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

To: TobagoJack who wrote (67805)	11/4/2010 11:17:42 PM
From: Hawkmoon	Respond to of 220077

if i were the potus, i would - rip the heart out of wall street - declare global default - zero out credits and debits - shrivel govt sector by 75% - reset money - and get on with life That's rather drastic... What I see being the primary reforms that must occur is getting a handle on HFT black boxes and dark pools because it skews price discovery. Then we must ban naked CDS. Financial "surety" based upon the destruction of assets not owned by the buyer of CDS protection hampers capital formation. If I can take insurance out on YOUR house, I have every incentive to burn your house down. To buy CDS, one should own the underlying asset. The mortgage securitization process should be completely revamped in order to prevent banks from using it to spin off debt liabilities to a speculative equity market. We turned mortgage notes into stocks and undermined the foundation of the entire financial system. And as Mish has pointed out, public unions must be reined in to where government sector workers are not better protected and paid than the average wage of the comparable private sector worker, from who's taxes those public employees are paid. Any government stimulus must be guided and targeted towards creating long-term economic ROI. If people receive money for social entitlements/unemployment/welfare, there should be some expectation of community service being included where appropriate. And I certainly agree that government sector is too large. Debt must be based upon projected ability to add economic value and ultimately pay down that debt, not just roll it over. But let me also say this. It's not just the US that has this problem.. Every other major economy also faces similar dysfunction. Hawk

To: TobagoJack who wrote (67805)	11/4/2010 11:35:54 PM
From: RJA_	1 Recommendation Read Replies (1) \| Respond to of 220077

>>if i were the potus, i would - rip the heart out of wall street - declare global default - zero out credits and debits - shrivel govt sector by 75% - reset money - and get on with life Simple and quick. All the drek cleaned away after shock (quite alot of shock, actually). Not sure about the awe part. Probably depend on which side the military decided to be on. One problem with all that is the default. Treasuries are held as assets at the heart of the banking and financial system. Bank examiners (I used to be one) are required to hold obligations of the US Govmt as the highest rated of all assets, and make up bank reserves and the maximum safe assets in trust departments. They are also held by municipal governments as investments and as assets in pension plans for the same reasons. Very bad for credibility to show that to be idiocy. Not of course that this all hasn't happened on repeating basis over historical times. Folks keep trying to make alchemy happen, by stealth, secrecy, lying and denying... Things can get rough at the end, and I would really rather not go through that.