Daily Digest

Daily Digest - July 28

Tuesday, July 28, 2009, 11:19 AM
  • Jeremy Grantham's Newsletter Refers to Chris Martenson's Crash Course (H/T Laviera, PDF)
  • Casey Research, Default Now (Video, H/T JAG)
  • Goldman Sachs Rolling Stones Video (H/T CalledOutIn08)
  • Frontline: Madoff (Video, Repost)
  • The End of "The End of the Recession" (White Paper, I could not edit out the inflation viewpoint)
  • Dr. Marc Farber: This is NOT The Final Crisis! & Views on the Dollar (Videos)
  • Dylan Ratigan Interviews Congressman Alan Grayson..(Video)
  • Leading Edge Indicator - Rail Traffic (Chart)
  • CRE Bust
  • Econned How the Myth of Free Markets Wrecked Our Economy, by Yves Smith - Blogger

Economy

Jeremy Grantham's Newsletter Refers to Chris Martenson's Crash Course (H/T Laviera, PDF)

Casey Research, Default Now (Video, H/T JAG)

Goldman Sachs Rolling Stones Video (H/T CalledOutIn08)

Frontline: Madoff (Video, Repost)

The End of "The End of the Recession" (White Paper, I could not edit out the inflation viewpoint)

Dr. Marc Farber: This is NOT The Final Crisis! & Views on the Dollar (Videos)

Dr. Faber goes on to say, “This is not the final crisis. The final crisis is the one where the whole system will collapse and the whole system will be cleaned of corrupt politicians and incompetent policy makers!”

Dylan Ratigan interviews Congressman Alan Grayson..(Video)

Leading Edge Indicator - Rail Traffic (Chart)

CRE Bust

The commercial real estate bust is going to be legendary. We are talking trillions of dollars. The attention of Americans is being pulled away by massive market volatility that has seen the S&P 500 shoot up 44 percent in four months. Yet the U.S. Treasury and Federal Reserve have kept their eye on this market and have started examining a “Plan C” focused on bailing out this industry even before major problems occur. The new preemptive doctrine of bailouts. That is, they want to saddle the taxpayer with further burdens on some of the most speculative bets known to humankind.

Econned How the Myth of Free Markets Wrecked Our Economy, by Yves Smith - Blogger

17 Comments

Davos's picture
Davos
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DavidC's picture
DavidC
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JAG's picture
JAG
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Does USA 2009 = Argentina 2001?

From Eric Janszen at iTulip:

Does USA 2009 = Argentina 2001? Part I: Falling economy reaches terminal velocity

Davos's picture
Davos
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Re: Does USA 2009 = Argentina 2001?

Hello Jeff:

The YouTube video embeded on that page was a very moving watch. Thanks, I'm still reading the article, have just skimmed it so far. Take care

JAG's picture
JAG
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Re: Daily Digest - July 28

Hi Davos,

Yes, that is a really scary video. I'm not sure that I have the guts to watch it all. 

In the article, I thought the most disturbing observation was that a period of deflation proceeded the hyperinflation of Argentina in 2001. The similarities between the US now and Argentina in 2001 are unnerving. Hyperinflation scares the crap out of me (which is probably why I prefer the deflationist camp).

Davos's picture
Davos
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Re: Daily Digest - July 28

Hello Jeff:

I've bet everything we have on hyper-inflation.

I don't give a rats behind about money not getting out of the banks and into consumer accounts and into the economy. I don't think it matters where the money is right now or later.

All I care about is simple math:

  1. Debt 11+ trillion
  2. Off balance Social Security and Medicare A & D 55+ trillion
  3. Off balance TARP, TALP and the rest 13-24 trillion

Grand total - well north of 80 trillion.

But the kicker for me is that we can't service the debt like we used to.

In other words we can't even borrow enough vis a vis the issuance of bonds. The Fed must now monitise the difference between what other countries purchase and what we owe out.

If that isn't the definition of insolvent then I would sure like to hear what is. To me that is akin to me not being able to service debt with consumer credit so I go to my basement and bleach dollars and scan 20's and hit the print button and wait for the Secret Service to come knocking.

I'm certain they will hold it together a little longer, but we have been clobbered by a 1.5 trillion dollar residential real estate wave.

Just offshore is a 3.5++ trillion dollar CRE wave and another 1.5 residential wave. When over 5 trillion clobbers the economy this fall and next spring I don't think they are going to be able to do much. Won't know for sure until we read about the Plan C that Tim Geithner is working on now.

But once news of a stock market crash and more bank failures, big banks, were to hit an already beleaguered market I could certainly see countries selling dollars.

Maybe money moving from equities to securities will save the Fed. I don't know, I don't have a crystal ball.

All I know is broke is broke and the USA is broke.

Sad to say!

Jeff Borsuk's picture
Jeff Borsuk
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Re: Daily Digest - July 28

The End of "The End of the Recession" (White Paper, I could not edit out the inflation viewpoint)

Why "edit out the inflation viewpoint"? I want to know what other people are thinking. It's valuable to know that other people don't think inflation is coming. It's akin to Bernard Baruch's rule of liquidating his position when he hears a "tip" on it.

I think inflation is unavoidable, but I'm also very interested in what other people think.

I think Eric Janszen's "Ka-Poom Theory" will prove to be correct! But I like hearing from the Tyler Durden's of the world! (The economic "Fight Club" if you will.)

Jeff

Davos's picture
Davos
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Re: Daily Digest - July 28

Hello Jeff:

Just think it isn't accurate as to what will happen and I feel that I don't want to lead anyone astray, as inflation and deflation require different preparations. Deflation is simple. Cash. Inflation requires some advance gathering.

At the very least I didn't want to endorse it.

But I do agree, and I do read a lot of stuff that I try to just test, as I haven't all the answers and I welcome all views.

Hope all is well, take care

rht1786's picture
rht1786
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Re: Daily Digest - July 28

In response to a letter by the Queen of English to economists, the FT recently ran a "debate" concerning the purpose of economists. There's some good stuff in here, especially in the comments section, albeit diluted with the usual sheisse. 

http://blogs.ft.com/arena/2009/07/28/economists-what-is-the-point/

dcm's picture
dcm
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Re: Daily Digest - July 28

"All I care about is simple math:

  1. Debt 11+ trillion
  2. Off balance Social Security and Medicare A & D 55+ trillion
  3. Off balance TARP, TALP and the rest 13-24 trillion

Grand total - well north of 80 trillion.

But the kicker for me is that we can't service the debt like we used to.

In other words we can't even borrow enough vis a vis the issuance of bonds. The Fed must now monitise the difference between what other countries purchase and what we owe out. "

IN A NUTSHELL

WELL PUT DAVOS

two choices, default or print. well three maybe, use our army to try to steal more natural resources...but that takes money and success I guess

Headless's picture
Headless
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Posts: 363
July 28, The Day of True Acceptance

Davos,

I've long (10+ years) been expecting the utter collapse, a la Argentinian style, of America. But somehow today, for whatever reason (s), after watching and reading everything you've posted above and having followed some links which were contained within or related to those pages, and given the recent nonsensical and incessant barage of anti-logic being churned out by the MSM, I've really come to comprehend and feel what is about to happen in America. I have either just officially become nuts, or I have organized things (all data input) at some subconscious level (otherwise known as "the sixth sense"), and the result is utter conviction that there will be videos of Americans that will look just like those of the Argentinians. I am sure.

Thanks?

Headless, aka, NZO

P.S. My rants against Paulson over the past year or more are starting to look prescient. He's headed for jail.

suesullivan's picture
suesullivan
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Posts: 305
strange economic anectdote

Our neighbor has an 02 Ford SUV of some sort that needs a new fitted rubber hose that is manufactured only by ford suppliers. They've been told it's backordered until October, and their car isn't driveable without it. They've searched from here in Colorado to dealers on the East Coast, where they found a couple of hoses, but dealers wouldn't sell them, in case they were needed for local cars.

One of the parts suppliers she talked to said that while they'd been expecting this to happen at some point (because parts companies have been closing down?) he did not expect it this soon. He made some reference to this being a sign that it was all starting to fall apart. My neighbor, not being in the least bit clued in to the true economic situation (and going politely glassy-eyed on me whenever I start to go there in conversations) took it to be crazy talk and didn't pursue it, but I wish I'd been able to ask the supplier more about what he meant....

FWIW,

Sue

Headless's picture
Headless
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Re: Daily Digest - July 28

And now for the extreme news and a little controversy from the controversial (from our friends at maxkeiser.com):

http://www.larouchepac.com/node/11173

http://www.larouchepac.com/node/11138

Doug's picture
Doug
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Re: Daily Digest - July 28

Jeff, Davos

Where is the vid link on that page?  Do you have to subscribe to itulip?

Doug

Davos's picture
Davos
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Re: Daily Digest - July 28

Hello Doug:

It just plays, I had to do it a few times on one occasion, I might have swithced from FireFox to Safari. Hope that helps, take care

JAG's picture
JAG
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Re: Daily Digest - July 28

Doug,

Here is the video from iTulip.

iTulip puts out teaser articles to get you to subscribe, this article is one of them. In the past he has stated that he thinks hyperinflation is an impossibility in the US, but the last few months he starting to second guess that assumption.

Doug's picture
Doug
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Posts: 2747
Re: Daily Digest - July 28

Thanks Jeff and Davos, it is a disturbing but frequently repeated story in the colonies of major powers throughout the last century or so.  They were plundered for their wealth and left with brutal dictators propped up by tptb.  Is it possible that the tables are turning and we will experience third world conditions thanks to our own squandering of resources and lack of fiscal probity?

Doug

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