Iceland Arrests Bankers

[to:vulcan]

you seem to be confusing yourself.

the USD DXY (US Dollar Index) has weakened by about 7% since Feb 2007, thats hardly a devaluation.

and against the EUR it hasnt changed, it has apprecoated against the GBP and weakened vs most Asian currencies, but that seems part of the plan to gain competitiveness. In fact, you americans whinge constantly about how unfair the Chinese are bing and have been begging them to appreciate the CNY for years.

so far you hav gotten 7% over 3 years....big deal.

as for devaluation, not there yet matey, even though you like to say so..

btw, do you drive a taxi, a lot of what you wrire sounds like taxi driver talk.

[Vulcanl]

to: vulcan

"...the USD DXY (US Dollar Index) has weakened by about 7% since Feb 2007, thats hardly a devaluation..."

It sure as heck is to us normal people!!  7% on 245 billion is 17.15 billion and certainly means the difference between a gain or loss for the US taxpayer! 

[to;vulcan]

to: vulcan

"...the USD DXY (US Dollar Index) has weakened by about 7% since Feb 2007, thats hardly a devaluation..."

It sure as heck is to us normal people!!  7% on 245 billion is 17.15 billion and certainly means the difference between a gain or loss for the US taxpayer! 

I see, well, thats because americans are stupid. you claim you want a weaker currency and then when you get it you think its a conspiracy to steal your money!

so what do you want, a weaker currency, a stronger currency, the right to sell your bonds to the world forever? the right to walk all over the rights of other countries?

your currency has weakened modestly, but not vs the eur and is stronger vs the gbp. and it weakening isn't even statistically significant, being well with one 3 year standard deviation, i.e., normal movement.

you have engineered a modest weakening of your currency, not a devaluation and it has been at the insistence of your own politicians and your own citizens, not the bankers.

so please, if you really have nothing more interesting to say than "It sure as heck is to us normal people" then please just f*** off back to your f***hole country of morons, you'll find good company there as lots of them will be as dumb as you are.

[Vulcanl]

pp,

I agree with a lot of what you have posted.  BANKERS caused this sorry state of affairs....that's what I've been saying all along 

[to:vulcan]

pp,

I agree with a lot of what you have posted.  BANKERS caused this sorry state of affairs....that's what I've been saying all along 

i said this:

"you have engineered a modest weakening of your currency, not a devaluation and it has been at the insistence of your own politicians and your own citizens, not the bankers.
"

so you agree with that do you?

[Vulcanl]

to:vulcan,

The U.S. Gov't/Fed's intention is to destroy the US Dollar so that all the massive debt that has been accumulated can be paid off/stabilized with currency that is worth less.

I have posted about this many times before...the only reason that the currency has not collapsed (YET) is that China and other foreign holders of our debt don't want it to for various reasons...they continue to peg to the USD to prevent the inevitable.  It won't work, as we are seeing right now in Asia via inflation spiking up.

Whether the USD has collapsed by 20% or by 7%...the fact of the matter is that innocent bystanders (savers, people on fixed incomes, and generally people who are fiscally responsible that carry low/no debt) are being unfairly separated from their wealth by this insidious theft....enabled by BANKERS who have bought our elected representatives.

I have posted at great length about this at this point.

[to_vulcan]

to:vulcan,

The U.S. Gov't/Fed's intention is to destroy the US Dollar so that all the massive debt that has been accumulated can be paid off/stabilized with currency that is worth less.

I have posted about this many times before...the only reason that the currency has not collapsed (YET) is that China and other foreign holders of our debt don't want it to for various reasons...they continue to peg to the USD to prevent the inevitable.  It won't work, as we are seeing right now in Asia via inflation spiking up.

Whether the USD has collapsed by 20% or by 7%...the fact of the matter is that innocent bystanders (savers, people on fixed incomes, and generally people who are fiscally responsible that carry low/no debt) are being unfairly separated from their wealth by this insidious theft....enabled by BANKERS who have bought our elected representatives.

I have posted at great length about this at this point.

I find myself agreeing with some of what you say, strangely. I agree that the actions of the politicians and the central bankers pose a huge risk, they risk destroying the wealth and life savings and work of untold numbers of hard working and prudent `savers.

But I do not agree that the bankers are part of this at all. Yes, they had a role to play, amongst the others, in the crisis. And yes, a few of them have been criminally negligent, just as mortgage brokers were and just as the regulators and politicians were and also others, borrowers included.

However, the choice of cutting spending and discouraging excess borrowing versus spending away until the Ponzi scheme collapses is in the hands of the politicians and central bankers.

if the US$ does collapse and if US bonds collapse the blame will lie with Obama and Ben Bernanke, not Lloyd Blankfein or Vikram Pandit etc.

And by the way if these collapses do occur then these politicians will learn that they were wrong about this option representing the easy way out because when they allow that to happen they open up the gates to hell.

[Vulcanl]

to_vulcan,

You seem to be an open-minded person and that is laudable...you will be/are on a truth-seeking path (which is one of the reasons we exist) and will arrive at a firm conclusion about all this over time.

All I say is this: follow the money....those holding on to those vast sums are the criminals in this, the greatest caper ever pulled off.

[to_vulcan]

to_vulcan,

You seem to be an open-minded person and that is laudable...you will be/are on a truth-seeking path (which is one of the reasons we exist) and will arrive at a firm conclusion about all this over time.

All I say is this: follow the money....those holding on to those vast sums are the criminals in this, the greatest caper ever pulled off.

I have not changed any of my views at all. I have always thought and said that the US  politicians and central bankers were dangerous and irresponsible and I have always said that the bankers shared a role with these and other players, in the financial crisis, with the cause of that role boiling down to a small minority of those bankers, a few of whom had probably been criminally negligent.

But I do not think the bankers are playing any role in risking the purchasing power of the US$ or other paper currencies. It is the US politicians and central bankers that pose this threat. These people are interested only in their own short term personal success and to short term and seemingly easy options. Few appear to have the back bone or integrity or even intelligence to understand what is right and then to stand up and say that.

 

[Vulcanl]

to_vulcan,

Go to Youtube and type "don regan speed it up"

Watch the clip...then ask yourself who was/is really in control the whole time?

[nonsense]

to_vulcan,

Go to Youtube and type "don regan speed it up"

Watch the clip...then ask yourself who was/is really in control the whole time?

Michael Moore is hardly a source of unbiased opinion and accurate information. He is an attention seeking sensationalist who knows as much about finance and economics as the average taxi driver or bar room drunk.

To suggest that somehow the US is in the pockets of the banks just because an ex banker became Treasury secretary is just conspiratorial paranoia...red neck stuff.

And whatever the career paths of senior US civil servants or politicians, it is still the US politicians and US government that are making the decisions. They decided to hire him and by the way the current administration are democrats. And if you think the tax cuts were somehow the significant thing then why claim the US is in the pockets of the banks, why not the pockets of the rich in general? And if you go down that route, why would the rich want to destroy the value of their own wealth?

 I also  very much doubt a single US Treasury secretary would have single handedly made decisions for the president, congress, the house etc. Thats just laughable.

Your views sometimes make sense (eg the current threat to the US$ and inflationary threats and deficit etc)  but when you veer off into this kind of territory you just make a fool of yourself.

[Vulcanl]

"...Michael Moore is hardly a source of unbiased opinion and accurate information..."

What in the World does this fatass have to do with anything?!?  He didn't stage this...it is actual footage.  I too find it uncomfortable to watch....doesn't mean we should ignore it

"....To suggest that somehow the US is in the pockets of the banks just because an ex banker became Treasury secretary is just conspiratorial paranoia...red neck stuff..."

It is not just that instance.  We are looking here at a revolving door of senior Wall Street executives occupying high offices in administration after administration, back to Wall Street and back to Gov't, again and again.  You want more evidence?  I invite you to google 'The Warning Frontline' and watch the segment.  It is extraordinary, to say the least

"...And whatever the career paths of senior US civil servants or politicians, it is still the US politicians and US government that are making the decisions..."

Are they really 'making the decisions'?!?!  And if they are, whose decisions?!?

They decided to hire him and by the way the current administration are democrats.

This is not a 'Democrat' or 'Republican' issue.  I voted for Obama and have been sorely disappointed by this 'change we can believe in.'

"...And if you think the tax cuts were somehow the significant thing then why claim the US is in the pockets of the banks, why not the pockets of the rich in general? And if you go down that route, why would the rich want to destroy the value of their own wealth?..."

I am talking about BANKERS.  YOU are talking about 'The Rich.'  Those are two separate and distinct segments of society...let's stay on track, please. 

To address the spirit of your question: [why would BANKERS want to destroy their cash cow?]

My answer is:  They do not realize that is what they are doing.  Their GREED blinds them to anything but making money, no matter what.  These people need to be stopped

"...I also  very much doubt a single US Treasury secretary would have single handedly made decisions for the president, congress, the house etc. Thats just laughable..."

You may think so now, and I once thought as you did.  Keep an open mind on this, do some research on your own and you will see that all of these supposedly random events start adding up to some kind of organized activity

"...Your views sometimes make sense (eg the current threat to the US$ and inflationary threats and deficit etc)..."

Thanks.  As I said...keep an open mind.  Ask YOURSELF these questions.  Take ample time to THINK about it. 

I have more evidence readily available on the internet should you be interested.

[Vulcanl]

Someone earlier was trying to tell me that inflation is not a problem in the USA.  This one's for you:

New York Times
February 14, 2011

Companies Raise Prices as Commodity Costs Jump

By STEPHANIE CLIFFORD, MOTOKO RICH and WILLIAM NEUMAN

A package of Oscar Mayer cold cuts. A pair of Nine West boots. A Whirlpool washing machine.

By the fall, people will most likely be paying more for each of them, as rising prices hit most consumer goods, say retailers, food companies and manufacturers of consumer products.

Cotton prices are near their highest level in more than a decade, after adjusting for inflation, and leather and polyester costs are jumping as well. Copper recently hit its highest level in about 40 years, and iron ore, used for steel, is fetching extremely high prices. Prices for corn, sugar, wheat, beef, pork and coffee are soaring. Labor overseas is becoming more expensive, meanwhile, and so are the utility bills to keep a factory running.

“There are cost pressures from virtually everywhere,” said Wesley R. Card, the chief executive of the Jones Group, whose brands include Nine West and Anne Klein. After trying to keep retail prices flat or even lower during the recession, Jones says prices for its brands will climb 15 to 20 percent by autumn.

When commodity prices started to rise last summer, many manufacturers and retailers absorbed the costs, worried that shoppers would not pay higher prices during the competitive holiday season or while the economy was still fragile.

Many big companies, including Kraft, Polo Ralph Lauren and Hanes, say they cannot hold off any longer and must raise prices to protect some profits.

Whether shoppers will pay is unclear. “Consumers are not exactly in the frame of mind or economic circumstances to say ‘Oh, pay whatever they ask,’ ” said Joshua Shapiro, chief United States economist at MFR Inc. “There’s going to be pushback.”

Economists say the increases may eventually show up as inflation, though they are not yet projecting rates that would set off alarms. Despite some fears, inflation has been extremely low, at a rate of just 1.4 percent annually in December. Data for January will be released Thursday, but economists expect inflation will run about 2.5 percent this year.

Some do see the creeping signs of higher inflation, and warn that the Federal Reserve will need to raise interest rates or at least stop pumping more money into the economy. Others argue that such moves would choke off economic growth sorely needed to get companies hiring again.

For consumers, higher prices in stores means there will be a little less extra cash to spend. For companies, profits may be squeezed, making them a little less likely to invest in equipment or to hire aggressively.

“One has to think about these higher prices not as a reason for economic activity to get derailed,” said John Ryding, chief economist at RDQ Economics, “but as a reason why the recovery is slower than might otherwise be the case.”

Given that the price of a gallon of gas is now well over $3 on average, Americans may feel that they are already dealing with higher prices.

Adding to the cost of food won’t greatly distort most household budgets. Food, gas, clothing, personal care products and cleaning and laundry supplies make up less than a quarter of household spending in the United States, according to government data.

People at the bottom of the income scale struggle more as these prices rise, of course, because a larger share of their spending is on such essentials.

To some, the prospect of modestly higher prices is no reason to worry. In fact, rising prices can indicate improving economic conditions. Greater demand from fast-growing countries like China has helped push up the costs of many raw materials — though officials there are worried about inflationary pressures, as are some officials in Europe.

In the United States, the willingness of companies to raise prices shows they are feeling better about the domestic recovery.

The sharp rise in commodity prices since last year has not translated into all new records. Food commodity prices are about 8 percent below the high in the summer of 2008, while energy prices are less than half their zenith. Prices of a basket of other commodities are about 4 percent below the heights of mid-2008.

The cost of raw materials accounts for a small portion of the cost of most consumer goods, as labor, processing and packaging tend to make up a larger share of the price at the cash register. Foods like coffee, meat and milk, which are closer to raw materials, will probably show some of the biggest price jumps.

Companies that try to pass on all their costs could meet resistance. Although consumer spending has risen, unemployment remains at 9 percent, and average hourly earnings are up less than 2 percent over the last year.

“These companies are constantly walking a tightrope on how far do I go,” said Jack Russo, a consumer goods analyst at Edward Jones. “Do I offset with price or other cost cuts, or do I just take it and have it eat into my profit margins?”

Already, rising raw material costs have cut into corporate profits. Kimberly-Clark, which makes Kleenex tissues and Huggies diapers, said fiber- and oil-based products had contributed to a small dip last quarter. Procter & Gamble said earnings fell slightly in the division that makes Crest toothpaste, as well as in its household brands unit, which makes Tide and Cascade.

Plenty of companies are indicating they will push up retail prices. Kraft, the largest United States food manufacturer with brands like Oscar Mayer, Velveeta and Ritz crackers, said it would raise prices on many products this year without saying which ones or how much.

Soaring prices for coffee have pushed up costs at the coffee shop. Starbucks said last fall that it would raise some prices. Sara Lee, which sells Hillshire Farms meat and Senseo coffee, said that it would, too, on many items.

Restaurants, which resisted raising prices to keep customers coming through the doors last year, are also fretting. They may take other steps too, like lowering thermostats, shrinking packaging or reducing portion sizes to minimize the sticker shock.

Meat prices have surged because of the cost of feed, a decision by farmers to raise fewer cattle and pigs, and strong demand worldwide as living standards rise. An epidemic of foot-and-mouth disease that devastated South Korean hog farms has led to a recent surge in orders for American pork.

This year, “you’re going to have to raise prices to stay in business,” said Len M. Steiner, owner of the Steiner Consulting Group, which works with restaurant companies on ingredient purchasing.

Whirlpool says consumers can expect to pay 8 to 10 percent more for its products starting April 1. Apparel companies like Polo Ralph Lauren and Brooks Brothers said they would raise prices this year. Hanes Brands, which has already done so, said prices on cotton-heavy products would rise again at the end of summer. If cotton costs stay high, Hanes products could have a cumulative 30 percent increase.

Some companies don’t think they can get away with charging more. PepsiCo, which makes soft drinks and snacks, like Fritos, said it would be cautious.

Victoria’s Secret is nudging prices ever so slightly, with panties rising from five for $25 to five for $25.50.

John D. Morris, an analyst with BMO Capital Markets, said retailers would probably try to manage costs in myriad ways.

Prices rose significantly in the apparel sector from 1972 to 1974, driven by labor costs and commodity prices, he said.

“The retailers went on to have a pretty good year in ’73,” Mr. Morris said. “Sales were up, gross margins were flat, and profit margins were up a little bit. Retailers found a way.”

[Vulcanl]

It has been extremely slow in coming, but finally there is acknowledgement of the uselessness of bankers and their 'innovations' - indeed, the great harm they have done (and will continue to perpetrate if allowed to go unchecked) is only now being recognized:

New York Times

March 10, 2011

Crisis Is Over, but Where’s the Fix?

By FLOYD NORRIS

WASHINGTON — When the financial system began to crumble more than three years ago, the world rushed to rescue it. Country after country went deeply into debt to keep banks afloat and prevent a deep recession from turning into something worse.

It worked. This week was the second anniversary of the nadir of the crisis. Most stock markets around the world are at least 75 percent higher than they were then. Financial stocks, which led the markets down, have also led them up.

At the time, rescuing seemed more important than reforming. The world economy was breaking down because of a lack of financing. Trade flows collapsed, and companies and individuals stopped spending. It seemed clear that halting the slide was critical.

But the world has changed since then. The economic recovery in most developed countries is stuttering at best, and governments are struggling with their own finances. It is time for remorse and second-guessing.

A surprising citadel of that second-guessing is at the International Monetary Fund, where researchers this week concluded that the rescues “only treated the symptoms of the global financial meltdown.”

The researchers, Stijn Claessens and Ceyla Pazarbasioglu, warned that “a rare opportunity is being thrown away to tackle the underlying causes. Without restructuring financial institutions’ balance sheets and their operations, as well as their assets — loans to over-indebted households and enterprises — the economic recovery will suffer, and the seeds will be sown for the next crisis.”

There have been reforms, of course. The Dodd-Frank law in the United States is now being put into effect, albeit by regulators that the new Republican majority in the House of Representatives seems determined to starve of resources to do the job. Banking regulators around the globe have agreed that much more capital is needed by banks, but stricter requirements are coming very slowly out of fear that abrupt changes will reduce bank lending when it is needed the most.

More capital is clearly needed, but it may not be nearly enough. “If we ask them for more capital, and they are too big to fail, they can take even more risk” after they raise additional capital, Y. Venugopal Reddy, a former governor of India’s central bank, argued at an economic conference sponsored by the I.M.F. this week. He added that he was worried about institutions that were “too powerful to regulate.”

One of the questions economists were asked to address at the conference was, Does the financial system have social value?

A few years ago, that question would not have been asked at the International Monetary Fund. If it had been, the responses would have been as unanimous as might be expected if a gathering at the Vatican were to consider whether religion was a good thing.

Now, there is no such unanimity. It is clear that there are functions of the financial system that must be performed, among them the allocation of capital and the setting of prices. But there is at least a suspicion that a significant part of modern finance has no real value for anyone except the participants.

Adair Turner, the chairman of Britain’s Financial Services Authority, spoke with wonderment of the huge volume of stock trades now made by computers using algorithms to rapidly trade in and out. Some traders, he said, were using what they called “predatory algorithms,” whose sole purpose is to exploit a weakness in some other trader’s algorithm and get it to make an unprofitable trade.

“It is quite difficuIt to work out the social benefit of that,” he said.

And of course, there is also the fact that the financial system did not accomplish what it was supposed to do. “At the core of these functions is the ability to find and set the right price, including the extent to which it reflects risk,” Antonio Borges, an I.M.F. official and former vice chairman of Goldman Sachs International, told the conference. “This is not really a question of financial sophistication, of complex products or greedy bankers. It is a question of getting the prices wrong.”

He added, “It is unbelievable how wrong they were.”

There is general agreement that many of the assumptions economists and others made before the crisis — about the rationality of markets, about their ability to measure risks and about the proper role of monetary policy — were largely wrong, or at best oversimplified. But there is far less unanimity about what to do about it. International cooperation was impressive in dealing with the immediate crisis. Now it is splintering, and banks are threatening to move operations to areas they deem friendlier to them.

In retrospect, it is clear that the bailouts came with too little pain for those responsible. Bondholders who financed banks that failed largely escaped pain. That was true even in Ireland, where the bailout would have led to a default of government debt had Europe not stepped in. It is still not clear how Ireland will pay its national debt, but the bank bondholders did fine.

At the time, of course, there were fears that forcing bondholders to suffer would lead to the collapse of banks that could have survived. Those fears seemed reasonable to me then, and still do. But little progress has been made in setting up mechanisms to assure that any future crisis can be dealt with in a different way. There is talk of restructuring bank balance sheets to assure that debt is automatically converted to equity just when equity seems to be worth little, but that is unlikely to happen unless regulators force it, and it is far from clear what price investors would demand.

Moreover, as Mr. Turner noted, it is important to somehow assure that those who would suffer from such a conversion are not themselves so leveraged that a crisis would be intensified. Something like that seems to have played a role in Europe’s decision to avert a Greek national default. Most of the Greek debt was owned by European banks, and it was doubtful that they could afford to take the losses.

Perhaps the most important error made early in the crisis was a decision by Henry Paulson, then the United States Treasury secretary, to put pressure on big banks to accept bailouts whether they needed them or not. The idea was to avoid making acceptance of such money a scarlet letter that would in itself alarm depositors and investors. It seemed to make sense.

But it also meant that it was not clear which managers had led their banks over — or at least close to — a cliff. There was an unmet need to establish the principle that, in Mr. Reddy’s words, “When the profits are good, you take your bonus. When something goes wrong, you go out and somebody else comes in.”

The principle is particularly important because regulatory failures may be inevitable. If multimillion-dollar bank bosses do not see a crisis looming before it is too late, can we be sure regulators who work for far less will be more prescient? Markets clearly did a horrid job of allocating capital, but there is no particular reason to think governments would do better.

Even if regulators somehow did design a perfect regulatory system, it would not last, simply because clever bankers would eventually find ways around it, just as people find ways to evade taxes, forcing tax law writers to constantly make changes.

“Every decade or so,” said Paul Romer, a senior fellow at the Institute for Economic Policy Research at Stanford and now a visiting professor at New York University, “any finite system of financial regulation will lead to systemic financial crisis.”

If he is right, it is all the more important that ways be found to assure that the costs of the next financial crisis — in failed institutions and lost economic growth, not to mention government borrowing — will be far lower. It is hard to conclude much progress has been made in accomplishing that goal.

[P.O.D.]

In 2008 we discovered the existence, but not the whereabouts, of the infamous black hole.
Our governments poured billions in cash into it.
Now we are told it worked? 
But where did it go to and how did it work? And have we taken steps to ensure it will not happen again?
I mean, US auto manufacturers have never been so busy pumping investment into China...and banks have made a miraculous recovery and are awash in cash.
Is it a miracle?