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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ChrisJP who wrote (3864)	12/25/2003 10:02:59 AM
From: russwinter	Read Replies (3) \| Respond to of 110194

<Only an idiot would try to blame Greenspan for all of this.> Then call me an idiot, and I will proudly wear the label on my sleeve. Greenspan is the worst central banker to come down the pike since John Law in 1720's France. <incentivise consumer demand IN THE FACE OF INCREASING UNEMPLOYMENT > "Incentivized" sounds like Greenspeak for creating more credit and debt, no? Good thing that under his regime, borrowers apparently don't really need growing incomes to pay for that, huh? <until the excess capacity created during the economic boom works its way out of the system.> Yes indeed, the excess capacity caused by not taking away the punch bowl the last time he created one of his "incentivitized" bubbles. <causing home purchases to be temporarily more affordable> And creating another raging hormone bubble. And what happens here, when homes are no longer "temporarily" affordable as you put it? <motivating people to refinance and take some equity out of their homes and of course, people being people, used this money to purchase stuff, lol.> Excuse me, but "take out some equity", and who loaned them this money? And now where is the money taken from the 1H, 2003 refi boom? Didn't seem to work for the important XMAS season, or for wage progress. Time to pronounce this one another in a string of failed "policies". <He did this by lowering interest rates> A mindless and easy way out policy that's created endless bubbles, market distortions and maladjustments discussed ad nueseam on this thread. <Consumer demand would keep a majority of businesses afloat, minimize layoffs, while weaker businesses go under and their assets are absorbed by competition or are redistributed in some other way.> Consumer demand (another maladjusted bubble) has prolonged the lives of weak businesses, and not allowed them to clear or go under. If anything it has created even more maladjusted, unnecessary leach like businesses in retail, finance, Wall Street,etc that will have to be cleared and liquidated later. <Since one of our major sources of deflation is cheap goods from overseas> Fine, if you never plan to take a step out of Wal Mart (by cheap do you mean shoddy or inexpensive, or perhaps both?). Personally I'd like to be able to have money with real value to say go to Europe again. And besides Wal Mart what exactly is so cheap in the US anymore? Been to a movie or restuarant lately, or paid medical insurance? Wait till you get your gas and fuel bill this year. Lucky for you (snicker, snicker) that you don't have to pay for a "cheap good" like steel: meps.co.uk <Sept 11th, 2001 and our very expensive response didn't help him out either.> Just another "my dog ate the homework" excuse to print more money and provide "more liquidity", all right up the Wizard of Oz's alley. Now the excuse will probably be Mad Cow disease. <If most of Greenspan's critics were in charge, we'd be in a deep depression > We wouldn't even be facing this abyss to begin with. Ever watch Pulp Fiction? Remember Harvey Kietel's memorable character "the Wolf"? That's who we'll need after Greenspan is through.

To: ChrisJP who wrote (3864)	12/25/2003 12:48:31 PM
From: mishedlo	Respond to of 110194

So give him a break. He's not the problem. Greedy stupid businessmen/bankers and the "buy now pay later -- or never" public are. Osama bin Laden has also cost us a few hundred billion buck too. Chris Call me an 88% idiot Greenspan might not have been abe to STOP the madness but he made it worse at every turn. Preaching against irrational exhuberance in 1995 or whatever he did nothing to slow it down by raising interest rates early. Worse yet his solution to EVERY MFing problem was to throw money at it. From LTCM to Y2K to bubble prop jobs, to recession fighting madness. He also started to believe in the productivity miracle and thought the boom could go on forever right at the peak. He got sucked 100% into the madness right at the top. This man has done nothing but throw $ at every problem that ever existed, in spite of the fact that throwing $ around like they were pennies is exactly waht caused the problem. Now we have an idiot that thinks the cure for too loose monetary policy is even looser monetary policy. Well right now, the path is set. It is clearly "inflate or die" and that is one huge point that Russ and I agree on I bet. The difference is that I think all Greenspan did was make things worse and "inflate or die" dies on the vine in 2004 or 2005. Deflation here we come as all that excess debt gets wiped out. Mish

To: ChrisJP who wrote (3864)	12/25/2003 1:17:12 PM
From: ild	Read Replies (1) \| Respond to of 110194

Greenspan is pursuing a very risky policy. He creates financial bubbles hoping that all of them will eventually deflate without major dislocations. This is pure gamble. With each bubble he's taking a bigger and bigger risk. Well he's quite old and may want to take this risk, but taking that risk is not justified for US citizens. If printing more money was a panacea then Argentina would be the richest country. Please read about bubbles Jun 20, 2003 Global: Endless Bubbles Stephen Roach (New York) morganstanley.com

To: ChrisJP who wrote (3864)	12/25/2003 2:11:00 PM
From: Ramsey Su	Respond to of 110194

Include me in the "idiot" group also please. This idiot came to the conclusion that Greenspan for many many reasons but I will name a few here: Read this book amazon.com This is a book of praise by Woodward. However, any student of economics would understand how Woodward actually pointed out the over manipulation of a system. One of Greenspan's biggest flaws is indeed trying to play maestro. "Irrational exuberance" - while declaring irrational exuberance, he did just the reverse. He bailed out LTCM (which I still think that there should be congressional investigations into exactly what the Feds promised the brokerages) by lowering rates. The fed has to power to increase margin requirements. There would be no tool more appropriate than raise that to combat irrational exuberance. He chosed not to act. Governance - Read amazon.com after the fall, Greenspan was specifically asked whether hedge funds should be more regulated, especially in pertinence to the use of margins. He said no. The industry can regulate itself. If you have read the book, you would see that clearly it is the outrageous leverage that created a systemic failure possibility, prompting his action. Backbone - Greenspan has proven that he will sell out to wallstreet, evidenced by above. He will also sell out to anyone to keep his job, and legacy. Before Bush became president, he was pounding table on surpluses should be used first to retire national debt, instead of tax cuts. We all knew Bush wanted the tax rebates from his campaign. After Bush took office, Greenspan did an about face and said the rebate is a good idea. There are a lot more but I really think that if I provide any more facts, it would be difficult to maintain my idiot status. In closing, I think that when the baby boomers start retiring in earnest, they will find out what Greenspan did for them during this asset and credit bubble era. The new book on Greenspan will not be Maestro but The Bubble King.

To: ChrisJP who wrote (3864)	12/26/2003 10:23:09 AM
From: Rarebird	Read Replies (4) \| Respond to of 110194

<Only an idiot would try to blame Greenspan for all of this.> The US economy "grew" by 8.2% in the third quarter. The trade/current account deficit doesn't matter, it simply reflects the global demand for US assets. Official interest rates will stay at their present 1.0% level until 2005. LOOK AT THE STOCK MARKET! Everything is beautiful, isn't it, especially if you called the end of the Bear Market in Gold Stocks on October 25, 2000 and started accumulating? Message 14655257 Message 14655181 The orchestrators of all this are on Wall Street, at the Treasury, at the Fed, and in the boardrooms of Central Banks throughout the world, most notably in Asia. The Fed keeps interest rates at ridiculous levels, the Treasury keeps pumping out new debt to enable the Bush Administration to spend to the tune of $US 20,000 plus per American household and to borrow at historically unprecedented rates. Wall Street sees an avalanche of this new money placed by large institutions and by investors who can't find a domestic rate of return anywhere else. And the foreign Central Banks, especially the Asian Central Banks, keep creating vast amounts of new domestic currency in order to buy Dollars in order to recycle the Dollars back into new Treasury (and Agency) debt in order to keep the wheel turning over. ALL of the economic and financial FACTS and the news reporting these facts - the budget deficit, the trade and current account deficit, the swooning Dollar, the decimation of US manufacturing, the PRICE RISES which the Fed claims it cannot see - ALL of this and more is submerged in the great Wall Street stock market rally of the past year. US mutual funds are now enjoying an inflowing surge of new investment capital only bettered by the all time record set in 2000 - the year of the market top. Wall Street bonuses are at their second highest level ever - again only bettered by the record set in 2000 - the year of the market top. When it comes to investing/longer term trading, I accept the mindset of these Bozos and act accordingly. I don't allow my personal feelings to interfere. I'm not surprised in the least at what Greenspan has done. 1% Fed Funds is great for Gold and the Miners. No reason to sell (outside of taking initial investments off the table and play with house money) just yet. I'm expecting around $500 Gold in the first quarter of 2004.