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thepeel
Joined: 08 Aug 2004
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 Posted: Tue Nov 20, 2007 5:46 am Post subject: |
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Clearly, what he have is somebody who doesn't understand this topic.
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| Mortgage rates have been low in the past but never produced the run up we've seen recently. Why is that? |
It is the excessive expansion of liquidity WORLD WIDE which caused asset bubbles and changed the fundamental risk structure of finance. You do not understand. What happened in "sub-prime" housing is about to happen to commercial estate and then "sub prime" credit cards and then sub prime car loans and then sub prime lines of credit. The bubble, dear huff, extends FAR beyond housing. Look at equity markets around the world. Housing bubbles in Singapore, Spain, Ireland, Australian, Alberta, Hong Kong and China. Off the top of my head. These problems are global in scope but simply more strong in the USA.
When you increase the supply of credit to far you get asset bubbles. Forever and always, amen.
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Doesn't a greater money supply also equal more money in people's pockets? Plenty of ordinary people made money off of the housing boom. |
This is the point where I want to stop discussing this with you, as it demonstrates your level of ignorance. However, I'm sitting in an office compiling research on this very topic and will be until late, so I've got the time.
Expanded credit means more "money" in the pocket of some people but the value of that money adjusted for PPP is what is important. Hell, why not print 300 million dollars and make everybody a millionaire in the USA? By your logic, this would be an increase in wealth.
Unfortunately not. Property prices in the United States will likely fall up to 50% (that is, back to 2001 or 2002 levels) in the next two years. Also, the extra money that was printed was spent by American consumers on electronics and those little green pieces of paper are now under the Chinese mattress. When those dollars are invested or otherwise consumed by the Chinese (6-700 billion of them), at whatever rate they choose, the American PPP will decrease accordingly.
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| But you keep bad mouthing the Fed as though it's an inherent problem. |
No, I think that Greenspan and Bernake are an inherent problem. I think that the deep connections between investment banks, HF's, PE and others to the Fed are very problematic. Goldman's wanted a cut, and got one. The Fed system is ONLY AS GOOD AS THE HUMAN RUNNING IT. Got that?
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| So we're ignoring your "perfect world" scenario? I thought you would at least attempt to explain and defend your "alternate system." But I guess not. |
I'd prefer private asset backed currencies that compete with each other for credibility and legitimacy. In a perfect world.
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| And how are you being "raped" by the Fed's actions. You should be happy. You've got a 1:1 loonie now and you can go back home to Canada. |
For me, who will work in finance/economics, a dollar at parity can be a very good thing. For others, namely the rest of my country, it is a mixed bag. A highly valued currency isn't NECESSARILY a good thing. It depends on the structure of your economy, the time between it being a cheap/expensive currency and many other factors. We live in a globalized world.
I think Dodge has done a fairly good job in Canada. It is hard to balance a country that has one area producing a massive windfall of forex and 9 areas doing next to nothing. Those situations need a different policy and he has done as well as can be expected.
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| I'll try to take better notes next time. Obviously I'm not caring enough (as if not at all isn't already too much) about what you say from one day to the next. |
Human institutions are as good as the humans running them. While I don't think the system of fiat cash the best, I can live with it just fine. Shall I make it my signature?
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| And where has such a system ever been implemented and worked successfully? |
I am not aware if it has. It is a theoretcial argument. I believe medieval Iceland has a similar system for a time.
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| Another good reason not to trust him. |
I'm sure the people who the great huff votes for a perfect and without any flaw. We bow in front of your pretend universe. |
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huffdaddy
Joined: 25 Nov 2005
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| Posted: Tue Nov 20, 2007 6:36 am Post subject: |
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| thepeel wrote: |
| Clearly, what he have is somebody who doesn't understand this topic. |
Hey, that's what you get for sticking around on a forum for English teachers. Maybe you should have made some friends in your Econ department.
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| I'd prefer private asset backed currencies that compete with each other for credibility and legitimacy. In a perfect world. |
I can only begin to imagine the nightmare that'd be.
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| And where has such a system ever been implemented and worked successfully? |
I am not aware if it has. It is a theoretcial argument. |
I'd suggest that maybe you and your theoretical economic cronies find a smaller economy to play around with before trying out your ideas in the major leagues. Work out the kinks and get back to us with the results. Maybe then we'll consider it. |
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thepeel
Joined: 08 Aug 2004
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| Posted: Tue Nov 20, 2007 9:16 am Post subject: |
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Hey, never deviate from the status quo when speaking with a true believer, eh? Ideas are ideas and reality is reality. I'm willing to accept the situation as it is while at the same time pondering something else.
I've noticed that right-wing Americans get upset when you criticize their leaders and left-wing Americans get upset when you criticize their institutions. As The Economist says "Republicans fall in line and Democrats fall in love". Too true.
Feel free to criticize the hell out of Canada. Institutions or leaders. I won't get offended. |
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huffdaddy
Joined: 25 Nov 2005
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| Posted: Tue Nov 20, 2007 2:46 pm Post subject: |
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| thepeel wrote: |
| Hey, never deviate from the status quo when speaking with a true believer, eh? Ideas are ideas and reality is reality. I'm willing to accept the situation as it is while at the same time pondering something else. |
I've pondered your ideas and determined there are untested and unnecessary.
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| I've noticed that right-wing Americans get upset when you criticize their leaders and left-wing Americans get upset when you criticize their institutions. As The Economist says "Republicans fall in line and Democrats fall in love". Too true. |
Who's upset? I just think multiple currencies is a stupid idea.
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| Feel free to criticize the hell out of Canada. Institutions or leaders. I won't get offended. |
I couldn't feign enough interest to get past one post. All the Canadians in this forum can't even sustain a thread about Canada. |
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Kuros
Joined: 27 Apr 2004
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| Posted: Tue Nov 20, 2007 2:56 pm Post subject: |
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| thepeel wrote: |
I've noticed that right-wing Americans get upset when you criticize their leaders and left-wing Americans get upset when you criticize their institutions. As The Economist says "Republicans fall in line and Democrats fall in love". Too true.
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Culture shock, eh?
I once met a wise ex-pat (American) in China who cautioned against going to a country with high expectations. When I began in China, I had no special interest in the country. My expectations were quite low. I was surprised by how much I came to enjoy the country at the end. I realize in hindsight that when I entered Korea, I had similarly low expectations. |
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scottinseoul
Joined: 13 Oct 2006
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| Posted: Wed Nov 21, 2007 3:48 am Post subject: Market meltdown |
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| Thepeel pretty much sums up the predicament. |
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keane
Joined: 09 Jul 2007
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| Posted: Sat Nov 24, 2007 4:36 pm Post subject: |
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Forecast: U.S. dollar could plunge 90 pct
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RHINEBECK, N.Y., Nov. 19 (UPI) -- A financial crisis will likely send the U.S. dollar into a free fall of as much as 90 percent and gold soaring to $2,000 an ounce, a trends researcher said.
"We are going to see economic times the likes of which no living person has seen," Trends Research Institute Director Gerald Celente said, forecasting a "Panic of 2008."
"The bigger they are, the harder they'll fall," he said in an interview with New York's Hudson Valley Business Journal.
Celente -- who forecast the subprime mortgage financial crisis and the dollar's decline a year ago and gold's current rise in May -- told the newspaper the subprime mortgage meltdown was just the first "small, high-risk segment of the market" to collapse.
Derivative dealers, hedge funds, buyout firms and other market players will also unravel, he said.
Massive corporate losses, such as those recently posted by Citigroup Inc. and General Motors Corp., will also be fairly common "for some time to come," he said.
He said he would not "be surprised if giants tumble to their deaths," Celente said.
The Panic of 2008 will lead to a lower U.S. standard of living, he said.
A result will be a drop in holiday spending a year from now, followed by a permanent end of the "retail holiday frenzy" that has driven the U.S. economy since the 1940s, he said. |
Have we seen [worst] of mortgage crisis?
New Wave of Mortgage Failures Could Create a Nightmare Economic Scenario
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