[deMolay]

For those who still believe all is well. http://www.reuters.com/article/ousiv/id ... 6Z20090310

[patience]

How much of that lost wealth was vaporware? I'd guess that a lot of it was paper profits wiped out, with a lot of REAL wealth stolen from the populace via creative actions to replace the paper losses. If I'm correct, then it was no problem until the thieving took place, AKA, bailouts.

[pedalling_faster]

"Between 40 and 45 percent of the world's wealth has been destroyed in little less than a year and a half," Schwarzman told an audience at the Japan Society. "This is absolutely unprecedented in our lifetime."

has wealth been destroyed or are we just doing a little re-calibration work ?

much of the wealth that seemed to disappear was paper wealth.

did it ever exist at all ?

seems related to what Karl Denninger calls "the bezzle". not the urbandictionary
version of the bezzle
http://www.urbandictionary.com/define.php?term=bezzle

The Bezzle Version 2009
http://market-ticker.denninger.net/authors/2-Karl-Denninger/P3.html

[crude_intentions]

45% Of World's "IMAGINARY" Wealth Wiped Out In Past 1.5 Years,

I fixed your headline for you

[PrestonSturges]

Someone needs to compare the banks to Enron. Enron traded energy as if they were stocks and they made a lot of "money" until it all turned out to be a scam. The banks seem to have traded securities (using the same models????) and they made a lot of virtual "money" until it all turned out to be a scam.

[joewp]

The whole debt-based fiat money system is a scam, and therefore anything based on it is a scam too, especially if you add in the impossibility of requiring exponential growth to make it work.

[jupiters_release]

The 45% 'loss' was simply a correction of an intentional overvaluation of assets by the same percent over the past decade. This 'mini-bubble'(if we can call it that had a value of perhaps $45 trillion or thereabouts) was necessary to create the entirely fraudulent mega-bubble of $700 trillion derivatives market. The mini-bubble, as bad as it was/is, most likely on its own cannot destroy the global economy indefinitely, even though the media does a good job of indiscriminately lumping both bubbles into a monolithic Black HoleTM. The mega-bubble is valued at around 15 years worth of total global GDP. This means, that unless the derivatives market is nullified, the global economy is fucked on a practical level pretty much forever.

What percent of all the bailouts so far has been wasted on this mega-bubble? How long will derivatives be executed and serviced by public debts? Clearly there's an endgame here somewhere, of course peak oil is part and parcel to the policies that created this most brilliant transfer of wealth in all of history. No one gives props to the major derivatives beneficiaries(besides the nebulous Black HoleTM). The argument is perfect too: By definition it's impossible to have transparency in a Black HoleTM. What better decoy than a worthless $50 billion pull by Madoff. The circus is well orchestrated for sure.

[blukatzen]

The real problem is the powers that be NOW will use this as an excuse to never really fix the things that are a country's REAL wealth..it's infrastructure. They will be so busy chasing their tail on what is "exactly owed" plus excruciating interest, with the meter ticking on that, we'll never really get to invest it in anything really meaningful.

Meanwhile the roads are rotting and folks are doing the pothole dance, bridges are falling apart, older buildings are not getting fixed, malls emptied or are emptying now, no plans for many places to re-engineer their city or city services towards new urbanism approaches.

There will never be any rebuilding of any hurricane cities beyond cleaning up the dead, tributes to NYC dead will never get built.

There may be a few pork projects here and there, but never really anything to take home to the bank, to encourage any rebuilding of what has been lost, and will never be again. Cycles of change are here upon us. The people who live might be those people who know how to accept these ideas, and endure in spite of this. The ones left behind will be stuck in the "what if's" or worse, "should have, would have, could have".

Blu

[jupiters_release]

The real problem is the powers that be NOW will use this as an excuse to never really fix the things that are a country's REAL wealth..it's infrastructure. They will be so busy chasing their tail on what is "exactly owed" plus excruciating interest, with the meter ticking on that, we'll never really get to invest it in anything really meaningful.

Blu

Investment in infrastructure won't happen if it's not profitable, and there's nothing profitable about infrastructure when cheap energy disappears for good. No reason or excuse to waste time on something that can't be exploited anymore. Society, as a whole, has now become a liability to the policy makers because of peak oil. If I were in their shoes, I'd pump the derivatives game all the way down to the Olduvai Gorge too.