Posted on 10/05/2008 6:52:37 PM PDT by Lazamataz
We face extreme danger. Unless there is immediate intervention on every front by all the major powers acting in concert, we risk a disintegration of global finance within days. Nobody will be spared, unless they own gold bars.
Investors will learn today whether the Paulson bail-out - fattened to $850bn (£480bn) by Congress - can begin to halt the death spiral in the credit system. So far, the response looks terrible.
Germany is now in the hot seat. The collapse of a rescue deal for Hypo Real Estate on Saturday threatens a €400bn (£311bn) bankruptcy that nearly matches the Lehman Brothers debacle for sheer scale.
Chancellor Angela Merkel has been forced to pull her head out of the sand, guaranteeing all German savings, a day after she rebuked Ireland for doing much the same thing. Reality intrudes.
During the past week, we have tipped over the edge, into the middle of the abyss. Systemic collapse is in full train. The Netherlands has just rushed through a second, more sweeping nationalisation of Fortis. Ireland and Greece have had to rescue all their banks. Iceland is facing an Argentine denouement.
The US commercial paper market is closed. It shrank $95bn last week, and has lost $208bn in three weeks. The interbank lending market has seized up. There are almost no bids. It is a ghost market. Healthy companies cannot roll over debt. Some will have to sack staff today to stave off default.
As the unflappable Warren Buffett puts it, the credit freeze is “sucking blood” out of the economy. “In my adult lifetime, I don’t think I’ve ever seen people as fearful,” he said. We are fast approaching the point of no return. The only way out of this calamitous descent is “shock and awe” on a global scale, .....
(Excerpt) Read more at telegraph.co.uk ...
I do. I am expecting a Mad Max world, the stuff I've been reading!
It is possible that the effects of the problem are being exaggerated by those who seek to profit from it. I think there is a fair amount of that in the bailout bill debate.
But, yeah...a lot of (illusory) wealth disappeared very rapidly, and the echoes are causing all sorts of chaos. IMHO.
I don't have a ton, but do you suggest I turn my savings into greenbacks?
I do understand that deflation kills. When there isn't a small amount of inflation, lending is impossible.
Bob Brinker said tonight there was no possibility of inflation.
I’m putting mine into tulip futures.
Brinker is incredible. Does Brinker -- a levelheaded fellow -- postulate complete meltdown and worldwide poverty / food riots / etcetera?
China is not immune. Their whole economic system is built on selling the goods they manufacture to others, mainly the U.S. If that goes, so does the whole Chinese economic pyramid.
So what you are saying is we are completely screwed.
Laz,
You know the difference between ethical and legal. Lots of things legal are not ethical. Quite a few people don’t give a rat’s patootie for the difference. They are hedge fund managers and pornography producers. For them to operate on wall street, it is a zero sum game; they win, you lose.
Now we’re in a bind; looking for a legal way to curb their interesting interpretation of ethical conduct. If their trades cause them to have all the money and stock, in their point of view, that’s good. If we’ve been enabling that for the past ten years, that’s very good; in their point of view.
Now they have so much clout, the pond isn’t big enough for all the heavyweight crocs waiting for innocents to come and drink. Will the whole world wide system crumble? As far as the crocs are concerned, yes. The day after we try to feed them $700,000,000,000 the very next word is ‘that isn’t enough’!
AIG is almost through all the bridge money the fed gave them to liquidate bad assets and they haven’t even started to do that. These crocs want someone to guarantee their transactions and their cash flow, and it isn’t going to happen. We’re just feeding their maw by opening floodgates of cash.
I could go on with this rant but you get the idea-—someone peed in the pot with our supper.
http://www.nakedcapitalism.com/2008/10/hypo-bank-gets-68-billion-rescue.html
Hypo Real Estate just got a $68billion bailout without the German taxpayer being burdoned as reported in the above link.
Aw, dang. And here I set myself up to profit from inflation.
Banks aren’t liquid - none of them are. Most of the money they process doesn’t even exist.
That’s why we have issues.
Theoretically your savings in a bank are 'guaranteed' up to $100,000.00 per Federally chartered bank. Now whether or not, in actual practice, you'll be able to withdraw that is an open question. For the last several years we've been buying 10 to 15 ounces of silver a month. We've got a tidy little pile set back. When they were available, we would toss some 1/10th ounce gold coins in there.
At my most recent visit to my dealer, he informed me that there are no gold or silver rounds available, period. He had about 20 1 ounce silver bars left, which I purchased, but that's the end of his inventory.
Now you tell me what's going on.
To answer your question I don't think it's ever a bad idea to have a small pile of cash on hand. We keep some locked in our safe for a rainy day and have for years.
Would I recommend you draw it all out? No. Would I recommend you have a few hundred bucks around? Yep.
What I would recommend is that you have a nice pile of other metals available to hand....brass, copper, and lead spring to mind.
L
Nobody will be spared, unless they own gold bars.
Gold bars taste horrible.
Don’t forget to buy a high quality water filter,one of the ones with a ceramic filter.Everybody talks about ammo and food,lack of safe water will do you in pretty quick.
The writer is a liberal doomsayer.
His Chicken Little Syndrome shows he needs some medications.
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