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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: dave9 who wrote (89184)	10/26/2008 12:37:27 AM
From: Elroy Jetson	10 Recommendations Read Replies (2) \| Respond to of 116555

There have always been attempts to stabilize markets, but certain people with their hands on the levers of government really nuts after 9/11. Nothing was off-limits to "keep America strong". Even the real estate bubble was an incredibly stupid post-9/11 attempt to keep the economy running at top speed. Although there are many proprietary indices, the chart of prices in one condo building in Los Angeles (see below) illustrate what happened. A price chart of every neighborhood looks similar. A sudden urge to buy real estate right after a national disaster is not something which would normally occur. This bubble was created at a governmental level. Suddenly, post-9/11 new loan syndication channels at Bear-Stearns, Lehman and other investment banks made no money down, variable-rate, option-pay mortgages (where you can skip 36 payments, like the first 3 years worth) available on a "stated-income" basis (aka imaginary income) to anyone with a pulse and a credit score greater than bankruptcy (FICO 685). The result was this unimaginable real estate bubble and looted banking system. In order to keep our nation strong, our White House and central bank devastated our economy in a way, and to a degree, that terrorists could only dream of.

To: dave9 who wrote (89184)	10/26/2008 5:05:01 PM
From: koan	Read Replies (4) \| Respond to of 116555

The Canadian dollar going form parity to $1.27 in three weeks says a lot about the underlieing tumultousness. I wish I could remember exactly what this pertained to, but I read soemwhere that aspects of this crash were 20 standard deviations from the mean. Something like 10 to the 50th power--,which is essentially impossible. So what is really going that we cannot see??