Daily Digest

Daily Digest 9/13 - Backlash Against World Landgrab, Deflation vs. Hyperinflation, Battle Of The Think Tanks Over Peak Oil

Monday, September 13, 2010, 9:54 AM
  • The Theory Of Exponentials
  • The Backlash Begins Against The World Landgrab
  • U.S. Apocalypse Fears Gain Ground
  • Mauldin: But It’s More Than the Deficit
  • G10 Is On Its Way – Indian Ex-President 
  • The Deflation vs. Hyperinflation Debate On Steroids
  • Global Oil Supplies as Reported by EIA's International Petroleum Monthly for September 2010
  • China and Russia Drive Mineral-Rich Mongolia To Join The Mining Elite
  • Battle Of The Think Tanks In Peak Oil Reports

Crash Course DVDOwn the Crash Course DVD – share the message of the Three E’s with those you care about (NTSC or PAL)

Economy

The Theory Of Exponentials (Don B.)

“Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist.” Kenneth Boulding

The Backlash Begins Against The World Landgrab (joemanc, pinecarr)

Last week's long-delayed report by the World Bank suggests that purchases in developing countries rose to 45m hectares in 2009, a ten-fold jump from levels of the last decade. Two thirds have been in Africa, where institutions offer weak defence.

U.S. Apocalypse Fears Gain Ground (SolidSwede)

The guru of this doomsday line of thinking may be economist Nouriel Roubini, thrust into the forefront after predicting the chaos wrought by the subprime mortgage crisis and the collapse of the housing bubble.

"The US has run out of bullets," Roubini told an economic forum in Italy earlier this month. "Any shock at this point can tip you back into recession."

Mauldin: But It’s More Than the Deficit (joemanc)

A $1.5-trillion-dollar yearly increase in the national debt means that someone has to invest that much in Treasury bonds. Let's look at where the $1.5 trillion might come from. Let's assume that all of our trade deficit comes back to the US and is invested in US government bonds. That could be as much as $500 billion, although over time that number has been falling. That still leaves $1 trillion that needs to be found to be invested in US government debt (forget about the financing needs for business and consumer loans and mortgages).

    Crash Course DVDOwn the Crash Course DVD – share the message of the Three E’s with those you care about (NTSC or PAL)

G10 Is On Its Way – Indian Ex-President (pinecarr)

TIf India maintains its economic growth at 10% annually for a decade, it will definitely have become an economically developed nation by 2020, says India’s ex-president (2002-2007) A.P.J. Abdul Kalam.

The Deflation vs. Hyperinflation Debate On Steroids (pinecarr)

The post infuriated some hard core deflationists who continue to refuse to acknowledge the possibility that in its attempt to inspire inflation at all costs, the Fed may just push beyond the tipping point of monetary imprudence away from mere target 2-3% inflation, and create an outright debasement of the world's reserve currency. One among these was none other than Mish himself, who a week ago recorded a podcast on Global Edge with Eric Townsend and Michael Hampton (link here), in which his conclusion was that Hyperinflation is the endgame, "so it is unlikely."

Of course, the very premise of this statement argues that even in a monetary collapse the Fed will retain control over the flow of money, which of course is unlikely, and thus makes us very skeptical that such a simplistic and solipsistic argument is enough to resolve the debate. Since one of the items covered in the Mish podcast was Lira's argument, it was only fair that Gonzalo himself should be heard.

Energy

Global Oil Supplies as Reported by EIA's International Petroleum Monthly for September 2010 (pinecarr)

My post is mainly an update to OPEC's Spare Crude Oil Capacity - Will it Disappear by the End of 2011?, based on data which the EIA reported in the past few days. I will also briefly present updates to recent developments in OECD and Non OECD oil supplies/consumption.

China and Russia Drive Mineral-Rich Mongolia To Join The Mining Elite (pinecarr)

China's imports surged in August, up no less than 32pc on the same month last year. When I heard this news last week, via my mobile-phone, I was standing on a hilltop in Mongolia, watching as massive hydraulic excavators worked what is said to be the world's largest surface-mine coal seam.

Perhaps it was serendipity, but the growth of Chinese imports and the harnessing of Mongolia's mineral wealth are closely related. I know this is a departure from my usual territory of global economics, but stand by for some reportage from the frontier of capitalism.

Battle Of The Think Tanks In Peak Oil Reports (pinecarr)

Two think tanks, on different sides of the world, published peak oil reports earlier this month – generating very different levels of media and web coverage. A draft study prepared for the German military was leaked at the same time Australia’s “most influential progressive think tank” published its own findings. Needless to say, when words like leaked, military and peak oil are put into a headlines, you can guarantee a degree of interest – meanwhile, the Australian report came out shortly after the nation’s August 21 federal election, too late to shape the debate.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

16 Comments

saxplayer00o1's picture
saxplayer00o1
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Re: Daily Digest 9/13 - Backlash Against World Landgrab, ...

"(Reuters) - The world's rich countries need to extend fiscal stimulus and job growth initiatives to fix a "dire" labor market that could threaten entire societies, the International Monetary Fund said on Monday.

At a conference co-hosted by the IMF and the International Labor Organization, visiting Spanish Prime Minister Jose Luis Rodriquez Zapatero said high unemployment may trigger a "crisis of confidence" in Europe.

The IMF said more and more workers worldwide were unable to find jobs for longer periods, weakening social cohesion and raising risks of unrest and even undermining democracy."

 

  • Other news and headlines:

GSEs' Short Sales and Deeds-in-Lieu up 27% in Q2

Ruble Eurobond to Cut Yield as Kremlin Seeks Currency Clout: Russia Credit

Chicago Losing AA Rating as Daley Deals Fail to Offset Deficits

NJ halts new work on $8.7B NY-NJ tunnel project due to budget issues

Next Wisconsin governor faces big deficit ($2.7 billion)

Hungary Still at Risk of Credit Downgrade to Junk, S&P Says

Pennsylvania Bolsters Its Capital to Avert $3.3 Million Harrisburg Default

Baby boomers long to retire, but can't

Losses in US commercial property debt increase

Independent contractors feel the pinch of state budget as payments are delayed (NY)

High-frequency trades earn $2.3m fine

Christie to announce plan to fix $46 billion shortfall in public pension system (NJ)

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How To Boil A Frog, with Jon Cooksey ...

How To Boil A Frog Official Website

[quote=]

Wikipedia Review

How to Boil a Frog is a humor-oriented website run by TV writer/producer Jon Cooksey that puts up free short videos, articles, links and other materials about the consequences of overshoot, including global warming, peak oil, overpopulation, income inequality and what the site calls the “war on nature” – overuse of natural resources, extinction, and so on. The site also has two subsidiary pages, free-ranging cultural and political critiques, with lots of pictures, supposedly written by the site’s mascot, Lou the Frog – and a page with a sort of Candyland feel that serves as a video-based overview on the subject of peak oil.

The website went up in August 2007, and text on the site says it’s part of a feature-length movie currently being produced by Cooksey’s company, Fools Bay Entertainment.

{Continued ...}

~ VF ~

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Re: Daily Digest 9/13 - Backlash Against World Landgrab, ...

re: G10 Is On Its Way – Indian Ex-President .. in a decade?

according to the CIA:

Rank
country GDP (purchasing power parity) Date of Information
1 European Union
$ 14,430,000,000,000
2009 est.
2 United States
$ 14,140,000,000,000
2009 est.
3 China
$ 8,748,000,000,000
2009 est.
4 Japan
$ 4,150,000,000,000
2009 est.
5 India
$ 3,570,000,000,000
2009 est.
6 Germany
$ 2,810,000,000,000
2009 est.
7 United Kingdom
$ 2,128,000,000,000
2009 est.
8 Russia
$ 2,110,000,000,000
2009 est.
9 France
$ 2,097,000,000,000
2009 est.
10 Brazil
$ 2,013,000,000,000
2009 est.

https://www.cia.gov/library/publications/the-world-factbook/rankorder/2001rank.html

china's economy continues to grow at nearly 11% YoY, and last week both India and Brazil registered 8.8% growth for the 2nd quarter...russia's economy is expected to take a hit from the fires and heat waves and be cut to 4%; so with that, it looks to me like brazil will pass russia, france, and the UK to become the world's 6th largest economy by sometime next year...

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Total Aggregate Estimated Debt and Total Liabilities In The U.S.

 

Has someone or an organization somewhere done research to estimate of the following debts in the U.S.?

Total Consumer Debt (including mortgages, car loans, and credit card debt and interest)
Total Business Debt (including bonds and mortgages)
Total Business Liabilities (including pension plans, retiree health care costs, etc.)
Total Local, State, and Federal Government Debt (including bonds, but not pension or entitlement obligations)
Total Local, State, and Federal Government Liabilities (including pension plans, entitlements, etc.)

And THEN not added them all up (that would be a fallacy!) but instead aggregated them? (Example: Consumers pays or settles credit card debt to a bank that then pays out bond interest to a pension plan that then distributes it to consumers...)

If you know of information on that, I'd love to know.

Poet

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Davos
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Re: Total Aggregate Estimated Debt and Total Liabilities In ...
Poet wrote:

 

Has someone or an organization somewhere done research to estimate of the following debts in the U.S.?

Total Consumer Debt (including mortgages, car loans, and credit card debt and interest)
Total Business Debt (including bonds and mortgages)
Total Business Liabilities (including pension plans, retiree health care costs, etc.)
Total Local, State, and Federal Government Debt (including bonds, but not pension or entitlement obligations)
Total Local, State, and Federal Government Liabilities (including pension plans, entitlements, etc.)

And THEN not added them all up (that would be a fallacy!) but instead aggregated them? (Example: Consumer pays credit card to bank who pays bond interest to a pension plan...)

Poet

Source Jim Quinn's Burning Platform and I used it in my last article.

www.usdebtclock.org has more, but I'd have to really dig to see if I even have what matches your filter criteria. Also this weekends FSN had in part 2 a professor talking about 200trillion in debt, I have yet to find time to listen but I wouldn't be surprised if there is more there.

And oh, on housing I think you might want to know debt to equity ratio so here this article has that.

At the peak of the housing bubble in 2006 Americans had $13 trillion in equity in their residential real estate. At the peak, total residential mortgage debt stood at $9.8 trillion. Today, American households have $6.2 trillion in equity while mortgage debt has grown to $10.3 trillion. In other words American households have faced a real financial loss of $6.8 trillion. At the same time you’ll notice that the amount of mortgage debt has remained steady. The toxic mortgage waste just sits idly by while banks use the taxpayer wallet as an ATM. You can’t have a double-dip without bouncing first. Americans hold most of their net worth in housing. That has not recovered because employment is weak. Stocks, which are heavily tilted as a primary source of income for the top income earners has only made people feel better temporarily. The mainstream media for the most part represents this tiny group and that is why it has taken so long to even realize that there really is no recovery outside of the stock market.

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Silver holding over US$20/oz.?

It's been flirting w/that benchmark for a few weeks now, but has always fallen back within a day's time.  But it's been above 20 for most of today (9/13/10) and is holding that line in after-hours trading...

 

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Re: Silver holding over US$20/oz.?
SagerXX wrote:

It's been flirting w/that benchmark for a few weeks now, but has always fallen back within a day's time.  But it's been above 20 for most of today (9/13/10) and is holding that line in after-hours trading...

 

Should be interesting as the hedge funds start covering shorts.

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SagerXX
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Re: Silver holding over US$20/oz.?
Davos wrote:
SagerXX wrote:

It's been flirting w/that benchmark for a few weeks now, but has always fallen back within a day's time.  But it's been above 20 for most of today (9/13/10) and is holding that line in after-hours trading...

 

Should be interesting as the hedge funds start covering shorts.

They might have to change their shorts, then cover their shorts, if the price of Ag goes any higher...<grin>

 

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Re: Silver holding over US$20/oz.?

Money mouth

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saxplayer00o1
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Posts: 4066
Re: Daily Digest 9/13 - Backlash Against World Landgrab, ...

For 9/14 news

 

"WASHINGTON - The federal government is on track to record the second-highest deficit of all time with one month left in the budget year.

The deficit totaled $1.26 trillion through August, the Treasury Department said yesterday. That puts it on pace to total $1.3 trillion when the budget year ends Sept. 30, slightly below last year’s record $1.4 trillion deficit."

"Deficits of $1 trillion in a single year had never happened until two years ago. The $1.4 trillion deficit in 2009 was more than three times the size of the previous record-holder, a $454.8 billion deficit recorded in 2008."

"AUSTIN - The working estimate of the looming state budget shortfall has grown to about $21 billion in the face of smaller-than-expected tax revenues and projected higher costs for education and health care, legislative staff said Monday.

Previous estimates topped out at about $18 billion for the upcoming two-year budget period.

"There are a lot of moving parts to the budget, and unfortunately, a lot of them are moving in the wrong direction," budget expert Dale Craymer, president of the Texas Taxpayers and Research Association, said of the new estimate.

The latest estimate from legislative budget writers' staff comes after the state closed the books on the 2010 fiscal year Aug. 31.

Tax collections dampened by the recession are about $1 billion worse than anticipated, according to figures discussed by staff.

Another $2 billion of the shortfall estimate is tied to new projections for growth in areas such as public school enrollment, Medicaid caseloads and higher health care costs for prisoners, government employees and retirees. Staff called the figure a rolling estimate."

"The newly appointed commission to review the long-term sustainability of the state pension system will hold its first meeting sometime in the next few weeks. But union officials are already warning of dire consequences should the commission recommend cuts.

Maryland currently has about $32 billion combined in several pension funds. That’s less than two thirds of the money needed to pay promised retirement benefits. There are $18 billion in unfunded liabilities. There is another $15 billion in unfunded promises for retiree health benefits, and the state has been putting away no money recently to pay for them."

"Corporate pension plans in the U.S. are falling behind future payouts to retirees by the most in a decade amid a slowing economy and the lowest bond yields on record.

The gap between the assets of the 100 largest company pensions and their projected liabilities widened by $108 billion in August from the previous month to a $459.8 billion deficit, actuarial and consulting firm Milliman Inc. said today in a statement.

The shortfall is “like a silent heart attack,” said Kenneth Hackel, president of research and consulting firm CT Capital LLC. “People aren’t recognizing the symptoms until the patient falls on the ground.” "

 

  • Other news and headlines:

 

Puru Saxena : US is insolvent, hyperinflation (CNBC Video)

Beware starting trade war, China economist tells US

Alarms sounded over rising debt loads (Canada)

Cash-strapped MTA considers fare hikes (NY..."more than $900 million budget deficit for the 2011 fiscal year")

China to Allow Credit-Default Swaps With Restrictions

Student Loan Default Rates Increase

Harrisburg, Pennsylvania, Incinerator Receiver Sought

Harrisburg School District administrator proposes cutting kindergarten, sports to address budget deficit

Pennsylvania Cities See Harrisburg-Like Woes

Restructuring groups eye indebted cities

UK Inflation Unexpectedly Exceeds 3% on Air Fares, Food

Romania Sells Fewer Bills Than Planned on Yield Cap

Lehman Unwinding Fees to Pass $2 Billion

US risks losing superpower status unless it tackles the deficit, Henry Paulson warns

Cuba to cut 500000 gov't workers, reform salaries

Atlanta Awash in Empty Offices Struggles to Recover From Building Binge

S&P Sees US Commercial Construction Spending Down 14% In 2010

Aging population's health costs boost debt

Miss. Medicaid chief: Fed health overhaul costly ("could push as many as 400000 additional people onto the rolls of the state program")

Homeowners who bought in 2003 would break even

Europe Fears Debt Tensions Could Slow Growth

Ireland's Finance Minister signals even more pain ahead

Motorists fill tanks ahead of Greek strike

Eurozone industrial rebound runs out of steam

183000 in state lose jobless aid (California)

California foreclosures up four-straight months with 16.6% rise in August

Market Forecasts for Home Prices Continue to Darken

Up To 67% Of Phoenix Homes Are Underwater (News video posted at zerohedge)

John Williams Sees The Onset Of Hyperinflation In As Little As 6 To 9 Months As Fed "Tap Dances On A Land Mine" (Posted at zerohedge)

Poet's picture
Poet
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Re: Total Aggregate Estimated Debt and Total Liabilities In ...
Davos wrote:
Poet wrote:

 

Has someone or an organization somewhere done research to estimate of the following debts in the U.S.?

Total Consumer Debt (including mortgages, car loans, and credit card debt and interest)
Total Business Debt (including bonds and mortgages)
Total Business Liabilities (including pension plans, retiree health care costs, etc.)
Total Local, State, and Federal Government Debt (including bonds, but not pension or entitlement obligations)
Total Local, State, and Federal Government Liabilities (including pension plans, entitlements, etc.)

And THEN not added them all up (that would be a fallacy!) but instead aggregated them? (Example: Consumer pays credit card to bank who pays bond interest to a pension plan...)

Poet

Source Jim Quinn's Burning Platform and I used it in my last article.

www.usdebtclock.org has more, but I'd have to really dig to see if I even have what matches your filter criteria. Also this weekends FSN had in part 2 a professor talking about 200trillion in debt, I have yet to find time to listen but I wouldn't be surprised if there is more there.

And oh, on housing I think you might want to know debt to equity ratio so here this article has that.

At the peak of the housing bubble in 2006 Americans had $13 trillion in equity in their residential real estate. At the peak, total residential mortgage debt stood at $9.8 trillion. Today, American households have $6.2 trillion in equity while mortgage debt has grown to $10.3 trillion. In other words American households have faced a real financial loss of $6.8 trillion. At the same time you’ll notice that the amount of mortgage debt has remained steady. The toxic mortgage waste just sits idly by while banks use the taxpayer wallet as an ATM. You can’t have a double-dip without bouncing first. Americans hold most of their net worth in housing. That has not recovered because employment is weak. Stocks, which are heavily tilted as a primary source of income for the top income earners has only made people feel better temporarily. The mainstream media for the most part represents this tiny group and that is why it has taken so long to even realize that there really is no recovery outside of the stock market.

Davos:

Thank you for taking the time to find and share the enlightening graphic and links.

I guess what I'm thinking is along two lines:

1. What is the total debt? Because ultimately consumers who owe money are also business owners who owe money are also taxpayers who backstop the government. If it's too staggering, then we need people to be more aware of the total.

2. Maybe some of those debts are backed by other debts backed by other debts, and what it really takes is less money to flush some of it out of the system than one would think. If customers pay off their credit cards, then the bank can pay off on the bonds and the pension fund can get some monies.

Now obviously that wouldn't necessarily be a real solution: after all banks need to lend and consumers tned to borrow as soon as they've paid something off, and if they don't borrow then the economy contracts, and pension obligations are supremely underfunded anyway...

Thank you again.

Poet

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Poet
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Posts: 1891
Re: Total Aggregate Estimated Debt and Total Liabilities In ...
Poet wrote:
Davos wrote:
Poet wrote:

 

Has someone or an organization somewhere done research to estimate of the following debts in the U.S.?

Total Consumer Debt (including mortgages, car loans, and credit card debt and interest)
Total Business Debt (including bonds and mortgages)
Total Business Liabilities (including pension plans, retiree health care costs, etc.)
Total Local, State, and Federal Government Debt (including bonds, but not pension or entitlement obligations)
Total Local, State, and Federal Government Liabilities (including pension plans, entitlements, etc.)

And THEN not added them all up (that would be a fallacy!) but instead aggregated them? (Example: Consumer pays credit card to bank who pays bond interest to a pension plan...)

Poet

Source Jim Quinn's Burning Platform and I used it in my last article.

www.usdebtclock.org has more, but I'd have to really dig to see if I even have what matches your filter criteria. Also this weekends FSN had in part 2 a professor talking about 200trillion in debt, I have yet to find time to listen but I wouldn't be surprised if there is more there.

And oh, on housing I think you might want to know debt to equity ratio so here this article has that.

At the peak of the housing bubble in 2006 Americans had $13 trillion in equity in their residential real estate. At the peak, total residential mortgage debt stood at $9.8 trillion. Today, American households have $6.2 trillion in equity while mortgage debt has grown to $10.3 trillion. In other words American households have faced a real financial loss of $6.8 trillion. At the same time you’ll notice that the amount of mortgage debt has remained steady. The toxic mortgage waste just sits idly by while banks use the taxpayer wallet as an ATM. You can’t have a double-dip without bouncing first. Americans hold most of their net worth in housing. That has not recovered because employment is weak. Stocks, which are heavily tilted as a primary source of income for the top income earners has only made people feel better temporarily. The mainstream media for the most part represents this tiny group and that is why it has taken so long to even realize that there really is no recovery outside of the stock market.

Davos:

Thank you for taking the time to find and share the enlightening graphic and links.

I guess what I'm thinking is along two lines:

1. What is the total debt? Because ultimately consumers who owe money are also business owners who owe money are also taxpayers who backstop the government. If it's too staggering, then we need people to be more aware of the total.

2. Maybe some of those debts are backed by other debts backed by other debts, and what it really takes is less money to flush some of it out of the system than one would think. If customers pay off their credit cards, then the bank can pay off on the bonds and the pension fund can get some monies.

Now obviously that wouldn't necessarily be a real solution: after all banks need to lend and consumers tend to borrow as soon as they've paid something off, and if they don't borrow then the economy contracts, and pension obligations are supremely underfunded anyway...

Thank you again.

Poet

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Davos
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Joined: Sep 17 2008
Posts: 3620
Re: Total Aggregate Estimated Debt and Total Liabilities In ...
Poet wrote:

Davos:

Thank you for taking the time to find and share the enlightening graphic and links.

I guess what I'm thinking is along two lines:

1. What is the total debt? Because ultimately consumers who owe money are also business owners who owe money are also taxpayers who backstop the government. If it's too staggering, then we need people to be more aware of the total.

2. Maybe some of those debts are backed by other debts backed by other debts, and what it really takes is less money to flush some of it out of the system than one would think. If customers pay off their credit cards, then the bank can pay off on the bonds and the pension fund can get some monies.

Now obviously that wouldn't necessarily be a real solution: after all banks need to lend and consumers tend to borrow as soon as they've paid something off, and if they don't borrow then the economy contracts, and pension obligations are supremely underfunded anyway...

Thank you again.

Poet

Hello Poet:

I've collected about 5,000 links on a spread sheet. I've focused most of my education process on debt. I feel pretty stupid. Of course the other day I heard a Harvard educated Phd say that he felt the same way about Social Security, some 4,000 pages of drivel he can't even get.

Total debt is a nightmare to calculate, you have federal, off balance federal, you have personal and business of often meshed until tax time, you have state debt. Then you have the nightmare of off balance sheet debt, SPVs and a load of other nightmares.

Everything I have read indicates 1 thing and 1 thing only. The US is broke and may or may not know it. Many of us bloggers blogged about the housing saying the same thing. 

Good luck if I see more figures I'll post it. You might scour the ShadowStats website.

 

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Re: Daily Digest 9/13 - Backlash Against World Landgrab, ...

Sax,

There is gold in the ZH-piece;

by B9K9
on Tue, 09/14/2010 - 12:03
#580918

 

Mish is a spent force. Just as he made his bones properly emphasizing the correct definition of inflation as a net increase in the supply of money-credit aggregates, he is going to ride his personal ship down by misunderstanding the true definition of hyper-inflation.

Perhaps it's the 'inflation' part that throws him off. In actuality, the spark of hyper-inflation has hardly anything to do with supply, but rather a rapid withdrawal of goods/services from the market. (Note the velocity component - not on the monetary side but the rapidity of abandonment of open exchange.) Given increasing fears of default risk in the underlying hard asset(s) backing the $USD (in this case, Ts & MBS), who would willingly exchange real assets (oil, food) for officially approved legal tender?

Ben monetizing a few $trillion or so of Treasuries doesn't really put sufficient new reserves/dollars into the system to create a push effect (ie money chasing goods). Rather, the market wakes up (Mish's 'shazam' moment) to the reality of what's driving Ben's actions and realizes the USA ain't gonna make it. It is this loss of confidence and expectations of heightened default risk that results in a pull effect as goods/services flee open exchanges.

As Gonza, FOFOA and others patiently explain, it is the government's response to its critical need to acquire these goods/services at any cost that then results in hard-core money printing.

 

 

by George Orwell
on Tue, 09/14/2010 - 12:17
#581090

If hyperinflation is a confidence game, why would other countries lose confidence in a country with more than 5000+ nuclear weapons and a record of using those weapons?  The US dollar is backed by plutonium and uranium, not gold.  We are not a fiat currency!

I don't think we will ever see hyperinflation because if things get sufficiently bad, we will launch those nukes to wipe out the foreign countries holding out debt and those countries with oil.  Tactical nukes can be used on those with oil so as to not damage the oil wells.

Nothing inspires more confidence in the US than a display of nuclear prowess.

To quote Dick Cheney one more time.  "The American Way of Life is NOT NEGOTIABLE."

 

George Orwell

 

Thank you for your continuing great work!

 

-S

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Re: Daily Digest 9/13 - Backlash Against World Landgrab, ...

Another way to hedge inflation (from my blog):

What's Your Number?

Most of us have probably seen the commercial where actors lug around big numbers that represent what they need to retire.  The irony of the advertisements is that most conventional investments -- mutual funds, etc. -- will likely lose value over the next few years.  Indeed, in an inflationary or hyper-inflationary environment, "your number" might only be enough to buy a can of beans ten years down the road. Impartial observers believe that the market will be flat at best over the next ten years.  As of June 30, 2010, the ten year return for the S&P 500 is minus 1.59.  One reason for the dismal past and future for conventional investments is that they assume that growth is perpetual.  This is hard to achieve on a finite planet.  In the conventional world, the players beat each other up in an effort to find the investment that offers the most growth and the results speak for themselves.

What would happen if we changed the rules to something that is a bit more sane?  How about we agree to deposit funds in a system whereby the assets are always available at cost to those who have enough common sense to make the transition.  As someone committed to sustainability, the assets that I would want access to would look much like those described further down this page. [See http://UniverseClub.org ]

The Power of Compounding: A Unique Reservation System

If everything is available at cost, how do we determine access rights?  This is done through a system whereby your deposits "earn" a compounded return.  Please note that the resulting figure does not represent actual funds but rather the figure determines who has senior reservation rights. Those who are early adapters get to "earn" reservation ranking at a higher compounded rate.  For example, as someone who has devoted 12 years to coming up with the system and in all likelihood foregoing income of at least $89,000 [my salary as an investment manager before I checked out of the system in 1998] per year for 12 years, my compensation would not be stock options but reservation rights to a sustainable and quality environment.  Through the power of compounding, utilizing a 100% annually compounded return, I've "earned" $364,455,000 (press "Download Compounding" link [again, see http://UniverseClub.org ] at the bottom of this page for the spreadsheet) to be used in calculating reservation rights.  I have gladly foregone the cash in order to have senior reservation rights to the assets in the system.  'Tis better to access than to possess.  Possessing is like going through life with a piano tied to your rear.

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idoctor
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731
Re: Daily Digest 9/13 - Backlash Against World Landgrab, ...

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