Posted on 11/03/2009 3:43:48 PM PST by blam
Eric Sprott: "Dead Government Walking"
Joe Weisenthal
Nov. 3, 2009, 12:48 PM
If you're looking for something to cheer you up, don't read the latest letter from ultra-bear Eric Sprott (via Market Folly). Basically he argues, a US default is coming sooner, rather than later, and that there's just no hope of averting this.
The projected US deficit from 2009 to 2019 is now slated to be almost $9 trillion dollars.3 How on earth does anyone expect them to raise this capital? As we stated in a previous article, in order to satisfy US capital requirements, all existing investors would have had to increase their US bond purchases by 200% in fiscal 2009. Foreigners, however, only increased their purchases by a mere 28% from September 2008 to July 2009 - far short of what the US government required.4 The US taxpayer can’t cover the difference either. According to recent estimates, tax revenue from all sources would have to increase by 61% in order to balance the 2010 fiscal budget. Given that State government income tax revenues were down 27.5% in the second quarter, the US government will be lucky just to maintain its current level of tax revenue, let alone increase it.
[snip]
(Excerpt) Read more at businessinsider.com ...
i wonder if these figures include the interest.
Well, there is that big pile of money sitting in IRA’s and 401K’s. Hillary already said 10% should be skimmed right off the top but why stop there? Some policy twit said during the election that the govt should take it all and give the holders a govt SS IOU.
Remember Hummel said the same thing
http://www.econlib.org/cgi-bin/printarticle2.pl?file=Columns/y2009/Hummeltbills.html
That ‘money’ you refer to is about to shrink dramatically as the commerial real estate crash arrives ... vast sums of retirement funding are in real estate and loans on real estate.
This is all I have to say about that:
http://www.freerepublic.com/focus/news/2264097/posts?page=10#10
No, wait.
THIS is all I have to say about that:
http://209.157.64.201/focus/f-news/2231750/posts?page=7#7
bookmark
maybe scratch walking for crawling....
maybe scratch walking for crawling....
Wilbur Ross: Commercial Real Estate to Cause ‘Tragedies’
Vulture investor Wilbur Ross is sure talking down the commercial real estate market.
He told CNBC this morning that:
Everything’s going in the wrong direction and I think we’re going to see quite a lot of tragedies in that sector...The same reckless lending that characterized the subprime mortgage business in residential was also characterizing what went on in commercial real estate in the mid 2000s.
“I don’t think the federal government is going to do much to help the commercial building side, because individual home owners vote, but buildings don’t vote,” he said.
He did point out that the commercial market is about $3 trillion versus an $11 trillion residential market.
However, he failed to mention that Goldman Sachs doesn’t appear to have any significant exposure to commercial real estate, so they won’t be around muscling the government to prop it up. In fact, friends tell me they are probably net short CRE.
http://www.economicpolicyjournal.com/2009/11/wilbur-ross-commercial-real-estate-to.html
Japan will be one of the first to default, and they buy our bonds. When they stop, and dump their treasuries on the market, we can’t borrow money. When we can’t borrow, we have to cut the budget severely, print, or default.
That big pile is about to shrink dramatically
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