Markel writes:
What with publiprivitazation all the rage, why not just sell Clear Channel directly to the Ministry of Truth?
Markel | 03.25.08 - 4:28 pm | #

NSA writes:
Will we be able to hear the collapse on Clear Channel?
NSA | 03.25.08 - 4:29 pm | #

crispy&cole writes:
I hear the fed is going to take the first $30 billion of the downside here. Move along nothing to see here...
crispy&cole | Homepage | 03.25.08 - 4:29 pm | #

NSA writes:
THUD.
NSA | 03.25.08 - 4:29 pm | #

jd writes:
clear channel will get bailed out too. Its the fashionable thing to do.
jd | 03.25.08 - 4:30 pm | #

Drew writes:
But everyone on CNBC says we are surely at a bottom, and the kinks have been worked out in the financial system.

Meanwhile, Clear Channel down 20%+ AH.
Drew | Homepage | 03.25.08 - 4:31 pm | #

crispy&cole writes:
Finally, a deal where Cerberus didn't f it up...
crispy&cole | Homepage | 03.25.08 - 4:31 pm | #

REBear writes:
Treasury secretary says program [Social Security ] is 'financially unsustainable.'

Trustee report says government will have to pay back what it owes starting in 2017.

http://money.cnn.com/2008/03/25/ ...sion=2008032514
REBear | 03.25.08 - 4:33 pm | #

Angry Saver writes:
What's going to support asset prices at these historically high levels?

SWFs - nope

Private Equity - nope

Weak underwriting - nope

Company buy backs - nope

Increasing earnings - nope

Increasing commodity prices - nope

Decade high inflation - nope

AAA ratings - nope

Liquidity - nope

Hedge funds - nope

Consumer spending - nope

Stimulus/debt increase plan - nope
Angry Saver | 03.25.08 - 4:35 pm | #

barely writes:
Anyone here following the TMA saga with $1.4B in notes at 18% and then some stepdown to 12%, as if that's a great deal for TMA.

New lending model: Borrow High - Lend Low?

How does this arithmetic work or is this simply positioning of vultures closer to the carcass?
barely | 03.25.08 - 4:35 pm | #

Angry Saver writes:
barely,

TMA is going to make it up on volume.
Angry Saver | 03.25.08 - 4:36 pm | #

jd writes:
barely

I read the article, too on TMA and am still scratching my head.. They should have just gotten a few thousand credit cards at 12.9% in my opinion.
jd | 03.25.08 - 4:37 pm | #

SM writes:
Great quote from somewhere in blog land

"It is the magic of Wall Street. We privatize the profits while socializing the losses. That is why I got into this business to begin with."
SM | 03.25.08 - 4:44 pm | #

MarkS writes:
Hmm, just a wee bit of put buying in CCU today, ever so slightly more than the call buying.
MarkS | 03.25.08 - 4:44 pm | #

barely writes:
Existing notes are probably already yielding 18% or more, but without the warrants:

"The sale includes senior subordinated secured notes due to mature in 2015. Terms call for an initial interest rate of 18 percent, falling to 12 percent later if certain conditions are met. The investors also get warrants to buy common stock for a penny a share. "

It's a mystery and the stock actually bounced, like the common will be worth anything. Maybe the shareholders now expect the Fed to put a $10 floor under every single company since everything on Wall St is too big to fail?

http://www.bloomberg.com/apps/ ne...id=aMX9BZG6CLiw
barely | 03.25.08 - 4:45 pm | #

rich writes:
For what it's worth in a manipulated market, I think the next three quarters (at least) will be a bloodbath for corporate earnings. This is emerging as one of the worst earnings environments of all time.

The inflationary forces set loose by the Fed, severe contraction in consumer and business spending, and commodities volatility all are going to hurt earnings. A lot of companies will have to write down losses from bad investments or employee severance.

Inflation hurts all companies that can't pass through costs. A weak dollar hurts the vast majority of U.S. companies, except those with net exports or operations abroad.

The great green earnings of Q1 and Q2 2007 will soon be replaced with deep red, which will send TTM P/E ratios through the roof.

There comes a point in every cycle where earnings get really bad, but there is still no real visibility going forward. That point is when stocks become most vulnerable, at least by the textbooks. We're several quarters of red ink from that quarter.

If you believe the voting machine will give way to the adding machine, then just buy and hold some of the short ETFs on U.S. stock indices, especially small-caps. It's a rough ride but will be rewarding.
rich | 03.25.08 - 4:48 pm | #

solo writes:
With the PPT in action, just buy the dips, sell the rallies, what can be better? Hope this continues well into 2009.
solo | 03.25.08 - 4:51 pm | #

rich writes:
I believe if the Fed is funneling loans through to dealers to buy long stock index futures, it's doing so mainly to prevent sharp downturns in the market. They will try to unwind some of those contracts when it looks opportune. So, it's mostly a smoothing thing, not a permanent prop under the market.

My main theory is that the Fed knows a lot of public and private DB plans have way too much exposure to U.S. stocks, and PBGC is ridiculously underfunded. The Fed is holding up the ceiling of the market so DB plans can gradually cut down their market exposure and avoid public DB plan and PBGC meltdown.

Severely underfunded private plans must get up to 100% funding within seven years under Pension Protection Act. The same act requires plans to use yield curve discount rates based on 24-month averaging. With short-term rates so low, DB plans with a lot of short-term liabilities (retired workers) are very vulnerable. (Liabilities increase as the discount rate decline.) This could be a huge drag on earnings of some big companies with private DB plans.

I think we will start to see insolvencies in some smaller public DB plans (like the one in N. California) within a year.
rich | 03.25.08 - 4:55 pm | #

barely writes:
The LBO PUT is officially... KAPUT.
barely | 03.25.08 - 4:58 pm | #

Gary writes:
Couldn't happen to a nicer bunch of GOP shills . . . unless Sinclair Broadcasting somehow blows up?
Gary | 03.25.08 - 4:59 pm | #

idoc writes:
well guys. looks like a great buying opportunity in metals and energy. certainly alot of ppl think so. get em while the goings good.
idoc | 03.25.08 - 5:01 pm | #

Ministry of Truth writes:
I don't want them!!!!
Ministry of Truth | 03.25.08 - 5:02 pm | #

Noble writes:
I waste valuable time in the day just to read the snark ... damn you all... may you have to listen forever to clear channel when you get to your maker.
Noble | 03.25.08 - 5:05 pm | #

Bob Dobbs writes:
Clear Channel is a child of deregulation, sleazy politics, and easy financing, little more.

Its assets are falling in value, too; radio listenership in general is declining. Why listen to a bunch of robot radio stations with bland programming controlled by the music industry if you can program your iPod with whatever you want, even plug it into the dash. Certainly not most of the young.
Bob Dobbs | Homepage | 03.25.08 - 5:05 pm | #

FFDIC writes:
Can we still watch American Idol?
FFDIC | 03.25.08 - 5:07 pm | #

FFDIC writes:
Bloomberg - Dollar Falls on Bets Fed Will Make Deeper Interest Rate Cuts (Karl Denninger has a few kind words to say about this.)
http://www.bloomberg.com/apps/ne...y6BQ& refer=home
FFDIC | 03.25.08 - 5:16 pm | #

REBear writes:
I haven't seen a credit agency MBS downgrade for a long time. I guess we have downgrade moratorium in place.
REBear | 03.25.08 - 5:25 pm | #

Anonymous writes:
what a pity, guess I'll use VOIP or send a letter
Anonymous | 03.25.08 - 5:29 pm | #

LJ writes:
guess we have downgrade moratorium in place.
REBear | 03.25.08 - 5:25 pm

You see, in order to get downgraded by the big three, you need to go bankrupt first. Then they take you from AAA to AAa.....
LJ | Homepage | 03.25.08 - 5:30 pm | #

12th Percentile writes:
I'm glad that paulson is focusing on 2017. I'm sure he isn't trying to divert everyone's attention or use the current economic crisis to try to privatize social security. Nah. Just using some of that long term planning wall street types are so well known for.
12th Percentile | 03.25.08 - 5:31 pm | #

Raging Bulls Unite!!! writes:
I see no reason for The fed to not come in and get this deal done ASAP, maybe by Midnight, or better yet, before the stock market opens in Japan. This can be done in the next few hours if they use a phone and open the vault. This is a matter of National seurity, because anything related to the market going down is bad for America, regardless of cost, accounting, antitrust, or any of that legal hocus pocus.

Get the fu_king deal done before the market opens!!!!!!
Raging Bulls Unite!!! | 03.25.08 - 5:32 pm | #

giacutter writes:
What's going to support asset prices at these historically high levels?

SWFs - nope

Private Equity - nope

Weak underwriting - nope

Company buy backs - nope

Increasing earnings - nope..........
Angry Saver

Fed -yep, till they run out of money or the printing press breaks.
giacutter | 03.25.08 - 5:36 pm | #

Dean writes:
What will happen to my favorite morning drive-time DJs if this deal fails!?
Dean | 03.25.08 - 5:37 pm | #

REBear writes:
a recently built starter-home development seven miles northwest of Charlotte, North Carolina, 81 of the community’s 132 small, vinyl-sided houses were in foreclosure as of late last year.


http://www.theatlantic.com/doc/2...200803/ subprime
REBear | 03.25.08 - 5:38 pm | #

4822 writes:
"What will happen to my favorite morning drive-time DJs if this deal fails!?"

Probably end up with ranchero music.
4822 | 03.25.08 - 5:43 pm | #

Vito writes:
"What will happen to my favorite morning drive-time DJs if this deal fails!?"


All Morning Zoos will be safe under the Endnaged Speciaes Act.
Vito | 03.25.08 - 5:44 pm | #

Vito writes:
Ooops.

Endangered Species Act

P.S. The joke is never funny if you have to spell check it.
Vito | 03.25.08 - 5:45 pm | #

Dean writes:
Ah yes...Ranchero music. The official music of Southern California.

I love me them narcocorridos too!
Dean | 03.25.08 - 5:48 pm | #

Raging Bulls Unite!!! writes:
Re: rich writes:
For what it's worth in a manipulated market, I think the next three quarters (at least) will be a bloodbath for corporate earnings. This is emerging as one of the worst earnings environments of all time.

>>> That does have me thinking.

What if The fed is goosing the market by buying some types of derivatives and thus helping run up stocks that the average person is not buying. This insider trading and collusion to goose the market to the ipside -- while earnings crash sets up very poor fundamentals, as Ive suggested before, however, the new twist in my theory -- thanks to you, God Bless you, is that this insider trading that ends up overvaluing stocks, and decreasing the earnings yields, results in short term liquidity for securities trading and allows some of these companies to unwind dervative positions in a somewhat orderly fashion, and thus not a crash.

However, the theory of un-winding hedge positions and dumping hedges, CDO', ABS, MBS, etc and not playing ball down the road, just buys time and sort of resets the trading clocks, like daylight savings time, in a coordinated sync of dumping toxic waste.

The majority of little guys will be out of the market while this reset occurs and then as counterparties swap junk and reorg, in conjunction with all The fed window activity, then, in maybe 7 months, we start to see very dramatic over-valuations and ore writeoffs and then we also will see more reserves built up. This is like giving corporations a windowof opportunity to build a fortress for the coming tsunami. The little guys, will be tempted to get back in, but with volatility skyrocketing, earnings crashing and a recession in your face, all most people will do for months is wonder whats going on.

However, when the tsunami really hits in 2009, housing will be very weak, but maybe on the verge of turning, stocks will go down a lot, but they may be worth buying (after they drop 30%) gold will go down, oil will stay high, the recession will be called a soft landing and The Fedwill have amazing toxic waste reserves buried deeply hidden away, and corporations will look to SIFMA for new ways to churn derivatives and goose earnins, as home sales slowly pick up. meanwhile 80% of the home builders will be bankrupt, realtors will be in short supply and wall street will grind away looking for ways to find earnings and learn to live with greater regulation and enforcement...
Raging Bulls Unite!!! | 03.25.08 - 5:50 pm | #

FFDIC writes:
Thread music: Los Lonely Boys - Heaven
http://youtube.com/watch?v=fjC4HXwLzBU
FFDIC | 03.25.08 - 5:50 pm | #

jd writes:
Here’s a post from Naked Capitalism just now proving that yes, in fact, the Plunge Protection Team did act last week:

Are the Feds Manipulating the Stock Market?

from naked capitalism by Yves Smith


This message came from an investor who has provided me with some very useful research from time to time:

"Mike Belkin, who writes a weekly technically-based look at lots of markets—the only technical service to which I subscribe—notes today that last week equity fund flows netted to a $22.9 billion inflow, broken down as $3.3 billion of mutual fund outflow, and $26.2 billion of ETF inflow. His inference is that the Fed/Treasury is buying ETFs. Just so you know, Mike is an ultimate insider, although he views things with a very jaundiced eye, and views them from Seattle. He ran a Salomon prop desk for years, and is the opposite of a conspiracy theorist or a perma-anything—he’s very good at noting crosscurrents and catching shorter term countertrend moves within broad longer term trends."

The reason I consider this credible is that I was told back in 2000 by my derivative trading buddies that the Fed, known as the Turk, would place orders in S&P futures. Note that the Fed has no responsibility for the health of the stock market despite what its actions would lead you to believe.

I find this all rather hard to believe. Surely neither the Fed nor the government would intervene in the workings of the free market. What would they do if their bet lost? Who would pay?
jd | 03.25.08 - 5:53 pm | #

Vito writes:
"I find this all rather hard to believe. Surely neither the Fed nor the government would intervene in the workings of the free market. What would they do if their bet lost? Who would pay?"

We'll just cover the losses with the profits from Iraqi oil.

It's all part of kicking the can down the road.
Vito | 03.25.08 - 5:59 pm | #

Raging Bulls Unite!!! writes:
Fed Game plan:

1. Contain systemic collapse at any cost

2. Support the stock market to save devaluation of pension funds and money markets at any cost.

3. Help corporations prepare for a financial tsunami by providing liquidity to be used to build up sandbag reserves for Katrina.

4. Tsunami hits

5. Fly over wall street and review damage.

6. Publicaly state in FEMA-fashion, "heck of a knob" dude.

7. Let the chips fall where they fall; this is survival of the fittest, unless you have connections and a key to the vault.

8. Pass the wand to Mccain and goose The Iraq war and issue Patriot Bonds.
Raging Bulls Unite!!! | 03.25.08 - 6:03 pm | #

bZb writes:
Looks like the Clear Channel deal may collapse because the credit channels ain't so clear yet. Can't they go to CCFL?
bZb | 03.25.08 - 6:05 pm | #

Anon writes:
my wife's position at CC was no 'longer being supported' as of two months ago. CC has been quietly trimming the fat from every possible corner to save the deal.

Evidently they had more to contend with.
Anon | Homepage | 03.25.08 - 6:08 pm | #

Owner Earnings writes:
Why doesn't the Fed back the Clear Channel bonds along with the Bear Sterns colateral? Bailout, eat, drink, wash, sleep, repeat.
Owner Earnings | 03.25.08 - 6:09 pm | #

FFDIC writes:
anon,
Your wife would probably frown on her worklife being described as 'trimming the fat'...and since her fatty position has been eliminated..she might be a bit sensitive right now.. just say'in.
FFDIC | 03.25.08 - 6:14 pm | #

O-Joe writes:
However, when the tsunami really hits in 2009, housing will be very weak, but maybe on the verge of turning, stocks will go down a lot, but they may be worth buying (after they drop 30%) gold will go down, oil will stay high, the recession will be called a soft landing and The Fedwill have amazing toxic waste reserves buried deeply hidden away, and corporations will look to SIFMA for new ways to churn derivatives and goose earnins, as home sales slowly pick up. meanwhile 80% of the home builders will be bankrupt, realtors will be in short supply and wall street will grind away looking for ways to find earnings and learn to live with greater regulation and enforcement...
Raging Bulls Unite!!!

RBU: I didn't know LSD was such a fashinable drug again.
O-Joe
O-Joe | 03.25.08 - 6:22 pm | #

Nemo writes:
I've got it. The Fed should help Wells Fargo buy Clear Channel. (They did volunteer, sort of.)

Problem solved.
Nemo | Homepage | 03.25.08 - 6:23 pm | #

my poor savings account writes:
pfft... whatever. I'm still waiting for some UltraLong ProShares. Where are they!?!?
my poor savings account | 03.25.08 - 6:26 pm | #

Markel writes:
Paulson's a laff riot. What an ideal time to argue for privatizing Social Security at JPMorgan. Maybe that's his scheme for helping the IBs and BDs recapitalize.

Hey, what about the unsustainable, unfunded obligations at the Pentagon? Like to see the NPV of those commitments in perpetuity, please.
Markel | 03.25.08 - 6:29 pm | #

Nemo writes:
my poor savings account --

pfft... whatever. I'm still waiting for some UltraLong ProShares. Where are they!?!?

They are just called "Ultra Proshares":

http://www.proshares.com/funds?p...? products=98646

(This does not constitute an advertisement to buy. Always do your own due diligence. Past performance does not necessarily reflect future results, and boy howdy, these days we ain't kidding.)
Nemo | Homepage | 03.25.08 - 6:35 pm | #

my poor savings account writes:
thanks nemo.

I was a bit tongue-in-cheek, but I was wondering if there was a Long version of the UltraShort which tries to get 2x the return as the underlying index. Thanks for clarifying that. I'm just learning more about all these ETFs.
my poor savings account | 03.25.08 - 6:47 pm | #

RhodesianRidgebackinAZ writes:
How dumb is this idea I have...

Borrow from my 401k to go short using ETFs. I can borrow up to 50% of the outstanding balance. I'm thinking maybe borrow 20% to bet against the market at this point.

(I'm already 92% money market in my 401k...went to cash in oct 2007...the rest is in company stock[I work for Initech])

At this point, I'm having trouble seeing how the stock market could go up during this recession. It feels like this proposed strategy would be a decent calculated risk...thoughts?
RhodesianRidgebackinAZ | 03.25.08 - 6:51 pm | #

Nemo writes:
RhodesianRidgebackinAZ --

How dumb is this idea I have...

Asking strangers on the Internet for investment advice is dumb. (Well, strictly speaking, it's not the asking but the taking of such advice that's the dumb part.)

That said, my advice is do not gamble with your 401(k) money. Any attempt to bet on short-term market moves is a fool's game. (My definition of "short-term" is anything less than 10 years.)

At this point, I'm having trouble seeing how the stock market could go up during this recession.

Do you know how the stock market behaves during recessions? (Is it always the same?) Do you know what this recession will be like, and how the market will react? Are you sure?

20% is a lot to extract from a tax-advantaged haven. But that's just the opinion of an anonymous voice on the Internet.
Nemo | Homepage | 03.25.08 - 7:11 pm | #

Billy Shears writes:
Rhodesian, you would be betting against the Fed. You want to take that risk? Suppose BB proposes buying mortgages? The dollar would fall and the market would rally (for awhile). Remember, the market is very short-term oriented.
Billy Shears | 03.25.08 - 7:16 pm | #

sk writes:

RhodesianRidgebackinAZ writes:

Borrow from my 401k to go short using ETFs.
...
(I'm already 92% money market in my 401k...went to cash in oct 2007...the rest is in company stock[I work for Initech])


How's your office space doing ? On a purely technical level( i.e. not investment advice), if you 401K allows you to trade stocks then you won't need to borrow money - just use the short or ultra short ETFs around; there are quite a few of them - top of the head, the ultra shorts I use and know are TWM,QID, SKF, SRS - There are several others - several straight short ones.

-K
sk | 03.25.08 - 7:25 pm | #

Troy writes:
I'm having trouble seeing how the stock market could go up during this recession. It feels like this proposed strategy would be a decent calculated risk...thoughts?

I moved my Roth fully into SDS today.

This is medium-term money (I'm eligible to draw out the $10K for first-time home purchase in 2011).

I like the bet because it's win-win. If the economy tanks, my shorts win, if the economy keeps skating along, my customers will still have money to buy my stuff.
Troy | 03.25.08 - 7:25 pm | #

Barley writes:
TMA is going to make it up on volume.
Angry Saver

Note to self: Stop drinking coffee while reading Angry Saver comments

LOL!
Barley | 03.25.08 - 7:26 pm | #

Troy writes:
oh, I share your appreciation that the 2001-2003 swoon we saw in equities and economical vitality could repeat, or worse, since the per-capita debt overhang is a lot greater now than it was in 2003.
Troy | 03.25.08 - 7:28 pm | #

Barley writes:
What would they do if their bet lost? Who would pay?
jd | 03.25.08 - 5:53 pm | #

if true,

Somebody is going to read the predictable method and run a B$ counter and try to break the Fed
Barley | 03.25.08 - 7:30 pm | #

AllenM writes:
Well, good and RRA, while I have done the same myself;-}

I do not recommend that you do what I do- in fact, unless you just *have* to trade, I would not pull money from a retirement account.

On the other hand, if you think you can make a great enough return and that retirement account is your only source of covenient capital. Then go for it.

Life is short, no guarantee you will make it to retirement.

Someday this war's gonna end...
AllenM | 03.25.08 - 7:30 pm | #

SweetHomeKilla writes:
RhodesianRidgebackinAZ-

If the majority of your saving is in your 401k and/or tied up in non-liquid assets such as housing, then I would suggest borrowing or withdrawing some and buying physical silver.

Some people like Nemo suggest you don't gamble with the money in your 401k. I agree, bonds are a sure loser do to decreased purchasing power and stocks are a gamble, so get your money the hell out!

The majority of paper asset holders are going to be losers until this mess is over.
SweetHomeKilla | 03.25.08 - 7:31 pm | #

mbartv writes:
Ridgeback. As someone who's been mostly in the Ultra Short Russell for the last 8 months, with money I didn't feel like losing, all I can say is you need nerves of steel to hang on to a position like that. It's hard to sleep at night, plain and simple. Do what you think best, and good luck.
mbartv | 03.25.08 - 7:33 pm | #

rich writes:
>However, when the tsunami really hits in 2009, housing will be very weak, but maybe on the verge of turning, stocks will go down a lot, but they may be worth buying (after they drop 30%) home builders will be bankrupt, realtors will be in short supply and wall street will grind away looking for ways to find earnings and learn to live with greater regulation and enforcement...
Raging Bulls Unite!!!

I don't think the Fed (or anybody) can artificially prop up the U.S. market until 2009 for the simple reason that it's a global market now and too many hedge funds and arbitrageurs are capable of exploiting valuation gaps in long/short funds. Europe has kept its currency strong while ours has been debased, yet European stocks have been hit harder than ours, probably because they aren't manipulated. But that gap will have to reverse at some point. The same with Japan and emerging markets. Really, the same with stocks and gold or oil.

Nobody really has enough money or guts to try to prop up a $18 trillion stock market permanently, in the face of terrible fundamentals. I think that if the Fed is subsidizing stock market buys, there are multiple levels of leverage involved, maybe with a different entity bearing risk at each level. It would only take one level to leave the game for the whole thing to collapse.
rich | 03.25.08 - 7:36 pm | #

CRead writes:
Is anyone watching NBC on the east coast right now 7:30 pm? There, in basically Prime Time, is a 1/2 HOUR infomercial on - disguised to look like CNBC doing a breaking News story on the Mortgage Meltdown. Announcing NE Jumbo Loan limits etc - This is pre-empting regular TV. How desperate and see-through is this getting???
CRead | 03.25.08 - 7:48 pm | #

FreedomWorks writes:
The government has no legal or contractual obligation to repay Social Security....the government doesn't "owe" anybody anything. All the tax dollars you've paid in are spent that year.

http://www.freedomworks.org/info...php? issue_it=15
FreedomWorks | 03.25.08 - 7:49 pm | #

justintime writes:
This was noted on Market Ticker:
"March 25 (Bloomberg) -- The dollar fell against the euro as a rally in Asian stocks encouraged investors to buy higher- yielding assets with loans in the U.S. currency."

We are soon finished if smarter people do not get real pricing of the losses in MBS. Kiss it all goodbye. We watched the fall in the Japanese stock market years 20 years ago and it NEVER came back. Pensioners in Japan lived the rest of there lives impoverished.
justintime | 03.25.08 - 7:51 pm | #

kis writes:
The government has no legal or contractual obligation to repay Social Security....

SS just holds a form of treasury bonds as an investment, just like any other gov't bond holder might. Sure, the gov't can theoretically default on these, just like they can theoretically default on any other bond. But they generally don't. Saying that gov't doesn't 'owe' SS this money is a common scare tactic.
kis | 03.25.08 - 8:02 pm | #

Troy writes:
Saying that gov't doesn't 'owe' SS this money is a common scare tactic

what I find rather brilliant is that the populations of people who have paid excess FICA contributions for the past 20 years vs. people who have been undertaxed these past 20 years are largely disjoint ... basically the former is J6P making the median income and the latter are the Paris Hiltons who have the lion's share of annual income and thus pay the bulk of income taxes.

Should the USG default on the SSTF bonds, it would amount to a $2T+ swindle 30+ years in the making.

And people say Government can't plan ahead. I'm rooting for this swindle just for the entertainment value.
Troy | 03.25.08 - 8:23 pm | #

idoc writes:
The Fed is holding up the ceiling of the market so DB plans can gradually cut down their market exposure and avoid public DB plan and PBGC meltdown. -rich

that would require that the Fed be in communication with the DB's to warn them to reduce stock exposure. not in a million yrs. too many ppl in the know and the risk of leaking that diabolical of a plan would be immense. i'm sorry, its just plain old stock propping by a couple of Fed traders in a small condo in the Caymans with access to unlimited Fed funds, a billion dollar a yr salary, and free Emperors Club VIP membership.
idoc | 03.25.08 - 8:24 pm | #

Troy writes:
^ LOL
Troy | 03.25.08 - 8:30 pm | #

Anonymous writes:
"Sure, the gov't can theoretically default on these, just like they can theoretically default on any other bond."

They won't they'll just print it $20 happy meals.
Anonymous | 03.25.08 - 8:33 pm | #

sam writes:
you must see this. sickening

http://www.bloomberg.com/avp/ avp...5SLFncnzYHc.asf
sam | 03.25.08 - 8:34 pm | #

rich writes:
>Somebody is going to read the predictable method and run a B$ counter and try to break the Fed
Barley

This is just what I was thinking, and i wouldn't be surprised if it isn't somebody (or somebodies) overseas.

If you watch CNBC Asia, there is growing resentment and frustration with the way the Fed has thrown the rest of the world's currencies, markets and economies under the bus. It's getting to where it's not about dollar valuation but about dollar loathing. If the Fed can't stand behind its own currency, why should other countries care anymore about the dollar.

Once the Fed starts to actually hear those voices is when its stock-propping strategy becomes most vulnerable.
rich | 03.25.08 - 8:37 pm | #

dryfly writes:
To get sort of back on topic - one of the companies I work for is owned by a PE firm and I don't think things are going so well. They have had the 'principals' in lately for 'special meetings'. My guess is they don't have access to liquidity and now need this company to 'cash flow'. Good luck with that in an industry mostly supported by automotive. We don't do automotive but are now feeling competition from automotive suppliers looking for work - hungry automotive suppliers.

I wasn't in on these details but put the pieces together from talking to various sources.

They bought the company something like five years ago - planned a flip job - build it up, cash it out and sell or go IPO right about now. Ain't happening unless they take a loss - potential buyers they would flip to have no credit & less cash.

Another friend I know works for a firm owned by a different PE group - recent acquisition - he said they have money coming out their ears and are 'loaning' it to them to upgrade... and they are 'forced' to pay it back at 18%. Some honeymoon. More credit card rates for you. This guy hasn't realized yet they are sucking the blood out of his company - it looks like 'help' & 'support' now but it all comes with strings attached.

My guess is the folks looking at the Clear Channel deal have all come to the conclusion theres no blood there to suck so why even do it.

dryfly | 03.25.08 - 8:45 pm | #

Ken writes:
Sure, the gov't can theoretically default on these, just like they can theoretically default on any other bond.

By ratcheting down benefits SS can stay in the black forever, thus they don't have to default on the bonds, they can just default on the benefits that were expected to be paid. There are many people who feel that expected benefit levels are supported by the existence of the bonds, but there's absolutely no legal guarantee.
Ken | Homepage | 03.25.08 - 8:53 pm | #

Drew writes:
Sam -

Great link. Thanks for sharing that.
Drew | Homepage | 03.25.08 - 8:53 pm | #

dryfly writes:
If you watch CNBC Asia, there is growing resentment and frustration with the way the Fed has thrown the rest of the world's currencies, markets and economies under the bus. It's getting to where it's not about dollar valuation but about dollar loathing. If the Fed can't stand behind its own currency, why should other countries care anymore about the dollar.

Screw the Asians merchantilists who think that. If they've been loading up on dollars then that's their own stupidity.

They only care about the strong dollar as long as they can export here due to their weak currency and still pay their own people shit for hard labor and profit while doing it. If their currencies strengthen - then the average laborer in Asia actually gets paid some value for their effort.

Its about time the dollar plunged. This didn't just happen out of thin air - it was the result of 20 plus years of growing deficits where all we gave them for back breaking labor was our paper.

The fall of the dollar is one of the few good things Bernanke has accomplished.

dryfly | 03.25.08 - 8:58 pm | #

Misean writes:
Sam,

Enjoyed the Shiff interview.

Cheers,
Misean | 03.25.08 - 8:59 pm | #

Yoringe writes:
thanks Sam too very good one..
Yoringe | 03.25.08 - 9:01 pm | #

Yoringe writes:
btw some off the charts in the interview where from Dec. 2007 and locked bad allready..
Yoringe | 03.25.08 - 9:02 pm | #

Yoringe writes:
looked..
Yoringe | 03.25.08 - 9:02 pm | #

Misean writes:
dryfly,

"The fall of the dollar is one of the few good things Bernanke has accomplished."

Except for the stunning rise in energy inputs here. I'm a bit more ambivalent on this point.

Cheers,
Misean | 03.25.08 - 9:07 pm | #

Hazard writes:
dryfly, these games have been several years in the making across various "unrelated" industries. Which is one reason I retired. Get the hell out while the "gittin" is good (so to speak).
Hazard | 03.25.08 - 9:10 pm | #

Misean writes:
This is kinda funny:

"FDIC adds 140 workers to bank-failure division
Federal regulators will increase by 60% the number of workers who handle bank failures."

http://money.cnn.com/2008/03/25/ ...sion=2008032518

140 is a 60% increase. 233 currently. The mind boggles. The FDIC insures like how many $T of deposits.

BRB, the Super Colander Tin Foil Hat just caught fire!

Cheers,
Misean | 03.25.08 - 9:13 pm | #

km4 writes:
Clear Channel gets to sleep in the Bush bed that they made.

Fuck them !
km4 | 03.25.08 - 9:15 pm | #

Misean writes:
Oh yeah, heard an ad for these guys on my home today. This will make you puke.

http://www.fha1fha.com/

Cheers,
Misean | 03.25.08 - 9:22 pm | #

solo writes:
"solo writes:
With the PPT in action, just buy the dips, sell the rallies, what can be better? Hope this continues well into 2009."

Ok good buddy explained to me about the “Bear Trap”, I now admit my error, I'm out.
solo | 03.25.08 - 9:27 pm | #

number2son writes:
Couldn't have happened to a nicer gang of right-wing pukes.

Who knows, maybe the noise machine is finally running out of juice?
number2son | 03.25.08 - 9:27 pm | #

dryfly writes:
Except for the stunning rise in energy inputs here. I'm a bit more ambivalent on this point.

Energy should have never been that cheap - high prices are the only thing bringing sanity to stupid lifestyle choices. I suffer more than anyone due to my business (sales territory covering about a quarter of the US) but high prices makes me a lot 'smarter' - more internet, better planning & bought a far less expensive car.

Price signals are good even when they suck.

dryfly | 03.25.08 - 9:28 pm | #

Misean writes:
dryfly,

My point was that many beneficial impacts of dollar cliff diving are offset by said energy price increases.

"high prices are the only thing bringing sanity to stupid lifestyle choices."

Over time sure. But, and maybe I'm assuming that which I shouldn't, manufacturing still has to deal with it, and I assume a manufacturing uptick is what you find good about a dollar decline. I'm likely putting words in your mouth, but I've read A LOT of your posts, and conversed about them here for a bit. If I'm incorrect, I appologize in advance.

Cheers,
Misean | 03.25.08 - 9:34 pm | #

dc1000 writes:
dry

come on now, big ben really had nothing to do with the dollar's fall

thats like, um, some analogy that i'm not smart enough to come up with but you get my point

he's watching the tail end of the freight train run over the dollar
dc1000 | 03.25.08 - 9:44 pm | #

creekside writes:
more on housing false bottoms.
Comments are helpful, too.

"Bank-owned homes are real estate's new gold rush"
Julia and Gary Draper are in escrow for a house where the lawn is overgrown, the carpet needs replacing and the fence blew down in a January storm.

Not surprisingly, a bank has owned the place for months.

But at $170,000 for three bedrooms in Rio Linda, it is their dream come true. The Drapers are among the nearly six in 10 buyers in Sacramento County whose house-buying odyssey currently ends with a home bought from a bank.
http://www.sacbee.com/142/story/ ...l#comments_here
creekside | Homepage | 03.25.08 - 9:47 pm | #

Barley writes:
Misean writes:
Oh yeah, heard an ad for these guys on my home today. This will make you puke

Misean - Bad day?
Barley | 03.25.08 - 9:47 pm | #

dc1000 writes:
dry -

do you think you've gotten more, shall we say, setsered over the years? i always feel a very strong international econ orientation to your posts. as de long so eloquently showed us a few years ago its the international economy that rules us all at this point.

you're 'tough talk'' towards asian mercantilists echoes the currency manipulation, wage pressure and overall geo-political-ness of their economic policy.

or is that just because you're in the economic family trree of international firms?
dc1000 | 03.25.08 - 9:51 pm | #

dc1000 writes:
and golly - sorry for no caps bad spelling and weak grammar.
dc1000 | 03.25.08 - 9:52 pm | #

Barley writes:
Found this interesting:

Rising prices for industrial metals and other commodities have pulled thousands of new investors into what were once illiquid markets. Money invested in commodity hedge funds surged 83 percent to about $55 billion in 2007 from $14 billion in 2005, according to estimates by Chicago-based Cole Partners Asset Management. Mutual funds tracking commodity indexes held $125 billion at the end of 2007, compared with $25 billion in 2003, according to Barclays Capital

http://www.bloomberg.com/apps/ne...dqK4& refer=home
Barley | 03.25.08 - 9:53 pm | #

Misean writes:
Barley,

Should be "on my WAY home"

Yeah Barley, actually been a bad week. 20 year colleague, cancer, and didn't end wel.

Cheers,
Misean | 03.25.08 - 9:55 pm | #

dryfly writes:
Over time sure. But, and maybe I'm assuming that which I shouldn't, manufacturing still has to deal with it, and I assume a manufacturing uptick is what you find good about a dollar decline. I'm likely putting words in your mouth, but I've read A LOT of your posts, and conversed about them here for a bit. If I'm incorrect, I appologize in advance.

Mfg is part of it but only part... and if we are going to import oil then by God we better export something else OR expect our standard of living to drop... debasing the currency is one of the LESS socially disruptive ways a standard of living can fall - it is disruptive but the others from a general population perspective are worse (high unemployment & low productive good output).

I've said all along weaker dollar means more of us work but we work for less. Maybe not less dollars but less of what those dollars buy. This HAS TO HAPPEN or the other will happen in SPADES (unemployment & corp failures). Either way those imbalances rebalance.

I am seeing my income (measured in what I can buy) decline just like everyone else. But this is better than seeing a lot of folks lose jobs & companies fail - myself maybe included.

I get all jazzed when people say the dollar fall is a surprise - it shouldn't be if they watched the deficits & foreign reserves grow over the last couple decades - it was like watching snow pile up all winter than shock that there are floods in the spring.

There are two no-brainer & almost immediate sectors that can ramp up exports & compete against imports - agriculture & mfg. That's why these 'tradables' are so important at a time like this. It is by accident that I'm close to both & understand them.

But if this weak dollar continues we will see a number of other sectors step up too - tech, travel & tourism, entertainment & maybe even medicine. But the dollar can't take off again like it did under Rubin, if it does it will be back to hundreds of billions in deficits every year - maybe trillions. That won't be sustainable. More kicking the can down to the next generation - I got some of those & and am worried about their futures more than my own.

dryfly | 03.25.08 - 9:56 pm | #

Misean writes:
dc1000,

weak.

Cheers,
Misean | 03.25.08 - 9:56 pm | #

Red Pill writes:
Clear Channel gets to sleep in the Bush bed that they made.

Fuck them !
km4 | 03.25.08 - 9:15 pm | #

I 2nd that!
Red Pill | 03.25.08 - 9:56 pm | #

4822 writes:
"But at $170,000 for three bedrooms in Rio Linda, it is their dream come true. "

But if the value drops to $100,000 and they lose a job or have to move, what then?
4822 | 03.25.08 - 9:57 pm | #

Barley writes:
Misean - Regards ol' chap
Barley | 03.25.08 - 9:58 pm | #

Misean writes:
dryfly,

I understand your point. I am still more ambivalent on it...but so be it.

;)

Cheers,
Misean | 03.25.08 - 9:58 pm | #

dryfly writes:
do you think you've gotten more, shall we say, setsered over the years? i always feel a very strong international econ orientation to your posts. as de long so eloquently showed us a few years ago its the international economy that rules us all at this point.

dc - even though I grew up in the interior my father was educated as an economist & many of the firms he originally worked for were early proto-MNCs... very international even back then. Plus my sister studied latin american econ & politics prior to going to law school (lived in DC & worked at DOJ - she now writes & teaches)...

I grew up with this stuff around the dinner table. So I was Setserized before Setser. He was preaching to my choir so to speak.

But he is right. I know he is right - you can just see the effects almost everywhere.

dryfly | 03.25.08 - 10:03 pm | #

Anonymous writes:
"I got some of those & and am worried about their futures more than my own."

Me Too.
Anonymous | 03.25.08 - 10:11 pm | #

dryfly writes:
Misean - as per your colleague, add my sympathies as well. A rough passing makes 'money talk' seem a little less important.

dryfly | 03.25.08 - 10:14 pm | #

dc1000 writes:
misean,
guess i missed something.
dc1000 | 03.25.08 - 10:17 pm | #

ac writes:

My point was that many beneficial impacts of dollar cliff diving are offset by said energy price increases.

Also, I wouldn't assume that the negative impact of a weak dollar on foreign economies won't come back to haunt us.

If there really is significant overcapacity overseas, that combined with a weak dollar could cause serious tensions.

What if China starts dumping treasuries and ultracheap manufactured goods into our markets at the same time?

ac | 03.25.08 - 10:19 pm | #

dc1000 writes:
not sure if you might be interested in this, but i've done the oddest dumbest thing ever, i've gone and hooked up with a true land developer - sell to national home builders - deal with cancellations - etc etc - here in NoVa.

so many deals available, so many people with banks making them sell, so much opportunity if you just have money.

i am now in the belly of the beast. my name is associated with task lists within the publicly traded home builders (ie. build the neighborhood center, finish the sewer plant, build the roads, etc etc).

feels very strange after hanging out here for so long.

nonetheless, buying when no one else is seems like a good thing as much as selling when everyone is buying is i guess.

we'll see!
dc1000 | 03.25.08 - 10:21 pm | #

dc1000 writes:
ac-

its been the dumping of treasuries that scared me the most. i guess its the MADD that was described a few years ago. mutually assured debt destruction.

it just isnt in their best interest to do so. yet.


dry: i wonder if its way too late to try to rotate in warehouse/industrial RE. we're happy in institutional/educational now but dang, wouldn't industrial/warehouse RE be booming just about now or in the near future?
dc1000 | 03.25.08 - 10:23 pm | #

dryfly writes:
What if China starts dumping treasuries and ultracheap manufactured goods into our markets at the same time?

They won't be able to do both for long unless they bring back forced labor camps - the only reason they continued to make cheap crap as long as they did is that they bought vaults full of our 'cheap paper'. Now they have choices to make as do we.

From now on it will have to be a value for value exchange and that isn't all bad. Real stuff for real stuff. Not bad at all. A phony exchange where they send value produced from real investment and hard labor and we send promises isn't an exchange at all.

dryfly | 03.25.08 - 10:27 pm | #

Misean writes:
Barley, dryfly, dc,

Thanks. It wasn't unexpected. But it wasn't pleasant.

Cheers,
Misean | 03.25.08 - 10:27 pm | #

Misean writes:
ac,

If they )asians, particularly Chinese) dump dollars, I think it will be tough to do the other.

However, the oil producers are another matter.

Cheers,
Misean | 03.25.08 - 10:31 pm | #

ac writes:

its been the dumping of treasuries that scared me the most. i guess its the MADD that was described a few years ago. mutually assured debt destruction.

it just isnt in their best interest to do so. yet.

China could be a big problem.

I have this idea of China as being like the Miami condo market, except with factories instead of condos.

I don't know if this is really the case or not, but some economists that have been right about a lot of other things seem to think it's a possibility (Gary Shilling). And I don't know how the sort of growth they've been seeing in recent years can be managed in a sensible manner.

In a lot of ways China (what I know of it) reminds me more of the 1920s America than any other country today.

If that's the case it could mean real trouble for everyone.

ac | 03.25.08 - 10:32 pm | #

dryfly writes:
dry: i wonder if its way too late to try to rotate in warehouse/industrial RE. we're happy in institutional/educational now but dang, wouldn't industrial/warehouse RE be booming just about now or in the near future?
dc1000 | 03.25.08 - 10:23 pm | #

I can't speak for the east but there is a glut of whse capacity out here - especially south of Chicago off I80 & I39 (near Joliet).

All those exporters threw up HUGE whse & distribution operations to buffer demand. If you're shipping JIT into Caterpillar in Peoria from China then you better have whse somewhere - they got'em everywhere out here.

dryfly | 03.25.08 - 10:36 pm | #

homedad43 writes:
justintime writes:
This was noted on Market Ticker:
"March 25 (Bloomberg) -- The dollar fell against the euro as a rally in Asian stocks encouraged investors to buy higher- yielding assets with loans in the U.S. currency."
------------------------------

How cool is that. I just got a rice steamer for Xmas and now I, too, can be a Japanese Housewife.

Dollar carry trade, baby.
homedad43 | 03.25.08 - 10:38 pm | #

lawn grass writes:
Is Clear Channel a monoline or stereoline?

What happened to the monolines? Must not be their deathwatch week.
lawn grass | 03.25.08 - 10:39 pm | #

rich writes:
>Gerard Cassidy, managing director of bank equity research at RBC Capital Markets, projects 150 U.S. bank failures over the next three years, with the highest concentration coming from states such as California and Florida where an overheated real estate market is in a fast freeze.

I'll take the over on Michigan and Ohio vs. California and Florida.
rich | 03.25.08 - 10:42 pm | #

halbhh writes:
All psychology. It's all psychology.

How's this for psychology!!??

From CNBC at 4.15pm the video clip: Housing Market Bottom?

Maria B asks Chris Thornberg to give his view:
----------------
Chris: ".....[Los Angeles] in 2001 a median home [buyer] spent about 25% of their income to buy a median house, in 2006.... about 65%...
until houses come down...there is no bottom to this market."

Maria B: "So you're saying prices really need to sort of stabilize."

----------------

lol!!

Ships don't have to pass in the night. They pass oblivious all the time in the glare of bright lights.

lol
...
halbhh | 03.25.08 - 10:46 pm | #

dryfly writes:
In a lot of ways China (what I know of it) reminds me more of the 1920s America than any other country today.

More like 1880s Robber Barron America - with the party elite playing the roles of Tammany Hall... MNCs playing the role of Morgans & Carnegies.

But they aren't standing still - a buddy of mine just got back from China a couple weeks ago - said the gov't has 'closed' something like 8000 cheap-n-dirty factories in Guangdong area alone - most paying the worst wages, worst conditions & owned by Taiwanese. he knows 'cause they were soliciting work from him on a regular basis.

I believe it too - I used to get a call from cheap Chinese exporters almost every week asking me to sell for them. They have almost disappeared. Dollar has killed the cheap-n-dirty trade - doesn't break my heart either.

dryfly | 03.25.08 - 10:48 pm | #

Anonymous writes:
Re: Nobody really has enough money or guts to try to prop up a $18 trillion stock market permanently

The plan is to just prop it up and build a fortress, to prepare, to await the waters and the impact of financial Katrina, then go from there. This is a time to find sand bags, to take the children away to high ground, to send the weaker women to softer beds, to seperate the overpriced wheat from the un-needed fiber stuff...
Anonymous | 03.25.08 - 11:00 pm | #

KRISHNAN writes:
Schwab money market fund in trouble?.Even money market funds not safe!!.What next?
KRISHNAN | 03.25.08 - 11:06 pm | #

TXviaNJ writes:
...
TXviaNJ | Homepage | 03.25.08 - 11:08 pm | #

ac writes:

Well, if that MarketTicker dude here is right about the US dollar becoming a carry currency, then we're literally heaping disaster on top of disaster.

Of course this is exactly what you'd expect so long as the hedge fund industry is in tact - more economic cannibalism for profit. And this is why the Fed we have today is so tragic. The one effective weapon the have at their disposal, a heavy hand, is the one weapon they're too afraid to use:

"March 25 (Bloomberg) -- The dollar fell against the euro as a rally in Asian stocks encouraged investors to buy higher- yielding assets with loans in the U.S. currency."

Congratulations Ben, we just became a funding currency for carry trades, exactly like Japan.

My opinion:

Economists today apparently are incapable of understanding this isn't ultimately an economic issue -- this is a fundamental breakdown of restraint and common sense.

We've become financial savages.

No amount of rate cuts or bailouts will fix that.

ac | 03.25.08 - 11:10 pm | #

homedad43 writes:
In a lot of ways China (what I know of it) reminds me more of the 1920s America than any other country today.

If that's the case it could mean real trouble for everyone.

ac | 03.25.08 - 10:32 pm
----------------------------------

Not really far from the truth. Post WW One, the US "helped" Europe rebuild by essentially lending them the money with which to buy our goods for the rebuilding.

Let me say this, we really did help Europe, but the quotes are there because Harding's guys, corrupt though they were, were a bunch of steely-eyed capitalists. True enlightened self-interest.
homedad43 | 03.25.08 - 11:25 pm | #

Japanese Housewife writes:
Hello, Americans...

Have you good day today?

Have you seen dollar drop like fishhead in bucket?

Yes, Joe Sex Pack, you can be first on block to learn ancient secrets of carry trade. Mastered by my people since earliest tools available, like stone wheels and PC386.

And all of this can be your for only...

$149.99

No, make that $151.99.

No, make that $152.99.

Just send me gold.

Did I mention you also get rice steamer?
Japanese Housewife | 03.25.08 - 11:32 pm | #

dryfly writes:
Economists today apparently are incapable of understanding this isn't ultimately an economic issue -- this is a fundamental breakdown of restraint and common sense.

But that has been going on since mid-80s... we are just now reaping what was sowed. How it would manifest itself (in wide spread unemployment or debased currency or a partial mix of both) is the only variable.

A society can not over consume - consume more than they produce like we have done for DECADES - and get away with it. That is the lesson economists & lay people ought to be walking away with. The fed 'fix' is just managing what was already baked in the cake.

dryfly | 03.25.08 - 11:42 pm | #

sk writes:

Economists today apparently are incapable of understanding this isn't ultimately an economic issue -- this is a fundamental breakdown of restraint and common sense.
...

No amount of rate cuts or bailouts will fix that.

ac


I think people won't call this fundamental issue for what it is -

"Americans, the powerhouse of the world's economy, have lived beyond their means and have no means of recovering those means - A period of painful adjustment lies ahead"

Here's a quote from Peter Bernstein via John Maudin's newsletter:

The root of today's problems in the financial markets and in the economy as a whole is the household sector. The point needs no elaboration, but its significance cannot be minimized. As we have argued on more than one occasion, the shrinkage in the personal savings rate is not the result of consumer profligacy, as other commentators persist in describing it. Rather, the savings rate has been suppressed by a slowdown in the growth of household incomes. The shortfall between income and outlay has been met by borrowing, and in particular by borrowing against the family real estate.

Check john maudins website for the above.

And here is a quote from today's (London) Times:
http:// business.timesonline.co.u...icle3620323.ece


The bigger question is whether this loss of liquidity, the massive sucking of cash out of the wallets of Americans is part of something bigger — a loss of confidence in the ability of Americans to maintain the lifestyle to which they have become accustomed.

The liquidity has been flying east and south for many years, chasing profits in huge industrial and energy projects in emerging markets. It will continue to do so, seeking better returns, more promising prospects than funding the lifestyle of the underskilled, the tired and the underperforming.


The British adjustment took 50 years - 1930-1980 IMO. I saw 15 years of it. I wonder how long the US adjustment will take ( and who the US Maggie Thatcher will be)?

-K
sk | 03.25.08 - 11:52 pm | #

DAHarrold@aol.com writes:
dryfly:

Follow the timeframe (mid '80s) to today and think in terms of generation. Consider in terms of earning and spending power, etc.

No wonder other generations don't like the boomers. I'm one myself, and I don't like us.
DAHarrold@aol.com | 03.25.08 - 11:53 pm | #

dryfly writes:
No wonder other generations don't like the boomers. I'm one myself, and I don't like us.
DAHarrold@aol.com | 03.25.08 - 11:53 pm | #

It wasn't just the Boomers though. I also am one and agree to a certain extent that nothing typifies 'ugly american' quite like a bunch of us going anywhere.

But my father was a depression baby & vet and he would say even most of his generation over consumed & produced too little from 80s and beyond - they didn't all save. He knew plenty that couldn't rub too nickels together (like his in-laws).

Plus if what I read is accurate Gen Xers are even worse than Boomers from consumption & saving perspective - it is a powerful narcotic that buying & borrowing thing.

I don't spend a lot of time on the blame thing - who was worse then who else - but it has to get fixed. A weak dollar is the start to getting people to produce more since weak dollars by definition mean they can't buy more unless they produce more first.

dryfly | 03.26.08 - 12:09 am | #

RE writes:
I don't think the U.S. needs Maggie Thatcher nor any of her ilk, ugly as they were. She was simply lucky to come along at a time when North Sea oil started to really flow.
RE | 03.26.08 - 12:09 am | #

halbhh writes:
dryfly

Another way to look at the weak dollar and producing more, is as I'm sure is obvious to you also, that our recent high material consumption was really far above a level that made any kind of good sense for us or the world for more than a few years.

It did help capitalism get going faster in China. That's a benefit.

And perhaps we wind back down to more ordinary living, and the adjustment is only hard for a year or three.

Here's hoping on that one.
halbhh | 03.26.08 - 12:13 am | #

homedad43 writes:
dryfly:

If you have any extra reading time - heh - try something that came out about 20 years ago, entitled "Generations". Written by a couple of social scientists/historians, it gives an interesting take on American history; i.e. there are actually repetitive types of generational characteristics throughout our history.

Some premises could be challenged, but it was a good read.
homedad43 | 03.26.08 - 12:15 am | #

dryfly writes:
I don't think the U.S. needs Maggie Thatcher nor any of her ilk, ugly as they were. She was simply lucky to come along at a time when North Sea oil started to really flow.

Given the choice I'd much rather be lucky than right. ;)

But sk makes a point - 'the dole' in the UK was something to behold. We have had nothing quite like it and Thatcher squashed it. I am not a neo-con nor fan of a lot of Thatcherisms but faced with the dole & Labour's unending support for it - I'd have voted Tory then too if I were there.

dryfly | 03.26.08 - 12:16 am | #

homedad43 writes:
RE:

Don't tell anyone, but I hear that Norway is doing some nasty stuff with WMD...
homedad43 | 03.26.08 - 12:16 am | #

HC writes:
Each day brings more bad news for our right wing masters, their towering piles and their organs of thuggery, such as Clear Channel.

Bloody Xmas in March, this is. :-)
HC | 03.26.08 - 12:18 am | #

dryfly writes:
homedad - I've not read 'Generations' but have heard snippets about it. I don't think a lot changes generation to generation...

Example - I remember the 'rage' against the older generation during the 60s. You know 'never trust anyone over 30'. Well those folks are now the elderly boomers facing the same kind of rage from Xers. And what's really funny is watching the folks younger than Xers - my kids & their litter mates - they hate the Xers as much as Xers hate us.

Nothing changes - born naked, live, grow old, die naked. If you are lucky make 70-80 trips around the sun. Enjoy the ride.

dryfly | 03.26.08 - 12:24 am | #

homedad43 writes:
dryfly:

"Nothing changes - born naked, live, grow old, die naked. If you are lucky make 70-80 trips around the sun. Enjoy the ride. "

Nicely put. Have to remember that to keep in perspective.
homedad43 | 03.26.08 - 12:26 am | #

HC writes:
Dryfly:

"Plus if what I read is accurate Gen Xers are even worse than Boomers from consumption & saving perspective - it is a powerful narcotic that buying & borrowing thing.

Yes. A monkey slaked by constant fixes, in the form of endless credit card offers made from the moment they slithered from the cradle.

It will be somewhat harder for them than it will the Boomers to quit. The Boomers will be able to comfort themselves with their memories, relatively fresh, of seeing Mick Jagger for 500 clams a ticket, of finally owning that muscle car, and of their third wife's upgraded implants. And over the hum of their dialysis machines the past will seem so bright, cozy, cocaine-rich and fun.

Gen X, though, will have to go cold turkey. Lucky thing their iPods are full.
HC | 03.26.08 - 12:33 am | #

sk writes:

dryfly writes:
example - I remember the 'rage' against the older generation during the 60s. You know 'never trust anyone over 30'.


Time to trot out my own take on that. Indeed, I used to say:
"Never trust anyone over 30"
Then I turned 30. No problem. New line:
"Never trust anyone over 40"
Then I turned 40. So I scratched my head and came up with the truth:
"Never trust anyone"

-K
sk | 03.26.08 - 12:44 am | #

tranches of like writes:
As a 'Gen Xer,' I get tired of some of my fellow Xers trashing the Boomers. I see so much apathy and consumerism in my generation... calling out the Boomers for 'selfishness' or 'selling out' is a bit pathetic.

But overall, I subscribe to dryfly's view...nothing new under the sun. Perhaps in facing the trials ahead a new 'greatest generation' will emerge.
tranches of like | 03.26.08 - 12:48 am | #

RE writes:
Dryfly,

Just wanted to post the U.K. unemployment rate. Note that Thatcher was in power from 1978 to 1988. Given the incredible contribution of North Sea oil to the U.K. economy during this time and looking at the chart as to what happened before and after, I don't see how she had such an incredible influence on U.K. unemployment. Most of it was just a myth spread by her fans in the U.K. and the U.S.

U.K. Unemployment last 40 Years
RE | 03.26.08 - 1:10 am | #

sk writes:
OKOKOK - this is wayyy off topic but here is the oil production chart for the UK offshore operations:
http://www.theoildrum.com/ upload...ields_to_99.png

This idea of oil revenues supporting the economy ONLY during her time in power isn't accurate is it ? There were there to a substantial degree before she was elected in 1979, the peaked and then they declined during her time in power which ended in 1990.

What she did was, in modern day parlance, was to readily acknowledge that the UK was f*cked; and the fault wasn't in the stars but within ourselves ( with apologies to unowho) and craftily and selectively manouvered a coalition kicking and screaming out of the post-war genteel deshabille into a post-Empire era - her run ins with the steel workers and the two run ins with the coal miners ( lost one, learnt, won the next ) were amazing examples of political genius - as was the coalition of the Tory grandees with the arriviste - her genius was that without in any way rejecting or even apologizing or even discarding the traditions and thought processes of Empire and noblesse oblige she actually went and just did the economic reforms that were rotting the UK from within - and the other paradigms just started to fade away - fade not disappear but definitely fade - and all without acknowledging root causes - true genius or perhaps simple blind caring for the UK and its people as a nation and not at all for the Empire thang - she was after all just a grocer's daughter and not someone with the aristocratic traditions of Empire.

One could list her policy faults - NI is the most glaring, IMO - but that's not the context here - her economic reforms and contribution to a psychological change in the UK are more important.

All of this is IMO.

-K
sk | 03.26.08 - 1:43 am | #

Anonymous writes:
Re:

"Nothing changes - born naked, live, grow old, die naked. If you are lucky make 70-80 trips around the sun. Enjoy the ride. "


As you recall:

Your born in pain, live in fear and die alone (irish)!
Anonymous | 03.26.08 - 3:01 am | #

Wayne Qiu writes:
Please spread this message.

Why is Bear Stearns Trading at $6 Instead of $2?

http://www.hussmanfunds.com/wmc/...c/ wmc080324.htm

Don't just do blogging and do something if I really love this nation.
Wayne Qiu | 03.26.08 - 3:24 am | #

Alec writes:
Emmis broadcasting is scrimping to try and take themselves private before the ad implosion.
Alec | 03.26.08 - 6:04 am | #

Nelson Muntz writes:
Ha Ha!
Nelson Muntz | 03.26.08 - 10:38 am | #