naked capitalism

RueTheDay says:

US markets are roaring back.

Clearly there is the expectation that the governments of Dubai, Abu Dhabi, and the various European countries will simply make the banks and investors whole at the expense of their respective taxpayers. Collectively, we’ve already socialized a couple of trillion in losses, what’s another $60 billion.

Jason Rines says:

I was correct about the downturn coming as was Yves. I did not and do not post such matters online as personal vanity. So where will it go from here? I look at the macro, this is one big W event. The US banks are sitting on $800 B in reserves. Those will be released in January and will reinflate the entire economy by a bit, including the lost son called Main St.

The timing of the release of the reserves is almost all political. In the US, our mid-term elections (think key Senate financial oversight committees) is in the fall of 2010. The economy will look like it has started to recover. By 2011 however, the quadruple whammy of the Bush tax cuts expiring, additional federal, local and state tax increases, serious energy inflation will occur all simultaneously. While the US government will keep a smaller portion of these big reserves for the 2012 elections, but this money will not be near enough for Main Street to keep the incumbant party in power. Here is some trends from 1850 that correlate to Depressions and wild political swings. Here in the USA, the Republican party was born around (note I didn’t say EXACT date) the time these charts trend back to, 1850. Voter revolution is the key operating words:

http://ragingdebate.com/uploads/image/Party_Retention.gif

http://ragingdebate.com/uploads/image/Party_Retention_Rates.gif
http://ragingdebate.com/uploads/image/Seats.gif

That the entire political system in the USA will be near collapse and the citizenship will be in chaos by the fall of 2012 will probably be OK to the Kingmakers. They will be long gone from the USA before 2013 with steaming trunks of wealth, already invested in fungible investments spread out around the world.

That is when we all should be VERY concerned about a Middle East conflict. The attack will be initiated by Islamic nations and coordinated loosely by Russia, whom is consolidating world oil resources while we speak.

Here is my Fall of 2008 “W” article. Rhoubini wasn’t sure if our economy/recovery would be U or W shaped, I insisted it would be W shaped. This article will help you trade if you choose to some degree, but I am no daytrader.

I exited the stock market in March of this year. Now, my only real store of value is in intellectual I.T. property. Much harder for governments to steal in the time of raw resource scarcity:

Article: http://theburningplatform.com/groups/deflation-hyperinflation-debate/discussions/the-depression-will-be-a-w-shaped-formation—suggested-strategy

Tyler Eliott says:

Unlike Mr ‘Naked Capitalism’, I Do want the markets to crash- Badly. I’ve witnessed this Market continually go up over 8 months based on fiction and fantasy; every negative piece of information about the economy- trade, unemployment, debt- is brushed off or spun positive by the corporate media so the investors will continue to invest. And its all based on lies…. A Depression is actually a very good thing.. Take the Great Depression of 1929- for argument sake, let’s say Hoover was able to fix the financial problems of his day and by 1930, all was well again, we wouldn’t currently have social security, medicare, welfare, unemployment benefits, and many other social programs which millions upon millions of people depend upon to survive. Real reform only comes through economic turmoil- and as long as the government and financial sectors can keep propping this economy up, they will continue ignoring the needs and suffering of its citizenry… So the sooner the Markets crash hard, the better.

Cynthia says:

Given that Halliburton, one of our great warfare-welfare Queens, moved to Dubai in order to avoid paying its fair share in taxes, and given that our war profiteers are in thick with our banksters, look to see Bailout Ben fly his helicopter over to Dubai to drop a load of greenbacks onto this playground for the rich and famous built on the backs of slave labor.

http://gregmankiw.blogspot.com/2007/09/helicopter-ben.html