Archive for the ‘krise-sitater’ Category

Økonomiske sitat: 25-26 september 2008

Lagret under: krise-sitater, økonomisk on september 27, 2008 at 3:51 pm

“The term ‘government money’ has been bandied about a lot in recent weeks. It is being portrayed as a near miraculous elixir that provides wonderful results when used for bailouts past, present and future. But government money comes with limitations. It is not a magic potion, and cannot cure all the ills of the financial system. More importantly, it is not even money at all – it’s debt.” 

James Turk, 25. September 

“The IMF — where Paul Wolfowitz went after carrying out his assignment at the Pentagon — is the Rothschild instrument to enforce its interests. They are auditing the Fed to make sure that no policy and no action of the Fed or the US government will result in any repudiation of debt owed to the Rothshild’s or in any way reduce the expected harvest of assets that the international bankers are expecting from the US collapse.  The IMF and the Federal Reserve should both be shown the door by the next president. The Federal Reserve needs to be shut down immediately — but by the United States, not by international financiers.”  

Dick Eastman 

“The measure includes a provision in which the public debt is raised to over $11 trillion. This will put it at about 85% of US GDP. We recall from a couple weeks ago that Louis 16th lost his head after France’s debt rose to about 80% of GDP. The problem is, when you get to that level of debt, lenders balk and the borrower runs room to maneuver. In the modern world, that probably means higher interest rates…and what was once unthinkable, a downgrade of America’s debt rating from AAA to something less than that – and possibly junk. 

This would be accompanied by a sell-off in the dollar too. In this regard, here comes an insight from the democratically elected president of Iran: 

“The world,” explained Iranian President Mahmoud Ahmadinejad, “no longer has the capacity to absorb fake U.S. dollars.”  

Of course, that is exactly what we’re about to find out. Mr. Ahmadinejad has rushed to judgment. We’ll let the court take its time. But we have a feeling that the Iranian president is right about the ultimate verdict.” 

Bill Bonner, 25. September 

“When everybody thinks the same thing, no one is thinking. And now, everyone thinks the market screwed up…and the bureaucrats rush in to unscrew things.” 

“And what a bunch of numbskulls – Greenspan, Paulson and Bernanke! Every word they’ve said so far has been financial poison. “Greenspan relaxed about house prices…” reported the Financial Times in 2005. “Most negatives in housing are probably behind us…” said the same sage in October 2006. “We believe the effect of the troubles in the subprime sector…will be likely limited…” said Bernanke in March 2007. It’s “not a serious problem…I think it’s going to be largely contained,” added Paulson in April 2007.” 

“For the last 15 years, the U.S. money supply has grown about twice as fast as GDP. Federal government liabilities, meanwhile, have grown three times as fast. As a result, the USA now has more financial obligations than assets. It is, effectively, broke. Nevertheless, the debit side of its ledgers grow heavier and heavier. This year’s US government deficit will add about half a trillion. The US trade deficit is about $700 billion. The U.S. bailout plan will probably cost at least $1 trillion more.” 

“If, on the other hand, it merely prints the money – or if it creates it “out of thin air,” to use Lord Keynes’ handy phrase – the results are even worse. Inflating the money supply with new currency, a la Argentina or Zimbabwe, wipes out debts. But it destroys faith in the dollar and brings down the whole world’s money system. 

Sooner or later, this is just what will probably happen. Not because capitalism doesn’t work – but because it does. Capitalism is doing just what it should do – it is separating fools from their money. But the fools vote. After a big bubble, there are more fools than sages…and, in the United States of America, more debtors than creditors. Sooner or later, Americans will realize that they are better off destroying their own money than preserving it…and that they would prefer to stiff their creditors rather than pay their bills. That is when deflation will gives way to inflation…and the world’s post-’71 dollar-based money system comes to an end. ”

Bill Bonner, 26. September

“We’ve dedicated many columns and thousands of words to identifying what we feel are sound investments in fundamentally solid, debt-free companies, resource stocks and, of course, we constantly hammer home the importance of holding at least some of your wealth in physical gold.” 

Joel Bowman,  26. September 

“What’s left of the Barry Goldwater wing of the Republican Party, which maintains its natural tendency to trust the markets and not government, has dug in its heels. But, Bush, Paulson and the Democrats have argued that our problems are so dire that free enterprise principles must go out the window. The struggle is historic, but the Congressmen are fighting a losing battle. Sadly, Americans now appear willing to abandon their economic heritage at the first sting of financial pain.” 

“The urgency for passing this bailout bill is based on the claim that the American economy will collapse if nothing is done. If the government were to stay out, and allow the market to function, there will certainly be a great deal of economic pain. Companies will go bankrupt, banks will fail, real estate and stock prices will keep falling, and many people will lose their jobs. However, government action will not prevent any of this. At best, it will merely delay the inevitable, but only at the cost of increasing the severity of the underlying problems, thus making their ultimate resolution that much more painful to endure.” 

“Our leaders maintain that without this bailout consumers will not be able to borrow money to buy cars. So what is wrong with that? We already have plenty of cars, and if we are broke, why do we need to buy more? Instead, we need drive our old cars longer, pay off our underwater auto loans, and produce more cars for export. It is also argued that without access to credit parents will not be able to borrow money to send their kids to school. That’s fine by me as it will force Universities to reduce tuitions to levels families can actually afford. They will either have to cut out all of that bureaucratic fat, or go out of business for lack of customers.” 

Peter Schiff, 26. September 

“The financial meltdown the economists of the Austrian School predicted has arrived.” 

“We are told that “low interest rates” led to excessive borrowing, but we are not told how these low interest rates came about. They were a deliberate policy of the Federal Reserve. As always, artificially low interest rates distort the market.” 

“Speaking about Fannie Mae and Freddie Mac, the president said: “Because these companies were chartered by Congress, many believed they were guaranteed by the federal government. This allowed them to borrow enormous sums of money, fuel the market for questionable investments, and put our financial system at risk.” 

Doesn’t that prove the foolishness of chartering Fannie and Freddie in the first place? Doesn’t that suggest that maybe, just maybe, government may have contributed to this mess? And of course, by bailing out Fannie and Freddie, hasn’t the federal government shown that the “many” who “believed they were guaranteed by the federal government” were in fact correct?” 

“F.A. Hayek won the Nobel Prize for showing how central banks’ manipulation of interest rates creates the boom-bust cycle with which we are sadly familiar. In 1932, in the depths of the Great Depression, he described the foolish policies being pursued in his day – and which are being proposed, just as destructively, in our own: 

“Instead of furthering the inevitable liquidation of the maladjustments brought about by the boom during the last three years, all conceivable means have been used to prevent that readjustment from taking place; and one of these means, which has been repeatedly tried though without success, from the earliest to the most recent stages of depression, has been this deliberate policy of credit expansion.” 

The only thing we learn from history, I am afraid, is that we do not learn from history.”

“The very people who have spent the past several years assuring us that the economy is fundamentally sound, and who themselves foolishly cheered the extension of all these novel kinds of mortgages, are the ones who now claim to be the experts who will restore prosperity! Just how spectacularly wrong, how utterly without a clue, does someone have to be before his expert status is called into question?

Oh, and did you notice that the bailout is now being called a “rescue plan”? I guess “bailout” wasn’t sitting too well with the American people.”

Ron Paul, 26. September  


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Økonomiske sitat: 23-24 september 2008

Lagret under: krise-sitater, økonomisk on september 27, 2008 at 3:28 pm

” Being long gold, for example, is one way to short the U.S. dollar. And drinking at home with friends is one way to short restaurants with stuffy dress codes.” 

Joel Bowman, 23. September  

“What are my “big investment ideas,” you ask?  I’ll give you three: Sell the dollar, sell the dollar and sell the dollar.  My fourth and fifth big investment ideas are related: Sell short long-dated U.S. Treasury bonds; buy commodities.” 

“Even though commodity prices have retreated substantially from their all-time highs, they will rebound eventually…and then continue on to new all-time highs. (Perhaps the big bounce in gold and oil during the last couple of trading sessions is the start of something bigger). So at the risk of repeating myself, I will repeat myself anyway: I like commodities, at least for the long haul, if not also for the short haul. I like commodities because supplies are limited and demand is not. I also like commodities because they lack CEOs and executive management teams. I like commodities because greed and stupidity cannot destroy their value.”  

“American-style investment banking is not a “business model,” it is a Ponzi scheme – a fraud – in which all the money flows to the people at the top, while everyone else who plays the game absorbs the losses. This massive institutionalized fraud is now over.” 

Eric J. Fry, 23. September  

“Last week, the SEC announced a temporary ban on new short sales in 799 specific financial stocks. Short selling is one of the most important weapons in an investor’s cache. It allows the market to react to foul play and sloppy corporate leadership. This is an even more important tool to use against poorly run small caps. That’s why this ban is so significant.” 

“Rather than target the individuals who had been warning about this situation for years, why doesn’t the SEC investigate the proprietary trades of the banks’ trading desks? I’d expect it would find evidence that the investment banks were short selling each other’s stocks at the same time that they were cutting each other’s lines of credit. In the autopsy of Lehman Brothers’ balance sheet, we have discovered that Lehman management wildly overvalued its toxic assets. Why wasn’t this taken as evidence that the lack of transparency at investment banks is at the root of last week’s crisis?” 

Dan Amoss, 23. September  

“And the New York Times reports that older Americans are “terrified.” They staked their retirements on housing and stocks. Both now are losing value. Worse still, they have fewer savings than any generation since WWII…and the meager savings they do have pay almost nothing!” “Those old people would be better with a stash of gold coins somewhere. Coins have no counterparties. No hidden liabilities. No explosive “investments” in the vault. They yield nothing…but nor do they lose value when people get scared. Instead, when the going gets rough, they typically go up in price.Our guess is that we will hear a lot more about gold in the years ahead. Because the world’s paper money system…a system that depends on hope, faith, and the kindness of strangers…is going bust. Maybe not this week. Maybe not this year. But eventually. And each day that passes brings us closer.” 

“As the correction continues, we expect more and more frantic efforts on the part of the government to stop it. Look for the Fed to cut rates. Look for more bailouts…more junk on the Fed’s balance sheet…more guarantees…and more intervention. Both candidates for president, along with the media, and the voters themselves are all in favor of “doing something” to prevent assets from falling to what they are really worth.” “Of course, investors will smell it coming. They will push up the gold price…to $1,000…to $1,500…maybe to $3,000. And then, the financial authorities will prohibit trading gold. Franklin Roosevelt already set the pace; he confiscated it.” 

 “First, note how the elitists have allowed the stock markets to crash over the past two days in order to put pressure on Congress to adopt their plan.  They have withdrawn PPT support in an effort to stuff this plan down Congress’s throat.  And this pressure will continue until they get their way.  This is what Congress gets for letting the Illuminati run our country.” 

“And how is this elitist bailout bonanza going to benefit the taxpayers, or our economy?  It isn’t!  In fact, it is going to exacerbate an already volatile situation. Thanks to free trade and globalization, the global economy has become a tripwire economy.  One wrong move, and the claymores go off, taking out the entire global financial system in a blaze of shrapnel and glory.” 

“The United States operates at a deficit, spending more money than we gained from our own production, and we need foreigners to finance our profligacy.  In order to help us finance this deficit, these foreigners buy our treasury paper with the excess dollars they obtain from their trade with the US.  They do this by having their central banks print more of their domestic currency to absorb the dollar forex which is flooding their economies due to trade imbalances with the US.  Their central banks simply print more of their own currency, which is then used in currency exchanges to soak up that dollar forex.  This process inflates their economies by dumping their own currency on their domestic markets while bidding up dollars which are then used to purchase treasuries.  While those dollars are parked in treasuries, they do little harm to US citizens via inflation, although we do have to pay interest on them.  The foreign nations then enjoy a competitive price on their exports to the US because of their artificially weakened currency, but at the expense of domestic inflation.  This system perpetuates the trade imbalances, and the inflation in the foreign nations.  Obviously, this cannot go on forever.” 

“And now, all these wild, lunatic bailouts will threaten the entire world economy. Why?  Because we are dumping more dollars into the world economy, devaluing our currency, and therefore the value of all these foreign-owned US treasury bonds. Imagine what will happen when 700 billion dollars, in cash, is dumped into the fraudster system.  If the fraudsters start lending again, that means the fractional banking multiplier, which usually runs at 7 to 8 times reserves, will then generate five to six trillion dollars of new money and credit, an amount that would swamp the US and global financial systems even if the Fed shut off its money and credit spigot completely.” 

“These bailouts must be stopped at all costs, or we are going to get vaporized later.” 

Bob Chapman, 24. September 

“If citizens across the country could glimpse the horror seen by the Congressmen (of which we have long warned), then widespread panic would truly be the order of the day. In particular, people will be shocked to see how Paulson’s seemingly vast request to Congress for some $1 trillion is utterly dwarfed by the likely problem.” 

“An old maxim is that, gold makes sense when nothing else makes sense. Today, not much does make sense. Gold is likely to explode, at least in the initial stages of panic. In a recession, cash becomes a King. In a depression, gold is an Emperor.” “In these precarious times, think return of capital, not return on capital.” 

John Browne, 24. September 

“What is ironic is that China, a self-described socialist state, is increasingly now responsible for the well-being of the US, a nation rapidly transforming itself into a fascist nation right before our eyes; and, while this might be the ultimate resolution of the two competing ideologies of the 20th century, I don’t think so. Instead, it could be the end of both.” 

Thomas Jefferson: “I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”  

Jefferson’s prophecy has now come true and, yet, we act surprised; and, if we are, it is because the corporate controlled media has effectively misled Americans about the cause of their problems.” 

Darryl Schoon, 24. September

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