on the "books" reads page is the list of some books but it's gotten "no love" as of recent. There are certain texts, which are "must reads" that we can help promote.
I read Secrets of the Temple and I wish some PBS grant would turn it into a documentary.
Right now we have the "illuminati" type of documentaries around on the Federal reserve which destroys any valid credibility they have in criticism.
Well, damn good job and I can see from the web stats a host of other financial sites are picking up on your work, so it's being read (which to me is the most important thing, nothing worse than busting your butt to not get any readers!)
Also, if you have any "must read" books I can add them to that page and we could also put together a "book review" of blog posts that are reviews section.
Hello, long time no see! I'll have check those numbers, on face, that seem not possible (and yes I know derivatives, the shadow banking system is the real problem).
You might consider joining up, creating an account for I know you are on a lot of the EP topics being written on/discussed.
I got the idea for this article from the book I'm reading, Secrets of the Temple (I'm almost done with it).
It's a history of the Federal Reserve from late 1979 to about 1985. It was moderately interesting until I came to the part about Penn Square and Continental Illinois.
Then suddenly I was "Deja Vu! I've seen this movie before."
After that it was pretty easy finding the FDIC reports on these banks and drawing some common sense conclusions.
It's amazing how a little historical knowledge can put things into perspective.
World derivatives, therefore total $1.14 Quadrillion USD. In a prior article, Pizzo shows us that US banks have too much exposure to derivative 'gambling debt' speculation, showing that total commercial banks and trust companies with derivatives had total assets of $10.5 trillion vs. total derivatives at $175.8 trillion
see page 22 of 33 at
http://www.occ.treas.gov/ftp/release/2008-152a.pdf
The jig is up folks.
At the April 2nd G20 meeting world leaders should write off this toxic speculative derivative 'debt'.
Put in further perspective, the entire world's GDP, according to the CIA's world book, is $71 trillion USD annually. Compare that with that $1.14 quadillion and you now understand that a huge transfer of wealth is taking place, crowding out legitimate recovery efforts.
I agree that TBTF needs to be an immediate criteria to break up a bank.
I know one thing, structured financial "products" need to be approved before every being allowed on the market. Take
CDOs for example. In the mathematics itself, the base model are some very obvious assumption flaws. It's so bad I am now wondering about the entire financial mathematical field and what they are even reviewing in Academic research.
Then, to me it's obvious to throw off any system which allowed unlimited CDSes on one underlying contract. So far in my own reading this implies if I see a potential asset I believe is going "down" regardless of the fact I own none of that assets, I can buy a CDS and collect when that asset defaults.
Another reason I think to stop TBTF is it seems once these institutions are big enough, they can buy off any politician and as you note, even get their own guys onto the Federal Reserve...
which is another can of worms, beyond only one appointment by the President, it seems the Federal Reserve just doesn't have that much accountability or is interwoven into the power sharing government structure.
... it seems as if consumer credit unions sell some of their mortgages, car loans, etc. to a corporate credit union to increase their lending capacity, like banks selling mortgages to Fannie Mae (and the corporate credit union may have raised some of that money by setting up a Collateralized Debt Obligations). Corporate credit unions might also be lending to consumer credit unions who have a use for funds.
Bad economic conditions will make some of the assets held by the corporate credit union to go bust. And if credit unions are forced to cut back on their lending, the corporate credit unions would face dwindling interest income from lending to consumer credit unions just when the returns on their asset base would be dropping because of loans going sour.
they are talking about turning the Fed into a glorified FDIC or give it the authority to seize nonbank institutions, like AIG to deal with systemic risk.
The ability to seize nonbank institutions who post systemic risk sounds like a good idea but to give the Fed that much power considering the above, no way.
Great list, scary, shocking, also massive expansion of powers as I see this.
The end of times are near. Don't laugh it is apparently clear people are very sex and money crazy and care nothing about using other Americans tax dollars for their perverted and greedy ways. The bonus clowns in CT are being protested and have ask for State protection from pissed off tax payers. Print their sorry ass names and go after them. Every last one. But wait it was our sorry ass leaders who have allowed this. May they all rot in Hell. As a country we need to demand the money back and ask for jail time for our elected officials and the idiots who took the money as a bonus. Lack of intelligence will be the Corporate Wall St. end. They will die broke and hell will await them all.
"Funding the draw-down of the social-security system is essentially impossible without significant changes. The Boomers borrowed too much, saved too little. Various small changes - retirement age, adjustments to Medicare part B, etc. - are going to be required to keep it solvent.
"I suspect Team Obama is sensitive to this issue.
"As to management of the other aspects of the real economy-it seems the Obama administration should get better marks than its management of the fake economy (e.g. finance).
"They are right to target the medical system; we have a system in which (whether you like it or not) the emergency room has become a public health system. In which we overdiagnose and overtreat, with little concrete proof of effectiveness. In which other countries pay far less than the US for the same drugs (which were developed in the US). In which GPs are underpaid and overstretched. In which the costs of pursuing payment, managing the system to prevent non-payment, and negotiating payment levels have created real burdens on everyone - even though we have proven incapable of denying treatment in many cases for those that cannot pay. And, finally, in which the private insurance system is incapable of making rational decisions between million-dollar end of life care and providing less expensive prenatal care - simply because hospitals are compelled to chase profits.
"The argument for letting the profit motive drive the entire health care system was that it would give us a better (and more disciplined) system, yet there is no evidence to that end, and mounting evidence that the opposite is true. While we do see some excellent private sector innovations (health clinics in drugstores and Walmart), the health care system is _inherently_ plagued by incredible market distortions:
- Asymetric information
- non-rational behavior
- individuals who are non-functional (dying, senile) making complex “decisions”
- bargaining inequities/oligopolies (insurance companies pay much less for identical services than individuals)
- both adverse selection and moral hazard in insurance contracting
- previous non-market attempts to ‘fix’ the system that were patched over 70 years, now creating huge competitive disadvantages for US firms
"Team Obama has also targeted energy, environment, infrastructure, and education as primary areas for additional investment. And they are right across the board. To place your faith _entirely_ in the profit motive and sanctity of contracts to mobilize the US economy to fix drastic problems within a decade is entirely unrealistic.
"The baseless and unchallenged faith in the profit motive to _always_ work has allowed grossly anti-productive behavior to continue unchallenged.
"Consider one example of how the profit motive increases economic “growth”:
"Company X is a mining company. In order to keep costs down, the Federal govt. relaxes effluent and emissions controls (turns out the agency in charge has some bribery and sex scandals, but heh, who doesn’t these days?). Company X generated $100 million in revenues and $20 million in profits over 10 years, until the mine is played out. The wages and profits are then recycled into the economy, and it looks like we have a lot of growth.
"Unfortunately, after the mine distributes its winnings, it closes down and declares bankruptcy - leaving large unpaid environmental debts. As with the financial sector, it’s virtually impossible to recover profits that were already distributed over 10 years prior to declaring bankruptcy, even if you can win the lawsuit (a costly and time consuming process). And even then, the total profits generated would not come close to covering the cost of cleanup…
"Destroyed waterways, arsenic and slag-tainted soil and underground water supplies, and a littany of health problems among employees (and even non-employees in the vicinity).
"The “economy” then “grows” because the govt. has to pay for health/end-of-life care for disabled workers. It also has to pay for cleanup. And for this, it levies taxes.
"In this sense, official GDP number grew twice - once from the damage-causing activity, and again from repairing the vast amount of damage. But are people better off?
"One of my great feats regarding the financial crisis is that Team Obama’s incompetence at handling it would cause collateral damage to its other initiatives, which are much more sensible."
and it appears my assessment is dead on. I'm seeing Paul Krugman also write despair in the financial system and pointing out very similar problems that I saw.
these funds will have skewed incentives. In effect, Treasury will be creating — deliberately! — the functional equivalent of Texas S&Ls in the 1980s: financial operations with very little capital but lots of government-guaranteed liabilities. For the private investors, this is an open invitation to play heads I win, tails the taxpayers lose. So sure, these investors will be ready to pay high prices for toxic waste. After all, the stuff might be worth something; and if it isn’t, that’s someone else’s problem.
I thought the credit unions stayed away from all of the Ponzi scheme stuff so anyone have any details as to why these are failing?
Simply people are broke, lost their jobs, can't make the mortgage and pay their bills? Or did they get sucked into some derivative structured finance "product" to "protect" their assets somewhere?
on the "books" reads page is the list of some books but it's gotten "no love" as of recent. There are certain texts, which are "must reads" that we can help promote.
I read Secrets of the Temple and I wish some PBS grant would turn it into a documentary.
Right now we have the "illuminati" type of documentaries around on the Federal reserve which destroys any valid credibility they have in criticism.
Well, damn good job and I can see from the web stats a host of other financial sites are picking up on your work, so it's being read (which to me is the most important thing, nothing worse than busting your butt to not get any readers!)
Also, if you have any "must read" books I can add them to that page and we could also put together a "book review" of blog posts that are reviews section.
Hello, long time no see! I'll have check those numbers, on face, that seem not possible (and yes I know derivatives, the shadow banking system is the real problem).
You might consider joining up, creating an account for I know you are on a lot of the EP topics being written on/discussed.
I got the idea for this article from the book I'm reading, Secrets of the Temple (I'm almost done with it).
It's a history of the Federal Reserve from late 1979 to about 1985. It was moderately interesting until I came to the part about Penn Square and Continental Illinois.
Then suddenly I was "Deja Vu! I've seen this movie before."
After that it was pretty easy finding the FDIC reports on these banks and drawing some common sense conclusions.
It's amazing how a little historical knowledge can put things into perspective.
Steve Pizzo's article Follow The Numbers shows us that derivatives numbers are overwhelming the world's banking system
"Here's the breakdown, according to the International Bank of Settlements, which acts as banker for the world's central banks:
1) Listed credit derivatives stood at USD 548 trillion;
2. The Over-The-Counter (OTC) derivatives stood in notional or face value at USD 596 trillion"
http://www.opednews.com/articles/Follow-The-Numbers-by-Stephen-Pizzo-090...
World derivatives, therefore total $1.14 Quadrillion USD. In a prior article, Pizzo shows us that US banks have too much exposure to derivative 'gambling debt' speculation, showing that total commercial banks and trust companies with derivatives had total assets of $10.5 trillion vs. total derivatives at $175.8 trillion
see page 22 of 33 at
http://www.occ.treas.gov/ftp/release/2008-152a.pdf
The jig is up folks.
At the April 2nd G20 meeting world leaders should write off this toxic speculative derivative 'debt'.
Put in further perspective, the entire world's GDP, according to the CIA's world book, is $71 trillion USD annually. Compare that with that $1.14 quadillion and you now understand that a huge transfer of wealth is taking place, crowding out legitimate recovery efforts.
located next to the arrow.
This piece is a must read
I agree that TBTF needs to be an immediate criteria to break up a bank.
I know one thing, structured financial "products" need to be approved before every being allowed on the market. Take
CDOs for example. In the mathematics itself, the base model are some very obvious assumption flaws. It's so bad I am now wondering about the entire financial mathematical field and what they are even reviewing in Academic research.
Then, to me it's obvious to throw off any system which allowed unlimited CDSes on one underlying contract. So far in my own reading this implies if I see a potential asset I believe is going "down" regardless of the fact I own none of that assets, I can buy a CDS and collect when that asset defaults.
Another reason I think to stop TBTF is it seems once these institutions are big enough, they can buy off any politician and as you note, even get their own guys onto the Federal Reserve...
which is another can of worms, beyond only one appointment by the President, it seems the Federal Reserve just doesn't have that much accountability or is interwoven into the power sharing government structure.
While Discover, Citigroup, JP Morgan Chase literally are raising interest rates on credit cards to 30%, even with good credit, no late payment....
i.e. still just going along with their loan sharking ways...
the credit unions are the ones offering quality consumer loans and banking...
and....odds are they are not offshore outsourcing your data as much.
I had one account, which I closed and even though I closed it....they friggin' sent my account data to India.
Thanks for the intel.
... it seems as if consumer credit unions sell some of their mortgages, car loans, etc. to a corporate credit union to increase their lending capacity, like banks selling mortgages to Fannie Mae (and the corporate credit union may have raised some of that money by setting up a Collateralized Debt Obligations). Corporate credit unions might also be lending to consumer credit unions who have a use for funds.
Bad economic conditions will make some of the assets held by the corporate credit union to go bust. And if credit unions are forced to cut back on their lending, the corporate credit unions would face dwindling interest income from lending to consumer credit unions just when the returns on their asset base would be dropping because of loans going sour.
they are talking about turning the Fed into a glorified FDIC or give it the authority to seize nonbank institutions, like AIG to deal with systemic risk.
The ability to seize nonbank institutions who post systemic risk sounds like a good idea but to give the Fed that much power considering the above, no way.
Great list, scary, shocking, also massive expansion of powers as I see this.
Since then the Federal Reserve has created:
1. Maiden Lane, LLC (I and II) For Bear Stearns bailout.
2. Term Auction Facility (TAF)
3. Central Bank Liquidity Swaps (CBLS)
4. Primary Dealer Credit Facility (PDCF)
5. Term Securities Lending Facility (TSLF)
6. Term Securities Lending Options Program (TOP)
7. Asset-Backed Commercial Paper MMF Liquidity Facility (AMLF)
8. Commercial Paper Funding Facility (CPFF)
9. Money Market Investor Funding Facility (MMIFF)
10. Term Asset-Backed Securities Loan Facility (TALF)
11. Outright ownership stake in AIG
12. Numerous other "loans" to JPM, Citi and BofA after the Lehman Bros. collapse
13. Outright monetization of Fannie/Freddie MBS and debt
14. Outright monetization of U.S. Treasuries
15. Expansion of TALF to support the soon-to-be-announced Treasury/FDIC/Fed program to offload dead, toxic "assets" from banks.
Total amount flung or committed to be flung by the Federal Reserve:
Approximately ELEVEN TRILLION!
And this doesn't include the money the Treasury has committed to this insanity.
The end of times are near. Don't laugh it is apparently clear people are very sex and money crazy and care nothing about using other Americans tax dollars for their perverted and greedy ways. The bonus clowns in CT are being protested and have ask for State protection from pissed off tax payers. Print their sorry ass names and go after them. Every last one. But wait it was our sorry ass leaders who have allowed this. May they all rot in Hell. As a country we need to demand the money back and ask for jail time for our elected officials and the idiots who took the money as a bonus. Lack of intelligence will be the Corporate Wall St. end. They will die broke and hell will await them all.
i am not sure why they opt to not mention this major business development.
news?
this is not a tasteless news like Martha's hair style or Monica's new skirt...
Helicopter Ben Bernanke is swamping us with Massive Quantitative Easing....The Undertow is likely to destroy us all!
http://fargoneworld.blogspot.com
it sure is looking like that's the plan to bankrupt the US and deny all social safety nets...
but I think it's more short term profit theft.
These MNCs could care less about any nation...they are not loyal.
Please, please, please read the user guide.
I show you exactly how to XHTML format a block quote as well as format posts generally.
"Funding the draw-down of the social-security system is essentially impossible without significant changes. The Boomers borrowed too much, saved too little. Various small changes - retirement age, adjustments to Medicare part B, etc. - are going to be required to keep it solvent.
"I suspect Team Obama is sensitive to this issue.
"As to management of the other aspects of the real economy-it seems the Obama administration should get better marks than its management of the fake economy (e.g. finance).
"They are right to target the medical system; we have a system in which (whether you like it or not) the emergency room has become a public health system. In which we overdiagnose and overtreat, with little concrete proof of effectiveness. In which other countries pay far less than the US for the same drugs (which were developed in the US). In which GPs are underpaid and overstretched. In which the costs of pursuing payment, managing the system to prevent non-payment, and negotiating payment levels have created real burdens on everyone - even though we have proven incapable of denying treatment in many cases for those that cannot pay. And, finally, in which the private insurance system is incapable of making rational decisions between million-dollar end of life care and providing less expensive prenatal care - simply because hospitals are compelled to chase profits.
"The argument for letting the profit motive drive the entire health care system was that it would give us a better (and more disciplined) system, yet there is no evidence to that end, and mounting evidence that the opposite is true. While we do see some excellent private sector innovations (health clinics in drugstores and Walmart), the health care system is _inherently_ plagued by incredible market distortions:
- Asymetric information
- non-rational behavior
- individuals who are non-functional (dying, senile) making complex “decisions”
- bargaining inequities/oligopolies (insurance companies pay much less for identical services than individuals)
- both adverse selection and moral hazard in insurance contracting
- previous non-market attempts to ‘fix’ the system that were patched over 70 years, now creating huge competitive disadvantages for US firms
"Team Obama has also targeted energy, environment, infrastructure, and education as primary areas for additional investment. And they are right across the board. To place your faith _entirely_ in the profit motive and sanctity of contracts to mobilize the US economy to fix drastic problems within a decade is entirely unrealistic.
"The baseless and unchallenged faith in the profit motive to _always_ work has allowed grossly anti-productive behavior to continue unchallenged.
"Consider one example of how the profit motive increases economic “growth”:
"Company X is a mining company. In order to keep costs down, the Federal govt. relaxes effluent and emissions controls (turns out the agency in charge has some bribery and sex scandals, but heh, who doesn’t these days?). Company X generated $100 million in revenues and $20 million in profits over 10 years, until the mine is played out. The wages and profits are then recycled into the economy, and it looks like we have a lot of growth.
"Unfortunately, after the mine distributes its winnings, it closes down and declares bankruptcy - leaving large unpaid environmental debts. As with the financial sector, it’s virtually impossible to recover profits that were already distributed over 10 years prior to declaring bankruptcy, even if you can win the lawsuit (a costly and time consuming process). And even then, the total profits generated would not come close to covering the cost of cleanup…
"Destroyed waterways, arsenic and slag-tainted soil and underground water supplies, and a littany of health problems among employees (and even non-employees in the vicinity).
"The “economy” then “grows” because the govt. has to pay for health/end-of-life care for disabled workers. It also has to pay for cleanup. And for this, it levies taxes.
"In this sense, official GDP number grew twice - once from the damage-causing activity, and again from repairing the vast amount of damage. But are people better off?
"One of my great feats regarding the financial crisis is that Team Obama’s incompetence at handling it would cause collateral damage to its other initiatives, which are much more sensible."
--Stats Guy
and block quote the relevant reason you are pointing to another article.
Just posting a raw link tells us little, makes the site look "ugly", is terrible for search engines.
See the user guide on how to use block quote to copy in a relevant quote and also on how to format links.
the user guide is in the upper right hand column.
Thank you.
http://seekingalpha.com/article/127011-quantitative-easing-and-the-disap...
and it appears my assessment is dead on. I'm seeing Paul Krugman also write despair in the financial system and pointing out very similar problems that I saw.
Sure is a depressing mess we are in. I have little hope that Obama intends to fix anything but the bankers.
They're asking for another four years -- in a just world, they'd get 10 to 20 ~~ Dennis Kucinich
$57 billion ain't chump change either.
I thought the credit unions stayed away from all of the Ponzi scheme stuff so anyone have any details as to why these are failing?
Simply people are broke, lost their jobs, can't make the mortgage and pay their bills? Or did they get sucked into some derivative structured finance "product" to "protect" their assets somewhere?
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