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PostPosted: Fri Oct 24, 2008 9:15 am    Post subject: Reply with quote


Markets Nosedive on
Grim Economic News

Reuters | 24 Oct 2008 | 09:54 AM ET

Japan led a global stock market rout Friday that saw U.S. stock index
futures tumble so sharply they had to be frozen, and news that Britain's
economy contracted in the third quarter deepened fears of a worldwide

Mounting evidence of a downturn, born of the worst financial crisis in 80
years, also prompted extreme currency volatility.

The yen rocketed to multiyear highs against the dollar and euro, with the
euro/yen rate down a staggering 10 percent at one point.

Britain's economy shrunk 0.5 percent in the third quarter and euro zone
figures showed the 15-nation currency bloc was already in recession,
analysts said.

Stock markets were in freefall around the world as panicked investors
moved to liquidate risky positions.

Japan's Nikkei index ended down 9.6 percent and European shares
dropped 8 percent.

In New York December Dow Jones futures were down 6.3 percent,
Standard & Poor's 500 futures were off 6.6 percent and Nasdaq 100
futures were down 6.8 percent.

All three contracts lost the maximum amount permissible before the start
of futures trading in the United States.

Both the New York Stock Exchange and Nasdaq said trading would open as
normal at 9:30 a.m. (2:30 pm London time).

Russia suspended trading on its stock market until at least Tuesday after
the market lost more than a tenth of its value on Friday, hitting its lowest
levels since late 2004.

"The global financial crisis has been constantly spreading and worsening,
creating a severe shock to global economic growth," Chinese Premier Wen
Jiabao told an Asia-Europe Meeting of 27 EU member states and 16 Asian

OPEC, meeting in emergency session, agreed to cut oil output by 1.5
million barrels per day in an attempt to halt the steep slide in the price of

But the price of U.S. crude fell 7 percent to $63 as economic gloom
overshadowed the cut.

Commodities from copper to zinc, sugar and coffee were battered by
sharp selling -- bad news for emerging market economies that are major
commodity producers and depend on exports for much of their revenue.

The price of U.S. government bonds rose sharply as investors switched
out of stocks.

More Bad News From Companies

Bank of England Deputy Governor Charles Bean said Britain's economy
was still in the early days of weakness as a result of possibly the worst
financial crisis in history.

"This is a once in a lifetime crisis, and possibly the largest financial crisis
of its kind in human history," Bean told the Scarborough Evening News.

A survey of companies showed the euro zone private sector economy on
track for its worst performance since the recession of the early 1990s.

The October Markit Eurozone Flash Purchasing Managers' Indexes show
services business contracting at its fastest pace since after the Sept. 11,
2001 attacks.

Factory output was shrinking at the greatest rate in at least a decade.

"This is it, we are clearly into recession," said Gilles Moec, economist at
Bank of America.

A range of corporate giants reeled too, not just the banks that were hit
first and hardest by a financial crisis that began with a U.S. housing
market collapse.

Sony's shares plunged to a 13-year low after it halved its profit forecast.

French carmaker PSA Peugeot Citroen cut its full-year operating margin
target and said it planned to make "massive" production cuts in the fourth
quarter after posting a 5.2 percent fall in third quarter sales.

Air France-KLM also succumbed to the financial crisis with a profit warning,
sending shares in Europe's largest airline group down about 7 percent.

Government Action

Authorities around the world have committed nearly $4 trillion to a variety
of plans including deposit and debt guarantees and taking stakes in
struggling banks.

Foreign exchange analysts say major central banks urgently need to calm
wild swings in major exchange rates, the latest manifestation of the
deepening global financial crisis and one that has sent the U.S. dollar and
Japanese yen soaring against European and emerging market currencies.

In Washington, the Treasury Department and bank regulators plan to
announce as soon as this weekend the next batch of banks to receive
capital injections as part of its bank bailout package, a source familiar
with the Treasury's thinking said.

European leaders want China, the world's fastest-growing major economy,
to help shape global financial reforms.

"There was large agreement that such answers must be found
internationally," German Chancellor Angela Merkel said after talks with
Chinese President Hu Jintao in Beijing.

"I think China will make its contribution to the stabilization of the world
economy." Hu said the outlook was "grim and complicated." Leaders of the
world's major industrial nations and other big economies will discuss the
crisis at a special summit on Nov. 15 in the United States.

Chinese spokesman Liu Jianchao said his government was actively
considering attending.

IMF Package

The International Monetary Fund is hurrying to approve by early
November a package allowing certain emerging economies exchange their
currencies for U.S. dollars to ease short-term credit strains, officials
familiar with the plans said.

So far, Hungary, Iceland, Belarus, Ukraine and Serbia are in talks with
the IMF on programs backed by financing.

Interbank lending, frozen recently as banks feared peers might collapse,
has shown some signs of thawing.

In London, interbank rates for overnight dollar deposits were indicated in a
range of 0.95-1.25 percent, but the cost of borrowing longer-dated dollars
rose as banks remained wary of lending to each other for durations
extending into next year.

Markets expect the Federal Reserve to cut U.S. rates sharply next week to
help head off a sharp recession.

To that end, investors will scrutinize U.S. home sales data due later.


Meanwhile China is imploding too:


China toy story shows buzz has left the business

DONGGUAN, China (Reuters) - Hundreds of workers rallied at a
government office in south China on Friday to demand unpaid wages from
a shuttered toy maker as the global economic crisis worsened the outlook
for an industry already hurt by falling exports.

Factories in the once booming southern Chinese province of Guangdong
have suffered over the past year and a half from tight curbs on loans,
rising labor costs and China's stronger currency, which makes their
products more expensive.

On Friday, Hong Kong-listed Smart Union Group, one of the area's largest
toymakers, said provisional liquidators had been appointed, as hundreds
of solemn, unpaid workers gathered at the gates of its silent factory across
the border.

Its possible demise sounds a warning for factories across southern China
which survive on a precarious diet of loans as they compete for foreign
orders with wafer-thin margins.

"Finally I think the end is near," economist Andy Xie said. "You have
Chinese businesses disappearing... They've been keeping this house of
cards going for a long time with bank support."

Smart Union had tried to beat the downturn in toy exports by committing
more as smaller factories closed, local media said. It over-extended even
as demand worsened, thanks to the global credit crisis which could drag
rich consuming countries in the west into recession.

"The main reason for the closure is that we are too dependent on the U.S.
market, which has become sluggish," the China Daily quoted Smart Union
human resources staffer Xu Xiaofeng as saying.

Smart Union, a supplier to Mattel, had not paid its 6,500 employees in the
export-oriented southern city of Dongguan for two months, the China Daily

About 1,000 workers gathered at the factory in Zhangmutou, before
moving on to local government offices which were guarded by about 100

"I feel very agitated. We need money to pay for our housing and food,"
said worker Huang Luohui, 33, who is owed two months' wages......

Dongguan earlier this month set up a 1 billion yuan ($146.4 million) rescue
fund for small and medium sized businesses hurt by the global economic

But still, the outlook is bleak. The number of Chinese firms exporting toys
overseas halved in the first seven months of 2008, compared to the year
before, the General Administration of Customs said on Monday.

The number of visitors to the Canton Fair, the top trade fair which is a
barometer for China's foreign trade, was down sharply this week,
indicating stiffer competition for export factories in months to come.


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PostPosted: Fri Oct 24, 2008 11:08 am    Post subject: Reply with quote

Thursday's last hour rally was a good example of flagrant intervention by
the FED. Today the futures market was signalling an 800 point drop in the
DOW --but strangely the plunge never showed up??

The futures before the open, were so down that futures trading
was halted by technical stop points, but the momentum was
intercepted so quickly that the market never even saw losses to match.

Flagrant PPT action! Yeeeehah

It's the FED to the rescue --flushing your tax dollars to prop the market
on Friday, so they can engineer another 'confidence-boosting' measure
over the weekend....

Here's the data for October stockmarket falls alone
--not taking account of the falls prior to October.....

U.S., down 26%
Canada. down 37%
Mexico, down 44%
Argentina, down 43%
Brazil, down 48%
Chile, down 30%
Peru, down 42%

Britain, down 31%
Germany, down 35%
France, down 31%
Switzerland, down 20%
Italy, down 30%
Ireland, down 35%
Iceland, down 83%
Netherlands, down 35%
Belgium, down 37%
Denmark, down 35%
Finland, down 26%
Greece, down 45%
Poland, down 46%
Czech Republic, down 45%
Russia, down 53%
Hungary, down 50%
Lithuania, down 37%
Turkey, down 50%
South Africa, down 42%
Israel, down 22%

Japan, down 23%
Hong Kong, down 30%
China, down 21%
Taiwan, down 23%
South Korea, down 46%
Australia, down 34%
New Zealand, down 25%
India, down 36%
Singapore, down 35%
Spain, down 33%

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James D

Joined: 16 Dec 2006
Posts: 985

PostPosted: Fri Oct 24, 2008 7:19 pm    Post subject: Reply with quote

But what's really happening, Dude?

With regard to Articles by Howard S. Katz on the "What is money thread" http://breakfornews.com/forum/viewtopic.php?t=4707 they are deliberately sowing seeds of panic for a purpose.

With the up and coming G-7 + ........20.... +Spain (they're pissed at not being invited and are trying hard to gate-crash - Why? Really, who'd want to be associated with the biggest theft of all civilisation! Must be a gansta thing, I suppose!) What the F**K have they got planned!

What serious mind-numb-f**king-shit-storm-Astro-Super-PLAN have they got in mind?????!!!!!

Basic math :- 10 Earth's total resources and assets into One Ever Increasing Financial Black Hole - DON't GO !

Now with the power of internet and speed of interchange of information etc. - Has the "Window of Opportunity" closed slightly?
Who's shitin' who?
Has two years just turned into two months or even two weeks?!!

Now who's panicking?!! Hee, hee!!!!! Mad
Gosh it's so easy to get into the swing of things, it just picks you up and takes you away!!

So , really , What's happening? It's all bullshit really, isn't it?

I'm moving to the coast!
And I'm going to buy a load of stuff to eat and drink and smoke and trade and I'm going to buy or build a boat and ....sail away? NO, I'm gona TRADE DUDES!


Anyone want in?
Opportunities? Opportunities abound, mi' hearties!!!!

Peace and prosperity People!
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PostPosted: Sat Oct 25, 2008 5:08 am    Post subject: Reply with quote

The Long Bad Friday is behind us. What looms is...



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PostPosted: Sat Oct 25, 2008 2:20 pm    Post subject: Reply with quote


Chinese Premier Wen Jiabao, center, speaks at the start of a breakfast
with Asian leaders at the Great Hall of the People in Beijing Friday, Oct. 24,

BEIJING—Chinese Premier Wen Jiabao on Saturday acknowledged his
country was feeling ripple effects from the global financial meltdown and
pledged robust government spending to keep the economy from stalling.

While the direct impact of the crisis on China has been relatively light, the
accompanying global slowdown would "inevitably have an impact on
China's economy," Wen said.

"We need to use every means to prevent the financial crisis from having
an impact on the growth of the real economy," he said.

Chinese institutions held relatively little of the toxic sub-prime mortgage
debt hobbling Western institutions, and were as such largely unscathed by
the collapse of the U.S. housing market.

However, the Chinese economy overall is slowing and will be further hit by
a decline in demand for Chinese exports ranging from toys to rolled steel.
Growth in the third quarter slowed to 9 percent -- down from 11.9 percent
for all of 2007 -- still the fastest rate among the world's largest

Truth fears no questions
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PostPosted: Sun Oct 26, 2008 10:06 am    Post subject: Reply with quote


Sterling caught up in 'currency market tsunami'

Sterling is caught up in a “currency market tsunami” as money pours out of emerging markets and into the dollar and the yen, experts said yesterday.


By Rosie Murray-West
Last Updated: 7:59PM BST 25 Oct 2008

Bob Munro, senior consultant at currency experts HiFX, said that the dollar’s strength against the pound would continue as hedge funds liquidated assets in emerging markets and kept the money in cash.

He said: “Most of these hedge funds are dollar-denominated and so money is pouring into the dollar.” Munro added: “This is not a vote of confidence in the US economy, more a technical move as people get out of anything risky.

“There is a currency market tsunami washing over everything, and we will have to wait until the waves recede to see what’s left,” he said.

The pound, which has lost a quarter of its value against the dollar in the past year, fell 3.5 cents to $1.5837 on Friday, as hedge funds pulled cash out of emerging markets amidst gloomy global forecasts.

The move by investors away from emerging markets is contributing to the strength of the dollar and the Japanese yen. Some of the cash is being used to repay low-interest loans in yen that had been financing investments. These loans, known as carry trades, have depressed the yen for years. The currency rose to a 13-year high against the dollar on Friday.

After liquidating their emerging market assets, the hedge funds are holding them in either US cash or US government debt, contributing to the dollar’s strength.

Philip Shaw, chief economist at Investec Securities, said that although depressing economic news from the British Government on Friday had not helped sentiment, the pound’s fall was mainly due to global economic circumstances.

“Assets are being sold off in emerging markets, and cash is the only safe haven,” he said. “This de-leveraging is causing the dollar strength.”

He said another factor was that worldwide interest rate forecasts are being revised downward, which has increased interest in the US where rates have already been slashed. Hedge funds which had invested heavily in emerging markets are unwinding as many investments as possible, as fears of a deepening global recession continue.

George Buckley, chief UK economist at Deutsche Bank, said that although this week’s fall in the pound against the dollar had been “precipitous”, its previous position at over $2 to the pound was “possibly unsustainable in the first place.”

Blah blah blah

atm Evil or Very Mad
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PostPosted: Mon Oct 27, 2008 8:28 am    Post subject: Reply with quote

U.S. stock futures slump
on worldwide turmoil

By Steve Goldstein, MarketWatch - 8:37 a.m. EDT Oct. 27, 2008

LONDON (MarketWatch) - U.S. stock futures slumped on Monday on
heightened worldwide economic turmoil, with several regional banks
getting cash from the U.S. government, the Group of Seven industrialized
nations hinting they could intervene to stop the Japanese yen's ascent
and the International Monetary Fund announcing rescue plans for
Hungary and Ukraine.

S&P 500 futures fell 20.2 points to 845.80 and Nasdaq 100 futures fell
17.5 points to 1,174.00. Dow industrial futures fell 161 points.

It's the last full week before the presidential election, with Halloween not
the only scary day: Lots of economic data are due to rear their heads.

Last week, the Dow Jones Industrial Average dropped 5.3%, the S&P 500
fell 6.8% and the Nasdaq Composite lost 9.4% as fears surrounding the
global economy accelerated.

Those fears were given renewed attention as the IMF announced rescue
plans for Hungary and Ukraine, South Korea on Monday announced a rate
cut of three-quarters of a percentage point, and Kuwait over the weekend
announced a bank bailout.

The G7 expressed concern about the Japanese yen's recent appreciation
vs. the U.S. dollar and other leading currencies.

The yen's ascent didn't stop, however, as the dollar fell 1.3% to 93 yen.
The dollar's drop against the yen -- but not the euro or the British pound -
- come ahead of the release on Monday of new-home sales for
September and before Wednesday's interest-rate decision from the
Federal Reserve, in which the U.S. central bank is likely to cut rates.

"There's no question there remains a lot of volatility and that we could
see much bigger declines ahead given all the de-leveraging by funds
that's taking place
," said Hugh Johnson chairman of Johnson Illington

Worldwide equities tumbled, with the Hang Seng in Hong Kong closing
with a 12.7% decline and with the FTSE 100 down 3% in London.


And how's this for a bit of naked promo by Wall Street's
Marketwatch website --pleading with Americans not to
turn the deluge of redemptions into a tsunami, on the
basis that if you sell now you could lock in losses and
miss out when the market rebounds!

When the market rebounds?!
Question Exclamation Laughing Laughing Laughing Laughing Laughing

Talk is also going around that a bottom is in sight at DOW 7,500.

Reality check time, you financial leeches.

The bekoning bottom -in the medium term- is DOW 5,000

Check out the propaganda:

To sell or not to sell

Unloading stocks in bear-market rallies will only lock in your losses

By Jonathan Burton, MarketWatch - Oct. 26, 2008

SAN FRANCISCO (MarketWatch) -- Don't get mad, get even: That
sentiment could be a powerful motivator for shellacked shareholders
who are reeling from the stock market's collapse.

Spooked investors may be tempted to sell into periodic rallies at this
point, in an effort to at least recoup some losses. But that hopeful
strategy is full of flaws. Selling into a rally is for traders, not investors.
It shreds long-term plans and puts you on a hair-trigger defense.

You lose sight of the fact that time in the market, not timing the market,
determines financial success. Investment horizons that were considered
in years become measured in minutes, pushing you into panicked
you wouldn't make in a calmer situation.

"Investors think 'I'll get out now and then I'll get back in when this market
has bottomed,'" said Scott Kays, an investment adviser in Atlanta.

"They're fooling themselves," he added. "You're changing your strategic
allocation because of a change in your circumstances. That's market
timing, and I've never seen anybody do that consistently."

Grit and bear it

Market timing sure sounds appealing. You can be out of stocks during bad
periods and ride the gravy train when the bulls are in charge. Indeed, a
timer with perfect pitch who correctly guessed every market fluctuation
between 1926 and 2004 would have turned $1 into a cool $20 billion,
according to a University of Michigan study for investment adviser
Towneley Capital Management. But the probability of being right even
50% of the time is nearly zero.

"You can't control the markets, and you can't control getting in and out at
the right time," said Christine Fahlund, a senior financial planner at
mutual-fund giant T. Rowe Price Group. "If you knew how to do that,
you wouldn't be in the predicament you're in today."

In truth, if you haven't sold by now, with the U.S. market down by more
than one-third in the past 12 months, this is no time to throw in the

You might feel safe and smug in cash, especially if stock prices tumble
further. But what happens when the market improves? You will have
locked in your losses, selling low instead of buying low.....


The laughable part is that the now-threadbare classic advice to hold
for the long term, because time in the market, not timing, is the key,
is the TOTAL REVERSE of the tactics being used by FED/JPM/Goldman
insiders to rake huge volatility profits -even as your investments are
remorselessly turning to toilet paper.

The real question, you assholes, is this:

When is the best time to bail out of a Ponzi scheme?

Answer: EARLY.

And it's LATE already.

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PostPosted: Mon Oct 27, 2008 12:21 pm    Post subject: Reply with quote

How exactly does the PPT and IMF work and get their money? That the US market is not resonding in line with foreign markets is interesting.
Another question is whether the US market is being propped up only until after the election. I am assuming yes, and for the benefit of influencing McCain votes. But votes don't matter, right?

The big schysters have already make their money in pumping and shorting. M&A are already going on. Only so much left to do in the raping of the lock. After that, a major crash? Mustn't we wait for that after the elections? If it is before, how will voters vote?

And by the way, why do people forget they have no say with their vote? Is all this just posturing for the make-believe democracy plus the way citizens can cuddle up with their friends (and make enemies) amongst themselves?

Please someone explain the grandest sport on earth - American Presidential elections. Looks like lots of money to be spent and to be made, not just hoodoo and voodoo to the psyche. What influences ($$) the electoral college to go GOP one year and DEM another?

Thank you,

just cos things are fucked up doesn't mean it isn't progress...
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PostPosted: Wed Oct 29, 2008 6:18 pm    Post subject: Reply with quote

Russia begins to refuse credit cards
in worsening global financial crisis

By Charlotte Bailey
Last Updated: 9:15PM GMT 27 Oct 2008

Russian businesses have begun to refuse credit cards as the global
financial crisis worsens.

Several Moscow city centre restaurants are now refusing to accept cards
in a move not seen since Russia's last financial crisis almost a decade ago.

Some automated teller machines at Sberbank, the country's biggest state-
owned bank, have also stopped accepting cards from other banks.

Several electronics and mobile phone stores said they no longer accepted
credit card purchases.

Over the weekend, Aeroflot, the biggest Russian airline, announced it had
stopped taking credit cards payments for flights except from a handful of


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PostPosted: Thu Oct 30, 2008 9:36 am    Post subject: Reply with quote

RedMahna wrote:
How exactly does the PPT and IMF work and get their money? That the US market is not resonding in line with foreign markets is interesting.
Another question is whether the US market is being propped up only until after the election. I am assuming yes, and for the benefit of influencing McCain votes. But votes don't matter, right?

The big schysters have already make their money in pumping and shorting. M&A are already going on. Only so much left to do in the raping of the lock. After that, a major crash? Mustn't we wait for that after the elections? If it is before, how will voters vote?

And by the way, why do people forget they have no say with their vote? Is all this just posturing for the make-believe democracy plus the way citizens can cuddle up with their friends (and make enemies) amongst themselves?

Please someone explain the grandest sport on earth - American Presidential elections. Looks like lots of money to be spent and to be made, not just hoodoo and voodoo to the psyche. What influences ($$) the electoral college to go GOP one year and DEM another?

Thank you,

Red I'm not completely up to speed on the election end as it relates to this financial business but I am up to speed on the financial end of it. My personal take is that most of this is a set up, some call it a redistribution of wealth. It's deeper than that. Someone, but we'll probably never know who for sure, has staged this whole thing. I have my ideas as do others but starting with the United States would be accurate. The states are NOT nearly as bad off as the World is made to believe, that's a huge red flag to me.

The IMF is mainly a monetary or policy setting entity, or so we're led to believe. They influence just about everything known to finance, that have a thing for Gold and other various natural resources. The Federal reserve is the tool they use to " INFLATE or DEFLATE " prices and the " CENTRAL/WORLD BANKS " are the ones who offer the " CREDIT " backed by the " POLICY " of the former. Now with the Feds backing certain assets you can bet your arse that their main focus isn't on " BAILOUTS " it's more about assets, valuable assets like, well hell you know what their after. Gold, Resources, Stocks, property of all kinds, and most importantly " DOWNSIZING " of certain corporations/companies/. GM and Ford are prime example. GOOG and YHOO another Drug companies are next in line, look for major mergers.

I suspect many countries around the world will and are being forced to put up natural resources of all types as collateral for cash loans. The rates of such transactions are controlled by the IMF. Just recently I posted a small piece about the US accepting a " RAIN FOREST " for payment of debt from Peru. Other countries have had to do this as well, usually it's gold or other metals, coal reserves, oil reserves, or in some cases land. MSM just doesn't cove very much of this end of world finance.
Right now the sights are trained on Africa and most of their natural
resources are up for grabs and the wheels of ECONOMIC IMPROVEMENT are being greased. Help me so I can help you.

The investment houses are being reworked into " BANKS " so they can be regulated, you've been told. That's bullshit, it's because they were all in danger of going under. Even Goldman Sachs as proven by Buffets 5 billion investment ah I mean 10% preferred coupon. He gets 10% you and I get 1-2% if were lucky. He's gets Government backing, we get/ASSUME the RISK end of the stick. Just look at GS chart since Warren moved " ALL IN " You or I would be livid where he just sits and grins at the 10% He has a conversion strike price, does he not? Or sure he's under water a ton but " NOT " really. I'd read the filing but it's too boring for me these days. Rest assured he'll suck up a few shares of common which will offset his loss and more than likely make money.

All of this set in motion not by crisis, but by people who knew. This began under Clinton in the mid-late 90's and the target were minorities. The New York times reported it, wrote about it, they re-ran it on Tuesday as a slap at the Dems I would guess. Fanny and Freddie Fed/Government entities were the tools used. This means they knew and have known for years what lie ahead. The crisis was a set up for what you have today.

One other thing and an important one lost in ALL of this. Just because the Fed gives banks monies doesn't mean the banks will " LOAN IT " So this begs a question: How real is this crisis?

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PostPosted: Mon Nov 03, 2008 10:59 am    Post subject: Reply with quote

Will the Feds Take Over Our Private 401Ks Now?

by Mike Miller - October 28th, 2008

We are barreling toward socialism at an alarming rate, and every day I
become more and more afraid for the future of our country. Teresa
Ghilarducci is an economist at the New School for Social Research in New
York who wrote a policy paper on the subject of retirement account, and
followed that up with a book entitled, When I’m Sixty-Four: The Plot
Against Pensions and the Plan to Save Them.

She was called to testify before Congress on her harebrained scheme to
have the federal government take over all our private 401K plans (which
have historically realized at least 10% annually, on average) and
“guarantee” a rate of return of 3% over inflation. From ABC News:

Here are the basics of her proposed Guaranteed Retirement Accounts:

Employees would make mandatory contributions equal to at least 5 percent of the earnings. Workers could contribute higher amounts if they wish.

Those contributions would be offset by a $600 federal tax credit each participant would receive.

As with a 401(k) plan, workers would have individual accounts they could track. The balance of each account would depend on each worker’s contributions and income level.

The Social Security Administration would handle account management, and the Thrift Savings Plan — a well-regarded retirement plan for federal employees — would manage the money.

Participants would be guaranteed a fixed rate of return that exceeds inflation by 3 percent. For instance, if inflation stood at 2 percent, the worker would earn 5 percent; if inflation reached 3.5 percent, the worker would earn 6.5 percent. Participants could receive an inflation-beating return above 3 percent if the government’s investment returns were high enough.

At retirement, participants’ account balances would be converted into a lifetime stream of income that adjusts for inflation. There would be options to take partial lump sum payments, opt for lower payments in return for survivor benefits and, upon death, leave a portion of a financial account balance.

The intent of the plan is not to replace Social Security. Rather, Guaranteed Savings Accounts would supplement Social Security, Ghilarducci said.

Given the government’s horrendous track record (i.e. Social Security,
Fannie/Freddie, Medicare, Medicaid, etc.) it’s preposterous to think the
government would handle your 401K money wisely.

And then there’s this little nugget:

The portion of Ghilarducci’s plan that has drawn the greatest criticism is
her suggestion to eliminate the tax breaks received for contributing to a
401(k) plan or an IRA.

There are so many things wrong with this idea I don’t know where to
begin. And it’s scary that people, even foolish journalists at ABC.com,
are taking it seriously.

A major concern of mine, which I bet you don’t see anyone talking about,
is that this plan is based on the currently published inflation rate, which is
widely known to be severely manipulated. The fed and the government
play so many number games it’s difficult to keep things straight. If we
calculated inflation using the same formula we used in the 1970’s, we’d all
be bemoaning a rate of 12-13%. (To understand this better, I strongly
recommend you watch Chris Martenson’s Crash Course, specifically
“Chapter 10: Inflation” and “Chapter 16: Fuzzy Numbers” — they are not
only fascinating but quite eye-opening). I wouldn’t mind a “guaranteed”
rate of 15%, but we all know we can’t rely on government guarantees,
don’t we?

Whatever happened to people being responsible for themselves?

Read the whole article here. Try not to vomit all over yourself.


Movement to Scrap 401(k)s Gains Traction
Net Gains: Guaranteed Retirement Accounts Are Getting Attention in Washington

In 1982, when J&J, FMC, PepsiCo, JC Penney, Honeywell, Hughes Aircraft,
etc. all got their employees into 401k, company participation was minimal.

The DJIA was at 875, after bouncing from 500 to 1,000 for over 25 years.

By 1984 there were 17,903 plans and 7,540,000 participants and the DJIA was up to 1,276.02.

By 1990 there were 97,614 plans and 19,548,0000 participants and the DJIA was up to 2,700.

By 1996 there were 230,808 plans and 30,843,000 participants and the DJIA was up to 5,500.

By 2001 there were about 423,000 plans, 43,000,000 participants and the DJIA was up to 11,215.10.

And on and on from there, except for the plunges in 2002 and 2003 when
others took their profits while your money was trapped in a 401k - that is
grossly overvalued.

Think about it, since 401k became the method of retirement financing, the
DJIA increased from 875 to 14,000 last year, a period of 25 years.

Assuming the rule of 72 and dividing 72 by an average inflation rate of
3% during that time period, it should take 24 years for the value to
double. So, the DJIA should have logically doubled since 1984, to
around 3,500.

But, the feed of 401k dollars, with nowhere to go, has instead increased
the DJIA by 4 times what it should have at this point last year. There is no
assets or former financial thought process that can justify that great an
increase. So what we have is people blindly putting their retirement funds
into these "great" investments, and the fat cats occasionally pulling
money out to reinvest later as the retirement money rebuilds the

Simple really.


Minds are like parachutes.
They only function when open.

Last edited by Fintan on Mon Nov 03, 2008 3:39 pm; edited 1 time in total
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PostPosted: Mon Nov 03, 2008 11:29 am    Post subject: Reply with quote

Was that a Bailout for America??

Or just a Vulture(Venture) Capital Fund for the Big Boys!!

‘Troubled ASSET RELIEF Program’?
Are Banks the ‘Troubled Asset’?

October 31st, 2008 - Mr Mortgage

More TARP anger and confusion is surfacing every day. The blow back
with respect to it looking nothing like what originally was sold to American
tax payers is getting heavy. Even the name TARP (Troubled Asset Relief
Program) makes no sense any longer, unless the banks themselves are
the troubled assets to which the acronym refers....

Within two weeks, the program has become vastly different from what the
politicians begged American’s every day on TV to support and what
Paulson and Bernanke stood up under oath and testified to.

All of a sudden now, everyone is standing up saying ‘WTF happened
. I still can’t get credit and most of the first round $350 billion is
already earmarked as investments in banks’.....

As many feared, the banks look to be using the money for what I would
use the money for if I were CEO of a bank - to acquire distressed banks
for pennies on the dollar for their foot print and deposits.

I would also use the money to batten down the hatches so I am around
several years out when the skies clear. The last thing a responsible CEO
would do is start aggressively lending during the largest asset revaluation
and de-leveraging period in history. Who cares about returns and share
price at this point, its all about survival.

And that is exactly what is happening at least at Chase according to NY
Times reporter Joe Nocera who has the smoking gun.

So, When WIll Banks Give Loans?

By JOE NOCERA - 25th October, 2008

Christmas came early at JPMorgan Chase.

The JPMorgan executive who was moderating the employee conference
call didn’t hesitate to answer a question that was pretty politically
sensitive given the events of the previous few weeks......

In point of fact, the dirty little secret of the banking industry is that it has
no intention of using the money to make new loans
. But this executive
was the first insider who’s been indiscreet enough to say it within earshot
of a journalist.

(He didn’t mean to, of course, but I obtained the call-in number and
listened to a recording.)

“Twenty-five billion dollars is obviously going to help the folks who are
struggling more than Chase,” he began. “What we do think it will help us
do is perhaps be a little bit more active on the acquisition side or
opportunistic side for some banks who are still struggling
. And I would not
assume that we are done on the acquisition side just because of the
Washington Mutual and Bear Stearns mergers.

I think there are going to be some great opportunities for us to grow in
this environment
, and I think we have an opportunity to use that $25
billion in that way and obviously depending on whether recession turns
into depression or what happens in the future, you know, we have that as
a backstop.”

Read that answer as many times as you want — you are not going to
find a single word in there about making loans to help the American
. On the contrary: at another point in the conference call, the
same executive (who I’m not naming because he didn’t know I would be
listening in) explained that “loan dollars are down significantly.”

He added, “We would think that loan volume will continue to go down as
we continue to tighten credit to fully reflect the high cost of pricing on the
loan side.”

In other words JPMorgan has no intention of turning on the lending spigot.

Even Dodd, one of the largest proponent of this bill is trying to save his skin.

“If it turns out that they are hoarding, you’ll have a
revolution on your hands. People will be so livid and furious that their tax
money is going to line their pockets instead of doing the right thing. There
will be hell to pay.”


No Wonder JPM decides to crank up the PR Machine:

Massive Effort to Save Mortgages


J.P. Morgan Chase & Co. launched an ambitious plan Friday to modify the
terms of $70 billion in mortgages for borrowers who are behind on their
payments or soon could be.

The move by the New York bank will cover as many as 400,000
. They'll be moved into loans carrying lower interest rates,
smaller principal amounts or other more-affordable terms.

The changes will particularly focus on a type of loan structured in such a
way that the borrower's outstanding balance sometimes grows month
after month. J.P. Morgan inherited $54 billion of such loans with its
takeover of the beleaguered thrift Washington Mutual Inc. in September.


Nice bit of PR to portray JPM actually DOING something to fix the problem.
but likely just a drop in the ocean of defaults coming down the pike.

Now we are witnessing a rally in the markets from the temporary bottom
of late October, BUT BEWARE. I was speaking privately about this
last week. I think any Rally could be a setup to lure in the sheep
for one final shearing exercise.

Anyway, here's Mr. Mortgage about the latest on the Mortgage problem:



Currently, there are roughly $7 trillion in loans still on the book made
during the years in question. Even borrowers with 750 scores who put
20% down and got a a 30-year fixed are walking due to excessive
allowable debt-to-income ratios at the time the loan was made and
negative equity, as values are down as much as 75% in some of the
harder hit areas in the bubble states.

Prime is going down the same hole as Sub-Prime.

This chart shows the percentage increase in 2008 vs. 2007 in mortgage
loan Notice-of-Defaults that each company originated. This does not
include second mortgages of which Chase is also loaded to the gills:


1.)Who holds 50% of all U.S. Derivatives & CDS Contracts?
2.)Who is behind & responsible for the COMEX Gold Fraud?
3.)Who was behind the collapse of Bear Sterns?
4.)Who was behind the collapse of Lehman Brothers?
5.)Who was behind the collapse of WaMu?


Hey everybody! Lets play LAST MAN STANDING with the US Economy. Laughing

'The Quickening' - From Sept. '08


Minds are like parachutes.
They only function when open.
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