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| User Info | President Obama's Asian Problem in forum [Ticker] | ||||
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Genesis Posts: 71431 Incept: 2007-06-26 
KD^2 
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http://market-ticker.org/archives/1618-P....
---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-11-12 15:41:01
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Truthseeker Posts: 2016 Incept: 2007-10-07 
NW US
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Genesis wrote..Welcome to reality. In light of October's deficit report, this is a perfect wrap for a timely ticker! Well said. ---------- "The real leech****s are not the welfare people, but the paper shufflers in privileged positions who are skimming the money flows." " ~ Bozonian
2009-11-12 15:47:28
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Tesla Posts: 8174 Incept: 2008-04-03 
Delaware
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more jawboning - http://online.wsj.com/article/SB12579727.... Economists in the latest Wall Street Journal survey, on average, expect the Federal Reserve to raise interest rates around September 2010, a politically sensitive time considering midterm elections will be right around the corner and unemployment is forecast to still be over 9.5%. Kelly Evans and Phil Izzo discuss the findings from the latest WSJ economic forecasting survey, in which most economists predict that the Federal Reserve will start raising interest rate next September. The 52 surveyed economists—not all of whom answer every question—on average expect the unemployment rate to rise to 10.3% by the end of this year from its current 10.2%, and they expect it to stay above 9.5% through 2010. The respondents expect job growth to return over the next 12 months, but the forecast calls for an average of about 50,000 jobs to be added per month over that period. The economy needs to add about 100,000 jobs a month just to keep up with new entrants to the labor force. "The small-business sector is still under pressure, and larger companies are still focused on bolstering current results rather than preparing for the future," said Lou Crandall at Wrightson ICAP. Productivity gains and cost cuts have allowed companies to boost their bottom line without adding staff. The economists expect gross domestic product to expand around 3% at a seasonally adjusted annual rate through 2010, slightly slower than the 3.5% recorded in the third quarter. The forecast represents solid growth but remains at a level too low to add the number of jobs needed to make up for the eight million cuts recorded so far in this recession. The last time the unemployment rate topped 10%—in the 1980s—the following six quarters posted average growth of more than 7% but still only managed to bring the jobless rate down by about three percentage points. Despite the challenges, confidence is running high in the Fed to manage the economy. Thirty of 50 economists who answered the question said that the central bank will raise interest rates at the right time, while 18 said the Fed will be too slow. That contrasts with widespread criticism of the Fed's timing in the past. In the March 2008 survey, 80% of respondents said the central bank was too slow to raise rates in 2003, and Fed Chairman Ben Bernanke has been accused of being slow to cut rates at the start of the financial crisis. But that doesn't mean an increase in rates is imminent. Most economists said the Fed won't raise rates until the third quarter of 2010 at the earliest. Futures markets are putting 90% odds of a rate increase in August next year. "After a year of growth, the portion of the easing meant to curtail depression will be taken away," said Dean Maki of Barclays Capital. But "the Fed is unlikely to raise rates until the unemployment rate is on a decisive downward trend." If the Fed raises rates in September, it would come just six weeks before the midterm election. The central bank values its independence from the political process, especially on monetary policy, but it could be feeling pressure to maintain its easy stance amid high joblessness. "I don't think the [rate-setting Federal Open Market Committee] is influenced by the political calendar," Mr. Maki said. But "the Fed doesn't want to become a main topic of the election either. I could imagine it being a mild disincentive [to act]." He notes that increasing the federal-funds rate to 0.5% from its current 0%-0.25% range would still keep the rate at an extremely low level. No matter how much the Fed wants to stay out of politics, the decision to change rates could come amid a highly charged political battle in Congress over the central bank's future. Sen. Christopher Dodd (D., Conn.) this week introduced legislation that would curtail the Fed's powers. His counterpart in the House, Barney Frank (D., Mass.) wants to expand them. The debate could drag on well into 2010. Among other findings of the survey: * Emerging markets and commodities are the most likely places for another bubble to develop, according to economists, but they only put slightly better than 1-in-3 odds of such an unsustainable run-up in asset prices occurring in the next two years. * More than half of the respondents see a U-shaped recovery with some slowness followed by solid growth, and 31% forecast a stronger, V-shaped recovery. Just 11% of economists expect an L-shaped rebound where economic activity stabilizes at a low level, and only 7% see a double-dip recession—another drop in gross domestic product after a short rebound—as the most likely scenario. Write to Phil Izzo at philip.izzo@wsj.com ---------- "Neither the wisest Constitution nor the wisest laws will secure the liberty and happiness of a people whose manners are universally corrupt." Samuel Adams I'd rather die on my feet than live on my knees. - Emiliano Zapata
2009-11-12 15:50:56
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Sqmo Posts: 387 Incept: 2009-09-14
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China is already cutting back on new US Debt purchases. Japan however is still buying. What I find hard to believe is that the Fed is just as big of a player as these two Asian countries. China has 0.8T, Japan 0.7T, and the Fed somewhere between those numbers. Not to mention another 0.7T in MBS This visit is more about preventing China from selling anymore rather than getting them to buy more. How in the world the Treasury is going to issue another 1.5T next year is beyond me.
2009-11-12 15:57:59
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Bogey Posts: 728 Incept: 2008-03-12
Montana
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I keep saying this, but I don't understand why anybody thinks the Chinese or Japanese leaders have any incentive to stray from the status quo. Are TPTB over there living any less high on the hog than ours are over here? Are THEIR peasants rising up any more than ours are? As long as the Asian worker remains content in his poverty and does not demand a bigger slice of the wealth that keeps sloshing across the ocean, I believe the game will simply continue ad infinitum...
2009-11-12 16:09:03
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Sangell Posts: 61 Incept: 2009-08-16
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I read Mr. Pesek's piece and I suspect he is right. Obama is likely to be the recipient of the bluntest talk any American president has ever been forced to listen to outside of Kim Jong Il or Leonid Brezhnez. This is for the good. Obama needs to get his mind off of healthcare boondoggles and focus on our position in the world. China wants to be the hegomonic power in the region and they will be by default if Obama continues his reckless economic policies. Destroying the dollar will ineluctably drive Japan into the Chinese orbit and with it Taiwan and South Korea.
2009-11-12 16:16:49
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Jwm_in_sb Posts: 224 Incept: 2009-04-16
California Desert
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how can it continue infinitely if Americans can no longer consume their goods / exports keeping their population of migrated farm workers in the factories? How are they going to keep them employed????
2009-11-12 16:19:57
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Max2205 Posts: 56 Incept: 2009-03-06
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Last phase of the rally underway ( DIA vs IWM)= dumping small caps for blue chips...till it don't work, then to comodities, then bonds, then small caps, rinse and repeat....
2009-11-12 16:47:23
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Mikeri Posts: 140 Incept: 2007-10-04
Natchez, MS
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KD. One of your best ever. Kudos.
2009-11-12 16:55:25
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Glasshammer Posts: 124 Incept: 2009-09-02
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Speaking of Asia. You must see this video of Ordos City in China. A modern day ghost town in what in a fully developed city. http://www.zerohedge.com/article/other-s....
2009-11-12 17:03:08
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Mezcal Posts: 838 Incept: 2007-08-04
Benicia, CA
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kd wrote..So let's cut the crap. If the Asians don't like us borrowing so much money stop lending it to us. Word. ---------- The state controller's office fired up a pair of printing presses... - LA Times
2009-11-12 17:03:19
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Glasshammer Posts: 124 Incept: 2009-09-02
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So let's cut the crap. If the Asians don't like us borrowing so much money stop lending it to us. Agreed.
2009-11-12 17:13:54
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Yaldor Posts: 1430 Incept: 2008-05-17
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Sad Ticker. Truth is not pleasant . ---------- For every crash the probability of someone showing that he predicted it is near 1 . For every prediction of an imminent crash the probability of it being correct is almost zero Last modified:
2009-11-12 17:22:21 by yaldor
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Grf Posts: 489 Incept: 2008-12-08
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"Audit the Fed... is a scam." Maybe I'm not following, but WTF Karl?!? IMO, this statement of yours needs a little explanation. Banksters frontrunning the market through the Fed, getting money good back on absolute trash, Bernanke/Timmay/Paulson holding a gun to the USA's head saying "don't audit us or we crash the markets" - are these not the definition of an independent and predatory central bank. Maybe I misunderstood, but this statement of yours gets a big WTF from me.
2009-11-12 17:27:43
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Genesis Posts: 71431 Incept: 2007-06-26
KD^2
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Go read it again. Auditing The Fed will not drain system liquidity. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-11-12 17:29:14
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Econ101 Posts: 498 Incept: 2007-08-19
Online
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the whining and crying about "Audit The Fed" bills is not just misplaced. He called the whining misplaced & scam , not the audit.
2009-11-12 17:29:53
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Thelight Posts: 10 Incept: 2009-09-06
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Just an FYI. Well Ben B. did recently speak out against growing federal deficits. But, his words announced after the FY2010 budget proposal, are just empty thoughts. Running a deficit is only viable if you can fund Government. The solution, the Federal Reserve Central Bank of the US. The point is, we have the worst of all worlds here; a greedy political system unable to control spending and waste, and a Central Bank who will help pay for this irresponsibility directly through QE or indirectly through foreign central banks, or Federal Reserve member banks.
2009-11-12 17:43:53
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Bogey Posts: 728 Incept: 2008-03-12
Montana
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JWM, how are they being kept employed now? Print, print print of course. As long as people keep getting the same digits going into their bank accounts every month, they either don't notice or don't care that there's less and less wealth behind those digits. It's the boiled frog syndrome times 2 billion.
2009-11-12 17:45:18
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Architect Posts: 780 Incept: 2007-07-11
london UK
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I have been wondering why the FCBs keep buying Treasuries and it occurred to me that they might have been buying US originated MBS from their own banks to keep them afloat . So the FCBs are holding the junk. Then the Fed and the US Treasury cuts a deal with them to swap the MBS junk for Treasuries by buying the MBS . It seems plausible......... is there any evidence that the Feds MBS purchases are all from US sources?
2009-11-12 17:51:04
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Grf Posts: 489 Incept: 2008-12-08
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So you're talking about the bankers' whining. OK. Now I get it. Bankers control government, government creates Fed, Fed bows to government pressure to keep interest rates low, bankers get free money from Fed, bankers speculate and make money, bankers use money to control government even more. Is that a good summary?
2009-11-12 17:54:02
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Jwm_in_sb Posts: 224 Incept: 2009-04-16
California Desert
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"JWM, how are they being kept employed now? Print, print print of course. As long as people keep getting the same digits going into their bank accounts every month, they either don't notice or don't care that there's less and less wealth behind those digits. It's the boiled frog syndrome times 2 billion." Ummm, I don't think so. There have been lots of Chinese factory workers laid off in the past year or so due to lack of demand here in the US. I don't think anything is being deposited into their bank accounts...if they have one that is.
2009-11-12 18:01:24
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Lucky1 Posts: 64 Incept: 2009-08-05
Pittsburgh
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"Normally you'd have to tax more to spend more, but that's not politically acceptable. So we float some more bonds, claim everything is ok, and off we go spending money we don't have." Did I read that Treasury release right today that tax revenue in October was down 17.9% year-over-year in October, on top of the crash in revenue in October 08 vs. October 07? If I'm seeing it right; the Feds expect $121B in Corporate Income Tax this year and received NEGATIVE $4.5B (NOL Carryforward refunds in October from September 15 corporate tax filings on extension???) see second line of page 5 of 32... http://www.fms.treas.gov/mts/mts1009.pdf It looks like they actually *cannot* tax more...what to make of this trial balloon today about 'paying down the deficit using TARP funds'?!?!? Are they kidding us? Are we really that (collectively) stupid? Is this just a game to push out the debt ceiling increase a little further hoping they can jam Health Care through the Senate first? I'm starting to wonder...is 'Health Care' just 'Stealth Tax' to put in place a tax increase and then put off implementing any health care program spending in 2013 to 2014, 15, 16, or infinity - tax everyone then never actually spend the money on described program - bait and switch? Incidentally, that $176B October deficit is more than the deficit for the entire fiscal year of 2007 of $161B. ---------- "Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy." -USSC Justice Louis D. Brandeis: Dissenting Opinion in "Olmstead v. United States" (1928)
2009-11-12 18:56:12
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Jstanley01 Posts: 2571 Incept: 2008-07-30
San Antonio, Texas Online
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Randomly: A short version of this Ticker:Tickerguy wrote..[O]nly the scammers are left!"Audit the Fed" is fuzz in the Ron Paul types' navels, so they've got something to focus on "cleaning up" while they're getting ass ****d. online.wsj.com/article wrote..Despite the challenges, confidence is running high in the Fed to manage the economy.If there is one lesson from the 20th century, it is that centrally-planned economies don't work. Why? See the short version of this Ticker, above. ---------- ...so in short, my fellow Texans, we must secede. "For the children..." --Me Last modified:
2009-11-12 19:16:52 by jstanley01
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Yatez112 Posts: 102 Incept: 2009-01-20 Louisville
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Excellent ticker, Genesis. While the Fed may supposed to be "independent," its actions are not.
2009-11-12 19:23:42
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Bezzle Posts: 3857 Incept: 2009-08-02
Moonbat Patrol Online
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Karl wrote..Volcker did it because despite the heat he knew he would take (and he did) it was necessary.In the late '70s it was actually possible for the government to pay off its debt ("necessary") by jacking interest rates and raising taxes. (This brought on the "stagflation" recession which, in addition to the Iranian hostage crisis and assorted Cold War issues, swept Reagan into office.) The trouble today is that there's no possible way in hell they're ever going to pay off the debt. They're inside the event-horizon of the debt black hole. Raising interest rates a small amount to prevent the dollar from being eviscerated is one thing; jacking them to up to double-digit levels in an attempt to pay off the federal debt will result in decades of grinding austerity which I doubt the population will put up with. ---------- Why would you try to stop this? A bond-market dislocation puts an instant stop to all the bull****. It is the only limiting factor left in this interventionist madness. It is an almost holy event. -- Christian Gustafson
2009-11-12 19:33:07
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