[ReverseEngineer]

New pyramid scheme. Balancing on its point this time.

$700 Billion in September, + $800 Billion November, how much in January, March, May, etc etc etc.

When will this madness end.

No, I'm not laughing. Our situation / government in the UK is just as bad.

Its beyond telephone numbers now. We have mortgaged our children, grand children, and great grandchildren to a life of high taxes just to pay debt on money that has never really existed.

This won't be paid for with taxes. It will be paid for in blood.

Reverse Engineer

[MrBean]

New pyramid scheme. Balancing on its point this time.

$700 Billion in September, + $800 Billion November, how much in January, March, May, etc etc etc.

When will this madness end.

No, I'm not laughing. Our situation / government in the UK is just as bad.

Its beyond telephone numbers now. We have mortgaged our children, grand children, and great grandchildren to a life of high taxes just to pay debt on money that has never really existed.

This won't be paid for with taxes. It will be paid for in blood.

Reverse Engineer

That's what the world is afraid. That US will nuke the world if world stops accepting funnymunny dollars for the stuff the US [s]imports[/s] robs.

[idiom]

Well as market ticker recently pointed out, deficit spending won't get the U.S. out of this hole.

That is one of the two most widely held solutions for fixing recessions. The other is war.

Unless Obama goes radical right/left wing economist on us, War will be the next cure all after the spending doesn't help.

[gwen2]

Ok, I am showing my ignorance here, but I have a question. Why did congress go through all that commotion to pass this bailout for $700 billion....it almost doesn't pass...everyone panics....etc. when it seems like the government gives out even more money without passing any bills. Why does this new $800 billion or any other money not have to be approved by congress like the bailout? Was that all for show?
Gwen

[Daniel_Plainview]

It seems war is inevitable; I'm just surprised that war didn't happen under Cheney, the US's homegrown warmachine extraordinaire.

[AlexdeLarge]

Its the last bubble. It going to pop and it will get ugly. For awhile I thought they might get a handle on this mess. But there is no way this can end without depression and a new currency being issued.

The question is when will the bubble pop. Next month? Next Summer?? 2010???

[Byron100]

Ok, I am showing my ignorance here, but I have a question. Why did congress go through all that commotion to pass this bailout for $700 billion....it almost doesn't pass...everyone panics....etc. when it seems like the government gives out even more money without passing any bills. Why does this new $800 billion or any other money not have to be approved by congress like the bailout? Was that all for show?
Gwen

Exactly!!! I wonder the same exact thing myself.

And why doesn't the media say anything about this???

Hmmm.....

[Zardoz]

That's what the world is afraid. That US will nuke the world if world stops accepting funnymunny dollars for the stuff the US [s]imports[/s] robs.

What is it about so many people on this forum? Why is there a persistent belief that a logical progression from economic collapse is a General Nuclear Release?

Please explain the motivation of those who might start the nuclear exchange. What would they think there might be to be gained by turning the planet into a radioactive wasteland? Who exactly would stand to profit by being contaminated with a rain of radioactive fallout? Whose holdings would increase in value if they glowed in the dark?

What is this crap? Why do so many forum posters truly think that those who have access to the launch buttons would see the end of human existence as we know it as a viable solution to a credit problem?

[Duende]

$700,000,000,000, $800,000,000,000... what difference does it make anymore?

I'm actually coming to terms with this situation. I don't know if I'm using sound reasoning, and if anyone would like to tell me where I went wrong and remind me about how screwed we are.

Basically, I've come to believe that the money being given to the banks is meant to replace money that never really existed to begin with. It just disappeared, like a goddamn ghost in the night. So its a zero sum game. The banks are made whole. There are two conclusions I come to:

1. There will be no runaway inflation yet because the previous money just disappeared. For there to be inflation, money supply has to be increased. This conclusion leads to me favor a deflationist view.

2. Debt servicing will have to increase. This is the real problem. It's only when they turn on the printers to service this debt that we are in trouble.

The only question left is: "When does the bill come due?" Or, in the US's case, it's only worth considering when the repo man comes. Because when he does, the US will be ready with the shotgun equivalent of a nuclear arsenal saying "Do you feel lucky punk? Do ya?"

[Duende]

Zardoz wrote:

What is this crap? Why do so many forum posters truly think that those who have access to the launch buttons would see the end of human existence as we know it as a viable solution to a credit problem?

Believe me, I am horrified at the thought of it. But when I think about how crazy people can be... jeezus, just look at the system of destruction humanity has placed it's faith upon. Civilization itself has lead us to disrespect the planet, and ultimately ourselves. It's not a bright picture we're going toward.

Just check out a column today on Marketwatch. It's very dark, but possible. Read the whole thing. [url=http://www.marketwatch.com/news/story/Worried-about-a-depression-How/story.aspx?guid={FE3C1E3B-3D53-49C0-9DF3-FD94B0E4B9B3}&dist=SecMostRead]HERE[/url]

[Sixstrings]

Gasmon:

No, I'm not laughing. Our situation / government in the UK is just as bad.

From what I've read, what we're seeing is the failure of the "anglo" banking model vs. the more conservative "scandinavian" model. I don't quite understand it all, but that's what I read anyway.

The article I read seemed to be really pointing all the fingers at the Englsih speaking world in general, which obviously includes the UK.

[Sixstrings]

Duende wrote:

1. There will be no runaway inflation yet because the previous money just disappeared. For there to be inflation, money supply has to be increased. This conclusion leads to me favor a deflationist view.

That's what I've been reading as well, that all this money being pumped into the system actually pails in comparison to the money out, so overall it's deflation.

I also read that at the first sign of economic recovery the banks will all move to lend money at once and this will cause fractional banking to explode into hyperinflation, like a dam bursting.

[idiom]

That's what the world is afraid. That US will nuke the world if world stops accepting funnymunny dollars for the stuff the US [s]imports[/s] robs.

What is it about so many people on this forum? Why is there a persistent belief that a logical progression from economic collapse is a General Nuclear Release?

It is the U.S. collapsing. Precedence says the least logical course is the most probable.

[MrBean]

That's what the world is afraid. That US will nuke the world if world stops accepting funnymunny dollars for the stuff the US [s]imports[/s] robs.

What is it about so many people on this forum? Why is there a persistent belief that a logical progression from economic collapse is a General Nuclear Release?

Please explain the motivation of those who might start the nuclear exchange. What would they think there might be to be gained by turning the planet into a radioactive wasteland? Who exactly would stand to profit by being contaminated with a rain of radioactive fallout? Whose holdings would increase in value if they glowed in the dark?

What is this crap? Why do so many forum posters truly think that those who have access to the launch buttons would see the end of human existence as we know it as a viable solution to a credit problem?

That's just how American culture is seen - true or not. Insane. Eager to kill the world just out of spite because the Holy American Way of Life cannot continue. Just like a school massacre, but on different scale.

[Fredrik]

That's just how American culture is seen - true or not. Insane. Eager to kill the world just out of spite because the Holy American Way of Life cannot continue. Just like a school massacre, but on different scale.

When the death of the American way of life is imminent, I'd bet those in power would rather secure their personal survival (like moving to a well-defended, self-sustaining community someplace far away), rather than commit a global suicide. Individual survival instinct would probably win over frustration and anger, even if those were felt on unforeseen levels.

[Cog]

Lou Dobbs made an interesting observations last night. He said that if the government had simply bought all one million houses under foreclosure for the average house price of $200k, the total outlay to the taxpayers would have been $200 billion.

Now I don't understand credit defaults swaps that well, but wouldn't that have everyone whole on that deal as well, since no one would have suffered loss? It sounds too simple that this would have worked out and saved the taxpayers a boatload of money. I'm not a conspiracist but it seems like Paulson a and Bernake are solving a different problem then the one they are claiming to be a problem.

[MrBean]

That's just how American culture is seen - true or not. Insane. Eager to kill the world just out of spite because the Holy American Way of Life cannot continue. Just like a school massacre, but on different scale.

When the death of the American way of life is imminent, I'd bet those in power would rather secure their personal survival (like moving to a well-defended, self-sustaining community someplace far away), rather than commit a global suicide. Individual survival instinct would probably win over frustration and anger, even if those were felt on unforeseen levels.

[ReverseEngineer]

Lou Dobbs made an interesting observations last night. He said that if the government had simply bought all one million houses under foreclosure for the average house price of $200k, the total outlay to the taxpayers would have been $200 billion.

The problem would be that the "toxic assets" AKA non perfoming loans are not restricted to just houses in foreclosure. Its also all the malls going under, its also all the loans to businesses going bankrupt. The reason the number is so big, and bound to get a whole lot bigger is that the economy as a whole has failed and the Goobermint is trying to buy up ALL the debt, to take it off the books of the banks. Lou did not take that into consideration.

Reverse Engineer

[perdition79]

Lou Dobbs made an interesting observations last night. He said that if the government had simply bought all one million houses under foreclosure for the average house price of $200k, the total outlay to the taxpayers would have been $200 billion.

Now I don't understand credit defaults swaps that well, but wouldn't that have everyone whole on that deal as well, since no one would have suffered loss? It sounds too simple that this would have worked out and saved the taxpayers a boatload of money. I'm not a conspiracist but it seems like Paulson a and Bernake are solving a different problem then the one they are claiming to be a problem.

Dobbs is a populist, saying only what lay people want to hear. As much as the idea of spending money to buy debts seems to make sense, buying $200 billion in real estate would be a deflationary action. All the checkbook money created from that debt, along with the checkbook money that debt is based upon, would cease to exist. Debt is designed to be serviced, not repaid. If home loans are repaid, the money that was created by securitizing the loans is taken out of circulation. Repay enough debts and money eventually disappears.