It's probably ridicules to mention it because it wouldn't happen in a million years because the lack of courage. But a bank holiday could be used to assess the magnitude or the extent of insolvency in the banking system. And possible address any problems sooner rather than this lingering zombie state.
I know - it's crazy even to mention it because everything is just fine.
This is an interesting comment, which dovetails nicely on the above, and excellent, blog by RebelCapitalist!
I've been researching this in conjunction with the so-called "public option" and equally so-called "healthcare reform" -- once again it has nothing to do with healthcare and certainly not with reform.
These securitizations go far beyond simply life insurance securitizations, it covers the gamut of insurance-linked securities, mortality-linked securities, mortality derivatives, mortality swaps and futures, and securitized instruments based upon mortality indexes (such as Goldman Sachs' QxX - previously mentioned - and JPMorgan Chase's LifeMetrics index).
Mortality swaps between JPMorgan Chase, Morgan Stanley and Goldman Sachs and corporate reinsurers are yet another form of layered securitization, with a probable meltdown time of four to five years hence, conveniently falling around the time this new "Healthcare Reform" bill kicks in; namely, 2013!
This will, no doubt, be tied into those event-linked futures, insurance futures exchanges, and we can expect to see securitization and derivatives occur with any introduction of medical exchanges tied to this "public option." (Gee whiz, doesn't this all sound so familiar?)
And, of course, expect to see a gargantuan jump in healthcare receivables' securitizations.
as Keynes said, one properly uses the tax structure and government spending to tweak the economy, NOT solely as a recurring crutch (or stimulus) to hobble the economy along.
Rubinomics, or Greenspanomics, or Greedonomics will never cut it -- but that is the message of the preceding, and present, administrations.
The writing was clear for all to see when President Obama appointed Diana Farrell to his administration in an economic advisory position (along with the rest of those Wall Street lobbyists and pharmaceutical industry lobbyists).
Farrell is Public Enemy Number One, who earned all her millions in her adult working life by pushing for, proselytizing about, and consulting and writing to generate that as many American jobs be offshored as possible!
The only quality appointment to date in Washington, D.C., is Elizabeth Warren, and she was appointed by congress to the oversight position and wields no power.
We can be sure that until the Obama Administration appoints individuals of her caliber, or Prof. James Galbraith, or Prof. Batra, or other truly thinking economics' types, we are head for serfdom the hard way.
All we have now are the typical Wall Street lineup of crooks and greedsters who will screw us forever.
And with regard to this "public option" scam, which is neither healthcare reform nor health insurance reform, why oh why does it kick in in 2013?
(I know the reason, but evidently NO senator nor congress critter does!)
Sadly, economists have held on to a physics based understanding of the economy, equilibrium and all, when in fact much of the time a biological view is better.
For example of we think of the economy like a gas, we can figure out the new equilibrium that will be established if we heat it or cool it off. (Charle's law) A molecule of gas is a molecule of gas, etc. The units are homogenous.
The economy isn't that way. It's organic. If a small firm making cakes goes out of business, it's unlikely to have a huge downstream impact.
If a firm making specialized components for transmissions does, it can lead to the short term shutdown of auto plants downstream. Even if the economic value of production of this firm and the cake firm is the same, the multiplier effect is likely to be higher in the latter case.
The economy is less like molecules of gas, and more like a living thing. Cut out the kidney, and the patient dies without constant external intervention. Cut off a finger and the impact is less drastic. Firms are not homogenous.
The problem with the bankruptcy of CIT isn't the damage it has alone, it's the absence of another firm able to provide the same specialized service on the same scale in the short to medium term.
does that make sense? The other thing is municipal and state governments that rely heavily on real estate property taxes. The reduction of property values reduces assessed values used to calculate property taxes.
Today, there were 2 very big investors that warned about CRE: Wilbur Ross and George Soros.
All the fundmentals are heading in the wrong direction with no sign of slowing down: occupancy rates, rent and cap rates.
Is there some sort of accumulative effect to these crisis and the question is whether the Fed and Treasury have spent their last bullets on the subprime mortgage crisis?
To me this is more the real economy too. Just when I go out driving, I see rows and rows of commercial real estate "for lease", all sorts of Mom&Pops, no more.
So, just how badly will CRE affect the overall economy is what I want to know, how bad is this tsunami, a 10 footer or a 100 footer?
A WPA type program must be considered a long with other types of government programs (National Infrastructure Bank). Private sector is just not capable of filling the job gap created by the Great Recession. Hell their job creating capabilities were questionable even before the Great Recession.
I think this was a great analysis and it seems like the truth is more or less the opposite of what "they" say it is. This really makes me a lot more pessimistic about the state of things now and the state of things to come. It just goes to show how the numbers and statistics could be made to look like they represent the opposite of what they really represent. And I don't like that one bit. Thanks for this great analysis of the real truth. -Rob
UI, Medicaid, and food stamps are good. Not because they are economically efficient, but because they are necessary to the health of communities and families.
Cash4Klunkers and the first-time homebuyers tax credit, not so good. Not just because of the fraud involved, but because it is an inefficient use of taxpayer money. Even economists are against it. What's more, it encourages people to go further into debt.
The best stimulus of all, the one we really haven't tried yet, and the one that socialists most endorse, is work programs. The WWII spending you mentioned was essentially a massive work program.
Millions went into the military. Millions more went into factories. It program worked because it directly put people to work. That's why the WPA during the GD was so popular.
We should use this same idea with the nation's infrastructure.
this little jewel from the Census Bureau's retail numbers is interesting.
Unfortunately Cash for Clunkers was a blip. I think that it had real promise, but I don't think that it was targeted enough. It should have been targeted specifically towards creating volume to pay the start up costs of specific smaller vehicles.
And as straight stimulus, the real problem was that it wasn't large enough.
In the case of the Great Depression, it was arguably only the massive government spending for the war that led to recovery. There's some kind of lesson in there.
Both tax credits are poor excuses for stimulus or even counter cyclical remedies but are great politics.
Ironically, it was Sen. Isakson (R - GA) who originally proposed the home tax credit in the stimulus plan which he eventually voted against but takes credit anyway. And he is at it again with the extension.
I tried to hit out these points yesterday but this post really nails it home.
I think this is why the DOW crashed and burned today, you're right, the smart money sees this isn't sustainable.
But even more, when I tried to imply, it's like the Stimulus is just trying to re-inflate the old model which got us here in the first place...
an absurd debt laden consumer society when people just do not have the income to support it and more residential home sales where prices are still out of whack with the median income levels and affordability.
The initial proposal said that TBTF would contribute to this TBTF fund after the fact which is absurd. Well it sounds like Barney Frank had a change of heart:
Barney Frank, chairman of the U.S. House Financial Services Committee, reversed course and will support requiring financial firms to prepay into a fund the government will use to unwind large firms after they fail.
Legislation Frank crafted with the Treasury Department and unveiled this week will be amended to create an assessment on institutions with more than $10 billion of assets, he said today in an interview on Bloomberg Television’s “Political Capital with Al Hunt” being broadcast this weekend. The Obama administration is seeking fees after a firm fails.
Of course the financial conglomerates HATE this idea.
What goes around comes around - Rahm Emmanuel probably recruited many of these "New Democrats". But the only way they could get elected was being corporate whores - all of them. They had to compete for the corporate money with GOP. It was a race to see who can cater more to corporations but at the same time get elected because GOP wasn't too popular in those districts.
In the case of Bean, as you know, she beat a long-time Republican stalwart, Phil Crane, who was way out of touch with his district (and had a few controversies).
It's probably ridicules to mention it because it wouldn't happen in a million years because the lack of courage. But a bank holiday could be used to assess the magnitude or the extent of insolvency in the banking system. And possible address any problems sooner rather than this lingering zombie state.
I know - it's crazy even to mention it because everything is just fine.
RebelCapitalist.com - Financial Information for the Rest of Us.
Check all the failed bank list and snapshot at
http://portalseven.com/banks/index.jsp
This is an interesting comment, which dovetails nicely on the above, and excellent, blog by RebelCapitalist!
I've been researching this in conjunction with the so-called "public option" and equally so-called "healthcare reform" -- once again it has nothing to do with healthcare and certainly not with reform.
These securitizations go far beyond simply life insurance securitizations, it covers the gamut of insurance-linked securities, mortality-linked securities, mortality derivatives, mortality swaps and futures, and securitized instruments based upon mortality indexes (such as Goldman Sachs' QxX - previously mentioned - and JPMorgan Chase's LifeMetrics index).
Mortality swaps between JPMorgan Chase, Morgan Stanley and Goldman Sachs and corporate reinsurers are yet another form of layered securitization, with a probable meltdown time of four to five years hence, conveniently falling around the time this new "Healthcare Reform" bill kicks in; namely, 2013!
This will, no doubt, be tied into those event-linked futures, insurance futures exchanges, and we can expect to see securitization and derivatives occur with any introduction of medical exchanges tied to this "public option." (Gee whiz, doesn't this all sound so familiar?)
And, of course, expect to see a gargantuan jump in healthcare receivables' securitizations.
as Keynes said, one properly uses the tax structure and government spending to tweak the economy, NOT solely as a recurring crutch (or stimulus) to hobble the economy along.
Rubinomics, or Greenspanomics, or Greedonomics will never cut it -- but that is the message of the preceding, and present, administrations.
The writing was clear for all to see when President Obama appointed Diana Farrell to his administration in an economic advisory position (along with the rest of those Wall Street lobbyists and pharmaceutical industry lobbyists).
Farrell is Public Enemy Number One, who earned all her millions in her adult working life by pushing for, proselytizing about, and consulting and writing to generate that as many American jobs be offshored as possible!
The only quality appointment to date in Washington, D.C., is Elizabeth Warren, and she was appointed by congress to the oversight position and wields no power.
We can be sure that until the Obama Administration appoints individuals of her caliber, or Prof. James Galbraith, or Prof. Batra, or other truly thinking economics' types, we are head for serfdom the hard way.
All we have now are the typical Wall Street lineup of crooks and greedsters who will screw us forever.
And with regard to this "public option" scam, which is neither healthcare reform nor health insurance reform, why oh why does it kick in in 2013?
(I know the reason, but evidently NO senator nor congress critter does!)
Sadly, economists have held on to a physics based understanding of the economy, equilibrium and all, when in fact much of the time a biological view is better.
For example of we think of the economy like a gas, we can figure out the new equilibrium that will be established if we heat it or cool it off. (Charle's law) A molecule of gas is a molecule of gas, etc. The units are homogenous.
The economy isn't that way. It's organic. If a small firm making cakes goes out of business, it's unlikely to have a huge downstream impact.
If a firm making specialized components for transmissions does, it can lead to the short term shutdown of auto plants downstream. Even if the economic value of production of this firm and the cake firm is the same, the multiplier effect is likely to be higher in the latter case.
The economy is less like molecules of gas, and more like a living thing. Cut out the kidney, and the patient dies without constant external intervention. Cut off a finger and the impact is less drastic. Firms are not homogenous.
The problem with the bankruptcy of CIT isn't the damage it has alone, it's the absence of another firm able to provide the same specialized service on the same scale in the short to medium term.
does that make sense? The other thing is municipal and state governments that rely heavily on real estate property taxes. The reduction of property values reduces assessed values used to calculate property taxes.
RebelCapitalist.com - Financial Information for the Rest of Us.
vs. residential and the business implied there, i.e. construction, contractors, finance people all lost their jobs when it imploded...
but intuitively it would seem that CRE would imply many more jobs due to the customers leasing/owning CRE would be employers themselves.
According to this WSJ article:
* $1.7 trillion in commercial mortgage loans.
* $100 billion in CMBS in jeopardy.
Today, there were 2 very big investors that warned about CRE: Wilbur Ross and George Soros.
All the fundmentals are heading in the wrong direction with no sign of slowing down: occupancy rates, rent and cap rates.
Is there some sort of accumulative effect to these crisis and the question is whether the Fed and Treasury have spent their last bullets on the subprime mortgage crisis?
RebelCapitalist.com - Financial Information for the Rest of Us.
To me this is more the real economy too. Just when I go out driving, I see rows and rows of commercial real estate "for lease", all sorts of Mom&Pops, no more.
So, just how badly will CRE affect the overall economy is what I want to know, how bad is this tsunami, a 10 footer or a 100 footer?
A WPA type program must be considered a long with other types of government programs (National Infrastructure Bank). Private sector is just not capable of filling the job gap created by the Great Recession. Hell their job creating capabilities were questionable even before the Great Recession.
RebelCapitalist.com - Financial Information for the Rest of Us.
I think this was a great analysis and it seems like the truth is more or less the opposite of what "they" say it is. This really makes me a lot more pessimistic about the state of things now and the state of things to come. It just goes to show how the numbers and statistics could be made to look like they represent the opposite of what they really represent. And I don't like that one bit. Thanks for this great analysis of the real truth. -Rob
Not all government stimulus is equal.
UI, Medicaid, and food stamps are good. Not because they are economically efficient, but because they are necessary to the health of communities and families.
Cash4Klunkers and the first-time homebuyers tax credit, not so good. Not just because of the fraud involved, but because it is an inefficient use of taxpayer money. Even economists are against it. What's more, it encourages people to go further into debt.
The best stimulus of all, the one we really haven't tried yet, and the one that socialists most endorse, is work programs. The WWII spending you mentioned was essentially a massive work program.
Millions went into the military. Millions more went into factories. It program worked because it directly put people to work. That's why the WPA during the GD was so popular.
We should use this same idea with the nation's infrastructure.
Why are we giving equity holders the benefit of the doubt and allowing this zombies to continue?
The longer we wait in ignoring the insolvency problem the longer we will linger in purgatory and risk losing billions and billions of taxpayer money.
RebelCapitalist.com - Financial Information for the Rest of Us.
this little jewel from the Census Bureau's retail numbers is interesting.
Unfortunately Cash for Clunkers was a blip. I think that it had real promise, but I don't think that it was targeted enough. It should have been targeted specifically towards creating volume to pay the start up costs of specific smaller vehicles.
And as straight stimulus, the real problem was that it wasn't large enough.
In the case of the Great Depression, it was arguably only the massive government spending for the war that led to recovery. There's some kind of lesson in there.
Both tax credits are poor excuses for stimulus or even counter cyclical remedies but are great politics.
Ironically, it was Sen. Isakson (R - GA) who originally proposed the home tax credit in the stimulus plan which he eventually voted against but takes credit anyway. And he is at it again with the extension.
RebelCapitalist.com - Financial Information for the Rest of Us.
I tried to hit out these points yesterday but this post really nails it home.
I think this is why the DOW crashed and burned today, you're right, the smart money sees this isn't sustainable.
But even more, when I tried to imply, it's like the Stimulus is just trying to re-inflate the old model which got us here in the first place...
an absurd debt laden consumer society when people just do not have the income to support it and more residential home sales where prices are still out of whack with the median income levels and affordability.
Obviously he didn't want to admit he's the "bad guy" on derivatives regulation.
I cannot recall who tried to beat her in the primary but I remember when the DNC did not back him there was uproar in the Progressive communities.
New Democrat Coalition
RebelCapitalist.com - Financial Information for the Rest of Us.
The initial proposal said that TBTF would contribute to this TBTF fund after the fact which is absurd. Well it sounds like Barney Frank had a change of heart:
Of course the financial conglomerates HATE this idea.
RebelCapitalist.com - Financial Information for the Rest of Us.
according to the Harper's Magazine story.
What goes around comes around - Rahm Emmanuel probably recruited many of these "New Democrats". But the only way they could get elected was being corporate whores - all of them. They had to compete for the corporate money with GOP. It was a race to see who can cater more to corporations but at the same time get elected because GOP wasn't too popular in those districts.
In the case of Bean, as you know, she beat a long-time Republican stalwart, Phil Crane, who was way out of touch with his district (and had a few controversies).
RebelCapitalist.com - Financial Information for the Rest of Us.
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