Comments on: Will The Real Geithner Plan Please Stand Up?

By: Does The US Still Face An Emerging Market-Type Crisis? « The Baseline Scenario

Fri, 10 Apr 2009 11:37:55 +0000

[...] bets on bank defaults) and a credible set of policies that show things are going to turn around (act at the system level; don’t try to handle the banks piecemeal). Don’t let bankers’ past misdeeds (or current power) and market panics ruin the [...]

By: Baseline Scenario, April 7, 2009 « The Baseline Scenario

Baseline Scenario, April 7, 2009 « The Baseline Scenario — Tue, 07 Apr 2009 12:47:24 +0000

[...] The resolution authority currently being sought by the Administration – and which we support – may have unintended consequences, some of which could ultimately prove positive if handled in the right [...]

By: richard campos

richard campos — Fri, 03 Apr 2009 19:24:51 +0000

Market Failure for lack of regulation, Invisible hand blamed for financial crash and spiraling death of a star
An unregulated business cycle falls on a pattern of steep booms or expansion,growth and proportionally equivalent steep busts or contraction ,recession, that can lead to a deep depression, the recovery cycle being directly proportional to the size of the initial boom. The final result of the end cycle of the boom is a shift of market power balance, the rate of change in capital accumulation, a shift of purchasing power because of the shift of wealth ,a redistribution of wealth, a concentration of aggregate supply and financial assets in a few hands and an equally inverse diminishing of aggregate demand that is worsened during the bust by a shift in value, assets lost value, fall in real estate prices, salaries ,etc. lost value of Bank financial assets freezes Banks, that increases more the concentration of aggregate supply and financial assets and catastrophically worsened by a government supply sided financial bailout that increases even further the concentration of aggregate supply and financial assets therefore exterminating aggregate demand , creating a freezing or stagnation because the falling rate of profit begins at the lower end of the market distribution chain therefore crashing distribution by finally exterminating aggregate supply also and eventually forcing government to finish the cycle according to the Eisenhower complex scheme or Spiraling death of a star. In order to avoid this a government demand sided approach should be used.
The problem is fictitious capital if it never existed and is the result of over valued assets because of a market manipulation by speculative gambling strategies that artificially inflated and drove up the price or value, inflating the bubble, you cant restore its original value unless you repeat the same cycle that pushed their false value during the boom.

By: adios amigos

adios amigos — Thu, 02 Apr 2009 03:21:35 +0000

Finally, a clear thinker (but not much of a speller)
AA

By: adios amigos

adios amigos — Thu, 02 Apr 2009 03:15:52 +0000

Yoo Hoo !!!!!! Ben, Nemo!!! I lost my entire pension over here – Norway – over this nonsense…I actually have a chip in the game. I would like BOTH…retribution and suffering. I would like the americans to suffer their way over to their bank and wire me the money that was stolen from my pension fund. A lot to ask, I know. I shouldn’t feel so bad I guess, at least i’m not a 9-year old child laying dead in the street in Baghdad. I guess I should stop complaining, huh? At least the americans spared my life. I guess i’m fortunate that all they did to me was steal 30-years worth of pension savings. I should proably start looking at it that way….at least they didn’t kill me….ya know? Hey, did they ever come across any of those WMD’s over there in Iraq?

By: Top Posts « WordPress.com

Top Posts « WordPress.com — Thu, 02 Apr 2009 00:13:13 +0000

[...] Will The Real Geithner Plan Please Stand Up? With all the material and moral support for U.S. mega-financial institutions currently on the table, why are bank [...] [...]

By: TonyForesta

TonyForesta — Wed, 01 Apr 2009 20:51:05 +0000

Lost in all the erudite econospeak, are the social implications. You do not need to be a London School of Economic’s doctorate to recognize that Geithner, Summers, Bernake and the entire Obama economic team are Wall Street insiders largely responsible for conjuring, cloaking, and profiting from the economic crisis. Further it is glaringly obvious to anyone who bothers to make even cursory examinations into these complex issues, that the Giethner plan, the PPIP is an overt heavily onesided give away to the thieves and swindlers on Wall Street who are responsible for the worst economic crisis since the great depression. The “Black Swan” should be essential reading for every American, and every economist. What you are failing to factor into your calculus is the human element of this crisis.

While hedgefund managers, bankers, and bondholders would be forced to put off that second yaught or villa purchase if the FAILED banks were nationalized and the criminal oligarchs disbanded in an orderly manner, – the rest of society is facing the harsh reality of informing your 17 year old daughter that affording a college education is simply no longer an option, or worse for many of us in the lower economic strata, adequate food, clothing, and housing are no longer a certainty, and the entire family could end up homeless living in a tent city. As these brutal realities become more pervasive (and they are every single day as the Obama government bailsout FAILED banks and FAILED managements bruting FAILED models with our taxdollars) ever expanding populations of people grow more desperate. Desperate people do desperate things.

There comes a time, and this moment is perilously near, – when the abused (poor and middle class Americans) are pushed a point of such dire desperation by abusers, (the finance oligarchs, the socalled regulators, and thier enablers and apologists in the government) that desperate and violent actions are the only viable options left for the abused.

There will be blood, a reckoning and a balancing. Factor that calculated risk into your baseline scenario.

By: Ben

Ben — Wed, 01 Apr 2009 18:25:10 +0000

Just wanted to add that CDS requires sellers to put up collateral when bond price drops. This has to tie up a lot of capital that in normal times would have went into writing more CDS.

By: Ben

Ben — Wed, 01 Apr 2009 18:22:43 +0000

Another possible interpretation for the CDS price spike could be that many CDS sellers have lost so much money that they stop selling CDS all together. This leads to drastic reduction in supply and therefore price adjusts.

What does the trading volume look like for the last 6 months? What is a good way to determine the supply of CDS?

By: Ben

Ben — Wed, 01 Apr 2009 15:22:53 +0000

I don’t agree with your desire for retribution trumps the suffering of billions.

By: Nemo

Nemo — Wed, 01 Apr 2009 14:57:12 +0000

Ben, if there is no relationship between your post and my conjecture, then there is also no relationship between your post and the original article, and every one of your dozen comments is off-topic.

Put another way, if you are not arguing for bailing out the existing banks — to “prevent the suffering of billions”, naturally — then you are not actually arguing with me. Or anybody else.

Feel free to have the last word.

By: StatsGuy

StatsGuy — Wed, 01 Apr 2009 14:49:11 +0000

Again, thank you.

By: Jaime double-Diamon

Jaime double-Diamon — Wed, 01 Apr 2009 14:48:24 +0000

I support the GM model for the banking system. Swift, certain and decisive. Standing on the sidelines while the the market manipulators muddy the waters is only making things worse. As you have written, — and we are watching — there is an oligarchy, and they are going to win. One way or another.

By: StatsGuy

StatsGuy — Wed, 01 Apr 2009 14:46:06 +0000

Helpful, thank you.

By: Ben

Ben — Wed, 01 Apr 2009 14:44:12 +0000

Nemo,

“If I accept your premise… Well, my answer does not change.” – Nemo

Hmm, your mindset is the suffering of billions of people is less important than retribution.

You’ve falsely conjectured my premise. What is the logical relationship with what I wrote in the previous post and your conjecture? All I cared is we make getting out of this crisis the first priority.

Lastly, if you can’t bring yourself to answer my very simple priority question, you really should look deep into yourself with your morality lens.