( – promoted by buhdydharma )
Everything you need to know about the world’s financial markets is depicted in the short film, below. Where did all the irrational exuberance go? No one seems to be having much fun anymore.
Like all good foreign films, it’s subtitled, so the transcript is built right in to the presentation.
Grab a hankie, this one is a real tear jerker:
It gets worse.
Okay. Fun’s over.
Join me for a little cultural anthropology from Planet Gloom. Lots of people aren’t laughing much these days. Or shopping much. They’re not socializing so much, either. Some are doing bizarre things. Plenty are just plain angry and have decided who to blame.
In media circles, people are snapping and acting out. And, in the investment world, it’s drama twenty-four seven. From my crop of financial newsletters and email, I get the impression that traders have progressed from denial and blame, and have moved into the bargaining stage of this tragedy, which gives their writings a stern tone laced with thinly-disguised panic and reckless ranting. For example, here’s one from an institutional currency trader:
The BIG news is the story that’s going around about Citigroup. Let’s see… “Citigroup is in talks with federal officials that could result in the U.S. government substantially expanding its ownership of the struggling bank, according to people familiar with the situation.”
Oh great! I can see the dolts on Capitol Hill all screaming about how this is proof that the U.S. needs to nationalize banks… Well, let’s see… If they hadn’t already put tens of Billions into this bank, maybe they wouldn’t be so ready to try and save it! See? This is what I was talking about months ago, when I said that the Gov. bailing out banks was a very bad thing…
But, do you think these guys on Capitol Hill cared to listen then? And they are still not listening… They are dolts!
When former Treasury Sec. Paulson, came to them and said he needed $750 Billion to make things right, these lawmakers didn’t bat an eye, they didn’t question where he got the $750 Billion figure, they didn’t ask him how he would account for the spending, or how it would be paid back and when… No, they just followed him like ducklings crossing the road with their mother…
Now, the Gold guys are a unique breed with a political instinct that swings from left to right, depending on the situation. They run the personality gamut from paranoid to eerily calm, and most have an inner soundtrack of Golum’s “My precious… It’s mine” playing in their heads.
I love them. They deal in the arcane and view gold as mythical. They also have an abundance of unguarded moments, and are likely to make outrageous statements then blithely hit the Send button:
The hedgies that are right now raping the middle European currencies will eventually dig a grave for the buck.
World flows of money know no human feelings, but like the demons at their heart, spread death and destruction wherever they flow. It is like a massive volcanic eruption poisoning the air and water, bringing with it a planetary malaise.
I may be the only one who knows why the world is ending in the equity markets and why no 1930 style rally with staying power can occur until certain procedural trading matters are worked out
Hell has broken lose. It will be more than two generations before this plague of greed is overcome. This is not a short-term aberration. It is a cataclysm brought about by the uncontrolled greed of an army of sociopaths.
Gold is the only safe haven because unlike paper money it is impossible to create twice as much with the strike of a bailout plan pen.
Gold is your only insurance.
Gold is the difference from being the cause of your future or a victim of this colossal theft of unprecedented proportions. Be a survivor, and save yourself for you and your families sake.
There are quite a few bankers participating in the chain-of-fools newsletters that plop into my in box at the crack of dawn. All bankers think of themselves as “the good guys.”
As you might expect, they are keenly concerned about their own interests, especially if their banks has sound assets. They are all worried about being swept up by the government, along with the bad banks:
During an interview yesterday, I was asked about the comments from former Fed Chairman Greenspan, who said that he “favored nationalization of banks.” I had seen that comment a day earlier and recalled that he sure didn’t make comments like that when he was the Fed Chairman, once referred to as the “Maestro” and “Mr. Free Markets.” But now that he is retired and looking at the mess he created, he thinks we’re in a huge pile of dookie, and had better do something, fast!
Well, that does it for us. If Greenspan is in favor of it, we’re against it. No one man bears more responsibility for the present worldwide financial crisis and coming depression that Alan Greenspan.
The Fed’s job is to take the punchbowl away when the party gets too wild, said former Fed chairman William McChesney Martin. Greenspan did no such thing. As soon as the party began to quiet down and people began fumbling for their car keys, Greenspan added more rum to the punch and turned up the music. By the time the credit cops finally shut it down, people were dancing on tabletops all over the world.
This “nationalization” cry is a very bad idea folks. Very bad. How bad? Very Bad! Did I say that it was a Very Bad idea? OK… Is that clear?Crystal. I hope!
As always, the “news tartar” and outright rumors are getting an unusual amount of play. No one likes their news vetted and “well done” these days. They all want breaking news.
The story belos, while it didn’t get a lot of play in the press, caused the email wires to heat up in the investment zone:
There was a story over the weekend that a “Eurozone bond” could be used to ease the turmoil on the European financial institutions. Here’s a snippet from Reuters:
The Chairman of euro zone finance ministers Jean-Claude Juncker has proposed that the common euro zone bond should cover the first 40 percent of the overall euro zone government debt, sources familiar with the work of the Eurogroup said.
This would be senior debt, guaranteed by the whole euro area, which now has 16 members. Anything above the 40 percent would be junior debt that would be issued by the individual governments.
The junior debt would most likely be more costly for the government to issue, therefore encouraging a reduction of debt toward the common euro zone level of 40 percent, sources said.
If agreed on, common euro zone bonds would in a matter of a few years create a highly liquid bond market of some 4 trillion euros which could successfully compete with a similar size U.S. treasuries market for large investors like China.
That’s HUGE folks! However, before we all go out to celebrate. There’s opposition to this plan by Germany, who already has about $1 Trillion euros worth of German bonds issued. And if Germany balks, this plan will not get off the floor. But, for now, it has put some wind in the euro’s sails.
You have to give the Eurozone ministers some credit for creating something that the likes of China could use as an “alternative” to Treasuries, as Treasuries have long been the only game in town for countries like China and Japan that have tons of cash to invest.
Update: The Eurozone bond story has not yet gained traction because Germany is against the idea and has dug in her heels. Until further notice, we have a failure to launch on this one.
So, what’s in your wallet?