Tribe.net. Local Connections B http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#653ec265-3835-4960-b4a1-7c65af10f8ab 2009-07-05T00:27:22Z 2009-07-05T00:27:22Z

That may be a little too soon. You have to factor in psychology. The summer moths means low volume in the Stock Market. We can see that this already means the the true small buyer sentiment is showing and that is down. However small volume also means the Plunge protection Team (i.e. the Presidents Working Group on Financial Markets) can diddle the system to their hearts content. The public being greatly just plain willfully ignorant do not notice anything until Wall Street collapses. So until the major players get back and the volume is large enough to swamp out the PPT things will limp along. At some point in time someone will notice that the richa dn hedgte funds have moved all their money offshore and then the SWHTF. The DOW will start to plunge to the long term mean (not these adjusted means) which is 3600 with an overshoot to 3000. This plunge can happen in two months (there are a lot of triggers and circuit breakers in the DOW right now to slow such a plunge down). So get ready for another wild October (there is a good reason big drops hapen in October) and November and December should see a lot of suicides.

B 2009-07-05T00:27:22Z Mark herpel http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#6041551a-4dd0-497e-8358-6c7e770e2a32 2009-07-04T23:11:49Z 2009-07-04T23:11:49Z

I'm no expert nor claim to be but.... I enjoyed your post and discussion. Here are several key factors I believe bring a collapse/banking holiday much closer as in late August early September. (1) Many Many people who have been getting unemployment for over a year now will be losing those checks in early August. In other words you are unemployed living on the gov checks and next month they will be gone also. From Aug on, there will be a lot of unhappy people with no money. (2) California is in such bad shape they will lose their credit rating soon and all those pension, mutual and bank funds which own CA Bonds will be forced to sell them as their rating will fall below what is required by the fund. This is a MONSTER collapse for CA and may well bring on the commercial real estate collapse also. Here is one of the most important guys I've read so far calling the next 120-150 days (basically through Sept) Dr. David Bronner, CEO of the Alabama Retirement Systems, the 43rd largest investment fund in America, spoke at Rotary Club here yesterday. He is one of the most respected fund controllers in the United States today by his peers. 1) Next month (July) California hits the wall financially, that will send a ripple effect across the US economy, AND over the next two years one state after the other will fall to it's knees financially as the federal government stimulus package ends by 2011. It has helped various states at different levels comparative to their economic condition. He says the stimulus package is what's been keeping the states alive for now...except for California which was in such terrible shape the stimulus package wasn't enough to really help them. "They go first" he said. Alabama would hit the wall in February of 2011, late in the game as Alabama is in better shape than other states. Bronner says Alabama might dodge the bullet if the economy revives enough by then. But, he doesn't really think things will improve enough by then to avoid a crisis."It will be the largest economic crisis in the history of the State of Alabama." Bronner says Alabama will experience such significant shortfalls by 2011 that taxes will have to be raised substantially to avoid collapse...probably on property. And that practically all states will face a similar fate. 2) Within 120 to 150 days from now the commercial real estate market nationally begins to collapse as stores, malls, and shopping strips, and industrial plant have enough closures (store and plant) and loss of rental revenue to make them unable to pay their mortgages. They will start going into foreclosure unable to pay their mortgages in a significant way at that time creating a second wave of economic disaster starting three to four months from now.

Mark herpel 2009-07-04T23:11:49Z Talon http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#a4c75ea2-b126-47ac-97b4-b34e8fe1612b 2008-09-01T19:57:21Z 2008-09-01T19:57:21Z

Great observations. Personally I've cut up all my credit cards in 1999, I just couldn't see why I was lending myself my own money and paying someone else a fee. Also, I put in and got an ATF permit to make my own ethenol. I am also learning to be a great gardener. I've installed solar panels and three small electric windmills. I, like many others, are going to survive the stupidity by being outside of it.

Talon 2008-09-01T19:57:21Z Lord of the Zodiac http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#9798b5d4-2e60-4c2b-a46f-63222ade013b 2008-05-29T09:53:48Z 2008-05-29T09:53:48Z

Avoid moving in NZC area with Moon in Orion (the WTC position). Next subprime crisis mid July. Advice: move with Moon in Auriga, settle with Moon in Sextans. http://lulu.com/astrology

Lord of the Zodiac 2008-05-29T09:53:48Z Paul http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#9e412b54-246e-4b08-bc47-a27a2f5cf9da 2007-11-23T16:06:27Z 2007-11-23T16:06:27Z

The Yen and gold and silver are barely off their highs. I don't see any good entry points coming up. But some BIG money has been proping up the US dollar against the Canadian dollar. The US dollar fell to .90 Canadian, but has since bounced back up to .98-- almost parity. There should be a good entry point on the USD/CAD pair soon. PS: If anyone wants to try their hand trading currencies, here's a good charting package. https://fx2.oanda.com/mod_perl/register/register.pl It's FREE and you get 5k in play money to trade with. If you are going to try this, send me a message so I can send you some "getting started" links. Note: this is a Java based application and does not require you to install any software.

Paul 2007-11-23T16:06:27Z Daniel http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#4e258218-fb38-425f-951b-9dbd607c875b 2007-11-22T20:14:15Z 2007-11-22T20:14:15Z

As with any predictor or prediction system, one must ascertain what the success rate from historical predictions is. What seems most important is not that the US dollar crash will happen at a specific time, since the US dollar crash is already happening. One must move their investments now to protect them, and not do this at some future time. I am invested in FXY (yen), GLD (gold), and UDN (bearish US dollar). I am looking for an entry point in FXE (euro), FXF (Swiss franc) and IAU (silver). A better situation would be to convert to yen/euros/francs/yuan in an offshore account and then purchase the same exchange-traded funds mentioned above. That would be much safer, IMO.

Daniel 2007-11-22T20:14:15Z solar http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#30f06f76-e4d1-4d02-8ee3-1c7f0571a0e5 2007-11-22T20:05:20Z 2007-11-22T20:05:20Z

Sounds ok to me----the Federa Reserve needs to collapse and the banks that engage in excessive usuary need to crumble too. We will then have an excellent oppurtunity to start a new......don't forget to plant a garden,put on your walking shoes and enjoy fasting.

solar 2007-11-22T20:05:20Z Paul http://alt-money.tribe.net/thread/b9430078-1000-4bfa-9e4b-8a405655cfaa#de97eec8-a3ef-4728-b0e5-2c76add3ead0 2007-11-22T18:34:41Z 2007-11-22T18:34:41Z

Message from John L. Petersen on the Coming Crash http://www.stevequayle.com/News.alert/07_Money/071120.John.Petersen.html November 19, 2007 It appears that the world in general and the United States in particular are on the edge of a major disruption in the global financial system. Here’s the summary as we see it. At a recent Board meeting of The Arlington Institute, Dr. David Martin, CEO of M*CAM and one of the members of the Board was asked for his assessment of the global financial situation in the coming months. Here are my notes from his response: I stand by my commentary in July of ’06. The next shoe to fall is consumer credit Currently as reports came in on the 3rd quarter, foreclosures were up 470% this quarter alone. They will be up over 500% this coming quarter (4th). A foreclosure in our terms is when the bank has officially declared an account insolvent and tries to regain the asset (if it exists). The person who is foreclosed upon can no longer secure any traditional consumer credit. This in turn goes straight to the banks as no one will be able to get the store issued charge cards. A minority of people pay off their consumer debt every month. When one considers the combination of consumer credit card debt and the compounded debt of “home equity” financing, we estimate that less than 20% of people actually carry no consumer credit from one month to the next. Many of the ones who don’t pay off their carried consumer debt have at least one credit card at its limit and therefore lack credit capacity. Most have their paycheck directly covering bills and servicing the minimum balance due. Therefore people who are foreclosed upon will not be able to obtain credit and since their paychecks will be maxed out, there will not be extra cash left over from the paycheck to service a new debt. Next, everybody buys things at Christmas. As much as 40% of retail sales are done in the 4th quarter of the year – i.e. the retail miracle. The purchase decline in retail goods this fourth quarter will occur because many credit-only consumers will lack the credit capacity mentioned above. Frequently, people overcharge their limit and the banks (albeit a profit center for subprime credit users) levy a penalty by increasing interest rates and charging additional fees. In the 4th quarter of 2007, the amount of people overcharging their limits will be too many for the banks to handle. We do not have a system in place to deal with overcharge on that scale. A substantial number of this December’s purchases will go into an overdraft on credit limits. CDO – Collateral Debt Obligation – Consumer Credit Consumer credit pooled debt investment instruments (a form of CDO) are originated and rated based on underlying historical credit behavior and a complex series of predictive models for repayment dynamics. CDOs have “strips” which are a combination of similar profile tranches within a larger investment product. Based on the market’s appetite for risk, investment performance guarantees (or credit enhancements) are packaged with the credits. These credit guarantees are issued by insurance companies, reinsurance companies, and other specialty finance companies – many operating with extra-territorial jurisdiction rendering fiscal oversight more complicated. These strips come in several categories: * Investment grade * Almost investment grade * Junk and * Why did we give them a credit card? All of these grades are priced on historical default rates. The credit insurance companies (AIG, MBIA, Ambac, Financial Security Assurance, Channel Re, XL, Zurich Re and other reinsurers) have, from time to time, issued credit guarantees to the securities. Banks sell debt in the form of a Collateralized Debt Obligation (CDO). Minor shifts in default actuarial activity (+/- 25 basis points) from normative behavior is absorbed within pricing of these financial guaranty contracts. However fundamental shifts (hundreds or thousands of basis points in one quarter) are not built into the model and result in credit enhancement insolvency on a major scale. When the insurer cannot pay based on its own liquidity impairment, the bank is left with catastrophic (an insurance term for excessive loss outside of expected) exposure. If in a single quarter we have an increased foreclosure rate of 400% (or 4000 basis points) the insurance contracts simply cannot handle that kind of drastic shift as evidenced by the write offs in the third quarter. When we will follow the drastic third quarter with a loss of 500% in the fourth quarter, the trajectory becomes clear. Neither the banking nor the insurance industry has a historical experience in dealing with this type of challenge and neither has the liquidity linked to these contracts to support system wide collapse. Where was the announcement of this? There was no announcement. However Hank Greenberg is resurfacing in AIG leadership even during an SEC investigation because without him, no one else can remember where the counterparty risks are. In order to save the insurance industry, shareholders have looked past alleged SEC violations as there is no one with Mr. Greenberg’s awareness of the market and counterparty agreements who can hope to navigate the coming challenges. In the 4th quarter, the US will have another record foreclosure announcement. Once you’re over 25% (25 basis point) foreclosure, all models are broken. Under a consumer credit melt-down, Capital One and/or Wachovia are likely going to put a massive foreclosure liability to an insurance company and the insurance company will not have liquidity to cover the exposure. This is the problem we got into when we issued credit card debt on top of secondary mortgages – (inflated the value of the home) and gave out credit based on faux equity that no one really had. The reason why this problem is the second shoe to fall (subprime mortgage collapse was the first shoe) is because consumer credit has a different foreclosure frequency than traditional mortgage credit. December is when the maturity of the giant buyout of the economy moves. By December, you’ll have a second round of charge offs based on consumer credit. The real big problem – when you foreclose on consumer credit, people stop buying things. When people stop buying things, we don’t have a tertiary way to pump liquidity into the market. People won’t have extra cash from their paychecks and won’t have capacity on their cards. Try this case study: Go to the mall and stand in front of counter at Victoria Secret. Watch what happens when someone wants to pay with cash. The clerk won’t know how to ring up cash. They will need a manager to come over to give change and unlock drawers. When you don’t have capacity on those cards, you don’t buy things. VISA credit cards actually denigrate using cash in their run-up-to-Christmas add campaign. Next, go to any savings bank data set. If you were going to spend $1000 in cash this Christmas, can you do it? For the most part, the answer would be “no” because we have had a net negative spending for the last 5 years. Therefore there will be depressed consumer spending this Christmas but what is spent, people will overcharge. This will take what used to be good investments in CDOs and will change the dynamic. If you used to be a person who paid their bills on time, you will now only pay half. If the credit companies are counting on the top two tranches to pay their card off in full and they don’t, they won’t have liquidity to cover the rest. The banks cannot afford the top tranch paying half. The estimates are out. There will be at least $400B in the first round of charge offs in the CDO market. We’re not going to be done with the subprime mortgage when the CDOs fall. Therefore we will have an insolvency problem with the banks that are mentioned above. This is the kiss of death of a privately held Federal Reserve. For the Federal Reserve to function, its stakeholder banks (like JP Morgan Chase) must remain viable and liquid. When one of them, or any major bank in the U.S. (like Bank of America, Citibank, Wells Fargo, Bank of New York, Washington Mutual, etc.) is impaired or ceases to exist, the architecture of the Fed’s capacity to respond to systemic challenges is unsustainable. If the banks have no money, they can’t pump liquidity into the market. Taking half of a trillion dollars out of market in a single distressed write down becomes problematic. The US banking system does not have the liquidity to take the hit. The actual solvency of the Federal Deposit Insurance Corporation is relatively indecipherable due to the fact that their treasury management processes (and the risks of their own investment strategies) are not uniformly disclosed with sufficient transparency. The FDIC was set up for isolated problems with a few bad banks but is NOT prepared to “insure” the system in an industry-wide crisis. The actual liquidity reserve of the “insurance” that Americans view as their safety net is 1/100th the actual exposure of outstanding deposits. The actual coverage ratio for the Bank Insurance Fund (BIF) fell below 1.25% in 2002, the same year that less stable credit practices were adopted by America’s leading banks. The funny part is that the Federal Government will be on holiday when all of this happens. There will be no one to put freeze actions and moratoria on actions. The only way you stop the cataclysm is to put together civil actions on deposit withdrawals. As I discussed previously, the Chinese currency wild-card may become relevant far sooner than expected. An effort by China to convert its $1.4 trillion U.S. Treasury holdings into euros is not viable for many reasons – not the least of which is the European Central Bank’s inability to absorb such an event. As China continues its rush away from supporting U.S. Treasuries and as Middle Eastern investors are buying them up in more diversified holdings, a new “currency exchange” is unfolding. Realizing that they cannot liquidate their holdings, it appears that the Chinese are currently using their U.S. Treasury holdings as collateral for euro denominated purchases and long term infrastructure transactions. In other words, they may be “liquidating” their holdings as collateral and, in so doing, effectively migrating to non-dollar value without ever having to officially dump their current Treasury holdings. Therefore, collateralize the credit in dollars – especially if you’re long in dollars. The lender/financier won’t call the note because you have it structured in such a way to both allow it to perform and hold illiquid collateral that no one wants. This essentially inflates euros. Although you can’t sell dollars, the whole purpose of collateral is that it is a second source of payment – collateral is there to down rate the risk of the loan. Secondary becomes irrelevant. When February comes, the Chinese are going to do something as they will have to decide what the exposure is going to be with the treasury. As I see it they have to just dump the treasury. They only keep it because they can use it – they have 43% direct/indirect of US treasuries so they’ll dump them on the market. The US Congressional pressures to decouple the RMB will work, but not in the way we want. Our plan includes helping them hold on to the treasuries, it does not involve them not holding the dollar anymore. The US wanted the tether to be part of the float. This will cause disenfranchisement of the US electorate (during primary season). February is also when public (media) will realize we won’t pull out of this. Side note: Mayor Bloomberg could enter the race at this point, being the savior candidate (at least economically), but has $1B dollars in non-liquid money so he may not be able to enter. March is when we realize that the dollar doesn’t come back. OPEC price with the whole fluctuation of oil futures presages the event. They are going to run the price of oil as high as they can get it on the dollar, while buying US treasuries from China with the money. When the dollar does collapse, they’ll flip denominations. The wild card is long about March when the OPEC cuts spot oil off the dollar to the euro. One can look at the current oil price at close to $100/barrel and fail to see that, as this premium price is currently turning around and investing in a weakening dollar, the effective price (less the dollar investment hedge) is probably closer to $50/barrel than the spot price reflects. Currency problems will change the game – they are financially structuring themselves to take the hit. When we can’t afford to buy oil commodities on a spot market – it compounds the problem however the consumer that Saudi Arabia ships to is liquid (China). In the US it is a big problem. There is still a market for oil; it just changes. When you come out of Straits of Hormuz, turn left. __________________

Paul 2007-11-22T18:34:41Z