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    Dollar Intervention Risk ‘Meaningful’

    by Chris Martenson

    Monday, September 29, 2008, 2:17 AM

    3

    Having watched the currency markets for long enough to know, I am certain that they are among the most regularly interfered-with of them all.  

    In this article it is openly speculated that perhaps a joint support of the dollar is in the works:

    [quote]Sept. 29 (Bloomberg) — A growing number of currency traders and strategists are starting to speculate that finance ministers from the world’s biggest economies will join to support the dollar.

    "We’re getting closer to the right conditions for authorities to step in and prop up the dollar,” said Maxime Tessier, who manages $151 billion as head of foreign exchange in Montreal at Caisse de Depot et Placement. "The nightmare scenario will be a wholesale loss of confidence in the dollar.”

    "The central banks of the world have embarked on all sorts of extraordinary interventions,” said Stephen Jen, the global head of currency research at Morgan Stanley in London. "Currency joint intervention would be the least surprising. And it would probably be the cheapest.” [/quote]

    Link (Bloomberg)

    I find it remarkable that they did not find a single quote from somebody who thought that the 9% gain in the dollar against the Euro was already a clear sign of manipulation.

    To me it is utterly improbable that the dollar rose, even as the US lost all but two of its investment banks, bailed out its largest insurance company, and suffered the largest bank failure in history. To explain this, I have to assume that whomever was buying the dollar and selling the Yen and the Euro was doing so for reasons that were not economic in nature.

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    Bailout is a done deal

    by Chris Martenson

    Sunday, September 28, 2008, 11:48 AM

    50

    As predicted by many here and elsewhere, a great show of "protecting the taxpayer" commenced, but, in the end, the bailout bill sailed through largely unchanged.

    [quote]WASHINGTON — Congressional leaders and the Bush administration reached a tentative agreement early Sunday on what may become the largest financial bailout in American history, authorizing the Treasury to purchase $700 billion in troubled debt from ailing firms in an extraordinary intervention to prevent widespread economic collapse.[/quote]

    Link (NYT)

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    Asia Needs Deal to Prevent Panic Selling of U.S. Debt, Yu Says

    by Chris Martenson

    Saturday, September 27, 2008, 7:21 PM

    17

    Uh oh.

    File this one under "oops".

    [quote]Sept. 25 (Bloomberg) — Japan, China and other holders of U.S. government debt must quickly reach an agreement to prevent panic sales leading to a global financial collapse, said Yu Yongding, a former adviser to the Chinese central bank.

    "We are in the same boat, we must cooperate,” Yu said in an interview in Beijing on Sept. 23. "If there’s no selling in a panicked way, then China willingly can continue to provide our financial support by continuing to hold U.S. assets.”

    An agreement is needed so that no nation rushes to sell, "causing a collapse."
    [/quote]

    Link (Bloomberg)

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    Gas Shortage in the South Creates Panic, Long Lines

    by Chris Martenson

    Saturday, September 27, 2008, 7:03 PM

    6

    While Ike was a lot less damaging than he could have been, it turns out that he did wreak enough havoc to create a severe gas shortage across the southeast.

    I raise this for two reasons.

    One, this can’t be helping the mood down there…running out of gas is both shocking and distinctly un-American.

    Two, this just shows what happens to complex delivery networks that operate on a just-in-time delivery basis.

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    Reminder – On the radio tonight from 9-10 pm EST

    by Chris Martenson

    Saturday, September 27, 2008, 7:00 PM

    17

    I will be doing my second spot with Robert Mangino on talk radio, this Saturday night from 9-10 pm EST.

    You can listen in via streaming radio.

    Go here: http://www.kdkaradio.com/ and click on the button at the top of the page that says "Listen."

     

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    FDIC May Need $150 Billion Bailout

    by Chris Martenson

    Friday, September 26, 2008, 6:39 PM

    26

    This news is from yesterday, but it bears mentioning.

    [quote]From 2002 to 2007, U.S. lenders made a total of $2.5 trillion in subprime mortgages, according to the newsletter Inside Mortgage Finance. "Given the magnitude of the bad loans still on bank balance sheets, it would be miraculous for the FDIC to squeak by with losses of less than $200 billion,” Whalen says. [/quote]

    Link

    The pace at which these monster cost estimates are piling up tells us that there’s a very high probability that the Federal Reserve is going to be directly monetizing debt, if they haven’t started already.

    This little chart from the Fed raises the prospect that direct monetization has already begun.

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    Viewing and Using Tip!

    by Chris Martenson

    Friday, September 26, 2008, 2:26 PM

    6

    If the site seems to be displaying improperly, clear out your temporary files and flush.  This has seemed to do the trick for many folks.

    What’s happened is that some browsers have stored an old version of the webpage and are trying to interpret the new site with that old information.

    We are aware that Safari seems immune to this trick and needs some attention on our part.

    No more to this message

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    Chaos in Washington!

    by Chris Martenson

    Friday, September 26, 2008, 1:47 PM

    12

    This is the most explosive story of the day, because of what it implies – a rupture in the formerly seamless power structure down in DC.

    The chaos in Washington represents the most serious split of political power in, well, far too long.  Depending on your point of view, this is either a godsend or a complete disaster.

    If you are the Bush administration, trying to find a crevice of political advantage for John McCain, it is a disaster.

    You don’t even have to read between the lines on this one.

    [quote]WASHINGTON – Even for a party whose president suffers dismal approval ratings, whose legislative wing lost control of Congress and whose presidential nominee trails in the polls, it was a remarkably bad day for Republicans.

    A White House summit meeting on Thursday meant to shore up John McCain’s shaky campaign "devolved into a contentious shouting match." And that’s how McCain’s own campaign described it.

    The meeting revealed that President Bush’s $700 billion bid to combat the worst financial crisis in decades had been suddenly sidetracked by fellow Republicans in the House, who refused to embrace a plan that appeared close to acceptance by the Senate and most House Democrats.[/quote]

    Link

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    Government Seizes WaMu and Sells “Some” Assets

    by Chris Martenson

    Friday, September 26, 2008, 12:20 PM

    3

    As recently predicted here, Washington Mutual became the next big bank failure.  However the details are slightly beyond my comprehension and I will have to wait for more details to understand exactly what happened here.

    First of all, I have no idea what "some" or "virtually all" assets means.

    [quote]Washington Mutual, with $307 billion in assets, is by far the biggest bank failure in history.

    Regulators simultaneously brokered an emergency sale of virtually all of Washington Mutual, the nation’s largest savings and loan, to JPMorgan Chase for $1.9 billion, averting another potentially huge taxpayer bill for the rescue of a failing institution.

    By taking on all of WaMu’s troubled mortgages and credit card loans, JPMorgan Chase will absorb at least $31 billion in losses that would normally have fallen to the F.D.I.C. [/quote]

    Link to NYT article

    And it is completely left unsaid why JPM would agree to eat $31 billion in losses the "normally would have fallen to the FDIC"

    But I can explain that.  That $31 billion will be foisted upon the unlimited billion bailout fund as soon as possible.  In short, the US taxpayer is being asked to provide a massive grant to JPM so it can expand its business reach. 

    And, of course, the greed of Wall Street is so profound that they can’t even resist the urge to rub this fact into the public nose.

    [quote]“We are building a company,” Mr. Dimon said in a brief interview. “We are kind of lucky to have this opportunity to do this. We always had our eye on it.”[/quote]

    As if you needed any further confirmation about just how out of control the looting and theft of the public funds really are, the NYT provides it in the very next paragraph.

    [quote]Mr. Fishman [MW’s new CEO], who has been on the job for less than three weeks, is eligible for $11.6 million in cash severance and will get to keep his $7.5 million signing bonus.[/quote]

    $18.1 million dollars for less than three weeks.  Only in America friends, only in America.  We might like to tempt ourselves with the thought that this money came from some magic pool, but it came directly from investors, depositors and/or taxpayers.

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