dividend, not a portion of earnings. In other words, all current shareholders are protected, unlike Lehman, Bear Stearns, Fannie Mae and Freddie Mac shareholders.”


To make sure this mega-grand larceny follows a schedule, Paulson and crew have hired the investment consulting firm Ennis Knupp and Associates to “advise on the implementation of the bailout/rescue plan,” that is to say advising the fleecing of the American taxpayer. The contract will last for one year and pay Chicago-based Ennis Knupp $2,495,190, according to the Washington Post.

The feeding frenzy will not be limited to Wall Street banks. On October 10, Times Online reported “that the US Treasury has been overwhelmed with requests from executives from other distressed industries, including the US car industry and America’s struggling airline business, seeking a similar bailout scheme for themselves.”

For now, Paulson and crew say the bailout is restricted to their buddies on Wall Street, although all of that may change after the corporate socialist Obama is elected next month.