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Think of it this way … LIBOR is the same in Europe as the Prime Rate in the US. Libor aka the London Inter-Bank Offer Rate. In the U.S. the FRB (Bernanke and friends) set the Fed Funds Rate and commercial banks set the prime rate. The prime rate does not move (up or down) unless the Fed Funds Rate is changed by the FRB. If the FRB increases (or decreases) the [...] Infamous for his prediction of the great recession, Europe’s demise, and the collapse of the US financial system (as well as profiting extremely handsomely from said predictions), so well captured in Michael Lewis’ book “The Big Short”, UCLA’s Dr. Michael Burry undertakes UCLA’s Economics Department’s commencement speech with much aplomb. In this “age of infinite distraction”, the astounding truthiness of this 15 minute speech is stunning from single-sentence summation of Europe’s [...] They are REQUIRED by accounting regulations (GAAP) to value assets that way !!!! FASB 157 on link below: http://www.fasb.org/cs/BlobServer?blobcol=urldata&blobtable Do not know how much background in accounting others have, but FASB is the Financial Accounting Standards Board, and GAAP stands for Generally Accepted Accounting Principles. Personally I do not like mark to market accounting, I preferred when lower of cost or market accounting was used to value assets. Prior to mark to market accounting, [...] Currently there are 6.1 million VACANT homes across the U.S. That includes both VACANT homes currently for sale and rent. It does NOT include the shadow inventory of foreclosed homes banks have not put on the market yet or will soon be foreclosed on. Currently the bank shadow inventory is 1.61 million homes. Add the numbers together and the US has approx. 7.71 million homes in need of occupants. Source of data: https://www.wellsfargo.com/downloads/pdf/com/research/real-estate-and-housing/HousingChartbook_04022012.pdf It [...] 1) Federal Reserve and Intragovernmental Holdings …………………. $5.351 Trillion 2) US Investors/Savings Bonds …………… $1.458 Trillion (includes individuals, brokers and dealers, personal trusts, estates, savings bonds, corporate and non-corporate businesses) 3) China ……………………………………………… $895.6 billion 7) US State and Local Governments …….. $511.8 billion According to data from the Bureau of Labor Statistics, there were 147 million working Americans in mid- 2008. Today, approximately only 140 million people in the United States are working. While a small portion of this decline has been due to baby boomers beginning to retire, the labor market shows more than 8 million jobs lost. The U.S. adds approx. 125,000 new entrants to the labor market each month for demographic [...] Written by Jeff NielsonMonday, 05 March 2012 13:26 One of the most poorly kept secrets in Wall Street’s empire of fraud was that credit default swaps were never anything but pretend-insurance. The credit default swap market is a $60+ trillion paper Ponzi-scheme. The Wall Street crime syndicate claiming to “back” this insurance have nothing more than a few $billion of liquidity apiece. It is a fact of arithmetic that these fraud-factories [...] “According to the St. Louis Federal Reserve, there were approximately 147 million employed persons in the United States in mid-2008 versus something in the neighborhood of 140 million today based on the recent data.” The U.S. needs to create approximately 125,000 jobs on average each month just to keep up with demographic additions (NEW ENTRANTS) to the labor market … that is 1.5 million new entrants per year. The data is from mid-2008 [...] Assume one owns a $200K home not in California, NY, or a couple other states where homes cost more. If the value of the home decreases by 3% in a year due to the real estate crisis, they lost $6000 in that year. Add in taxes, maintenance and homeowners insurance … and they would have saved money by renting a home rather than owning. For illustration only of the yearly amount, amounts would [...] *** French banks exposure to Piigs is 30% of France’s total GDP. *** French banks also have a loan to deposit ratio of only 85%. (Source: IMF) That means they have 15% more loans than deposits. Backing loans with deposits is a much more stable form of interest rate financing than other means due to the variability of interest rates of non-deposit based [...] With French banks already undercapitalized, the French banking system could be rocked if it has to take more capital charges. (See notes below) *French banks have extreme exposure to the countries that are at the center of the European debt crisis (Piigs) …. particularly Italy and Spain which is over 70% of French bank exposure. *As a percent of French GDP, French bank exposure to Greece, Ireland, [...] Paul Joseph Watson Senator Jim DeMint has accused President Barack Obama and Timothy Geithner of deliberately fostering panic in order to push through an agreement that would allow the debt ceiling to be raised, accusing the White House of “burning the clock” in order to push a decision close to the deadline, echoing how Congress was threatened with “martial law [...] It’s debt-limit hysteria, says Pennsylvania Senator Pat Toomey. Scare tactics, says Senator Jim DeMint of South Carolina. To Representative Joe Walsh of Illinois, it’s fear-mongering. A growing number of Republicans are scoffing at warnings that failing to raise the U.S. debt limit would trigger a financial catastrophe. Treasury Secretary Timothy Geithner’s cautions are merely aimed at stampeding Republicans into lifting the $14.3 trillion limit, said [...] by Chicken-Little “Much of the inventory of foreclosed homes and seriously delinquent home mortgages are concentrated in just of a handful of states…..Florida , Nevada , California, Arizona, and Georgia head the list of the most troubled markets.” “States with the highest proportion of seriously delinquent mortgages, underwater mortgages and high inventory of vacant homes should continue to see declines in real estate values…… making [...] Beginner’s Issue We have been advised in the past that dollar cost averaging, buy and hold avoiding all temptations to take yourself out of the market, is the “best” way to get “rich” and create “wealth” for retirement (whatever getting “rich” and “wealthy” means, since those terms were undefined). More particularly, we are urged to: “Consider investing in a simple, diversified portfolio of low cost [...] |
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