Real, or just pressuring bondholders? The latest offer I saw for bondholders looked pretty terrible, actually. How much worse would a bk really be for them?

Why is BO trying to link himself to the banksters.. has he not read history?

It'll be a strange new world, that's for sure.

mp, how are you and conjure faring? Any guesses on how much longer they can prop this corpse of an economy up?

Louis XVI is a more apt comparison

"Perhaps he thinks he's Brutus?"

China Cuts Purchases of Treasuries and Foreign Bonds (http://www.nakedcapitalism.com/2009/04/china-cuts-purchases-of-treasurie...)

Reversing its role as the world's fastest-growing buyer of United States Treasuries and other foreign bonds, the Chinese government actually sold bonds heavily in January and February before resuming purchases in March, according to data released during the weekend by China's central bank.

China's foreign reserves grew in the first quarter of this year at the slowest pace in nearly eight years, edging up $7.7 billion, compared with a record increase of $153.9 billion in the same quarter last year.

China has lent vast sums to the United States - roughly two-thirds of the central bank's $1.95 trillion in foreign reserves are believed to be in American securities. But the Chinese government now finances a dwindling percentage of new American mortgages and government borrowing.

But that is just the beginning of the unraveling of the private ponzi pension plans.

/"G.M. faces an unfunded liability of about $13.5 billion for its plans, which had $84.5 billion in assets and $98 billion in liabilities as of Dec. 31. That amount could sink the pension agency, requiring its own bailout before a G.M. case could be resolved."/

China cannot continue the bond buying charade for more than a few months.. maybe a year and a half.. even if they wanted to. Too many things are lining up for this storm.

That is an understatement..

//Lucifer, I sincerely believe that Bernanke, Geithner and Summers, to name but a few, will end up wishing they had devoted their lives to being convenience store clerks.//

Guillotine Fodder?

//Dr. Geitner- Head Surgeon?//

I think that this bubble is going to crash too.. observe how the money is being used to buy stocks rather than create jobs or increase consumption.
__________________________________________________________________________________________________________________

Commentary: Is Beijing's lending spree really quantitative easing? And if so, is it working?

By Craig Stephen
Last update: 7:26 p.m. EDT April 12, 2009

Comments: 20

HONG KONG (MarketWatch) -- After China's central bank signaled there will be no slowing in the massive lending spree by mainland banks, focus this week will be on whether A-shares can surmount key technical resistance.

The Shanghai stock market has been the best performer in the world this year rising 34% but there is concern this merely reflects a sugar high on the back of bank lending, rather than a sustainable market recovery. In the first three months of the year, China's banks have lent a massive 4 trillion yuan ($585 billion).

I have always been amazed by TV anchors who try to push retraining in health care jobs as an alternative.
_________________________________________________________________________________

Recession Now Hits Jobs in Health Care (http://online.wsj.com/article/SB123958719598112571.html#printMode)

By AVERY JOHNSON and KELLY EVANS

Employment in health care, the only major industry outside the federal government still adding jobs, is succumbing to the recession.

In the latest sign, the president of New York City Health & Hospitals Corp. wrote Friday to community organizations as well as employees and unions at its 11 hospitals and four nursing homes, saying the agency will lay off more workers even after slashing 400 jobs last month.

"We now project that HHC's deficits will worsen, even if we are spared further state cuts," Alan Aviles wrote to the staff of 39,000. "The challenges will deepen." He blamed the job losses on state cuts in Medicaid payments to the public-health system.

Organized labor isn't even a shadow of its former self, though. The bastion of union strength now resides in public servants, and they're hardly the type to protest the source of their livelihood.

Hell, out here in California -- now the highest taxed state in the nation -- we have all the public unions actively pushing ballot measures to raise them even higher.

So we havent hit bottom yet?

I think it will happen over a few months.. the system is collapsing very quickly.

//I think it quite likely that organized labor will become militant again, especially over the course of the next few years.//

Nope.. it will collapse even further.. and I think people will not wake up till that happens.

//Meanwhile, good companies will die & America will become a "Sweat Shop" nation.//

I suggest that we fire the 'experts'.. as they are incompetent.
______________________________________________

Weighing Furlough vs. Layoff (http://online.wsj.com/article/SB123938638933208987.html#printMode)

Costs, Skills Figure in How Best to Weather Recession
By CARI TUNA

Window maker Pella Corp. has been battered by the construction downturn. Rather than lay off some workers, executives in February ordered 2,400 hourly employees to take rotating weeklong furloughs.

A week earlier, newspaper publisher A. H. Belo Corp. rejected furloughs and laid off 500 employees, more than 14% of its work force. "The revenue trends we continue to experience simply do not support or require the same number of people as we have previously employed," Chief Executive Robert Decherd wrote in a letter to employees.

//But some workplace experts say layoffs often are more efficient. "If you don't see a light at the end of the tunnel, it just makes sense to lay off" less-productive workers, says Satish Deshpande, a management professor at Western Michigan University's Haworth College of Business.//

Same to you mp.

Haven't seen that one yet. We tend to only catch things on DVD.

I don't believe so.

If it gets to that there really won't be anywhere to run to, either.

I really really really hope that the GM "controlled" bankruptcy is just a pilot project of how to bankrupt the banks. If it is my faith in some amount of non idiocy will be partially be restored , but I'm not really holding my breath.

I mean why not just cancel all the CDSes , bankrupt the banks and start over. Can we get tyler durden here ASAP?

sdkid
That's the way they chose to graph it, in terms of deficit. Makes it easier to compare borrowing (deficit), to income (receipts). Half of all spending is borrowed money at this point

Comrade Kaboom,

So you don't think Obama had any choice in appointing Summers?

Summers seems to me to be what Cheney was for George W. Bush - a person who is going to destroy his President's tenure one bad decision at a time.

I am very curious to understand what (in specific detail) made Obama select Summers when Axelrod, Goolsbee, Volcker, Krugman and others would have been able to warn him away.

I suppose I'll have to wait a few decades to find out.

Guest1 wrote on Mon, 04/13/2009 - 6:27am.

'GM as test case for bank bankruptcy? HAHAHAHAHAHA'

Why laugh - a GM bankruptcy is likely to have all sorts of effects, include the collapse of various bank facades concerning revenue streams based on GM as a going concern.

Bring it on.This shit would be over if we'd have let all these jokers BK in October.

GM still has enough presence in the real world that its rolling stones are likely to cause all sorts of growing problems - car dealer bankruptcies come to mind, which then add to the weight of parts suppliers not being paid, pensions starting to fail, etc.

Propping it up another week ain't gonna change that.

Werner wrote on Mon, 04/13/2009 - 7:11am.

(I like the smell of bankrupt Americans in the morning.)

Werner, if you don't see that the wise policy is to treat the American people as captives / victims of their state and not its perpetrators, I don't really know what to tell you. Just don't be surprised when the Americans don't feel compelled to make good on any money the kleptocrats took from you. I mean, who but a sucker would suffer for an instant for your profit?

You're just angry because you fancied yourself a plutocrat. Don't come to me and point your finger and say "this is all a bankrupt fraud!" No shit Yosemite Sam. Thanks for propping it up for 20 years with hot air and sunshine, asshole. Now that the obvious can no longer be ignored, suddenly it's everyone's fault but yours? Gimmie a break.

I love that term "surgical". I guess they've never been in a surgery that went wrong.

"Why this is celebrated instead of feared escapes me ..."

Escapes me, too. Many innocent and defenseless people will be hurt.

Werner wrote on Mon, 04/13/2009 - 6:41am. (Central standard time)

Werner:

I agree with your last post, except for the wording of "American"

Are you so sure this is an American problem?
Sure, American banks lent money to people who could never pay it back. Is this any different than Hypo, a German Company? Or HSBC (english) Soc Gen (French) UBS (Swiss), you get the picture.

Did the Eurozone banks not create any derivatives? I must have missed that

DId the Eurozone not lend most foolishly to Eastern Europe, money that will/can never be paid back?

Did Europeans not way overleverage themselves into housing too? (I'm thinking of Spain, Italy, England, etc)

I agree, that the US was the first to break. I also agree that much of what happened originated here. But the rest of the world seemingly took this on quite willingly, and even expanded some of these programs all by themselves.

As they say here: "It takes two to Tango".

America's credit/housing bubble could never have happened were it not for foreign investors that completely ignored risk and purchased these securities. Many of them are the smartest/brightest that the world has to offer.
It could not have happened if the various countries didn't peg to our currency, especially when they peg artificially low.
It could not have happened without the carry trade, of Japanese origin.

Admittedly, perhaps Germany wasn't as involved in all these shenanigans compared to most every other Western Country, I don't know.

in sum, it is not the AMERICAN system that is failing, it's the WORLD system that is failing. It's not just the AMERICAN people and institutions that are to blame, it is the WORLD people and institutions that are to blame. And it's not just the Americans who will suffer, we all will suffer.

Who says there isn't any money in RE:

http://www.nytimes.com/2009/04/13/us/13burglar.html?_r=1&hp

"People asking "Why is Obama siding with the bankers?" don't understand how the system works. The President doesn't have a magic wand. He's just a man who gets sat down right after he's sworn in and told how things are going to go."

Indeed; He has to side with those who retain the power, or else be relegated to being a figurehead.

"The Vatican knew about the Holocoust and stayed mum !"

Umm... weren't they occupied at the time?

World system = US system by virtue of USD as global reserve currency among other things. The US leads and the rest will still Have to follow.

True to a point. Again, I'm no American apologist. But it really does take two to tango.

For instance, to my knowledge America did not force China to peg artificially low and then use mercantilist measures to remain an exporting powerhouse.

America did not force Japan to pursue ZIRP and quantatitive easing.

The US did not force Eurozone to lend to the Eastern European housing bubble, nor to the Spanish vacation housing bubble.

I agree with you, when the world agreed to US as reserve currency, many things did flow starting there. However, it is not a logical conclusion that US as reserve currency means that world must purchase CDS from AIG as example.

I also agree that when world history is written it will be the American Financial system that is blamed, and rightly so. They did create the Weapons of Mass Destruction. But that does not remove blame from the rest of world who used them.

Just like war. We may make the missle... but then the other militaries use them. the other militaries are not absolved of their culpability simply because the missles are made in the US.
It also does not remove culpability from the Americans, just because we didn't actually fire the missle.

anyway, I honestly think that it does take 2 to tango. In this case it took almost the entire world to two-step.

optimader, I fail to see where sitting around hang wringing and doing nothing will help. There is nothing wrong with wanting to at least be prepared for a worse case scenario, which appears more and more likely with each passing day. While we may not have complete control of our fate, at least some of us are trying to make the transition a little easier on ourselves and loved ones.

re--Larry 'men are better at math' Summers is where he needs to be. Some day, and that day may never come, Obama will need a sacrificial type to throw under a bus. Without a second thought his carcass will be treated with a tread mark tattoo. Meanwhile, he keeps the popinjay muzzled, speaking only when granted specific permission and strictly scripted to boot. Man, I love the smell of napalm in the morning.

Not wanting to defend Summers (in my opinion a total crook), but what he said at Harvard is actually correct - there are more men at the extremes of the bell curve (both top and bottom) than women. The only controversial issue is why. It may be environmental (women may be smart enough to know that fighting to the top in science or maths isn't the most important thing in life) or genetic, or most likely a combination of the two.

One interesting speculation that may make it genetic is men only inherit one X chromosome while women inherit two. This means men don't get the same averaging effect that women get. To give an example, imagine that there is a gene called Z on the X chromosome that comes in two versions, A and B. Anyone with version A is slightly better than average at maths, while anyone with version B is slightly worse. Men will only get either A or B, while women can inherit A & B. This could average out the effect of gene Z on maths ability. Since the X chromosome is packed with genes this effect will tend to make men more extreme than women for any gene that lies on the X chromosome (ie mens bell curve will be slightly wider than women) even though the mean for both men and women will remain the same. Around the mean for any attribute this makes little difference, but once you get 5 or 6 standard deviations away this "broadening" effect makes a huge difference to how many men verses women you find.

I should end by saying that no matter what the cause it should play no role in determining if women or men are better suited to any particular career. After all knowing that pygmies are smaller on average than the world average doesn't tell you how tall any particular pygmy is.

Jay D.,
What ? You mean you want spx 875 first ??

DOWN GOES FRAZIER

DOWN GOES FRAZIER

Off to Miami.

I only meant I don't have to bribe people to get my day to day job done.

And my mtg broker didn't do any neg ams or pick a pay 'cause he thought
they were wrong. And he did chase a few clients away because he thought they should buy
a cheaper house. But he did do 80-20 loans with Countrywide. And I closed 'em.

No outright lying on apps. But I want to tell you I don't know of a time when there wasn't some exaggeration.

.diogenes wrote on Mon, 04/13/2009 - 11:43pm.
lawyerlizinMI, I just got back from five weeks in Australia and the one question I got repeatedly from the aussies was concerning the ability and willingness of americans to just walk away from their obligations. Many asked "weve heard that in the US one can just turn in the keys and walk away from mortgage obligations...this can't be true, can it". You should see the expression on their faces when I tell them not only is it true but you can lie on your mortgage loan about occupancy and income and then when you walk you just blame it on the bank. Several told me that such a thing is impossible and they I was making it up. My wife had to straighten them out.

As an Aussie I have to say I was amazed by the concept of jingle mail when I first heard about it. Here in Australia the bank will bankrupt you and take away the house if you don't pay. There is little leeway given to losing your job or other personal misfortune - it was actually a lead story here recently that the banks have agreed to add the payments to the principle if a person loses their job. Also all our mortgages are floating - while you can get a fixed term loan here the time period is less than 5 years and the interest rate is much higher on average than the floating rates. This does make it rather stressful when rates are rising but nice when rates are falling.

LOL Hoopajoops...yep. At any rate, I've volunteered to help Mike out. I've done tons of research on GS and JPM and the derivatives ponzi...I figure Mike can use all the help he can get and if GS suffers as a result, all the better. I'm sorting my research now to send it to him.

Jay D.,
What I figgure is that each person is responsible for his/her own trading decisions and that nobody should be following advice offered by pseudonyms on a blog.

Tj and the Bear:

The highest tax state is not California but New Jersey. It's time to put that urban myth in the trash can.

AnonyMiss, yes, homepage urls are coming. And unless there's a storm of outrage against it, I'll probably disable signatures when they arrive, for the reason you mention.