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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (19818)	6/24/2007 11:56:11 PM
From: TobagoJack	Read Replies (2) \| Respond to of 218131

<<The thing doesn't look collapsible here, ... Will meet CB July first>> ... events looked beautiful in January of 1929. Pass this note to CB, and she can consider in light of she claims to understand about an earlier time telegraph.co.uk BIS warns of Great Depression dangers from credit spree By Ambrose Evans-Pritchard Last Updated: 5:11pm BST 24/06/2007 The Bank for International Settlements, the world's most prestigious financial body, has warned that years of loose monetary policy has fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump than generally understood. "Virtually nobody foresaw the Great Depression of the 1930s, or the crises which affected Japan and Southeast Asia in the early and late 1990s. In fact, each downturn was preceded by a period of non-inflationary growth exuberant enough to lead many commentators to suggest that a 'new era' had arrived", said the bank. The BIS, the ultimate bank of central bankers, pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system. advertisement"Behind each set of concerns lurks the common factor of highly accommodating financial conditions. Tail events affecting the global economy might at some point have much higher costs than is commonly supposed," it said. The BIS said China may have repeated the disastrous errors made by Japan in the 1980s when Tokyo let rip with excess liquidity. "The Chinese economy seems to be demonstrating very similar, disquieting symptoms," it said, citing ballooning credit, an asset boom, and "massive investments" in heavy industry. Some 40pc of China's state-owned enterprises are loss-making, exposing the banking system to likely stress in a downturn. It said China's growth was "unstable, unbalance, uncoordinated and unsustainable", borrowing a line from Chinese premier Wen Jiabao In a thinly-veiled rebuke to the US Federal Reserve, the BIS said central banks were starting to doubt the wisdom of letting asset bubbles build up on the assumption that they could safely be "cleaned up" afterwards - which was more or less the strategy pursued by former Fed chief Alan Greenspan after the dotcom bust. It said this approach had failed in the US in 1930 and in Japan in 1991 because excess debt and investment build up in the boom years had suffocating effects. While cutting interest rates in such a crisis may help, it has the effect of transferring wealth from creditors to debtors and "sowing the seeds for more serious problems further ahead." The bank said it was far from clear whether the US would be able to shrug off the consequences of its latest imbalances, citing a current account deficit running at 6.5pc of GDP, a rise in US external liabilities by over $4 trillion from 2001 to 2005, and an unprecedented drop in the savings rate. "The dollar clearly remains vulnerable to a sudden loss of private sector confidence," it said. The BIS said last year's record issuance of $470bn in collateralized debt obligations (CDO), and a further $524bn in "synthetic" CDOs had effectively opened the lending taps even further. "Mortgage credit has become more available and on easier terms to borrowers almost everywhere. Only in recent months has the downside become more apparent," it said. CDO's are bond-like packages of mortgages and other forms of debt. The BIS said banks transfer the exposure to buyers of the securities, giving them little incentive to assess risk or carry out due diligence. Mergers and takeovers reached $4.1 trillion worldwide last year. Leveraged buy-outs touched $753bn, with an average debt/cash flow ratio hitting a record 5.4. "Sooner or later the credit cycle will turn and default rates will begin to rise," said the bank. "The levels of leverage employed in private equity transactions have raised questions about their longer-term sustainability. The strategy depends on the availability of cheap funding," it said. That may not last much longer.

To: elmatador who wrote (19818)	7/12/2007 9:43:44 PM
From: THE ANT	Read Replies (1) \| Respond to of 218131

Elmat,Im in the belly of the beast and will report when able.Women, beer,good food,I can feel my morals slipping already.I wanted to go with my wife and kids through the Brasil Residents section of passport control as family and kids have Brazil passports.The lady said no ,go to foreign line.Got to the federal control agent and he said no way come through the Brazilian line next time even with US passport as I am one of you.Come through the line even if the lady says no,he says.Road from Rio to Belo warns you ahead of time with large signs if any radar ahead(signs are official road signs)just to keep you out of trouble.Road construction going on from Rio to Belo.Driver thinks Aercio Neves likely next Brazilian President.He gets things done in Minas Gerais and he should be good if that happens.You think Elroy ever gets tired of being wrong?http://www.pimco.com/LeftNav/Product+Focus/2007/EM-DLM-+Gomez-+06-2007.htm