The US government is making cash worthless, as bond yields hit 0%.

This, seriously, is one of the craziest things I've ever seen.

That's 11 cents a day on a $100,000 investment.

Huh?

Craziest thing I've ever seen. That and the 10-year falling below 3%.

The US government is making cash worthless. They're FORCING the market out of bonds, and into riskier assets. They're making it real attractive for people to refi, and not default on their homes. They're making money real, real, real cheap. And they're FORCING savers out of cash.

Books and movies will be written about this one day.

Craziest thing I've ever seen.

Date	1 mo	3 mo	6 mo	1 yr	2 yr	3 yr	5 yr	7 yr	10 yr	20 yr	30 yr
11/03/08	0.20	0.49	1.07	1.31	1.45	1.69	2.71	3.21	3.96	4.73	4.33
11/04/08	0.29	0.48	1.03	1.28	1.39	1.59	2.56	3.06	3.81	4.58	4.20
11/05/08	0.16	0.40	0.90	1.22	1.36	1.64	2.50	2.99	3.73	4.49	4.13
11/06/08	0.13	0.32	0.83	1.17	1.28	1.63	2.46	3.01	3.75	4.52	4.19
11/07/08	0.13	0.31	0.83	1.20	1.33	1.71	2.56	3.11	3.83	4.57	4.25
11/10/08	0.11	0.29	0.91	1.16	1.27	1.78	2.51	3.06	3.82	4.50	4.21
11/12/08	0.10	0.18	0.75	1.03	1.19	1.60	2.37	3.00	3.75	4.44	4.17
11/13/08	0.08	0.22	0.93	1.16	1.24	1.62	2.43	3.07	3.84	4.57	4.34
11/14/08	0.06	0.15	0.90	1.14	1.22	1.53	2.33	2.94	3.72	4.43	4.22
11/17/08	0.06	0.12	0.81	1.08	1.22	1.53	2.32	2.92	3.68	4.42	4.20
11/18/08	0.10	0.12	0.76	1.05	1.15	1.44	2.22	2.79	3.53	4.32	4.14
11/19/08	0.09	0.07	0.66	0.97	1.09	1.36	2.08	2.64	3.38	4.17	3.96
11/20/08	0.05	0.03	0.52	0.87	1.00	1.20	1.94	2.43	3.10	3.87	3.64
11/21/08	0.03	0.02	0.45	0.83	1.09	1.35	2.02	2.53	3.20	3.93	3.70
11/24/08	0.01	0.13	0.54	0.95	1.31	1.53	2.24	2.71	3.35	4.01	3.78
11/25/08	0.04	0.10	0.53	0.95	1.15	1.41	2.06	2.49	3.11	3.85	3.63
11/26/08	0.02	0.05	0.48	0.93	1.09	1.38	2.01	2.43	2.99	3.77	3.54
11/28/08	0.02	0.01	0.44	0.90	1.00	1.27	1.93	2.35	2.93	3.71	3.45

Krugman: The housing bubble owes the dot-com bubble an apology

And what I'll never understand is why Greenspan and Bernanke chose not to see the housing bubble.

Either they're complete idiots, or they're criminally corrupt.

Period.

Does the GOP have a GOD problem? Conservative columnist Kathleen Parker thinks so - "Armband religion is killing the Republican Party"

I'd say not only does the GOP have a GOD problem, they also have an ignorance problem. Which is now a major marketing problem.

Being the party of the clueless, the ignorant, the uneducated, the racist, the homophobic, the jingoistic, the fearful, the stupid, the anti-science and the anti-intellectual might have served them well in the past, well, frankly, when there were slightly more ignorant people.

But lo and behold, maybe thanks in part to blogs and the internet, America is running low(er) on dumb people. And the number of states where the ignorant can isolate themselves from the truth is dwindling (big shout out Alabama and Alaska!)

My message to the GOP: throw the fundamentalist religious crazies overboard. There are plenty of spiritual and religious voters out there, but they're repulsed by the right wing religious nutjobs (shout out Sarah Palin!). So throw them overboard. Let them start their own ignorant party. And start over as the "New GOP - Now Religious-Crazy Free!".

Giving Up on God By Kathleen Parker

As Republicans sort out the reasons for their defeat, they likely will overlook or dismiss the gorilla in the pulpit.

Three little letters, great big problem: G-O-D.

I'm bathing in holy water as I type.

To be more specific, the evangelical, right-wing, oogedy-boogedy branch of the GOP is what ails the erstwhile conservative party and will continue to afflict and marginalize its constituents if reckoning doesn't soon cometh.

Simply put: Armband religion is killing the Republican Party. And, the truth -- as long as we're setting ourselves free -- is that if one were to eavesdrop on private conversations among the party intelligentsia, one would hear precisely that."

The GOP has surrendered its high ground to its lowest brows. In the process, the party has alienated its non-base constituents, including other people of faith (those who prefer a more private approach to worship), as well as secularists and conservative-leaning Democrats who otherwise might be tempted to cross the aisle.

Crank it up.

Soot & Ashes Serious Question of the Day

Will gold be the last store of value in world history?

A Love Poem to the American People, By Ben Bernanke

The conclusion that deflation is always reversible under a fiat money system follows from basic economic reasoning.

A little parable may prove useful: Today an ounce of gold sells for $300, more or less. Now suppose that a modern alchemist solves his subject's oldest problem by finding a way to produce unlimited amounts of new gold at essentially no cost. Moreover, his invention is widely publicized and scientifically verified, and he announces his intention to begin massive production of gold within days.

What would happen to the price of gold? Presumably, the potentially unlimited supply of cheap gold would cause the market price of gold to plummet. Indeed, if the market for gold is to any degree efficient, the price of gold would collapse immediately after the announcement of the invention, before the alchemist had produced and marketed a single ounce of yellow metal.

What has this got to do with monetary policy?

Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.

By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services.

We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.

If you can't beat 'em, maybe next time join 'em. Crime pays. Laws were meant to be broken. There is no enforcement. Legal anarchy reigns.

George Bush
Dick Cheney
Chris Dodd
Kent Conrad
Alphonso Jackson
Donna Shalala
Richard Holbrooke
Angelo Mozilo
Ted Stevens
Dick Fuld
Stanley O'Neal
Chuck Prince
Bob Nardelli
Michael Perry
Franklin Rains
Jim Johnson
Casey Serin
David Crisp
Floyd Irons
Nicholas Retsinas
James Dimon
Ken Lewis
Martin Sullivan
Richard Syron
Hank Paulson
Barney Frank
Nancy Pelosi
Harry Reid
Everyone at Moody's
Everyone at S&P
Everyone at Indymac
Everyone at Countrywide
Everyone at Washington Mutual
Everyone at First Federal Financial
Everyone at Merrill Lynch
Everyone at Lehman Brothers
Everyone at Citibank
Everyone at JP Morgan
Everyone at the FDIC
Everyone at the FHLB
Everyone at Fannie Mae
Everyone at Freddie Mac
Everyone at HUD
Everyone at Goldman Sachs
Millions of mortgage fraudsters
Every realtor
Every appraiser
Every mortgage broker

Soot & Ashes Quote of the Day

"We need to diversify the global currency system, to support its stability through the use of different currencies"

- America's Landlord and Owner, Premier Wen Jiabao of China, October 2008

$10 trillion Money Bomb sounded far-fetched, eh? Well, we're already $8.5 trillion into it. And we're still just warming up.

Got gold?

From Motley Fool:

Commercial Paper Funding Facility	Federal Reserve	$1.8 trillion
Temporary Liquidity Guarantee Program	FDIC	$1.4 trillion
Term Auction Facility (TAF)	Federal Reserve	$900 billion
Fannie Mae (NYSE: FNM), Freddie Mac (NYSE: FRE), and Ginnie Mae	U.S. Treasury / Federal Reserve	$800 billion
Treasury Asset Relief Program (TARP)	U.S. Treasury	$700 billion
Total USD International Currency Swap Lines	Federal Reserve	$688 billion
Money Market Investor Funding Facility	Federal Reserve	$540 billion
Other Loans: Primary Dealer Credit, etc.	Federal Reserve	$288.7 billion
Citigroup (NYSE: C) Guarantee	U.S. Treasury / FDIC	$306 billion
Hope for Homeowners Act of 2008	U.S. Treasury	$304 billion
Term Securities Lending Facility (TSLF)	Federal Reserve	$225 billion
Term Asset-Backed Securities Loan Facility (TALF)	U.S. Treasury	$200 billion
Economic Stimulus Act of 2008	U.S. Treasury	$168 billion
Paid to JPMorgan Chase (NYSE: JPM) to Settle Lehman Brothers Debt	Federal Reserve	$138 billion
AIG (NYSE: AIG) Bailout	Federal Reserve	$112.5 billion
Bear Stearns Brokered Sale	Federal Reserve	$26.9 billion
I'm afraid to look …	Total:	$8,597,100,000,000

We interrupt this blog for a special message from Andrew Hac

Andrew Hac said...

Oh, Lordie, Lordie, Lordie...

Can the Americano specie stoop this low ?

This is the funniest nation on the planet Earth. And its occupants are no less funny as hell. No doubt about this. No BUT, IF, WHEN, WHAT, WHY. WHO, or HOW...

And you asked yourself the question over and over again "Why is the Americano so toasted ? ". Well, the answer is: This pitiful nation is comprising mostly of Joe6Pack and JaneZinfandel whom muddles through life having no clue as to why their existence on this planet Earth matters to them or the people around them.

The Americano Housing Bubble has now revealed the true anatomy of the Americano Australopithecus species to the whole wide world. And what that anatomy amounts to is a heap of putrid, rotten to the core, maggot filled, rat chewing pile of garbage.

Greed, Ignorance, Irresponsibility, Laziness, Materialistic-Craze, Hoity-Toity attitudes are all part of the Americano rotted anatomy, stinky gut.

How a fat-ass, obese, beer-gut, rotten teeth, putrid breath, dumb-ass Americano male driving by himself a Ford Expedition on the road, consuming 10-15 miles per gallon of gasoline is just beyond the realm of reasoning.

How a whole family of cracker-nuthead, GrandPa and GrandMa, Joe6Pack and JaneZinfandel, 6 of the spoiled-brat runny nose snotty kids swarming the Walmart aisle after aisle piling junks on the shopping cart is pure hilarious and pitiful at the same time. And the result of that is one ignorant, Jamaican-trash, piece-of-human-excrement temporary worker died being trampled on from the mad rush of tootless Grampa and Gramma.

How a whole family of Hicks and HillBilly chomping down on oily, greasy McDonal french fries and Wendy’s hamburger is just so resembling the scene of the bunch of hogs roosting and wallowing at the feed trough.

Who can we blame on this hilarious nation with its hilarious citizens except ourselves ? The mentality of the current Americano is just amazing if not stupefying. Empty of feeling, obligation, morality, duty, honor, sense of self-worthiness, the only way to go for the Americano is to be roasted slowly skewered from mouth to ass on a green Chinese bamboo stick, all sizzling nicely, fat popping, juices dripping over a bed of white hot charcoal.

The Americano nation is pathetic and sinful beyond the point of redemption !

I lost track. How many virgins do you get for killing an innocent woman?

Aren't cults fun? You know, until they're not.

And some interesting questions:

1) What if the bomber wants girls with more experience?
2) What if one virgin is no good in bed? Does she get replaced or is he stuck with 71?
3) If he's gay, does he get male virgins?
4) What if he's celibate? What does he get?
5) What if he hasn't reached puberty yet? Does he get 72 Xboxes till he comes of age?
6) If he's bi, does he get 36 of each?
7) If he blows himself up while building the bomb, does he still get credit?
8) What do you call a relationship with 72 women, a menage-a-soixante-deux?
9) Are they like 72 wives or 1 wife and 71 concubines?
10) What if he's ugly or smells bad and the virgins don't want anything to do with him?

Soot & Ashes Quote of the Day

"They kept shopping. It's not right. They're savages"

- Kimberly Cribbs, witness to the death of a Wal-Mart worker as a crowd of savage American consumers bum-rushed a Wal-Mart in the desperate pursuit of cheap sh*t from China, November 28, 2008

Paulson and Bernanke, with no oversight, have now gambled the United States. They're going "all-in".

The World Series of Poker, starring the United States.

Wow.

Well, look at the bright side. If the bet pays off (it won't), and the value of the crap assets that Bernanke just bought on our behalf soars in value, we could pretty much pay off the public debt.

But...

If it doesn't, we're f*cked.

On a side note, there's one thing about this $800 billion shock-and-awe money-print. Why didn't the US dollar collapse on the news? I mean, we just told the world we're now so desperate that we're going to the printing press, instead of the debt market.

So why didn't the dollar collapse? Yes, it rattled, but it didn't collapse.

Serious question.

2008: The Worst Year in the History of the US Stock Market (so far)

And after The Worst Year Ever, what comes next? Worse and worse, or do we rally?

That, indeed, is the big question.

So, Bernanke and Congress have committed over $7 TRILLION so far on the housing gambler mess. How does that compare? Take a look...

• Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billion
• Louisiana Purchase: Cost: $15 million, Inflation Adjusted Cost: $217 billion
• Race to the Moon: Cost: $36.4 billion, Inflation Adjusted Cost: $237 billion
• S&L Crisis: Cost: $153 billion, Inflation Adjusted Cost: $256 billion
• Korean War: Cost: $54 billion, Inflation Adjusted Cost: $454 billion
• The New Deal: Cost: $32 billion (Est), Inflation Adjusted Cost: $500 billion (Est)
• Invasion of Iraq: Cost: $551b, Inflation Adjusted Cost: $597 billion
• Vietnam War: Cost: $111 billion, Inflation Adjusted Cost: $698 billion
• NASA: Cost: $416.7 billion, Inflation Adjusted Cost: $851.2 billion

TOTAL: $3.92 trillion

Open thread - Mumbai India terrorist attacks

Santa Claus December rally, or big lump of coal?

Market is up now four sessions in a row. I don't think that's happened since about 1964.

So... year-end rally, or right back to the depths of hell?

2008 is still on track to be the worst year in the ENTIRE HISTORY of the stock market.

Get your predictions in now... Dow year-end, are you buying or selling, and also what's in store for 2009

I'm not quite sure what to make of this. Except that it's kinda cool to see the kids care about something other than their Wii

The movement needs more hot chicks though. And cake and pie. You have to have cake and pie.

Happy Thanksgiving from Sarah Palin

Here's the acting president George W. Bush pardoning a turkey. You know, a few weeks before he pardons Cheney, Rumsfeld, Gonzales, Miers and more.

George W. Bush, as we've said for years, and now quite obviously, is the Worst President in the History of the United States. He is a sad and tragic figure in the nation's history, and may go down as the most destructive, treasonous and hated American of all time.

So here he is, pardoning the turkey. Ha ha. But it won't be ha ha when he pardons his corrupt cabal. And if he does that dastardly deed, the message that should be sent now to George W. Bush is this:

There will be no pardon for you sir.

As the Great Britain economy melts down, it got a bit hot today during Prime Minister's Questions. I thought you wonks would enjoy. Cherio.

David Cameron: "This Prime Minister has given us the debt levels of Italy and the accounting practices of Enron.. The country is going bankrupt, he's been found out, and New Labor is dead!"

Gordon Brown: "They offer no help to hard pressed families, they are no longer a credible opposition, and he is the do-nothing leader of a do-nothing party!"


(at this point, they retired to a back room where they plotted how they could get their savings out of pounds, and what countries would take them in after they are forced to flee the nation they have destroyed)

Soot & Ashes Quote of the Day

“The explosion in US high-powered money via quantitative easing runs the risk of a sharply lower dollar in the future.”

- David Powell, Bank of America, November 25, 2008

Soot and Ashes Serious Question of the Day

Do you feel like it could all fall apart now?

Here's a post on HP a year ago, on how Countrywide was robbing the Federal Home Loan Bank. And then yesterday, the Fed covered up crime

Man, this one really pisses me off.

Countrywide (and Indymac) had the monkey-run FHLB buy up their toxic mortgage-fraud garbage, to the tune of over $100 billion. We couldn't believe it at the time, wondering just how corrupt or stupid the people at the FHLB had to be.

Well, we got our answer yesterday, as Hank Paulson and Ben Bernanke put the US taxpayer (again) on the hook for Angelo Mozilo's crimes, thanks to a tweak they had Congress make that allowed them to buy up unlimited FHLB debt. Unlimited. At any price they feel like.

No investigation. No oversight. No regulator. No mainstream media outrage. Nothing. Just $800 billion more pissed away yesterday. On top of the $6 trillion already gone out the door. And the trillions more to come.

I quit.

They win.

The US taxpayer loses.

Man, these grifters are good.

Here's the post on HousingPANIC from December 2007, warning of what was to come:

So why hasn't Countrywide Toxic Mortgage gone bankrupt yet? Simple. They conned the monkeys at the FHLB into lending them $50 billion plus

Right before banks fail you usually see them go to the central bank or the government as their "lender of last resort". And then they fail anyway. Just look at the Northern Rock mess in the UK for the perfect example, a failed bank which will now be nationalized (and the taxpayers of course get screwed).

Countrywide Toxic Mortgage, a corrupt institution which will fail in the end, has been looting the Federal Home Loan Bank, using it as its "personal ATM", potentially robbing taxpayers of over $50,000,000,000 so far and counting.

Taxpayers!? How could that be? Well, because when the FHLB fails, who do you think will fund their bailout? You got it. Us.

So how is Angelo Mozilo and his gang of thieves doing this? Simple. They've conned the FHLB into giving them all those billions by putting up mortgages as collateral.

Yes, if it wasn't so funny it'd be sad. They're putting up their toxic mortgages as collateral, and the FHLB is taking them.

The FHLB is either too corrupt or too stupid to know that there's a housing crash underway in the US, and that the crap that Countrywide has on their books is nowhere near worth what Angelo says its worth.

It's one big house of cards HP'ers. And when it all caves in, and the media is all a-twitter, asking "how did this happen"? and "nobody saw this coming", well, once again, it was all just so obvious (for HP'ers).

What stops this madness? When someone in DC finally realizes that the FHLB is being had, tells them that taxpayers will NOT bail them out, and they finally cut Countrywide and Mozilo off.

And then things will get interesting.

Sen. Charles Schumer, a New York Democrat and member of the Senate Banking Committee, accused Countrywide on Monday of treating the FHLB system "like its personal ATM," having borrowed $51.1 billion as of Sept 30.

He said that, as Countrywide's mortgage portfolio deteriorates, the FHLB exposure "poses an unreasonable risk."

Yet Bigelow said "we are very familiar with FHLB collateral requirements, and we are in full compliance ... The FHLB has some experience in risk management, and they probably have some idea what they're doing in terms of their lending activities."

Nothing pisses me off more than this. Nothing. Arrest Angelo Mozilo now. And end one of the most sordid chapters in American financial history.

Soot and Ashes Quote of the Day

"I don't know what the number is going to be, but it's going to be a big number. It has to be. The point is to, kind of, get people back on track and startle the thing into submission."

- Obama economic adviser Austan Goolsbee, on the Money Bomb to come, November 2008

After the recent panicked flight to 'safety' in the US dollar, is a dollar 'debasement' now right around the corner?

Ben Bernanke told us it would be. He thought a 40% debasement against gold was pretty cool.

Schiff says a dollar collapse is in the cards.

And watch this video.

It's coming folks. I don't know when, and I don't know if it happens slowly or overnight, but it's coming. The incentives for Bernanke and Obama to debase the dollar are just too great. It's almost as if they HAVE to do it. They have no choice.

And those of us holding dollars, we better start thinking what we want to do next, and when. It was a fun ride these past few months, but time to get off.

The dollar mini-bubble is almost over.

We were warned.

Here's Bernanke again, from 2002:

Although a policy of intervening to affect the exchange value of the dollar is nowhere on the horizon today, it's worth noting that there have been times when exchange rate policy has been an effective weapon against deflation.

A striking example from U.S. history is Franklin Roosevelt's 40 percent devaluation of the dollar against gold in 1933-34, enforced by a program of gold purchases and domestic money creation. The devaluation and the rapid increase in money supply it permitted ended the U.S. deflation remarkably quickly.

Who'd be the best CEO for a post-bailout GM/Ford/Chrysler?

If the government took GM, Ford and Chrysler, merged them all together as one company in order to make them mean and lean and able to compete against the foreign brands, who would be the best government-appointed CEO or "Auto Czar" to run it?

Here's five for starters, that actually might take it:

1) Jack Welch
2) Mitt Romney
3) Jeffrey Immelt
4) Lee Iacocca
5) Macgyver

(OK, maybe not the last one, so give me one for that slot)

Around the world, central banks will now start buying up assets. It hath been foretold.

Get ready folks. One big mop up on aisle five is about to commence.

And now, the central banks buy up the banks. And the commercial paper. And a whole bunch of everything else.

It hath been foretold.

"Since the downturn is now in the broader economy and no longer confined to the toxic end of debt, the best way to put cash into the pockets of consumers and companies is for the world’s main central banks together to buy mainstream securities, unlike under the initial US troubled asset relief programme.

But these must be targeted to relieve the critical credit blockages impeding recovery. Many of the assets discussed below are now at the lowest real prices seen in decades. The influx of cash and credit will regenerate global activity, increasing the real value of most of these assets. In due course, the central banks will be able to sell back the assets to the private sector at an overall profit. The timing of such sales can be designed to stabilise the next boom."

John Muellbauer, professor of economics at Oxford, Financial Times, November 25, 2008

Obama wants a money bomb "of a size and scope to get this economy back on track". I'm thinking about $10 trillion will do the trick.

The only problem? We're already on the hook for $7.8 trillion (thank you Ben Bernanke).

Oh, and that the stock markets have shed $23 trillion. That's a bit of a problem too.

Man, these numbers are sick, aren't they?

Thank you Angelo Mozilo. You and your gang of fraudsters f*cked America.

Things are really starting to fall apart now with the Fox Business News "experts"

I guess 10% isn't in the bag anymore.

Soot and Ashes Quote of the Day (made by a fool who should have googled 'housing bubble' and found HousingPANIC)

"I and others were mistaken early on in saying that the subprime crisis would be contained. The causal relationship between the housing problem and the broad financial system was very complex and difficult to predict"

- Ben Bernanke, the now-admitted Village Idiot, as quoted in the December 2008 issue of The New Yorker

FDR backing up the banking system in '33. Got deja vu yet now that Citigroup just got bailed out?

FLASH - US GOVERMENT BAILS OUT CITIGROUP - THE BIGGEST BANK IN THE COUNTRY - TO THE TUNE OF $300 BILLION PLUS

I feel like putting up a music video tonight that captures the mood of America. Get your requests in now...

Here's your winner... Dylan - "A Hard Rain's Gonna Fall"

The $10 Trillion Money Bomb

Dow 2,000

20% unemployment

50% decline nationwide home prices

$1 gallon gas


Seems crazy, eh?


Well, if less than a year ago I would have told you $5.00 gas would now be $2.00, 14,000 Dow would be 7,500, 5% home price decline would be 20%, and 4% unemployment would be 6.5%, and over 8% in California, you would have thought I was nuts. But here we are.

And at current trends folks, we could easily see the sickening numbers posted above. Trillions and trillions and trillions and trillions have already been lost. 2008 is on track to be the worst year in the entire history of the stock market. Foreclosures litter the land. Confidence is shot. And our incompetent leaders run around like the clueless and corrupted idiots that they are. They have no idea what to do, and the things that they do do just make matters worse.

I see one way and only one way out. Most will disagree with me. And it sickens me that it's come to this point, since we tried to warn the world years ago what was happening and what was to come, and nobody listened, when it could have made a difference.

The way out?

Money bomb.

I repeat, money bomb.

Like I said, most will disagree. Many will be mad. But I am telling you now, it's the only way out, like it or not. Unlike many countries, the US still has a massive line of credit, it has the world's reserve currency, and it has an electronic printing press and a Fed chairman willing to use it. And it needs to use all of these while it still can.

Obama needs to drop a money bomb on the US economy so big that it shocks the world. A money bomb that re-starts the heartbeat of the nation's economy, on a flat-lining patient that is looking D.O.A. right now.

Yes, the money bomb will take down the US dollar, it will send gold skyrocketing, and it will saddle future generations with sickening debt, and you know my take on that.

But, if he doesn't drop the money bomb, the United States economy fails. And in that case, the burden on current and future generations will be even worse.

This, folks, is called check. The bankers and politicians and realtors put us here. And checkmate is right around the bend. It might be just weeks away.

Money bomb.

$10 trillion.

Money bomb.

$10 trillion.

Money bomb.

Soot & Ashes Serious Question of the Day (with extra credit)

Do you own a gun?


Extra credit:

Would you use it to kill an intruder?

Would you use it to kill someone stealing your car?

Would you use it to kill someone stealing food from your garage or garden?

Daycare job didn't work out. They weren't hiring at Macy's. OK, guess the next logical choice is to be a hooker.

Watch this video.

Is money this important to people?

You have to wonder what percent of strippers and hookers used to be realtors.

World's oldest profession. Doing just fine during the world's greatest financial crash.

Interesting report on Obama supporters post-election

(trust me, you'll want to see this)

November 19, 1863

Hillary gets State. Bill Richardson Commerce. Napolitano at Homeland. Tim Geithner gets the Treasury mess.

Anyone want to bet how long Hillary lasts? You know, until Bill blows the whole thing for her. And when Obama tells her to go meet with Ahmadinejad and get us out of Iraq, will she listen?

Geithner is one of the dolts who got us into this mess, so I'm not sure why the market loved that one so much. Seems like an academic to me, when we need a fighter. Bloomberg would have been best. Oh well.

Richardson at Commerce is OK, but a bit uninspiring. Just keeping him engaged until Hillary is pushed out I guess.

And I do like Napolitano at Homeland Security. I've seen her speak a couple of times - she's tough, smart, fair, competent and likable. And a possible presidential candidate in 2016 - if she gets married (to a man).

Oh, hope you like the logo.

Classic Greenspan dress-down by Bernie Sanders, followed by Greenspan's admission of guilt

Ah, the good ol' days, when we only had a $4 trillion national debt...

But still, I loved this one with Sanders going off on "The Maestro".

History will be brutal.

I can't believe the damage that one man has done to this world.

Textbook

"We're clearly in some sort of liquidation phase. It's broad mass liquidation. It's selling regardless of value, regardless of net worth."

- Eric Cinnamond, Intrepid Capital Funds, November 20, 2008


"The final phase is a self-feeding panic, where the bubble bursts. People of wealth and credit scramble to unload whatever they have bought at greater and greater losses, and cash becomes king."

- Manias, Panics and Crashes

TREASON

TREASON

"Now, with the collapse of big banks, we see that money disappears, is nothing and all these things that appear real are in fact of secondary importance. Those who build the house of their lives on sand, are those who build on things that are visible and tangible, such as success, career and money."

- Pope Benedict XVI, October 2008

Naomi Klein - bailout is "trillion dollar crime scene" and "borderline criminal". Yup. That about sums it up.

0%.

In your wildest dreams, did you ever think you'd see it?

ZIRP.

Wow.

And he told you what comes next.

And now, a message from President Jimmy Carter on the "crisis of confidence" affecting America.

Ah, it's nice to see how far we've come in 30 years.

Oh, wait, crap, we're here again. Trying to recover from one of the worst presidential administrations of all time. Stuck in an economic tailspin. Suffering from a nationwide crisis of confidence.

Say what you will about Carter, these addresses to the nation remind me of when presidents spoke intelligently to the American people, like adults and not children, about the serious issues that confront them. I hope to see Obama do these types of addresses. I miss them. Bush sucked at pretty much everything he did. And he really, really sucked at having a dialogue with the American people.

Gonna be travelling for a few days...

Comments will be running behind, but I've got some good content queued up...

[update - blazing fast wifi here so no worries...]

Soot and Ashes Quote of the Day

"Prices are in a virtual freefall. Either the market is right and expecting a default rate considerably higher than it was in the Great Depression, or we have such profound dislocations and selling pressures going on that it really is creating extraordinary fundamental value"

- Martin Fridson, chief executive officer of money management firm Fridson Investment Advisors, November 19, 2008




So which is it gonna be Sashers? The buying opportunity of a lifetime, or a depression even worse than the Great Depression? Which is it gonna be...? (thanks Mark)

Warren Buffett for Treasury Secretary?

If not, who?

And is there any one person that could pull us out of this tailspin?

Volker?

FLASH: Remember a few weeks back when hyperinflation was raging, with commodity prices spiraling out of control? Well, no more. Deflation is here.

It's tough to invest or protect your wealth when we go 100% one way and then days later 100% another way.

The most chaotic and unstable market maybe in the history of the world.

I walked by a retailer's promo sign today advertising their "Inflation-Buster SALE!". And I laughed. By the time the ink dried on that sign, deflation had set in.

Thank you Ben Bernanke (in charge of price stability). Nice work.

Consumer prices drop by largest amount in past 61 years as energy prices see record plunge

WASHINGTON (AP) -- Consumer prices plunged by the largest amount in the past 61 years in October as gasoline pump prices dropped by a record amount.

The Labor Department said Wednesday that consumer prices fell by 1 percent last month, the biggest one-month decline on records that go back to February 1947. The drop was twice as large as the 0.5 percent decline analysts expected.

The big drop reflected not only a huge fall in gasoline and other energy costs, but widespread declines in other areas. Core consumer prices, which exclude food and energy, fell by 0.1 percent last month, the first drop in core prices in more than a quarter-century.

The big retreat in consumer prices reflects a remarkable turnaround from just a few months ago when a relentless surge in energy prices raised concerns that inflation could get out of control.

One more time, Here's Ben Bernanke, in his 2002 "Helicopter Speech" telling us exactly what he is going to do. Ignore this at your peril.

Although a policy of intervening to affect the exchange value of the dollar is nowhere on the horizon today, it's worth noting that there have been times when exchange rate policy has been an effective weapon against deflation. A striking example from U.S. history is Franklin Roosevelt's 40 percent devaluation of the dollar against gold in 1933-34, enforced by a program of gold purchases and domestic money creation. The devaluation and the rapid increase in money supply it permitted ended the U.S. deflation remarkably quickly. Indeed, consumer price inflation in the United States, year on year, went from -10.3 percent in 1932 to -5.1 percent in 1933 to 3.4 percent in 1934.17 The economy grew strongly, and by the way, 1934 was one of the best years of the century for the stock market. If nothing else, the episode illustrates that monetary actions can have powerful effects on the economy, even when the nominal interest rate is at or near zero, as was the case at the time of Roosevelt's devaluation.

Each of the policy options I have discussed so far involves the Fed's acting on its own. In practice, the effectiveness of anti-deflation policy could be significantly enhanced by cooperation between the monetary and fiscal authorities. A broad-based tax cut, for example, accommodated by a program of open-market purchases to alleviate any tendency for interest rates to increase, would almost certainly be an effective stimulant to consumption and hence to prices. Even if households decided not to increase consumption but instead re-balanced their portfolios by using their extra cash to acquire real and financial assets, the resulting increase in asset values would lower the cost of capital and improve the balance sheet positions of potential borrowers. A money-financed tax cut is essentially equivalent to Milton Friedman's famous "helicopter drop" of money.

Of course, in lieu of tax cuts or increases in transfers the government could increase spending on current goods and services or even acquire existing real or financial assets. If the Treasury issued debt to purchase private assets and the Fed then purchased an equal amount of Treasury debt with newly created money, the whole operation would be the economic equivalent of direct open-market operations in private assets.

Memories, Sweetened Through the Ages, Just Like Wine. Here's Peter Schiff's Greatest Hits

Schiff got what would happen 100% right.

Just watch this video. Watch how dreadfully wrong Ben Stein, Tom Adkins, Arthur Laffer, Mike Norman and the talking heads were. Wow. Especially Ben Stein. He should never be allowed near a TV set (or your money) again.

That said, Schiff nailed what was happening, and what would happen. However, his prescription for how to protect yourself was wrong. So far. Foreign stocks have been destroyed. Gold is down. The dollar is up.

But just wait. I have a feeling he'll be right in the end. Very right.

Prepare for the next wave.

"There's some serious decisions to be made, and your pathetic politics is disgusting". Oh yeah. The uprising against endless bailouts has begun

The unions and their overpaid workers killed the Big 3. The parasite killed the host. Drove them straight into the ground, while f*cking their own dues-paying members.

Fine. GM, Ford and Chrysler are dead. Let them die. And then maybe they can be reborn, union free, and start making good, affordable, energy-efficient, well-designed cars again.

Unfortunately, the Dems and Obama owe too much to the unions themselves. So another bailout is probably on the way. But if a bailout is to be done, then a pre-packaged Chapter 11. Anything else is a big wet kiss to the damn unions.

Let's just take every decision and action that George Bush made these past eight years, and quickly reverse it. Yup, this should be fun.

And now, a message from President Jimmy Carter on the energy crisis, and what we're going to do about it.

This same speech could be given today.

We did nothing back then. Nothing. And thirty years later, we've made no progress. None.

An epic failure on the behalf of Carter, the Congress, and the American people.

So, will history repeat itself? Will we again do nothing?

Or has something changed?

Get ready folks. Here comes the greatest global economic Hail Mary money bomb that the world has ever seen

A stimulative money bomb is about to go off, in America and all over the world.

The governments of the world, with a coordinated effort, will now use shock therapy to try to resuscitate the patient.

It's not a question of "if". It's a question of "when", and "how much".

Get ready.

It's coming.

And the shock waves will be felt for generations.

Tax cuts. 0% interest rates. Checks in the mail. Jobs programs. Infrastructure investment. Bailouts. And the most aggressive inflationary stimulative monetary and fiscal policy that the world has ever seen.

Get on record here with what this Hail Mary will look like. Or as I call it, a "Money Bomb".

And will it work?

Barack Obama on 60 minutes (full video)

Here you go wonks.

Enjoy.