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Friday, March 20, 2020

This is why you don't bail out the banks

They will never fix anything no matter how sternly they are warned about "the consequences next time". After the last round of bailouts, all they did was double down on what they were doing prior to 2008 and continue their financial rapine without restraint. All the paper wealth everyone "has" is nonexistent, it's just multiple claims on the same underlying property that allows the financial elite to skim off the incessant churn and turn it into stronger property claims. And that is why every debt-based system always collapses over time, as the current financial system is in the process of doing.
Before sunrise this morning, a normally calm and very senior Wall Street banker texted me: “All hell is about to break loose. No safe havens.” His text could not be ignored, coming as it did on the morning after hedge fund manager Bill Ackman’s 28-minute cri de coeur to CNBC yesterday, during which he essentially demanded that the U.S. immediately shut down for 30 days to stop the spread of the coronavirus. What was he talking about, I asked....

Now, apparently, the scourge of interconnectivity is back. Companies are drawing down their lines of credit with abandon. The senior banker seemed to be especially concerned about the portfolios of private equity companies, which are by definition mostly piled with debt and therefore at higher risk of default as the economy contracts. The big worry now among private equity types is that the $1.5 trillion or so of so-called “dry powder”—money that is sitting unused in their coffers or on-call from their limited partners—will now be needed to shore up existing portfolio companies with acute cash needs, rather than for new investments, which would be the preferred course of action in a more normal time, especially with stock prices down around 35% from their February highs. The big worry currently is that the limited partners of private equity funds have enough of their own problems that now they won’t be able to honor their capital calls as they start coming in from the general partners.

That’s yet another scary thought: the domino effect of one private equity portfolio company after another getting into trouble could well be a further negative catalyst to an economy already on the brink of collapse. If one private equity portfolio company after another slips into bankruptcy because limited partners don’t make good on their capital calls, that could mean hundreds of billions more of creditor and shareholder losses.
This is why usury was banned by Christendom and is prohibited by the Bible. I warned everyone back in 2008-2009 that if the banks were not permitted to fail, the next failure was going to be more difficult. It's really not hard to see these things coming, as the patterns of the crisis developing are easily recognizable. And the bigger the bank, the more internationally interconnected it is, the more likely it is to be taken down by the "unexpected" collapse of the system which will likely begin with the failure or bailout of a massive, well-respected institution like Deutsche Bank.

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107 Comments:

Blogger SciVo March 20, 2020 5:55 AM  

You, Mike Shedlock, me, everyone with the slightest bit of sense warned that you get more of what you incentivize. So what we learned is that our gov't is against us.

Blogger Brett baker March 20, 2020 6:06 AM  

I have absolute faith that legislation will be passed to prevent future calamities like this from happening.
Complete with loopholes that will ensure they will happen again.

Blogger Azure Amaranthine March 20, 2020 6:08 AM  

There aren't a whole lot of long-term stable enterprises that involve rocking the boat they sit in while pumping in water.

Blogger Mandos March 20, 2020 6:31 AM  

Indeed, you don't bail out the banks. Except when they hold you by the balls and threaten to reveal your dirty little secrets, like telling them you would guarantee their loans to insolvent borrowers, if you don't comply and save them.

Blogger John Rockwell March 20, 2020 6:33 AM  

Unless the federal reserve and others like it is dealt with like the Bank of International Settlements. Alongside the bailout issue.

We will not see the end of this.

Blogger Roman Daoist March 20, 2020 6:42 AM  

One conspiracy theory is that, given most deaths occur for people _with_ covid-19 and not _because_ of covid-19*, that it's the economic shut-down, and then 'solution', that is the real purpose. The elite putting people in a position where they want to give up transacting with cash, where people want to avoid groupings (like, you know, protests), where people want to give up going to Church. Where people accept complete total economic ruin, while at the same time totally accepting not being allowed to leave their homes.... so that some grannies in the aged care home die a couple weeks or months later than they would anyway, all just in time for the elite to suggest, I don't know, a new world order or something.

I'm becoming scared they might be serious this time.

* blog.nomorefakenews.com

Blogger Mr.MantraMan March 20, 2020 6:49 AM  

Obama the Black puppet, what a total stooge from allowing the Clinton crime family free run, to Biden and his senator buddies looting the Ukrainian "aid" budget, but biggest was bending over for the Wall St. globalists and their hand picked cow cult stooge federal district attorney for Manhattan.

Blogger Silly but True March 20, 2020 6:55 AM  

The American Recovery & Reinvestment Act: paying $0.8T to Canadian, German and Japanese countries to complete all the capital plans they otherwise would have completed on their own through Canadian, German, and Japanese banks, to keep 30 American workers of their American subsidiaries in jobs they already had.

Blogger BillHinDaytona March 20, 2020 7:08 AM  

Have a gallows on Wall Street. If you collapse the system, we hang bankers, starting with the CEOs and the entire C-Suite and the Board, and then moving to the directors.

It's sort of a workaround from attempts to rig the game. It's more like ... OK, we know you'll figure out how to game the system and we'll try to stop you, but if you crash the economy, regardless of circumstances, we hang you.

If we had hanged about 100-500 of the leading bankers back in 2008-09, we'd have made the point. And they would have acted more prudently to make sure they didn't crash the economy.

Blogger Skyler the Weird March 20, 2020 7:08 AM  

They're back to selling repackaged sub prime loans to the same people who defaulted in 2008.

Blogger nswhorse March 20, 2020 7:14 AM  

Anyone paying attention in 2008 and following knew that the elite were the enemy. They couldn't act fast enough to bail out the irresponsible on Wall Street and in multi-national corporations. Not a whisper was ever heard about bailing out Joe Average who lost his job and his home. The money that bailed out the big end of town could have bailed out all the Joe Averages, and left them with clear title to their homes. The bankers couldn't have complained. They would have ended up with a whole pile of cheques. Except for the fact that, as our host has pointed out, they don't really want money, they want to own everything. A mass prevention of foreclosures and freeing of their debt slaves would have set them wailing like banshees, and set the bowties spinning furiously in think tank world. It would be fun in an alternative universe to watch that unfold.

Blogger Jad March 20, 2020 7:19 AM  

@roman daoist, ubi is already here! People are already begging for it while the economy collapses and businesses shut shop. There are a few theories i have at the moment:

1. We are currently in a biological war between countries, china playing the long game started all this to bring the world to their knees and beg the yellow man for help.

2. Clearing out the globalist garbage and using the virus as a means to return to nationalism/populism. (unlikely, in my opinion)

3. Virus orchestrated to control the populations around the globalist controlled west by fear, reduce wealth among middle and working class and create dependency on govt handouts and specifically ubi.

I personally think no.3 is what is happening right now.

Blogger Doktor Jeep March 20, 2020 7:36 AM  

When people kvetch about financial collapse, I remember that our system of debt and usury needs to crash and burn. It's no more a financial system about finance than our justice system being about justice.
All this great vaunted democracy and free speech has only amounted to the same crap as ever just getting named different. Skin suits indeed. Dear God burn it all.

Blogger SomeOne March 20, 2020 7:37 AM  

Data finally coming out of italy: https://www.bloomberg.com/news/articles/2020-03-18/99-of-those-who-died-from-virus-had-other-illness-italy-

Only aged persons with serious health issues are at risk. So surely lets just isolate them, not the entire world.

What would one choose, when putting a price (as we must as a society) on the value of life of an 80.5 year old in seriously poor health? Is it worth the livelihood and life savings (and therefore their future) of one 35 year old business owner and their family of 4 (not to mention their employees well-being, creditors and suppliers etc)?

If not worth just one, perhaps 5 or 6 of the same? 10? 15?

At what point is the catastrophic economic and social cost of a prolonged enforced shut down not worth a certain number of deaths of aged individuals with existing serious health issues?

It is incredible how easily the entire population (regardless of ideology or political preference) has rolled over and given up its rights and privileges, out of fear and panic.

This includes the likes of Farage, Raheem Kassam, Ian Wishart - all of whom I have great admiration for. Or maybe they are all just loving the backlash against globalism and are eager to keep that backlash going. 4d chess and all that perhaps...

Blogger VD March 20, 2020 7:38 AM  

I personally think no.3 is what is happening right now.

It's not. You're wrong. While they will attempt to take advantage of it, as they always do, this was obviously not their plan.

Blogger John Rockwell March 20, 2020 7:42 AM  

@Doktor Jeep

I wish for the permanent death of usury.

Blogger Jad March 20, 2020 7:47 AM  

What is/are the obvious reasons this was not their plan? Willing to learn.

Blogger Ska_Boss March 20, 2020 7:57 AM  

I skimmed across a CNN headline the other day that basically said whatever you do, do NOT go on a bank run during this whole virus pandemic/economic crash.

Not giving financial advice here, but usually the truth of the matter is the exact opposite of what they say. And besides, anyone who knows how the Federal Reserve System operates shouldn't have large sums of cash sitting in a bank anyways.

Blogger Akulkis March 20, 2020 8:15 AM  

If it was No.1 or No. 3, they would have planted it in the west, at a major port city like London or New York. No. 3 would also have had them inoculated with inteediate forms of the synthesized virus, or most of it's original contributors, to build resistance in minor steps. Could easily be covered as "company-provided annual physical, health screening, and innoculations for flu, and common 2nd world diseases for their jet-set lifestyles.

I won't rule out bio-warfare, but it's not at the behest of the bankers. Probably either nation-state actor attacking China (Japan? Russia?) or the Chinese cutting corners on safety precautions because monkey-see, monkey-do without true understanding has worked so well in copying/stealing other western Tech.

The fact that they are fleeing their precious cities indicates

Blogger Akulkis March 20, 2020 8:17 AM  

I would gladly trade my bank account for all of the banks going under, and all the mortgages and loans disappearing with them.

Blogger jarheadljh March 20, 2020 8:26 AM  

Jad wrote:

2. Clearing out the globalist garbage and using the virus as a means to return to nationalism/populism. (unlikely, in my opinion)

3. Virus orchestrated to control the populations around the globalist controlled west by fear, reduce wealth among middle and working class and create dependency on govt handouts and specifically ubi.

I personally think no.3 is what is happening right now.


I'm pretty sure that THEY, you know, THEM, well, THEY thought that they were getting #3, and then they were surprised when #2 started happening. Forgive me for the following bit of ramble, it's early here:

SGTreport-WAS THIS PLANNED MORE THAN A DECADE AGO?? — Gonz Shimura
https://www.youtube.com/watch?v=3QU1Rj64FKU

The audio clip is from all the way back in 2005. The part that caught my attention is that he mentions that the virus was slated to come from China AFTER the NUCLEAR WAR. He doesn’t specify the countries involved, but it fits with the 2016 election. Putin had 40K troops on the Ukrainian border ready to invade if the Witch won in order to block her shoehorning Ukraine into NATO and placing medium range missile five minutes from Moscow. That was likely to domino into a a nuclear exchange between the US and Russia which would leave Russia decimated because the Pentagon still has much better space guns than the Kremlin, but would leave large swaths of America in ruins. Cue the UN, and the Chinese would make up the lion’s share of the multi-national task force INVITED by the Witch to restore order, and they would arrive at the Southern border in those vehicles that were discovered last year already staged for them(search "Alex Beckman mexico red star").

More confirmation that by getting Trump to run, Q kinda saved the world. For now.

Then before China got too uppity, the virus was to be released in a form much worse than the current release. From sources like X22 the rumor is that the whitehats had enough info to intercept the virus sample and neutralize the worst of the symptoms, and Cabal unknowingly released this neutered version, which is why the death toll is as low as it is(it was supposed to kill ten million or so). That would leave world power centered on the EU, that is to say centered on the Old World banking system which is the heart of Cabal’s power. Where all this globalism stuff comes from in the first place.

And the whole thing is on autopilot. Minor course correction is possible, but they can't change directions. And look around, they aren't happy. Panicked, not happy.

Blogger spinthathamster March 20, 2020 8:38 AM  

Not even a month of industry slowly shutting down, nasdaq at the level of june 2019 and the economy is already collapsing. Says it all...

Blogger Yossarian March 20, 2020 8:39 AM  

With banks failing, 5G around the corner, and massive amounts of processing power, an opportunity might be opening up for the bitcoin miners.

Blogger John Regan March 20, 2020 8:51 AM  

For a long time I figured we had to have a debt jubilee and a return to sound money. I must admit it never occurred to me that there might be a worldwide government push to quash the economic crisis by eliminating large numbers of claimants. But that's what some people seem to think is going on.

I can't say we don't deserve it as a people. It's still not pretty. It could still also be solved, demographically, by an immediate baby boom and a little patience.

Blogger Akulkis March 20, 2020 8:59 AM  

Near Topic
Corona Chan about to do the work Merkel's government refuses to do.

Blogger Doktor Jeep March 20, 2020 9:04 AM  

Don't forget that in 2007 the banksters were threatening Congress with a Mad Max scenario at its worst but that was likely cover for the real threat of puting them for kiddie diddling and drug habits.
I don't think the game is playable in that manner any more. It's obvious what Trump's intent is, and for that matter this thing is bigger than all of us. Hoka hey.

Blogger Stilicho March 20, 2020 9:10 AM  

There will be bailouts. It is one of the few things politicians can do, so they will. The donor class will insist on getting bailed out and their owned politicians will happily comply.

Luckily, Trump will insist on main street being bailed out too and that will likely have a much wider and more profound effect than the bankster bailouts. The ultimate form of these bailouts is to be determined, but I expect main street bailouts to take the form of extended unemployment benefits, tax breaks, and govt guaranteed loans for american businesses. The banksters, as usual, will get effectively free cash from the Fed and direct payments from treasury in some cases. trump will go along with this in order to get what he wants.

Make Tariffs Great Again!

Blogger awildgoose March 20, 2020 9:16 AM  

And of course, the overnight pump has produced a sucker's rally, despite the facts that the entire state of California shut down and the State Dept said not to travel internationally. Even car rental stocks are up.

This strategy is delusional and wrong. Stimuli versus the current trend to prop up overvalued paper are like firing a bazooka into an avalanche. As has been stated, less than nothing was learned from the last financial crisis.

I am surprised that Trump is the front man as the new police state is implemented. He does not seem like an NWO type.

I suppose it's possible the Deep State told him, "You can LARP as somewhat rightish, somewhat populist leader, but here is the overall plan. Don't deviate from the plan if you want your sons and daughters to have long, happy lives."

Blogger Jay Will March 20, 2020 9:26 AM  

It was not me it was the virus you see.

Blogger Sargent.matrim March 20, 2020 9:29 AM  

I really enjoyed The Return of The Great Depression. I read it in about 2010. Whatever else can be said about Marx, he predicted this very situation as well.

The more we bailout the banks and the system, the bigger the next crisis comes, and the worse the damage is from the collapse.

These truly are interesting times. We are living in the shift of empires, and global power.

Blogger Ominous Cowherd March 20, 2020 9:30 AM  

nswhorse wrote:Except for the fact that, as our host has pointed out, they don't really want money, they want to own everything.
Bankers know what currency is worth: they make it up out of nothing when you borrow, they see it return to nothing when you default or repay. That's why they don't get high on their own supply.
jarheadljh wrote:That was likely to domino into a a nuclear exchange between the US and Russia which would leave Russia decimated because the Pentagon still has much better space guns than the Kremlin, but would leave large swaths of America in ruins.
Last I heard Russia still had most of the USSR's civil defense infrastructure in place. They could probably come through that kind of thing much better than we could, because we have no civil defense infrastructure. Our space guns are nifty, but not nearly nifty enough.

Blogger Damelon Brinn March 20, 2020 9:42 AM  

And look around, they aren't happy. Panicked, not happy.

Yeah, you don't have to know anything about the virus, just be an observer of people. The primary force in politics today is TDS. All these leftist-run institutions, from Democrat governors to Harvard to the NBA, wouldn't be backing up Trump by shutting things down and costing themselves millions if this was a plan they were in on, or an overblown scare.

The people in charge are more panicked than the masses. The masses ran out and bought a bunch of toilet paper as almost a lark, but if the authorities had kept downplaying it as a mild flu, that would have been the end of the panic. They're still doing their best to use it against Trump somehow, but only within the context of a threat that's got them scared.

Blogger Damelon Brinn March 20, 2020 9:47 AM  

I am surprised that Trump is the front man as the new police state is implemented.

"The facts don't match my expectations, but I won't let that change my preconceptions."

Blogger Balkan Yankee March 20, 2020 9:49 AM  

Wunderbar!

Blogger map March 20, 2020 10:11 AM  

Vox,

"This is why usury is banned. I warned everyone back in 2008-2009 that if the banks were not permitted to fail, the next failure was going to be more difficult. It's really not hard to see these things coming, as the patterns of the crisis developing are easily recognizable."

But...see...this is the problem. The banking crisis back in 2007-2008 was caused by the Fed, not the banks. The Fed caused a massive increase in the Federal Funds Rate and that is what collapsed the housing market and the banking system.

If the banks are making out like such bandits, why did XLF take until January of 2020 to recover its pre-crash high when the S&P itself recovered in February of 2013?

What the media isn't telling people now is that, over the last few months, the Federal Reserve is implementing the Basel III requirements that were agreed upon back in 2011. These raise the bank reserve requirements from 7% to 10%. That is, the Fed is implementing a 42.86% increase in reserve requirements and all of the quantitative easing being done is to help the banks meet those requirements, not engage in lending.

The result is a liquidity crisis...cash is drying up. The Fed is effectively pushing the gas pedal and the brake at the same time...they dropped interest rates while pulling cash out of the market, to the point where the demand fro dollars is exceeding supply.

This is why gold sold off sharply. At the margin, the cash crunch is so great that people were selling gold in a gold bull market to raise cash. This is scraping the bottom of the barrel to satisfy a cash demand.

The Fed needs to reverse the reserve requirements and go back to a 7% reserve.

But again...we go back to the same problem...we have a government agency tanking the US economy and no one does anything about it.

Blogger Azure Amaranthine March 20, 2020 10:21 AM  

"Whatever else can be said about Marx, he predicted this very situation as well."

Anyone with a long enough eye to history can see this pattern over and over again for thousands of years. Not really hard to predict what happens every few generations for much of history.

Blogger johndoe03526 March 20, 2020 10:35 AM  

Bitcoin

Blogger Rough Carrigan March 20, 2020 10:40 AM  

#35. Why do you think the Fed is a government agency?

Blogger Daniel March 20, 2020 10:47 AM  

Map, kicking the can down the road doesn't solve anything if the road is a dead-end.

Blogger borsabil March 20, 2020 10:52 AM  

If Coronachan is some (((globalist))) conspiracy then it's backfired on them bigly.

Most of the nations of the world, and all western countries, have now closed their borders and put a complete halt to inward migration. Here in Australia we've shutdown all inward travel. The airports are dead with even domestic air travel about to be banned. Tasmania has announced that it's cutting itself off from the mainland, interstate visitors must complete a 14 day quarantine, the rest of the states are expected to follow suit in a week or two. The next move will see small townships and even urban areas excluding and quarantining strangers.

All of the temp migrants, most of them in the hospitality sector, are being thrown out of work. They'll either be made to go home or will starve to death. These policies will continue until a vaccine is available or humanity achieves herd immunity. So anything from 18 months to 10 years.

Does that sound like a globo homo wet dream? Coronachan is a game changer, whether that offends your boomer sensitivities or not.

Blogger Jeroth March 20, 2020 10:53 AM  

“We are fighting an enemy that is different from us. Not open, but hiding; not straightforward but crafty; not honest but base; not national but international; does not believe in working but speculates with money; does not have its own homeland but feels it owns the whole world,” - Victor Orban

He only got the last sentence wrong. They do have their own homeland now, and they need to gtf home.

Blogger Jeroth March 20, 2020 11:02 AM  

We went from J.C. Penney refusing to take credit cards, because he was afraid his customers would spend too much, to this. The silver lining is that Trump might not be able to run on muh markets and muh black unemployment. Thank God.

Blogger awildgoose March 20, 2020 11:07 AM  

Here is confirmation that the Fed is the buyer of last resort, and they will buy every piece of trash paper they can get their hands on to prop up completely overvalued equities at the expense of the US dollar:

https://www.zerohedge.com/markets/historic-day-fed-buy-record-107-billion-securities-today-alone-fed-balance-sheet-explodes

Today's price action provides additional proof. Marriott is up 25% right now. Somehow no revenue for a minimum of 1-3 months is bullish. Just like Tesla is also up 9% after having their factories and the state of California shut down.

Blogger MEGAMUS Maximus March 20, 2020 11:14 AM  

This is for Jad.

The entire epidemic has been a nightmare for globalist and their schemes.

No. 3 would already be happening if that's the case. Not only has this not occurred (And in a large number of cases has been prevented), but the reason number 3 would have looked appealing was because it would have been pushed as a false option by the enemy. The problem? Everyone now knows enemy's plan A and how it came about and are fully aware that plan B is a possibility.

People also know that your No. 3 is reliant on a population that's divided along ethno-racial lines and is fully accepting of the poz. Corona-Chan killed the poz and everyone hates the globalization that would have been a necessary precondition for enemy's admittedly fragile totalitarian police state dream.

Stop blackpilling. Or rather, stop being nostalgic for the mid 2000s conspiracy theory scene. There's a difference between identifying real conspiracies and making shit up that the members of that scene failed to do.

Blogger Zander Stander March 20, 2020 11:17 AM  

So it is either 1 or two? If I read your stance in general, would you say the answer is option number 2?

Blogger 🐻Drew🐻 March 20, 2020 11:27 AM  

Curious if this could be the catalyst to the break up of the US? Maybe I'm off but it seems like all the conservatives are laying out the rhetorical ground work to start conflict with China, maybe its posturing and the blame game... But all this is very interesting to see unfold in real time.

Blogger Damelon Brinn March 20, 2020 11:32 AM  

@40, Exactly. It's leading to a moratorium on immigration tighter than it looked like we could ever get through the political process. We might not be sending them back yet, and closed borders may make that difficult, but stopping the inflow was half the battle. Industries are already scrambling to hire local, as Vox points out in his next post. None of that is part of any globalist plan.

Blogger James Dixon March 20, 2020 11:37 AM  

Meanwhile: Insider trading? We've heard of it.

https://megaphone.upworthy.com/p/senator-kelly-loeffler-richard-burr-stocks

Blogger Filip S March 20, 2020 11:40 AM  

Someone made a website of the "money printer go brrrr" with a stock ticker playing initial D with adjustable playing speeds. LOL

https://brrr.money/

Blogger CM March 20, 2020 11:43 AM  

Not giving financial advice here, but usually the truth of the matter is the exact opposite of what they say. And besides, anyone who knows how the Federal Reserve System operates shouldn't have large sums of cash sitting in a bank anyways.

What is a large amount of cash? Over FDIC insured? Is "small" amount less than what you can get land for? That's my goal. To get to where we can pay cash for a bit of land near church family or biological family.

Blogger Unknown March 20, 2020 11:44 AM  

Not too long ago we pulled 8 trillion dollars (9.6 trillion in inflation adjusted terms) out of the ether to bail out the banksters.
Behavior was not modified so here we are again.
This time, how about this, instead of pulling 9.6 trillion out of the ether and giving it to the banksters, how about we pay off all the userous debt?
People win.
Banksters get "their" money
Then we reform the system

Blogger OneWingedShark March 20, 2020 11:50 AM  

Roman Daoist wrote:I'm becoming scared they might be serious this time.
Pray.

BillHinDaytona wrote:Have a gallows on Wall Street. If you collapse the system, we hang bankers, starting with the CEOs and the entire C-Suite and the Board, and then moving to the directors.

It's sort of a workaround from attempts to rig the game. It's more like ... OK, we know you'll figure out how to game the system and we'll try to stop you, but if you crash the economy, regardless of circumstances, we hang you.

If we had hanged about 100-500 of the leading bankers back in 2008-09, we'd have made the point. And they would have acted more prudently to make sure they didn't crash the economy.

This would require people in authority that weren't bought-off by the bankers.

Jad wrote:3. Virus orchestrated to control the populations around the globalist controlled west by fear, reduce wealth among middle and working class and create dependency on govt handouts and specifically ubi.

I personally think no.3 is what is happening right now.

There's also the fact that if the big multinational-companies are bailed out, and the local small- and medium-sized businesses are not, then this crisis will focus market-share and power into the big-corporations. — IOW, it's a frantic play at using the collapse to their globalistic/megalomaniacal advantage.

Doktor Jeep wrote:When people kvetch about financial collapse, I remember that our system of debt and usury needs to crash and burn. It's no more a financial system about finance than our justice system being about justice.

All this great vaunted democracy and free speech has only amounted to the same crap as ever just getting named different. Skin suits indeed. Dear God burn it all.

Imagine the weeping and wailing if the Justice Department was about Justice…

Akulkis wrote:I would gladly trade my bank account for all of the banks going under, and all the mortgages and loans disappearing with them.
Same.
God will care for me, because He is good; so I am mostly unworried about things… though I need to pray a bit more for Justice to be done in the US.

borsabil wrote:If Coronachan is some (((globalist))) conspiracy then it's backfired on them bigly.
There are likely several factions of Globalists in-play.
Remember how the tribe-members infesting the US seemed to be split on jumping to China or wringing the last drops of blood from us and the weirdness that all that produced? Now add in more players, some of which are also fractured.

Blogger Stilicho March 20, 2020 12:01 PM  

@Drew, I doubt it. There is still a lot of fail left in the US. Definitely another warning rumble from the volcano though.

Blogger Up from the pond March 20, 2020 12:05 PM  

UBI is the true market solution.

Instead of the government picking winners and losers, and giving its loot to friends and cronies in "the big club," it gives it to the people directly under UBI, no strings attached.

When people spend that money, they make their own individual economic calculations. Therefore the money is more efficiently allocated. Von Mises said economic calculation is impossible for a central authority to do. Remember?

Let the market decide. The money will end up in the hands of those who earned their customers' business.

The American people had their blood sucked out of them over the past 50 years of globalism. Bail them out - not the bankers, not the cronies - and let market forces reorganize the economy.

Blogger Akulkis March 20, 2020 12:10 PM  

@Jad
See my reply to you at 8:15am

Blogger Ominous Cowherd March 20, 2020 12:49 PM  

Rough Carrigan wrote:#35. Why do you think the Fed is a government agency?
Why do you think that there is a meaningful distinction between the oligarchs who own the Fed and the Federal Government which the Fed is sort of separate from?

The Fed serves two masters: it is owned by and operated for the profit of the banking oligarchs. It holds its counterfeiting monopoly at the pleasure of the Congress, and will maintain that monopoly only as long as they enable deficit spending at the level to which Congress has become accustomed.
Meanwhile, oligarchs keep congresscritters the way Asian folk keep elephants: they are dangerous, unpredictable but profitable beasts.
CM wrote:Is "small" amount less than what you can get land for?
Small would be small enough that you can afford to lose it.

Blogger justaguy March 20, 2020 12:50 PM  

Did any ever conclude that New Testament theology anywhere bans usury? A set-up in the far European past banned it for nobles, leaving others to provide the banking and allowing their pillaging without war risk. But it was allowed in every country in Europe. Everyone has been allowed usury since the nobles fell and no theology other than the OT says so along with hundreds of other prohibitions that are ignored as not applicable and now allowed.

Dead horse, stick, ....

Blogger Snidely Whiplash March 20, 2020 1:53 PM  

map wrote:The banking crisis back in 2007-2008 was caused by the Fed, not the banks. The Fed caused a massive increase in the Federal Funds Rate and that is what collapsed the housing market and the banking system.
A trigger for an event is usually not the cause.

Blogger Solon March 20, 2020 1:54 PM  

@57

Luke 6:34-36

Not a "ban," per se, but absolutely against New Testament advice.

Blogger Geir Balderson March 20, 2020 2:03 PM  

That is why i have all of my money invested in lutefisk. It lasts forever and everyone has to eat.

Blogger Silly but True March 20, 2020 2:21 PM  

Matthew has Jesus lamenting in parable a conservative man not depositing one’s investment with a banker to earn interest, thus suggesting God is thus an appropriate party to engage in usury of mortals’ spirits. This also implies New Testament Christians should also at least understand the benefits and obligations of interest-bearing loans.

I’m more interested in society as whole returning to a collective view of tax collectors being worse than lepers and rapists, though.

Blogger Snidely Whiplash March 20, 2020 2:34 PM  

Geir Balderson wrote:That is why i have all of my money invested in lutefisk. It lasts forever and everyone has to eat.
starvation ... lutefisk ... starvation ... lutefisk
Seems like a toss-up to me.

Blogger CM March 20, 2020 2:40 PM  

Matthew has Jesus lamenting in parable a conservative man not depositing one’s investment with a banker to earn interest, thus suggesting God is thus an appropriate party to engage in usury of mortals’ spirits

That isn't the parable. Investment and growth does not mean handing over to a bank to make foolish choices and use immorally in your name.

Invest in your own skills, a friend's skills, the wise plans of a stranger in a morally appropriate way. Don't bury your money in the yard in an attempt to keep it "safe".

Things living reproduce. Seek to have all things entrusted to you grow in a way honoring God. If it doesn't bear fruit, it is dead and useless - cut it off.

Blogger Jack Amok March 20, 2020 2:46 PM  

Conspiracies exist, but they're not the big, omnipotent ones conspiracy theorists like to imagine. There's a whole host of Globalist conspiracies going on in co-opitition with one another. I doubt the Kung Flu was a deliberate event by any of them. For one thing, they're all getting hammered badly by it. Even the banksters - who could profit from a bailout - wouldn't do this as it's too damn risky when they can just quietly skim wealth off their normal daily operations. All the globalists run highly fragilista operations. They may have gotten too fat-n-happy to remember that, but their usual MO is small, incremental steps below the radar. A global pandemic is the style of fictional cartoon villains, not the real globalist ones.

Blogger xevious2030 March 20, 2020 3:22 PM  

"The Fed caused a massive increase in the Federal Funds Rate and that is what collapsed the housing market and the banking system."

It was a massively bad idea, to the point of having to be intentional. What was coming out of the mouth of the Fed, and financial truth, were two opposite things. Yes, the garage was massively overloaded with fuel cans, but the lighting and throwing of the match was not an accident.

Blogger xevious2030 March 20, 2020 3:34 PM  

It was akin to throwing a match, watching flame, throwing another match, and another, and another as the fire kept rising.

Blogger weka March 20, 2020 3:51 PM  

I have a little list of politicians who should share their fate. They may be socialist in name, but the banks own them.

Watch this space. When half the population cannot pay their mortgages will there be the any relief? I predict not.

We should legislate the Jubilee

Blogger Ahărôwn March 20, 2020 4:04 PM  

Luke 6:34-36

Not a "ban," per se, but absolutely against New Testament advice.


Also Romans 13:8.

Blogger eclecticme March 20, 2020 5:32 PM  

TARP money was supposed to go to homeowners underwater in their mortgages. It went to banksters instead. Michael Hudson said that Ben Bernanke's helicopters only dropped money over Wall St.

I can see a clear difference between the real, productive economy and finance. That may be due to reading Michael Hudson. How common is this view? I do see some discusions about giving money to people vs. corporations/banks/Wall St.

Blogger nswhorse March 20, 2020 6:49 PM  

map wrote:Vox,

"This is why usury is banned. I warned everyone back in 2008-2009 that if the banks were not permitted to fail, the next failure was going to be more difficult. It's really not hard to see these things coming, as the patterns of the crisis developing are easily recognizable."

But...see...this is the problem. The banking crisis back in 2007-2008 was caused by the Fed, not the banks. The Fed caused a massive increase in the Federal Funds Rate and that is what collapsed the housing market and the banking system.

If the banks are making out like such bandits, why did XLF take until January of 2020 to recover its pre-crash high when the S&P itself recovered in February of 2013?

What the media isn't telling people now is that, over the last few months, the Federal Reserve is implementing the Basel III requirements that were agreed upon back in 2011. These raise the bank reserve requirements from 7% to 10%. That is, the Fed is implementing a 42.86% increase in reserve requirements and all of the quantitative easing being done is to help the banks meet those requirements, not engage in lending.

The result is a liquidity crisis...cash is drying up. The Fed is effectively pushing the gas pedal and the brake at the same time...they dropped interest rates while pulling cash out of the market, to the point where the demand fro dollars is exceeding supply.

This is why gold sold off sharply. At the margin, the cash crunch is so great that people were selling gold in a gold bull market to raise cash. This is scraping the bottom of the barrel to satisfy a cash demand.

The Fed needs to reverse the reserve requirements and go back to a 7% reserve.

But again...we go back to the same problem...we have a government agency tanking the US economy and no one does anything about it.


You have no clue what you are talking about. The Fed spent 20 years prior to 2008 flooding the market with cheap credit, two effects of which were the dotcom bubble and the housing bubble. The bankers happily went along with this because it benefited them handsomely. That's the reason the Fed funds rate increase pulled everything down. It was a bubble being pricked, not a liquidity crisis. 'Liquidity crisis' is a myth made up by Keynesians to explain away why their stupid theories never work in reality. Feeding more cheap credit into the economy to stave off a non-existent liquidity crisis only blows a new bubble and sets up a new, even bigger crash. Which is where we are right now.

Blogger Sargent.matrim March 20, 2020 8:03 PM  

True.

Blogger MEGAMUS Maximus March 20, 2020 8:25 PM  

It was shown clear as day that Usury was banned during New Testament times.

Usury also only became legal during the latter day middle ages, signalling the decline and corruption of that society. I've seen one argument that Luther's theses and actions were a revolt against Usury that had the unfortunate effect of encouraging it even more (Mostly because of that heretical synagogue of Satan in soul Calvin).

Blogger Akulkis March 20, 2020 8:33 PM  

"Not even a month of industry slowly shutting down, nasdaq at the level of june 2019 and the [i][b]phony[/b][/i] economy is already collapsing. Says it all..."

There, fixed it for you.

Blogger Azure Amaranthine March 20, 2020 8:56 PM  

"But...see...this is the problem. The banking crisis back in 2007-2008 was caused by the Fed, not the banks."

Cut the binary 'tardation. It was caused by both.

Blogger Silly but True March 20, 2020 9:30 PM  

@CM

I don’t disagree with your point. Surely we can agree that Christ at least rates an interest-bearing investment gaining say between 6% and 9% APR with no withdrawal penalties somewhere between sexing one’s wife often to grow a large family of shepards, good samaritans, and priests versus digging a hole in the backyard.

Blogger Roman Daoist March 20, 2020 9:34 PM  

It's not about money but about control. As was the axe.

You can already get arrested for being outside without a permit in France. Cali introduced a lockdown. Everyone says "OK".

QANTAS (Australia's largest airline) just dropped 20,000 employees. Tourism, hospitality (cafes bars restaurants hotels), arts, sports, education (AKA civilisation) are all getting turned Off. All the businesses that support and service those industries will themselves get turned Off.

There may be no functioning economy in a couple months anywhere. Nothing substantial left but supermarkets, chemists and hospitals. And the police.

WHILE NO ONE HEALTHY ACTUALLY DIES FROM KUNG FLU.

If we go with the Evil Elite idea then what they want is dominion, prefereably an acquiescent one. They're getting it.

Time for push-ups and prayer, bitches.

Blogger Jad March 20, 2020 10:55 PM  

I agree... Maybe because I live in Aus I have a different perspective. Not sure how things are in America but here it's all about, 'human biosecurity legislation,' 'localized lockdowns,' 'smart city's,' 'sustainable energy sources,' 'tax breaks,' 'interest-only payments,' 'easier access to loans,' 'quantitative easing until the cows come home,'

They wanted the virus to get here, they were more than capable of shutting the borders much earlier, as VD already stated. But now the virus is here and the fear has been stoked until our society is raging, we've already had home break-ins for the purpose of stealing food, then they offer the citizenry the olive branch of security and money (UBI). Now they shut the borders once the virus is here, don't actually enforce mandatory self-isolation they just request it and they even admitted they won't do full scale lockdowns because our economy must keep churning away!

I admit, I do want to see some chaos, I want to see our system burn to the ground and get replaced.

Remember, globalism is all about open borders, right up until they have control. At which point they shut them in order to divide any potential organised reactionary threats. I hope Im wrong. Maybe this is wacky conspiracy from the 90's-2000's. I'm happy to be wwrong! I sincerely hope that populism and nationalism is not impeded and that the globalists die quickly and in a shallow grave.

@ MEGAMUS maximus:

"Stop blackpilling. Or rather, stop being nostalgic for the mid 2000s conspiracy..." I think seeing our system crashing down is a white pill not a black pill. I want chaos, I just don't want the globalists succesfully using it to their advantage. Not all countries are responding to the virus the same way.

"People also know that your No. 3 is reliant on a population that's divided along ethno-racial lines and is fully accepting of the poz..." That's most of Australia mate. It's that bad. Our current treasurer... (((Josh Frydenberg)))

Blogger justaguy March 20, 2020 11:03 PM  

#72: The Romans (NT times) banned usury? The times after fall of Rome (say 460 to 1000) had bans on usury in Europe? Use of a minority population to perform actions is not banning. Now, the lands conquered by Islam did actually enforce some bans, but that is not the topic.

Blogger map March 21, 2020 12:13 AM  

Daniel wrote:Map, kicking the can down the road doesn't solve anything if the road is a dead-end.

But, again, this is a problem caused by the Fed. Why would you punish companies for that?

Blogger map March 21, 2020 12:30 AM  

Rough Carrigan wrote:#35. Why do you think the Fed is a government agency?

The Feds Board of Governors is appointed by the president and approved by Congress. The President could have any Fed governor removed and he can order the Fed to do what he wants. Richard Nixon, for example, ordered the Fed to print money to juice the economy in violation of the Bretton-Woods agrrement...and he got it.

This idea that the Fed is some 4th branch of government or some kind of private bank is simply not true. The Fed is supposed to create the illusion of independence because, if it was, say, part of the Treasury Department, the assumption would always be that the government is printing money even if it is not.

Blogger map March 21, 2020 12:34 AM  

Snidely Whiplash wrote:map wrote:The banking crisis back in 2007-2008 was caused by the Fed, not the banks. The Fed caused a massive increase in the Federal Funds Rate and that is what collapsed the housing market and the banking system.

A trigger for an event is usually not the cause.


The Fed makes its decisions on its own. It controls short term interest rates and that makes it the most powerful economic entity in the world.

Blogger map March 21, 2020 12:36 AM  

xevious2030 wrote:"The Fed caused a massive increase in the Federal Funds Rate and that is what collapsed the housing market and the banking system."

It was a massively bad idea, to the point of having to be intentional. What was coming out of the mouth of the Fed, and financial truth, were two opposite things. Yes, the garage was massively overloaded with fuel cans, but the lighting and throwing of the match was not an accident.


The Fed bases its decisions on the Philips curve. They believe that higher wages, higher housing prices, more employment, and higher stock prices cause inflation. To fight inflation, you have to create unemployment.

Blogger Snidely Whiplash March 21, 2020 12:41 AM  

map wrote:But, again, this is a problem caused by the Fed. Why would you punish companies for that?
The CAUSE was the over extension of credit, without regard for creditworthiness, enabled by the proliferation of derivatives and stupid investors.
The TRIGGER was the move by the Fed.

Blogger map March 21, 2020 1:06 AM  

Snidely Whiplash wrote:map wrote:But, again, this is a problem caused by the Fed. Why would you punish companies for that?

The CAUSE was the over extension of credit, without regard for creditworthiness, enabled by the proliferation of derivatives and stupid investors.

The TRIGGER was the move by the Fed.


C'mon...think about what you wrote. You're telling me that in a span of a few short years, all the biggest banks in the world forgot how to write mortgages? The all forgot about credit standards and how to evaluate insurance contracts? You can't be serious.

This is a chart of the fed funds rate. Remember, the Fed controls the FFR. The FFR and the prime rate move together at a fixed 3 percentage point spread. The prime rate moves the ARM. The fed caused mortgage rates to double and all of the ARM's adjusted accordingly.

https://www.barchart.com/stocks/quotes/FEDFUNDS.RT/technical-chart?plot=BAR&volume=total&data=MO&density=X&pricesOn=1&asPctChange=0&logscale=0&sym=FEDFUNDS.RT&grid=1&height=500&studyheight=100

Blogger Reader March 21, 2020 1:09 AM  

I remember that bald vampire, Henry Paulson, during that bailout fiasco. He was playing up the dramatics, getting on his knees. Such an immoral human parasite. A reckoning is overdue for this scum.

Blogger map March 21, 2020 1:39 AM  

Snidely Whiplash wrote:map wrote:But, again, this is a problem caused by the Fed. Why would you punish companies for that?

The CAUSE was the over extension of credit, without regard for creditworthiness, enabled by the proliferation of derivatives and stupid investors.

The TRIGGER was the move by the Fed.


Think about what you are arguing: that for some short period of time, all the banks forgot how to write mortgages and insurance contracts. Does that actually make sense? Everyone just decided to ignore creditworthiness.

No.

The Fed destroyed the economy because the Fed regards every measure that we consider good as an indicator of inflation. The Fed controls the Fed funds rate directly, which indirectly controls the prime rate, which determines mortgage rates. The Fed caused mortgage rates to double which crashed the economy.

See this chart:

https://www.barchart.com/stocks/quotes/FEDFUNDS.RT/technical-chart?plot=BAR&volume=total&data=MO&density=X&pricesOn=1&asPctChange=0&logscale=0&sym=FEDFUNDS.RT&grid=1&height=500&studyheight=100

Blogger Azure Amaranthine March 21, 2020 2:25 AM  

"But, again, this is a problem caused by the Fed. Why would you punish companies for that?"

Because the companies were complicit with the Fed. It wasn't caused by just the Fed, but by the Fed and the banks in conjunction. This is not hard.

"The Fed bases its decisions on the Philips curve. They believe that higher wages, higher housing prices, more employment, and higher stock prices cause inflation."

I've got a bridge to sell you.

Blogger Snidely Whiplash March 21, 2020 2:39 AM  

map wrote:You're telling me that in a span of a few short years, all the biggest banks in the world forgot how to write mortgages? The all forgot about credit standards and how to evaluate insurance contracts? You can't be serious.
Banks are only conduits of mortgages. Banks have not actually held mortgages for decades. Their only concern was being able to sell the mortgages on to someone else.
And yes, practically overnight, they discovered that they could bundle the mortgages into fund, slice then into "tranches" and sell the derivatives as guaranteed income with no risk. Go look at what investment sites were writing at the time.

Blogger SciVo March 21, 2020 3:35 AM  

@Up from the pond:

UBI is the true market solution.

Instead of the government picking winners and losers, and giving its loot to friends and cronies in "the big club," it gives it to the people directly under UBI, no strings attached.


I think that you are breath-takingly naive (and I say that as a confessed pollyanna). The bureaucrats administering it would basically be the same kind of people as Twitter's Orwellian "Trust & Safety" council.

The law would no doubt be written with a way to not give money to bad people, since who wants to do that? But the drones would interpret "bad" as "racist", so a non-white dope-dealing pimp would still get his UBI, while anyone twatting support for the Wall would not.

Blogger Bearable Pain March 21, 2020 6:15 AM  

On usury: Whether one is atheist or secular the horror written into Deuteronomy 15 vs 6 applies and affects everyone save a few if you get my drift. Usury is a mandate in the Old Testament and it ain't going to change until people get their heads out of their asses and into the 'literature'. That said, I do think the Globaalists (sic) are playing an all or nothing game and what has happened since 2006 is that they have lost control of the narrative. They lost control of their bullshit narratives and false histories. They lost the impeachment hoax, I mean accusation, they lost all credibility with WMDs, 9/11, the 2008 TARP bailout, Solzhenitsyn's banned book, Epstein not killing himself, Hillarygate and I could go on and on ad nauseum. The worshippers of light are showing their strength and intentions, to burn everything down under the guise of Corona. They don't build anything they destroy and profit from said destruction. I'll leave with the debate between Hillel and Shammai in the 2nd century where the Jujubees debated for two and a half years on whether or not God should have created mankind. After almost three years the decision was not a tie! One for mankind and one against. Nope. Both Pharasaic schools voted God should NOT have made mankind but since he did, mankind should be righteous. Now, ask yourself this, is mankind righteous? No. What kind of monotheistic theology votes against its own creation? What kind of monotheists criticize God for giving them the breath of life? You fill in the blank. Now, take a breath and look at it from the Atheist side which by definition votes against God making mankind because they don't believe in a creator and atheism by definition ascribes no moral 'righteousness' to mankind except for their myopic self-absorbed self-righteousness which is not righteous by any metric. We have a problem to solve. I believe and know God created a perfect world for us to live in. The world IS NOT fallen. It is man THAT IS fallen and has the capacity to be righteous given Jesus was a man and without question was righteous for all mankind to see. We know righteousness is possible and attainable. We know what the Jujubees did and thought about the last and only Christian hero. They killed God. They killed God before Hillel and Shammai ever debated One iota. It is up to us to resurrect the spirit. It is up to us to be righteous and solve the problems that are, yes, Biblical in scale. Men who conspire to burn the world to the ground must be dealt with. And ironically they hate the light! They hate the truth.

Blogger xevious2030 March 21, 2020 8:01 AM  

“Everyone just decided to ignore creditworthiness.”

Given the variable interest rates, and lending from a very temporary zero percent rate level, yes, they lost their freakin minds over it. Multiple hands passing along the same mortgage spread the pain. And raising the rates, while allowing almost no period of real adjustment (time to put the house on the market to trade abilities to pay, no special additional refinance to a fixed rate grant) was entirely retarded. The answer is yes, everyone involved.

Blogger Bearable Pain March 21, 2020 9:27 AM  

On my # 90 post above, I meant to open with 'whether one is religious or secular', not atheist or secular.. Shit. I drink... sorry.

Blogger Damelon Brinn March 21, 2020 9:53 AM  

You're telling me that in a span of a few short years, all the biggest banks in the world forgot how to write mortgages?

It started in the 70s with the Community Reinvestment Act, and then accelerated under Clinton, and then again under Bush. So it wasn't exactly a few years, though the worst of it was near the end with the bundling. But the groundwork for making risky loans to satisfy political demands was laid over decades.

Blogger map March 21, 2020 12:42 PM  

nswhorse wrote:You have no clue what you are talking about. The Fed spent 20 years prior to 2008 flooding the market with cheap credit, two effects of which were the dotcom bubble and the housing bubble. The bankers happily went along with this because it benefited them handsomely. That's the reason the Fed funds rate increase pulled everything down. It was a bubble being pricked, not a liquidity crisis. 'Liquidity crisis' is a myth made up by Keynesians to explain away why their stupid theories never work in reality. Feeding more cheap credit into the economy to stave off a non-existent liquidity crisis only blows a new bubble and sets up a new, even bigger crash. Which is where we are right now.

No, this is incorrect. The dotcom bust was caused by the Fed, not cheap credit. The NASDAQ boomed because of the tax cuts that Gingrich and Clinton agreed on were supplied side in nature and caused the economy to roar.

But the whole thing spooked Alan Greenspan. He could not understand why the Nasdaq was at 1500. He could not understand why Microsoft had a market cap greater than General Electric. Why, GE makes aircraft engines and power generators and trains. Microsoft just makes little plastic disks. Surely, Greenspan thought, this is a bubble caused by irrational exuberance.

So he acted on it. He deliberately prevented the M1 money supply (cash) from growing to accommodate the growing economy, deliberately starving it of capital. Eventually, this busted out the economy and caused what we know as the dotcom bust.

Yes, that was caused by the Fed.

At the same time, Greenspan's policy was wreaking havoc in Asia. Greenspan had established, between 1994-1996, a quasi gold standard, where the dollar price of gold moved in a very narrow range. This prompted Asian economies to fix their currencies to the dollar. Then, Greenspan started his cash-curtailing agenda. Reducing available of liquidity caused the value of the dollar to rise. In order to maintain the peg, Asian economies had to remove cash from their own economies. This means they were squeezing their own economic productivity to maintain the dollar peg. When they could no longer do that, their currencies then crashed.

This, btw, is how George Soros made his money on Asian currency speculations. He understood this dynamic that the Fed was creating, while everyone else was talking about a bubble.

What is the evidence of this? The gold price took a steep drop, from $450 to $350 an ounce. People were moving out of gold into cash. This is a deflationary event, indicating that people, at the margin, valued cash over gold, and liquidity was so scarce elsewhere, they were scraping the bottom of the barrel in gold sale. The second piece of evidence was the Federal Funds rate was flat at roughly 6%. Completely not moving through the entire period. Again, this was a problem engineered by the Fed.

After the Fed busted the Nasdaq, it turned its attention to the housing market. There was nothing wrong with housing. Interest rates were low because the dollar was so strong. You did not need high rates with a strong dollar. Why was the dollar strong? The deflationary policy the pursued from 1996 to 2001. Inflation was wrung out of the economy. Housing was priced correctly, at about what it was in 1968, adjusted from inflation, meaning housing was following the gold price. George Bush actually created a fantastic economy...and the Fed went ahead and destroyed it by doubling the cost of borrowing. Again, it is the Fed.

Blogger map March 21, 2020 1:13 PM  

Azure Amaranthine wrote:"But...see...this is the problem. The banking crisis back in 2007-2008 was caused by the Fed, not the banks."

Cut the binary 'tardation. It was caused by both.


Not both. The Fed leads and the banks follow.

Blogger map March 21, 2020 1:29 PM  

Snidely Whiplash wrote:map wrote:But, again, this is a problem caused by the Fed. Why would you punish companies for that?

The CAUSE was the over extension of credit, without regard for creditworthiness, enabled by the proliferation of derivatives and stupid investors.

The TRIGGER was the move by the Fed.


No. There was nothing wrong with the loans, or, at least, the vast majority of them. Yes, there will be a certain amount of defaults because people make mistakes. But, no, the market was clearing because the housing, the terms, the prices and the cash flow all made sense...until the Fed altered the economic environment.

Blogger map March 21, 2020 1:33 PM  

Azure Amaranthine wrote:"But, again, this is a problem caused by the Fed. Why would you punish companies for that?"

Because the companies were complicit with the Fed. It wasn't caused by just the Fed, but by the Fed and the banks in conjunction. This is not hard.


What do you mean "complicit?" Do you not see who leads and who follows?

Azure Amaranthine wrote:"The Fed bases its decisions on the Philips curve. They believe that higher wages, higher housing prices, more employment, and higher stock prices cause inflation."

I've got a bridge to sell you.


What bridge? the Philips Curve is stupid. I was trying to point out this stupidity.

Blogger map March 21, 2020 2:07 PM  

Snidely Whiplash wrote:Banks are only conduits of mortgages. Banks have not actually held mortgages for decades. Their only concern was being able to sell the mortgages on to someone else.

And yes, practically overnight, they discovered that they could bundle the mortgages into fund, slice then into "tranches" and sell the derivatives as guaranteed income with no risk. Go look at what investment sites were writing at the time.


Anybody who is going to buy this kind of paper is going to have to understand what it is as well as the bank does. An investment firm buying mortgage paper will hire experienced mortgage analysts to do so. Again, there was no fraud going on. My point still stands. Everyone suddenly forgot how to evaluate mortgages.

Furthermore, "selling off" mortgages is not unusual. Banks sell off their debt obligations all of the time. This is not unusual.

I read a lot of investment publications. There is a code of silence throughout the investment industry on the role of the Fed in the economy. My suspicion is that investment advisory industry uses the Fed as a leading indicator of when major cyclical changes happen in the economy. They just don't say that, instead generating tons of other analysis designed to obscure what they are really doing.

This is, incidentally, why Trump is so hated by the financial class. He called out the Fed. He got the country paying attention to what the Fed is doing and that means that Wall Street lost a very important indicator. In effect, Trump democratized investing by doing this.

Blogger map March 21, 2020 3:00 PM  

Bearable Pain wrote:We have a problem to solve. I believe and know God created a perfect world for us to live in. The world IS NOT fallen. It is man THAT IS fallen and has the capacity to be righteous given Jesus was a man and without question was righteous for all mankind to see. We know righteousness is possible and attainable.

Man and the World is a fallen place. God made Man to live in the Garden of Eden, until Man was cast out for eating from the Tree of Knowledge. I should say, Eve was cast out of Eden for eating from the Tree of Knowledge and Adam was cast out for letting Eve lead him by the nose.

Anyway, Man and the World is Fallen. Worse, the world belongs to the Devil, since Lucifer was cast out of happen for trying to be what was not in his Nature...God. He has been corrupting the world ever since.

There is no righteousness. No "healing the world." There is only salvation through Christ.

That's why there are only two religions in the world: Christianity and Satanism.

Blogger map March 21, 2020 3:01 PM  

xevious2030 wrote:And raising the rates, while allowing almost no period of real adjustment (time to put the house on the market to trade abilities to pay, no special additional refinance to a fixed rate grant) was entirely retarded. The answer is yes, everyone involved.

No.

Blogger map March 21, 2020 3:03 PM  

Damelon Brinn wrote:It started in the 70s with the Community Reinvestment Act, and then accelerated under Clinton, and then again under Bush.

CRA loans were small percentage of those portfolios. Yes, they would've been affected. BUT...the Fed doubled mortgages across the board. There is no balance sheet that can weather that kind of cost increase.

Imagine if your mortgage or rent payment doubled. How many here could afford that? How soon would you be in the red?

Blogger American Nationalist March 21, 2020 8:04 PM  

I want to do to them what they made us do during Basic Training- stand in a single spot for half an hour and scream at the top of their lungs "do NOT bail out the banks!"

That's how we learned that food tastes better when the heels are together, and to not eat in the chow line.

Blogger Azure Amaranthine March 21, 2020 10:35 PM  

"Not both. The Fed leads and the banks follow."

The banks chose. Seriously, how do you manage to breathe and walk at the same time?

Blogger Azure Amaranthine March 21, 2020 10:36 PM  

"What do you mean "complicit?" Do you not see who leads and who follows?"

Do you not see that banks can choose what sort of loans to give in in what magnitudes and frequencies and that they chose to follow the easy buck? Go away you waste of air.

Blogger Azure Amaranthine March 21, 2020 10:52 PM  

This is very simple and it's the last time I'm going to say it, map. The banks don't have to follow. There are many other options, ranging from taking the harder road of not grabbing for the most profit even when they knew it was irresponsible, to closing their doors as banks. They chose to do it, end of story.

Blogger matism March 22, 2020 9:14 AM  

The tribe is fine with the banks...

Blogger xevious2030 March 22, 2020 3:16 PM  

100. map "no."

Yes. People took (approved) loans at unusually low rates. Rates went up in short order. Fed kept raising rates.

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