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Depression and Inflation on Horizon

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JS80

Lifer
Oct 24, 2005
26,260
4
81
Originally posted by: LegendKiller
Originally posted by: senseamp
Originally posted by: LegendKiller
Originally posted by: palehorse74
Originally posted by: PC Surgeon
Originally posted by: JS80
Originally posted by: PC Surgeon
Originally posted by: JS80
GD was totally avoidable if the Fed didn't kill liquidity. They learned their lesson from that and are doing a fairly good job keeping it liquid.
The problem is that liquidity needs to stop at some point. You cannot just keep throwing money at the problem. The question is when is the time to turn off the faucet?
You stop liquidity and the system fails. Plus it's not exactly free money we're printing. It's all in the balance sheet.
Then you have the possibility of hyperinflation.
doesnt that statement right there make you the boy who cried wolf? After all, havent you been wrongly calling the current inflation "hyper" for some time now?
Hyper inflation, to them, is anything over 0%
Aren't you in lending, and wasn't your ilk responsible for this current mess?

Yes, I am lending, but only in a conservative way. Yes, some of them are resonsible for this current mess. You see, I have never denied it.
You are in securitzation?
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: PC Surgeon
Originally posted by: LegendKiller
Originally posted by: PC Surgeon
Don't take it so far. I said "possibility". You know as well as I do LK that the more the MS is increased the more the U.S. Dollar is debased. That doesn't take any advanced mind to know.

If you were the FED chairman LK, when would you stop the MS from increasing? I'm going to guess you will say "never" and that would tell me alot about modern economists. When business is bad, debase the currency until markets stabilize. NVM the massive hit the U.S. Dollar has taken to achieve economic stability because only the poor who can only buy food and energy will really feel it.
When would I stop MS from increasing? When fundamentals of liquidity have returned. However, that's a lagging indicator.

Nevermind the economic hit the "poor" would take if the capital markets stopped functioning. We saw what happened in 1929 in that same thing.
Follow the thought out then. If cutting off the MS causes crashes because of no liquidity and increasing the MS perpetually causes inflation to the point of oblivion *then* hyperinflation is a possibility. What "fundamentals of liquidity" are you talking about? Then you state that thats a "lagging indicator" so in effect causing more inflation than is needed before actually seeing hard numbers.
It reminds me of my friend telling me how steersmen steer a Nimitiz class carrier the first few times. Instead of a straight path, they zig-zag everywhere because they haven't quite mastered how the ship handles, requiring over-correction initially.

The problem is that it's almost impossible to predict these types of things. Human behavior is very erratic.

Yes, you will overshoot, it's inevitable.
 

BoberFett

Lifer
Oct 9, 1999
37,563
9
81
Originally posted by: palehorse74
Originally posted by: piasabird
Another topic is that I do not think only people with ARM's should get to refinance. A lot of people on fixed rate loans are suffering also. There are probably people with loans at %12 fixed or 9% fixed that if they could refinance, it would releive some pressure also.
:confused: what's stopping them?! AFAIK, anyone with decent credit can refinance at rates much lower than either of those you mentioned... so ?!
The people who currently have ARMs have them for a reason, usually because they couldn't qualify for a fixed rate at the amount they wanted to borrow. Add to that declining home values and lenders would have to be stupid to refinance for more than home is worth.

There's no easy way out of this, and we have greedy homebuyers and greedy lenders to thank for helping to destroy the dollar.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: JS80

You are in securitzation?
Yes, I am in conduit securitization (asset backed commercial paper (ABCP)). I was in term securitization at my prior 2 jobs at major issuers.
 

JS80

Lifer
Oct 24, 2005
26,260
4
81
Originally posted by: PC Surgeon
Originally posted by: JS80
Originally posted by: PC Surgeon
Originally posted by: JS80
GD was totally avoidable if the Fed didn't kill liquidity. They learned their lesson from that and are doing a fairly good job keeping it liquid.
The problem is that liquidity needs to stop at some point. You cannot just keep throwing money at the problem. The question is when is the time to turn off the faucet?
You stop liquidity and the system fails. Plus it's not exactly free money we're printing. It's all in the balance sheet.
Then you have the possibility of hyperinflation.
do you even know what hyperinflation is and what causes it?
 

Vic

Elite Member
Jun 12, 2001
48,385
9,201
126
Originally posted by: senseamp
So you have never been involved in issuing a subprime mortgage?
I've done THOUSANDS of them. As the loan officer/mortgage broker, no less. I started my career in subprime back in '94, and didn't start doing conforming loans until '97.

I wonder, if subprime is supposedly responsible for all this, and yet subprime mortgages existed then with even considerably less regulation than we have now, then how come the housing market didn't bubble then?
 

NoStateofMind

Diamond Member
Oct 14, 2005
9,711
6
76
LOL Hillary Clinton (in WV) on CNN just said "I think there should be an investigation into why the gas prices are going up so high". WTF? Anyone who reads about the economy knows why but she is just playing on peoples stupidity, an "investigation" is stupid to say the least.
 

StageLeft

No Lifer
Sep 29, 2000
70,150
2
0
Originally posted by: PC Surgeon
LOL Hillary Clinton (in WV) on CNN just said "I think there should be an investigation into why the gas prices are going up so high". WTF? Anyone who reads about the economy knows why but she is just playing on peoples stupidity, an "investigation" is stupid to say the least.
It's Al Qaeda!
 

NoStateofMind

Diamond Member
Oct 14, 2005
9,711
6
76
Originally posted by: JS80


do you even know what hyperinflation is and what causes it?

Hyperinflation

In economics, hyperinflation is inflation that is "out of control," a condition in which prices increase rapidly as a currency loses its value. The formal definition is: "inflation exceeding 50% a month." In informal usage the term is often applied to much lower rates. As a rule of thumb, normal inflation is reported per year, but hyperinflation is often reported for much shorter intervals, often per month.

The definition used by most economists is "an inflationary cycle without any tendency toward equilibrium." A vicious circle is created in which more and more inflation is created with each iteration of the cycle. Although there is a great deal of debate about the root causes of hyperinflation, it becomes visible when there is an unchecked increase in the money supply (FED not releasing M3 reports?) or drastic debasement of coinage, and is often associated with wars (or their aftermath) (Iraq/Terror anyone?), economic depressions, and political or social upheavals.
 

palehorse

Lifer
Dec 21, 2005
11,521
0
76
Originally posted by: BoberFett
Originally posted by: palehorse74
Originally posted by: piasabird
Another topic is that I do not think only people with ARM's should get to refinance. A lot of people on fixed rate loans are suffering also. There are probably people with loans at %12 fixed or 9% fixed that if they could refinance, it would releive some pressure also.
:confused: what's stopping them?! AFAIK, anyone with decent credit can refinance at fixed rates much lower than either of those you mentioned... so ?!
The people who currently have ARMs have them for a reason, usually because they couldn't qualify for a fixed rate at the amount they wanted to borrow. Add to that declining home values and lenders would have to be stupid to refinance for more than home is worth.
"ARMs"?? I made bold the important parts of piasabird's post... :confused:
 

BoberFett

Lifer
Oct 9, 1999
37,563
9
81
Originally posted by: palehorse74
Originally posted by: BoberFett
Originally posted by: palehorse74
Originally posted by: piasabird
Another topic is that I do not think only people with ARM's should get to refinance. A lot of people on fixed rate loans are suffering also. There are probably people with loans at %12 fixed or 9% fixed that if they could refinance, it would releive some pressure also.
:confused: what's stopping them?! AFAIK, anyone with decent credit can refinance at fixed rates much lower than either of those you mentioned... so ?!
The people who currently have ARMs have them for a reason, usually because they couldn't qualify for a fixed rate at the amount they wanted to borrow. Add to that declining home values and lenders would have to be stupid to refinance for more than home is worth.
"ARMs"?? I made bold the important parts of piasabird's post... :confused:
It doesn't change the fact that people with high interest loans have high rates because they didn't qualify for lower ones. Do I need to spell everything out for you?
 

senseamp

Lifer
Feb 5, 2006
34,993
5,039
126
Originally posted by: Vic
Originally posted by: senseamp
So you have never been involved in issuing a subprime mortgage?
I've done THOUSANDS of them. As the loan officer/mortgage broker, no less. I started my career in subprime back in '94, and didn't start doing conforming loans until '97.

I wonder, if subprime is supposedly responsible for all this, and yet subprime mortgages existed then with even considerably less regulation than we have now, then how come the housing market didn't bubble then?
Because I bet before those subprime loans had interest rates that reflected their risk, and did not assume that the government would handle the downside.
 

miketheidiot

Lifer
Sep 3, 2004
11,062
1
0
Originally posted by: Jaskalas
Originally posted by: miketheidiot
inflation isn't really a concern when you are having a tough time getting people to consume or invest.
Tell that to people buying anything in a store. That the rise in prices isn't really a concern.
thats not happening because of anything to do with federal reserve policy.
 

miketheidiot

Lifer
Sep 3, 2004
11,062
1
0
Originally posted by: Slew Foot
Stock market rallies recently havent been because of any good news in the economy, its only been on news of Fed bailouts/rate cuts/liquidity injections. This makes me think that these are the proverbial dead cat bounces, and were poised to go lower soon as soon as some shorts are squeezed out.
goldman sacs and lehman had higher than expected profits on monday. Of course that must be negative news right?
 

Vic

Elite Member
Jun 12, 2001
48,385
9,201
126
Originally posted by: senseamp
Originally posted by: Vic
Originally posted by: senseamp
So you have never been involved in issuing a subprime mortgage?
I've done THOUSANDS of them. As the loan officer/mortgage broker, no less. I started my career in subprime back in '94, and didn't start doing conforming loans until '97.

I wonder, if subprime is supposedly responsible for all this, and yet subprime mortgages existed then with even considerably less regulation than we have now, then how come the housing market didn't bubble then?
Because I bet before those subprime loans had interest rates that reflected their risk, and did not assume that the government would handle the downside.
Yeah well, I don't set the rates and I don't make the guidelines, I just sell them.
 

palehorse

Lifer
Dec 21, 2005
11,521
0
76
Originally posted by: BoberFett
Originally posted by: palehorse74
Originally posted by: BoberFett
Originally posted by: palehorse74
Originally posted by: piasabird
Another topic is that I do not think only people with ARM's should get to refinance. A lot of people on fixed rate loans are suffering also. There are probably people with loans at %12 fixed or 9% fixed that if they could refinance, it would releive some pressure also.
:confused: what's stopping them?! AFAIK, anyone with decent credit can refinance at fixed rates much lower than either of those you mentioned... so ?!
The people who currently have ARMs have them for a reason, usually because they couldn't qualify for a fixed rate at the amount they wanted to borrow. Add to that declining home values and lenders would have to be stupid to refinance for more than home is worth.
"ARMs"?? I made bold the important parts of piasabird's post... :confused:
It doesn't change the fact that people with high interest loans have high rates because they didn't qualify for lower ones. Do I need to spell everything out for you?
hi. you responded talking about ARMs. you were in left field.

welcome back.
 

NoStateofMind

Diamond Member
Oct 14, 2005
9,711
6
76
Originally posted by: glugglug
Originally posted by: miketheidiot
i recommend investing in tinfoil.
Also close to a triple:
Link
Thats Aluminum but Tin is tripled as well. If you go down through them all you notice just about every one of those metals have tripled in value since 2000. But thats only cause people are investing in copper, not because of a inflated dollar.
 

ranmaniac

Golden Member
May 14, 2001
1,939
0
76
Accountancy Shanty


:music:It's fun to charter an accountant
And sail the wide accountancy,
To find, explore the funds offshore
And skirt the shoals of bankruptcy!

It can be manly in insurance.
We'll up your premium semi-annually.
It's all tax deductible.
We're fairly incorruptible,
We're sailing on the wide accountancy!
:music:

 

rchiu

Diamond Member
Jun 8, 2002
3,846
0
0
Originally posted by: Skoorb
Originally posted by: PC Surgeon
LOL Hillary Clinton (in WV) on CNN just said "I think there should be an investigation into why the gas prices are going up so high". WTF? Anyone who reads about the economy knows why but she is just playing on peoples stupidity, an "investigation" is stupid to say the least.
It's Al Qaeda!
Okay, so why don't you tell us why the oil price is so high. Here is some historical perspective. Notice any change after 2000 and 2003? Anything changed in those year? Hint Bush and his war.

1990 $23.19
1991 $20.20
1992 $19.25
1993 $16.75
1994 $15.66
1995 $16.75
1996 $20.46
1997 $18.64
1998 $11.91
1999 $16.56
2000 $27.39
2001 $23.00
2002 $22.81
2003 $27.69
2004 $37.66
2005 $50.04
2006 $58.30
2007 $64.20
2008 $100+
 

GrGr

Diamond Member
Sep 25, 2003
3,204
0
76
Also Putin turned off the cheap spigot in Russia when he nailed the Oligarchs.
 

NoStateofMind

Diamond Member
Oct 14, 2005
9,711
6
76
Originally posted by: rchiu
Originally posted by: Skoorb
Originally posted by: PC Surgeon
LOL Hillary Clinton (in WV) on CNN just said "I think there should be an investigation into why the gas prices are going up so high". WTF? Anyone who reads about the economy knows why but she is just playing on peoples stupidity, an "investigation" is stupid to say the least.
It's Al Qaeda!
Okay, so why don't you tell us why the oil price is so high. Here is some historical perspective. Notice any change after 2000 and 2003? Anything changed in those year? Hint Bush and his war.

1990 $23.19
1991 $20.20
1992 $19.25
1993 $16.75
1994 $15.66
1995 $16.75
1996 $20.46
1997 $18.64
1998 $11.91
1999 $16.56
2000 $27.39
2001 $23.00
2002 $22.81
2003 $27.69
2004 $37.66
2005 $50.04
2006 $58.30
2007 $64.20
2008 $100+
I think he was being sarcastic. But the war against "terror" is definitely taking a toll on us now that we are hitting a recessionary economy.
 

palehorse

Lifer
Dec 21, 2005
11,521
0
76
What?! You mean the American people may be forced to sacrifice during a time when their country is at war?! *gasp* SAY IT AINT SO! oh the horror...

:roll:
 

StageLeft

No Lifer
Sep 29, 2000
70,150
2
0
Originally posted by: palehorse74
What?! You mean the American people may be forced to sacrifice during a time when their country is at war?! *gasp* SAY IT AINT SO! oh the horror...

:roll:
Your comment makes me want to cut my wrists. Who the fvck goes to war and slashes taxes at the same time? Bush, that's who. Were you in support of decreased or increased taxes in the past few years? They've clearly been too low. Of course when a country is at war people should sacrifice, but most Americans don't seem to realize this. If the true cost of the war was being paid while it was spent, our taxes would already be way up and people would _really_ hate the Iraq war then.
 

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