Economist Christina Romer serves up dismal news at her farewell luncheon
Economist Christina Romer serves up dismal news at her farewell luncheon
Christina Romer, chairman of President Obama's Council of Economic Advisers, was giving what was billed as her "valedictory" before she returns to teach at Berkeley, and she used the swan song to establish four points, each more unnerving than the last:
She had no idea how bad the economic collapse would be. She still doesn't understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things.
What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: "Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare."
Anybody want dessert?
If this is who is running our country, we should be really, really scared.
She had no idea how bad the economic collapse would be
The economic collapse will be really bad... possibly ending like the Weimar Republic because the system is designed to fail, utterly. It's only a matter of time before the props are seen for what they are.
The exponential is exponential
She still doesn't understand exactly why it was so bad
This is easy. The US monetary system is a ponzi scheme and the value is being called upon at a time when we need it but they have stolen.
The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things.
Correct and, wow, she's an idiot. Anything short of bringing our monetary in line with our Constitution is inadequate. This means getting rid of the privately owned and operated Federal Reserve and, short of amending the Constitution, returning to the gold standard. I am a fan of amending but it also needs to be a properly designed monetary system where money is value instead of being debt with interest rates. Debt is not money and we currently are treating it like money.
This time it won't be the same.
Hard-nosed Fed sends global markets reeling
Hard-nosed Fed sends global markets reeling
More ominously, some Fed officials fear the central bank is already "pushing on a string" and does not have the means to revive the economy. Whether or not they are right, this comes as a psychological shock for investors schooled by the "Greenspan Put' into thinking that there is a deus ex machina in the wings.
What goes up must go down... especially in a world being depleted of resources faster than ever.
Goldman Sachs said the yen was now overvalued by 20pc, or two "standard deviations" out of kilter
This is the most interesting aspect of this article. This implies that Goldman's algorithms for calculating prices aren't working any more. This has several very important meanings.
- The High Frequency Trading Algorithms used by the banks aren't or can't take into account macro economic trends.
- Their algorithms are much less effective at controlling the market now.
- Most importantly, the markets have broken out of long and old trading patterns.
Add in that their algorithms have known bugs or purposeful defects, as was demonstrated by the Flash Crash, and this is a recipe for disaster. Now, anything could happen.
Here is a good example of the problem:Demonstrating An HFT Algo Gone Apeshit
Well, today we just experienced another mini flash crash, after some algo went apeshit and decided to hit every bid on the way down, all the way to 0.0001 (gotta love that sub penny quoting just above zero). Below we show how this algorithm pushed the stock price of Core Molding from its normal price of $4.12 all the way down to $0.0001 in the span of one second, after an HFT program went ballistic, and would have kept on hitting the subpenny $0.0001 bid in perpetuity. It must have been swell to be a CMT holder: one second your stock is worth $4.12, the next, it is worth $0.0001 (and no, not $0.0000, how else will the computers game the NBBO in subpenny increments).
Keiser Report #70
Oliver Stone’s Wall Street sequel
'Wall Street' sequel is an omen of U.S. collapse
So, Just like Michael Moore's Capitalism: A Love Story, Oliver Stone has lost focus on the individual: What you can do in your own life to at least try to combat these evil forces. There are two kinds of actions to be taking right now.
- Corrective Actions to change society so it doesn't happen
- Damage Control Actions to minimize your own risk should something happen
The problem isn't capitalism. Capitalism is actually a very fine system. It works wonders when it is actually real. Our system we have today is not capitalism: it's fascism. It's government for and by corporations. banks and large corporations have so much power that they have taken over. They can manipulate markets and governments and thus you and me. So the question is, how many of the problems does Stone touch upon? The banks? monetary policy? constitutionality? capitalism? corporatism? cronie-democracy? the one party system (Republicrats)? fascism?
The Federal Government is way way out of line. They have taken so much liberty when the founders of the nation intended the Federal Government to be extremely limited and have each state govern itself.
Greek banks hit by wealthy citizens moving their money offshore, USA next?
Greek banks hit by wealthy citizens moving their money offshore
Greek banks are being hit by a wave of redemptions as the country's most wealthy citizens and corporations look to move their money offshore or to international financial institutions perceived as safer homes for their assets
...
More than €3bn (£2.6bn) of deposits held by Greek households and companies left the country in February, while in January about €5bn of deposits were moved out, according to the latest figures available from the Bank of Greece.
When will this happen to the United States? What will be the "safe haven?"
I've been hearing noise about bond traders starting to react to the US Sovereign Debt. That very much could be the trigger of the next devastative wave of the many that the bankers and government have ready for us.
The only way to fix this problem is to return to the Constitution. This means ending the Fed, Congress issuing money as gold (if they don't like it they should change the constitution through amendment, duh), removing corporations from the government completely (no more corporate personhood, influencing, or lobbying), institute instant run off voting in all elections so 3rd parties have an equal chance, and many others.
Could it be claimed that the current two party political system in the US is discriminatory? To me, it seems, any 3rd party candidate is harmed in such a system thus requiring instant run off voting for real Representative Republic.
The Federal Deficit vs. The Federal Reserve
I'd like to point out the EXTREME conflict of interest that Congress has with the Federal Reserve. The Federal Reserve directly or indirectly is funding a great part of the Federal Deficit authorized by Congress. Thus, until the Federal Deficit is wiped out we are holden to our Providers. Congress "can't" audit the Federal Reserve because they need the Federal Reserve.
Here is the kicker. Congress doesn't need the Federal Reserve for money. They have the Constitutional Power to create it themselves. Switching the system would be too disruptive to the powers that fund the Senators.
So they won't. So sad.
Keiser Report №17: Markets! Finance! Scandal!
We've been at financial war with China for many, many years. No one talks about the Chinese only letting us go through the kindness of their communist heart. At some point China is going start selling their worthless dollars, which will show just how little they are actually worth.
It's amazing that Goldman Sacks PROFITED from the hiding the Greek debt through derivatives and manipulating market prices. This only shows that derivatives really should be regulated. How exactly I don't know but maybe putting a cap on a derivative at $100 million would be a good idea. If banks move off shore to do this business so be it, would that put enough distance to be safe should the speculation hysteria burst?
I couldn't agree more with Keiser. The sooner and faster, the better. The more we delay the harder it will be. And there are some significant changes needed. Fiat money needs to go which is going to change a lot of things. But this is the only way to actually fix things.
If we don't fix this problem, then the banks will take everything because we all are using their future money which we need to pay back. The system is designed to make people fall off because not enough value has been, or ever could be, created to pay off their debt money with interest.
This is not a system of stable value. More money must be created to support the base of money in existence, with interest. This is an ever growing problem because the value represented by the dollar, the economy, needs to keep pace in order to stabilize the value. For decades they've created a little more money than created in the economy but now the economy has no more steam and cannot continue growing except through the shadow banking economy to which we are not allowed access. There has been extraordinary market distortions since the creation of the Federal Reserve and fiat money. That whole big mess needs to unwind before we get back on a sustainable track. This means a lot of changes which could be a complete mess if not actually planned by the government.
Not only that, but let me remind you that fiat money in the USA is actually unconstitutional.
Debt is everywhere because it is what we use as money! If you have money, it is really possessing other people's debts which they have to get back from you because, ultimately, it must go back to the bank with interest. We are literally slaves to our money system. Wasn't slavery made unconstitutional at some point?
The odd thing is that the money you do have usually lives at the bank. If you read the fine print of a new account document you'll see that it is really a loan to the bank. In exchange you get numbers in an account and the ability to (hopefully) get it back at some point in the future. Alas, they use this money as reserves to create new money and perpetuate the system.