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Politics : Welcome to Slider's Dugout -- Ignore unavailable to you. Want to Upgrade?

To: SliderOnTheBlack who wrote (7448)	12/27/2007 4:04:21 PM
From: pogohere	Read Replies (1) \| Respond to of 50118

" I have something that John Hussman doesn't have. And it gives me a huge advantage. And that "huge advantage" is being unencumbered by the traditional brainwashing of a formal economic education. . . .Fractional Reserve banking means than when a bank get's $10 billion of "dead/illiquid" assets of it's book that it can not monetize...in return for $10 billion of fresh cash from the Fed... it can now make $100 billion in fresh, new loans (applying 10 x leverage to it's new found liquidity). That's the real story on what the Fed is doing." That's a typical understanding of the economics of fractional reserve banking. Where's the advantage in that? I respect your opinion, but that's all you're offering. No details on the particulars of the Fed's or the ECB's actions. No data. No discussion of the impact of taking non-reserved SIVs back onto the balance sheet, where they require reserves. No discussion of who is now borrowing these sums you claim are available for lending. No discussion of the default rates going forward on credit cards and car loans. No discussion or analysis of the insolvency issues. Some slap.