Federal Reserve losing control

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Postby ninakat » Thu Nov 01, 2007 1:29 pm

antiaristo, it's all so 1984 -- up is down, 1+1 = 0

And yes, the reality of inflation is much different from the numbers they present, since, just as you stated, it's not just "core inflation." They purposely leave out oil and food, both of which are steadily going up. With the latest moves by the Fed, we'll be seeing the rate of inflation speed up dramatically. I think people will notice it more now, whereas before, it was like the frog slowly coming to a boil scenario.
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Postby ninakat » Thu Nov 01, 2007 2:05 pm

YOU WANT TO KNOW WHY YOU FEEL LIKE
YOU ARE STRUGGLING FINANCIALLY?
Because the U.S. Dollar Has Just Been Devalued
by a Third Over the Past Five Years

http://www.financialsense.com/fsu/edito ... /1029.html

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Postby 11:11 » Thu Nov 01, 2007 3:57 pm

This WILL NOT END until the banksters and their fiat money are put out of business. Any negoiating to control a criminal enterprise doesn't change what it is.
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Postby yablonsky » Fri Nov 02, 2007 4:40 am

antiaristo, i wonder what you think of this cross posted info. from another blog (including sources)

RE:
=======================
Fed Pumps $41B Into US Financial System

eltyra
=======================

Nope they didn't. Usually on Thursday you have 7 day, 14 day and the usual 1 day expiring repos ( repurchases ). These are transactions done 7, 14 days ago and replacing them is just maintaining the status quo - no adding/removing, just maintaining. And that's what they did - in fact there was 42.5B expiring today so net, net, they actually WITHDREW 1.5B. A site that keeps track of this is:

http://www.gmtfo.com/RepoReader/OMOps.aspx
I've desk checked a few of their numbers and they've stacked in the past and once you regularly keep an eye on it, there's a certain easily followable rhythm to it.

Yeah, I know how the Fed spokesperson phrased it in that yahoo link but you really gonna believe that bunch ?
Last edited by yablonsky on Fri Nov 02, 2007 4:47 am, edited 2 times in total.
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Postby yablonsky » Fri Nov 02, 2007 4:41 am

love your posts btw..i'm a long time fan..
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Postby antiaristo » Fri Nov 02, 2007 9:12 am

yablonsky wrote:antiaristo, i wonder what you think of this cross posted info. from another blog (including sources)

......

Yeah, I know how the Fed spokesperson phrased it in that yahoo link but you really gonna believe that bunch ?


Hi yablonsky,
Yes, I've been following that. On the Calculated Risk comments.
It's more blatant mind control.

Net net there was a REDUCTION of $1.5B

But look at all the headlines (lifted from above)


Fed pumps $41B into US financial system
WASHINGTON (AP) - The Federal Reserve pumped $41 billion into the US financial system Thursday, the largest cash infusion since September 2001, ...
www.abcmoney.co.uk/news/012007156928.htm - 1 hour ago - Similar pages - Note this
Fed Pumps $41B Into US Financial System - AP - National Business ...
The Federal Reserve pumped $41 billion into the US.
www.portfolio.com/news-markets/national-news/ap/ 2007/11/01/fed-pumps-41b-into-us-financial-system - 1 hour ago - Similar pages - Note this
Fed Pumps $41B Into US Financial System
be the first to share your thoughts on this question. - Sorry, comments are closed for this story. Fed Pumps $41B Into US Financial System. national.
www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2007/11/ 01/national/w082935D62.DTL - 4 hours ago - Similar pages - Note this
WJLA - Fed Pumps $41B Into US Financial System
WJLA ABC 7 News - Fed Pumps $41B Into US Financial System-The Federal Reserve pumped $41 billion into the US financial system Thursday, the largest cash ...
bob.wjla.com/headlines/1107/468944.html - 1 hour ago - Similar pages - Note this
Fed pumps $41B into US financial system
The Federal Reserve pumped $41 billion into the US financial system Thursday, the largest cash infusion since September 2001, to help companies get through ...
www.businessweek.com/ap/financialnews/ D8SL1QGO2.htm - 43 minutes ago - Similar pages - Note this
Fed pumps $41B into US financial system | Latest News | News ...
Fed pumps $41B into US financial system. WASHINGTON (AP) - The Federal Reserve pumped $41 billion into the US financial system Thursday, the largest cash ...
www.hemscott.com/news/latest-news/item.do? newsId=52587579697947 - 1 hour ago - Similar pages - Note this



When there is this much lying going on it's time to get out.

By the way. This is EXACTLY what happened with the "45 minute claim".
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Postby Byrne » Fri Nov 02, 2007 9:42 am

The UK financial company who, we are told, have the most exposure to the shananigans of the (sub-prime?) American lending market is Northern Rock.

In the news today, the Bank of England has already lent £23Billion GBP ($46 Billion USD) to the Northern Rock (that is equal to £730 for every UK taxpayer). £30 Billion is expected to be leant to the Northern Rock by the end of the year.

http://news.bbc.co.uk/2/hi/business/7073556.stm

The Bank of England are doing this to stave off a collapse of some sort.........
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Postby antiaristo » Fri Nov 02, 2007 10:04 am

.

Byrne,
The same thing is going on in the US.

Very very very quietly, the FEDERAL home mortgage banks have loaned $165 Billion to the private home loan operators.

That's why the "credit crunch" went very quiet. It's why "Countryfried" is still in business. It's why Mozillo can continue cashing out his share options.

Ther IS a bailout going on.
But everybody is focusing on the Fed.
Nobody (in polite company) mentions the activities of the twelve FEDERALLY GUARANTEED mortgage lenders.

None of this will end, because the British and American people are unwilling to do what's necessary and bring the country to a standstill.
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Postby ninakat » Fri Nov 02, 2007 7:00 pm

antiaristo, here's Peter Schiff writing about that phony 3.9 growth rate, saying the same thing you did (if I understand correctly). Plus, see his commentary near the end about the absurd report from the World Economic Forum ranking the U.S. economy as the world's most competitive. Whew.

They Have Got to be Kidding
by Peter Schiff

Yesterday, as the dollar fell to new record lows and oil and gold prices surged to new highs, Wall Street remained fixated on wholly meaningless government data that managed to report the lowest inflation in the last half century. These bizarre numbers were integral in allowing the Commerce Department to report 3.9% annualized GDP growth in the third quarter, which was heralded by the bulls as evidence that a resilient U.S. economy had shrugged off the problems in the housing and mortgage markets. However, the government's ability to make "economic growth" magically appear is based purely on statistical finesse.

To arrive at this rate, the government had to assume that inflation during the quarter ran at an annualized rate of .8% (that's less than 1%). That is the lowest rate of inflation used to calculate U.S. GDP since the Eisenhower administration. With oil priced at almost $100 per barrel, gold futures trading over $800 per ounce, the dollar hitting record lows, and the Fed printing money like it is going out of style, the government has the nerve to claim that current inflation is the lowest it has been in half a century. Unbelievable!

Just in case there is some confusion, the government adjusts nominal GDP gains using the GDP deflator, which represents the inflation rate during the time period being measured. This is done to strip inflation out of the GDP calculation so that only real growth gets counted: not nominal gains that result purely from inflation.

The consensus estimate for 3rd quarter GDP growth was 3.4%. The reason we beat that number was that the government adjusted the nominal 4.7% gain by a mere .8%. Had the government assumed a higher rate of inflation, say 2.6% (identical to the rate used to deflate second quarter GDP,) the 3rd quarter gain would have been only 2.1%, well shy of the consensus forecast. My guess is that inflation is actually running at an annualized rate closer to 10%. Therefore using a more honest deflator, the U.S. economy is actually contracting, which would explain the recent anecdotal evidence provided by various economic polls, voter dissatisfaction and consumer sentiment numbers. In fact, if one simply measures U.S. GDP using gold or any other currency, it is clear that we are already in a recession.

Similar illusions are created in other numbers, such as retail sales, corporate earnings, and stock prices, which are all rising merely as a result of actual inflation being higher than the official reports. For example, higher retail sales reflect consumers paying higher prices for the products that they buy. They may in fact be buying less stuff, but are paying more for it. Further, part of the gains result from tourists using their appreciated foreign currencies to buy products cheaper here than they can in the own countries. I have heard about Canadians checking into U.S. hotels with empty suitcases, crossing the border to indulge in weekend shopping sprees.

Corporate earnings, particularly those of multi-nationals, are padded as their foreign currency denominated earnings translate into more dollars when those earnings are repatriated. However, such gains are illusions, as companies merely earn more dollars of diminished value for the goods they sell. The actual volume of exports does not necessarily improve much, as evidenced by weak industrial production and manufacturing employment. When those additional debased dollars are paid out as dividends, they confer no real increase in global purchasing power to shareholders.

Similarly, just as inflation causes prices to rise for goods and services it causes stock prices to rise as well. Though such gains may be less than the actual increase in the cost of living, as long as the government gets away with using bogus CPI numbers which fail to fully reflect inflation, Wall Street takes credit for nominal gains as if they were real.

However, as ridiculous as the phony GDP number was, yesterday's biggest joke was a report on global competitiveness put out by the World Economic Forum in Davos, Switzerland, which ranked the U.S. economy as the world's most competitive. To arrive at this conclusion, the forum has obliterated the obvious under a mountain of theory. In determining country rankings, the WEF weighed strengths in their "12 Pillars of Competitiveness", including: institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market sophistication, technological readiness, market size, business sophistication and innovation. Completely ignored however are the measurable results of competitiveness, notably a trade surplus and a strong currency.

It is as if the WEF decided to judge a weight loss contest without using a scale, by instead focusing only on mental attitude, dedication, perseverance, and nutritional education! As a result the prize is awarded to the fattest contestant. Based on the empirical evidence of a gargantuan trade deficit, staggering global indebtedness, and a declining currency, the United States is clearly not the most competitive economy in the world.
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Postby antiaristo » Fri Nov 02, 2007 7:28 pm

.

ninakat,
Spread that far and wide.

I've no doubt the American economy is already in recession. I've seen data for sales tax collections and they are DOWN on last year.

I see you like charts.
Take a look at this one:

Image


That's MEW.

Mortgage equity withdrawal.

It's a measure of the extent to which homeowners have been using their houses as an ATM.

It went all the way up to 8-10% of total personal disposable income.

THAT will stop dead in its tracks.

(Full size version here
http://bp3.blogger.com/_pMscxxELHEg/Ryq ... dvance.jpg )

ABOUT SIX PERCENTAGE POINTS OF THE GDP!!!!!


LATEST!

Friday, November 02, 2007

Citi to Hold Emergency Board Meeting
From WSJ: Citi to Hold Emergency Board Meeting

Citigroup Inc. board members are expected to gather for an emergency meeting this weekend ...

It wasn't immediately clear what the meeting would address, but the subject of further writedowns could come up.



The music has stopped.

http://calculatedrisk.blogspot.com/
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Postby ninakat » Fri Nov 02, 2007 11:46 pm

Oooh, that mortgage equity withdrawal chart. Nasty. It's simply beyond comprehension to me that so many people could borrow against their homes. This isn't going to be pretty.

And, what's up with that Citigroup emergency meeting? Could be very "interesting" to find out.
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Postby antiaristo » Sat Nov 03, 2007 8:08 am

ninakat wrote:Oooh, that mortgage equity withdrawal chart. Nasty. It's simply beyond comprehension to me that so many people could borrow against their homes. This isn't going to be pretty.

And, what's up with that Citigroup emergency meeting? Could be very "interesting" to find out.



Yup. Interesting indeed.
Here's some more flavour, with a human interest element thrown in. :lol:


From The Times
November 3, 2007
Top US analyst hits back after death threats over Citigroup downgrade
Tom Bawden in New York

Meredith Whitney, the analyst who prompted a $369 billion (£177 billion) plunge in the value of US shares on Thursday by issuing a negative note on Citigroup, hit out at Wall Street’s culture of intimidation yesterday after receiving several death threats from investors in the bank.

Ms Whitney, a CIBC analyst who is married to the former World Wrestling Entertainment champion Death Mask, prompted a near 7 per cent drop in Citigroup’s shares on Thursday, after suggesting that the bank needed to raise more than $30 billion to restore its capital cushion.

She also downgraded her recommendation on Citigroup’s shares to “market underperform” in the note that set off America’s biggest stock market decline since August.

Ms Whitney, Forbes’s second-highest ranked stock picker for 2007, told The Times: “People are scared to be negative, especially when a company has such a wide holding. Clients are not pleased with my call and I have had several death threats.

“But it was the most straightforward call I’ve made in my career and I am surprised my peer analysts have been resistant. It’s so straightforward, it’s indisputable.

Ms Whitney, whose marriage to John Charles Layfield, the wrestler, 2½ years ago was detailed in The New York Times, said that she has never felt any pressure from the Wall Street firms themselves to be positive. But she said investors could be “nasty and belligerent” if they felt you had lost them a lot of money by influencing the price of their shares.

“No one had the moxie to put in print what I put in print,” she said.

Ms Whitney’s note came two weeks after Citigroup reported a 57 per cent drop in its third-quarter profits, following a $6.5 billion writedown, much of which related to the credit crunch.

That writedown intensified recurring calls for Chuck Prince, Citigroup’s head, to stand down, although he remains at the helm of the world’s biggest bank.

But in a move that will fuel speculation about his position, Mr Prince yesterday cancelled a speech he had been due to give tomorrow at the US Japan Business Conference. A Citigroup spokesman said he had cancelled the appearance to prepare for the company’s new listing on the Tokyo Stock Exchange on Monday.

Ms Whitney, 37, met Mr Layfield in 2003 when they were panelists on Bulls & Bears, a programme on Fox News.

Mr Layfield credits Ms Whitney with helping to make him more sophisticated. The New York Times reported him saying at their wedding: “She took a country boy like me and kind of refined me. I know what fork to use now at the dinner table, and I drink my beer from a glass.”

http://business.timesonline.co.uk/tol/b ... 796774.ece


Now there's a woman that knows her own mind. You GO girl!
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Postby ninakat » Sat Nov 03, 2007 1:13 pm

Mr Layfield credits Ms Whitney with helping to make him more sophisticated. The New York Times reported him saying at their wedding: “She took a country boy like me and kind of refined me. I know what fork to use now at the dinner table, and I drink my beer from a glass.”


Sort of a My Fair Lady in reverse, although I can't help wonder if the opposite might be true as well. Perhaps some of Ms. Whitney's moxie in issuing that negative note on Citigroup was bolstered by her hubby's wrestling background. At any rate, one gutsy lady (takes guts in this day and age, as the death threats against her prove).
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Postby ninakat » Sat Nov 03, 2007 1:41 pm

more "crash" speculation:

This Merrill Sees a Crash

While opinions about which way the stock market is headed are a dime a dozen, I have to admit that my interest was piqued when I clicked on the link to the following press release (it was forward to me by a reader of the Financial Armageddon blog):

"Charles Merrill Fears Market Crash"

PALM SPRINGS, Calif., Oct. 30 /PRNewswire/ -- Fearing a stock market crash worse than 1929, Charles Merrill (http://www.merrillcharles.com) of Palm Springs, cousin to the founder of the Merrill/Lynch dynasty, is quickly converting to gold coins.

"Merrill Lynch is crashing, due to the ineptness of the CEO. No matter who is running Merrill Lynch & Co., it's going to need a regimen of restraint and recuperation after getting badly bruised by the global credit market shakeout. I predict a house of dominos, and the whole stock market is going to crash," stated Merrill.

The world's largest brokerage took a $7.9 billion writedown for subprime mortgages and asset-backed bonds whose values went sour. Many on Wall Street believe there's more where that came from - maybe another $4 billion - and Merrill Lynch's leadership will need to reduce risk and rebuild morale among its ranks.

Merrill stated in a Palm Springs interview with Michael L. Grace (http://www.michaellgrace.com), "There is going to be a major stock market crash, so protect your assets. Buy physical gold and hide it."
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curbs

Postby vigilant » Sat Nov 03, 2007 2:41 pm

Well...from what I have been reading they have already, or have set a date to take the curbs off the market. Taking the curbs off the market means unlimited down side. Their explanation for taking the curbs off the market was this..."it doesn't really work"...

I have seen the curbs kick in more times than I can count and "work" to stop a market fall. It seems to me that the curbs worked "exactly" as intended.

I cannot imagine any reason for taking the curbs off the market other than "they anticipate needing the flexibility"....Things happen for a reason. There has to be a "reason" they decided to expose the market to the risk of a crash...
The whole world is a stage...will somebody turn the lights on please?....I have to go bang my head against the wall for a while and assimilate....
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