Posted on 03/05/2009 1:38:55 AM PST by TigerLikesRooster
The U.S. Financial System Is Effectively Insolvent
Nouriel Roubini 03.05.09, 12:01 AM ET
For those who argue that the rate of growth of economic activity is turning positive--that economies are contracting but at a slower rate than in the fourth quarter of 2008--the latest data don't confirm this relative optimism. In 2008's fourth quarter, gross domestic product fell by about 6% in the U.S., 6% in the euro zone, 8% in Germany, 12% in Japan, 16% in Singapore and 20% in South Korea. So things are even more awful in Europe and Asia than in the U.S.
There is, in fact, a rising risk of a global L-shaped depression that would be even worse than the current, painful U-shaped global recession. Here's why:
First, note that most indicators suggest that the second derivative of economic activity is still sharply negative in Europe and Japan and close to negative in the U.S. and China. Some signals that the second derivative was turning positive for the U.S. and China turned out to be fake starts. For the U.S., the Empire State and Philly Fed indexes of manufacturing are still in free fall; initial claims for unemployment benefits are up to scary levels, suggesting accelerating job losses; and January's sales increase is a fluke--more of a rebound from a very depressed December, after aggressive post-holiday sales, than a sustainable recovery.
For China, the growth of credit is only driven by firms borrowing cheap to invest in higher-returning deposits, not to invest, and steel prices in China have resumed their sharp fall. The more scary data are those for trade flows in Asia, with exports falling by about 40% to 50% in Japan, Taiwan and Korea.
(Excerpt) Read more at forbes.com ...
To the best of my knowledge, financial “derivatives” bear no relationship whatsoever to calculus “derivatives”.
I don’t understand the financial variety worth a darn either.
Hell, I barely understood the calculus variety...
Darn, I thought I could finally understand what they were talking about ;)
Oh, well, back to ignorance....
Does this mean we are, in effect, at Year Zero, as the Kymer Rouge proclaimed in Cambodia ?
Ping to post #85.
precious metals are a joke as a medium of exchange in a failed economy... not been used as such since the fall of the roman empire
How many $10 bills do you actually need? Sure I'll have some smaller bills for convienience, but I can't see needing many thousands in $10s. Even if I didn't want a stack of $100s, it would probably be easier and attract less attention just to get $500 of $20 bills every day for a few days at the ATM.
yup with your money
thats nice better get a big a$$ food locker too
Break a hundred it may cost that much by then
Not until inflation kicks in. Right now deflation is the concern. Cash could get in short supply. All off the hundreds of billions they just printed is.....well, who the hell knows where it is. You can't find it. They aren't telling who's got it and the banks sure the heck ain't lending it out.
It's being hoarded by the folks in the know! You might want to do the same.
Thanks for the uplifting news. Think I’ll go get drunk.
Mash here for a solid take on the whole thingy....
http://market-ticker.denninger.net/archives/835-Remarks-Of-TickerGuy.html
what about coinage though?..its solid, has a little value as a metal, and its recognizable....I wonder if it would be worth keeping several hundreds rolls of quarters around....
remember between the Clintoon final months and Bush coming in, we feared that Clintoon was going to have a "crisis" to cancel elections.....
and furthermore....just remember that barry is primarily a puppet for the mob and the elites....he will do whatever benefits them....
also, check in on loved ones to make sure they have their back up plans, stocked pantries, weaponed up and have "bug out" kits all in order, too. it should not be "every man for him self", but that "I am (literally) my brother's keeper". ;-)
I am not an expert on coinage, but it seems outside of quarters these days, when you bounce the stuff on the ground, you get a funny “thunk!”, which sounds so hollow I wonder how much metal is actually in those damned things these days.
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