Financial topics

[wvbill]

web site is
regularly read by tens of thousands of people,

John,

Your site (one of the best that I know of) and a few others are the only hope of getting the truth out there.

It is like a silent revolution is taking place over the internet. Hopefully, it will grow enough... It is having impact...

I wish there were a way to bring a class action suit against Goldman and the Fed for their illegal actions, And we should sue congress for complete incompetence... And the FDIC for not closing Citigroup... But that would pose "systemic risk" i.e. "cause Goldman to lose money"...

Like you and me, more and more people are getting pissed...

Thanks for your work.

Bill

[burt]

web site is
regularly read by tens of thousands of people,

I wish there were a way to bring a class action suit against Goldman and the Fed for their illegal actions

FORGET that, you have to put yourself in the skin of the Government and to understand what is "Crony capitalism".
And i'm not so sure that what GS does is illegal, it smells as rotten yes, but not necessarly illegal.

Actually the Government tries to save what can be saved and tries to buy time, and this is correct. What makes me feeling very anxious on the future is that they do STRICTLY NOTHING (whatever country you look at) to clean the problem, it is ONLY escape towards the future.

This is a REAL problem, because the solutions to solve the banking problem are all well known by anyone who knows the banks from the inside (not from general or philosophical views) BUT this means "throwing away" quite quickly a lot of the managers of the bailed out banks (without believing a second that they will do it by themselves).
In ANY developped country there are the specialists able to to the right jobs, but NO goverment wants anything to change (and we go back that way to the John's point of view). NO CHANGE and everything will go ok... WRONG! but this can hold for a while (not only a few months but enough years to be reelected OR to give the problem at the next president).
At any time of the man's history on earth, men had to build new Gods to escape its anxiety, and this is part of the new God (the Economical God) ("NO CHANGE and everything will go ok"). Thinking to God BUT NEVER to the reality... This is Religion...

Burt

[greghaught]

If there's any collusion going on between Goldman Sachs and the NY
Stock Exchange to manipulate the market, then I don't care how many
people know about it (or, more likely, only have some suspicion).
These Gen-Xers and Boomers will have convinced themselves that by
screwing everyone but themselves they're doing the world a favor.
Anyone who tries to stop them will be mowed down. They're just
"ordinary people," at a time when "ordinary people" are crooks.

i 100% agree that these are totally corrupt times. rating agencies, conflicts of interest, cronyism, legal fraud, bought and paid for pols, yes i get all that. but i try not to let that unnecessarily bias my thought process.

it's the part about appreciable market manipulation by merely non-cornering transactional means that i dont buy. i grant the possibility of cornering, but i'm not buying market manipulation without long term (not just intraday) control of supply (with the exception of the fed's monetary policies and jawboning). these HFT's get flat (out) when they're not making market because they're just scalping and riding intraday technicals in the subsecond timeframe.

an example of how prices ARE manipulated is us govt bond prices. the fed manipulates those the only way that it's possible to. by buying huge (really huge) lots, it artificially distorts demand. by selling those huge lots it artificially distorts supply. that's cornering.

my point about whistleblowers was not that they would be ignored like in your examples or like at enron. that doesn't stop whistleblowers. my point is that there aren't any. GS isn't a small blood family operation. there are plenty of disgruntled, disillusioned current and former GS employees who could definitively prove this market manipulation if it is true. they could just contact Matt and it would be published and widely read tomorrow.

as for P/E's, you all really need to get over fundamentals. of course the MSM is going to do tricks with those.

and you really need to try and resist hype and emotion. emotion is a red flag.

i understand your outrage. the system is rotten to the core, but try not to fall into the trap of condemning anything that yields a large profit for your archenemy or a large loss for your hapless friend, or that doesn't seem to be cooperating with your opinion or fundamental model.

[greghaught]

my final point.

the definitively provable reality of our systems corruption is abundant and might just be enough to precipitate some change. the hype of the imaginary just serves to dilute the influence of provable reality and dilute the credibility of the agents of change.

[freddyv]

as for P/E's, you all really need to get over fundamentals. of course the MSM is going to do tricks with those.

and you really need to try and resist hype and emotion. emotion is a red flag.

i understand your outrage. the system is rotten to the core, but try not to fall into the trap of condemning anything that yields a large profit for your archenemy or a large loss for your hapless friend, or that doesn't seem to be cooperating with your opinion or fundamental model.

I think you make some good points about not gettin too emotional about these issues and not trading based on who you dislike.

But...ultimately I think that as a little guy, which I assume all of us are in comparison to GS and the other powers-that-be, it is equally as foolish to jump on board their bandwagons believing you can ride them to riches. It is important for me to know what the truth is and that means understanding that when a person says, "the average market P/E is 15 and anything under 10 is undervalued" and then goes on to say that the P/E is 15 when in truth it is 160 and won't be under 20 again for several years, even based on the optimistic estimates - http://www2.standardandpoors.com/spf/xl ... EPSEST.XLS - he is lying to me and eventually that lie will play out and burn me if I buy into it.

Examples:

1929. When traders could legally influence the price of shares higher and did, many saw these rising prices and bought, believing they too would benefit. Likely most of those late buyers held on and held on and held on at the insistence of the "experts" and eventually sold sometime in 1931 or 1932.

1980. Gold has had a tremendous run to historic highs and everyone KNOWS that you can't go wrong buying it. All the "experts" are saying, buy, buy, BUY!

2000. Tech is on a tear and all the "experts" insist that this time it is different and that we are living in a new world. We all know what happened.

2006. Housing is booming and we all know that housing prices never go down bcause the "experts" told us so. We all know what happened.

2007-2008. The stock market is at an all-time-high and the "experts" tell us that our economy s fundentally strong. Of course a three year old can see that this is not the case.

2008. Oil breaks through $100 and everyone says that is crazy...until it breaks past $125 and then everyone, including the "experts" (I specifically remember GS call for much higher prices) claim that we are in a new era of "peak oil" and we all have to buy, buy, BUY!

2009. Despite the government racking up huge new deficits, huge overcapacity in just about every area of the economy and a stock market that is obviously overpriced,even for a good economy, we are told that this was all just a bad dream and that things really will be alright, after all, the banks are profitable again....


Yes, most important of all is to look at the facts and understand that while people can manipulate the markets for a period of time, fundamentals will ultimately win out. Trying to jump aboard the Goldman train will only result in the little guy getting run over by that very same train as he gets pushed off for breaking the rule of "no free rides", even though that train is loaded down with the very money taken from that little guy as he was told it would save him and "the system".

As long as we understand that we can't fix the system by ourselves, that distrust of powerful people and institutions can be a very valuable thing. Understanding how they operate can be even more valuable. Assuming that you can play their game or run with them - to me that is suicide.

--Fred

[freddyv]

Here's the video:

http://www.cnbc.com/id/32025494/site/14081545
John

Barofsky seems to be doing exactly what he should be doing and if the media were doing what it was supposed to be doing then the transparency we were promised would be a reality and the people stealing from us or creating even greater problems by their incompetence would be exposed. It's obvious that CNBC is much more concerned about protecting the status quo than actually digging up facts and reporting them.

It needs to be added that CNBC can only get away with this because of the corruption of the population as a whole. Most investors - too many that I know personally - would gladly sell out the future of their country and their own offspring to see their 401k go up by another 10%.

Generational Dynamics explains this quite well, IMO, but I have to wonder if there is not a bigger cycle at work here in which we are at the end of our time as a great nation. I have no doubt that we can return to greatness but I question whether or not we will without a great challenge to awaken us.

GD in fact, is one of the few things that gives me hope. As you suggest, we are in a time of crisis and we likely have only recently entered that period. Were we to rise out of our "depression" from here and go on without really having to fix the fundemental problems we face I would have to say that we are through as a great nation. It is actually my hope that things get worse as I would rather live in a poor nation of honest people than a wealthy nation of liars and cheats and I think that only by having to deal with adversity will we once again become a great nation full of honest, decent people.

--Fred

[John]

[MarshAviator]

John,

What I am wondering is: Does the crash have to start with the market or can the economy actually collapse first?
With all the manipulation, corruption and perma-optimism is it possible for equity markets to lag the larger "real" economy.

It wouldn't surprise me if one day our debit cards didn't work, credit cards didn't work (even if you think you have money in your account, credit limit left etc.) and the whole thing ground to a halt.

At some point the books will have to balance, the Enron trick of creating multiple cows only works until you actually try to milk it, then no mater how many you have on paper, there is just the actual one in the barn.

Is the GD theory silent on which will lead?

[burt]

What I am wondering is: Does the crash have to start with the market or can the economy actually collapse first?

Juste one note: There IS and WAS NEVER any correlation between the Economy and the Stock Market. So you have to think as 2 different and Independant entities, one is linked to wages and way of spending of ordinary people, the other one ONLY linked to herd phenomena between the actors who want to SPECULATE on something without ANY internal value (just a provocating sentence, the truth is more subtile, but not too far).

If you don't agree PROVE it, for one recession on 2 the stock market went UP and if you study the principe of the different WAVES (there are different theories on that) for the stock market, you can realize that ANY try to make a correlation between Economy (with a big E) and the God Market is a Myth, just a way used by CNBC to make money.

Think also about why, by the hell, did people speak of Investment (which is: Using money to build long term CONCRETE thing) when it is SPECULATION. Words count and are part of the mind manipulation we are all in.

Regards

[aedens]

I feel salient points are being missed again to GD framework so the forums are sputtering somewhat. The best thing I have done over time is reread the posts to actual contexts of consumer and commodity issues. My point is take our your last college exam and take it and see where you score. Some of the volunteers here are remarkable people and we live and learn from GD parameters as another "large" tool which we can agree to disagree but facts will remain. The open source format has always adjusted my perspectives and educated us all to humilty and public service. Think of it this way? We want to be proven wrong and bend a few trends, which may or may not affect the Policy's which we all must tolerate. Given the new predicated business cycle in market terms in my Corporate view we are stable and we are seeing a few more worker dislocations but some segmants are improving but of course this can change. Again we all in gratitute to each other. Now will math meet reality? Of course it will and the post's here clearly convey reality other's do miss and can miss. Lately a few more books to read and wonder why so few can be so disconnected from there own people on the Hill. Are we not warned to the hour of there avarice so prepare for your family's needs and not theres and that will indeed make them unneeded? Remember the vanguard always take the first hit. Its history and you can only fix ignorance. Never attribute to malice what stupidity will explain - Tacitus
John and many others have posited great stuff here in the crossroads this site is!
http://www.scotland.gov.uk/Publications ... 13162106/0 <--------
Our business groups have made some tough calls to maintain net working capital. At the cost of human capital with rent dissipation issues as many tolerate.
Do we like it? No, will they listen in todays context? No, i agree with Stiles that the market is countless people making independant decisions. In
observance with policy released they only pay attention when it affects them directly. Now it is, and the only plan there can fathom is red circling more to continue with what they deem as potilical capital. Picking winners and losers should be the consumer and really the numbers indicate that so we see what we already know in context of GD parameters with polital capital clearly interfering with market principles in a mixed market with reality's. Anyone for a broken window hidebound observance? http://en.wikipedia.org/wiki/Parable_of ... ken_window

http://prawo.uni.wroc.pl/~kwasnicki/Eko ... Lesson.pdf
There are simply not enough new buyers of debt on this planet to support the
spending programs of the United States government and it appears that current holders of
debt are beginning to sell. Because it is impossible to balance the budget from outside sources
of capital, the only source of funds left for the US, in all reality, is continued money printing.
The Federal Reserve’s policy of Quantitative Easing is failing. The US budget is ludicrous,
spending is out of control, spending promises are out of control, the world knows it - and we
know it. For all the pundits who see the economy improving over the next year, we invite you
to explain to us how this debt crisis will resolve itself without significant turmoil. We’ve
tabulated the numbers and they do not lie.

What I am wondering is: Does the crash have to start with the market or can the economy actually collapse first?

Juste one note: There IS and WAS NEVER any correlation between the Economy and the Stock Market. So you have to think as 2 different and Independant entities, one is linked to wages and way of spending of ordinary people, the other one ONLY linked to herd phenomena between the actors who want to SPECULATE on something without ANY internal value (just a provocating sentence, the truth is more subtile, but not too far).

If you don't agree PROVE it, for one recession on 2 the stock market went UP and if you study the principe of the different WAVES (there are different theories on that) for the stock market, you can realize that ANY try to make a correlation between Economy (with a big E) and the God Market is a Myth, just a way used by CNBC to make money.

Think also about why, by the hell, did people speak of Investment (which is: Using money to build long term CONCRETE thing) when it is SPECULATION. Words count and are part of the mind manipulation we are all in.

Regards