The "up-to-the-minute Market Data" thread

Originally posted by redhatty

With our tax base rapidly diminishing through the rise in unemployment, there really is no way for a hyper-inflationary situation to develop, without a rise in wages, you cannot possibly have hyper-inflation. And right now we don't have ENOUGH wage earners.

The consequence of "not enough" wage earners could be seen in California state budget crises. But Arnold knows where to go to fix things: to the place where money grows in the tree. But what if the Congress showed him your post and send Arnold back home empty-handed: There are not enough wage earners, so we don't have the money to help you out.

Be it that case, Arnold would surely wonder where all those bailout money spent and proposed come from? In other words, there is not much correlation between taxes collected and hyperinflation in the country where the government is empowered to create money. If California could make its own printing presses, Arnold wouldn't take a trip to DC.

We know that Obama was toying with the idea of fighting the unemployment, the everpresent sign of economic downturns, by creating jobs that would help to update US infrastructure. (No more collapsed bridges in Minnesota.) But there has to be a certain condition for the history not to repeat itself . . .

Social spending was rising at an unbelievable rate. In 1913 the government was spending approximately 20.5 per resident; by 1925 it had risen to almost 65 marks per resident and finally in 1929 it reached over one hundred marks per resident. The elevating amounts of money which were used for social spending combined with plummeting revenues caused continuing deficits.

reply to post by stander


Stander I understand your position, but Arnie is looking to finance state gov, whereas a regular J6P is looking to pay the bills and buy groceries.

Hyperinflation can only occur when someone can make the $$ to buy the high priced goods.

See Weimar or Zimbabwe. Wages in Zimbabwe literally rise by the hour for workers, as do the price of goods.

You have to have the money to buy or you cannot have hyper-inflation

Of course, the gov can always fins a way around that - like sending huge stim checks to every household - and on a monthly basis, but I just don't see that happening

At least not yet

Give people the illusion of wealth, like credit cards without lid, and then wait for the illusion to dissipate.

Now watch the show!

And the source for real wealth has to be outside the isolated system.
Since there is no such thing as isolated system, what you are observing right now is the process of entropy.

Because the real wealth is somewhere else and the flow of wealth has already created new riverbeds.

What Americans are going to get is mandatory voluntary service to pay for the void illusions.

Just observe the change of emphasis.

S&P 500 -5.00 786.60 3/19 6:26am
Fair Value 790.78 3/18 8:41pm
Difference* -4.18

NASDAQ -9.75 1203.00 3/19 4:41am
Fair Value 1207.34 3/18 8:41pm
Difference* -4.34

Dow Jones -36.00 7407.00 3/19 6:02am
===
FTSE 100 +27.59 +0.73% 3,832.58
XETRA-DAX +42.25 +1.06% 4,038.57
CAC 40 +26.04 +0.94% 2,786.38
===
Gold $936.45

Originally posted by redhatty
reply to post by stander

 

Stander I understand your position, but Arnie is looking to finance state gov, whereas a regular J6P is looking to pay the bills and buy groceries.

Hyperinflation can only occur when someone can make the $$ to buy the high priced goods.

I wasn't clear enough on the relationship between the government revenue from taxes and hyperinflation. The decreasing revenue from growing unemployment is not an obstacle for runaway inflation to occur. If you check the figures that reflect on the number of all Federal Government employees including Obama and armed forces, you would expect a drop commensurate with the growing unemployment figures. But that is not happening, coz the Federal Government doesn't depend on financing itself from the IRS source. A high-percent inflation is caused by an unwarranted increased in money supply flowing through the M1 money aggregate (fancy language, ain't' it?) and so the money is readily available to a consumer mainly through increased wages -- or through an economy stimulus check worth $200,000 sent to each adult in the USA. (Sudden high demand + low supply = prices up.) So when all these high-figure bailouts hit the financial system, some people started to feel uneasy about it fearing the onset of a vicious, spiraling cycle especially with the prime rate all time low. But the banks frowned on the irresistible offer by the Feds, coz the veins of the financial system is said to be clocked with various financial toxins and the banks don't want to lend fearing that their vaults get poisoned by debtors payments. There is no way to tell if the money is good or bad upon reception, coz all the fancy "financial instruments" are so sophisticated and not easy to see through, as many world investors learned to their dismay.

I don't think that the condition for the German or Zimbabwe style hyperinflation to take place here exists, but I don't understand lots of things to be 95% sure that we may not go through 14% inflation rate in 2010.

[edit on 3/19/2009 by stander]

reply to post by stander


Quite verbose this morning aren't we?

Oh I would pretty much guarantee we will see inflation - worse than the 1970's by 2010 - but NOT hyper-inflation.

Many people are going to have drastic changes in their lifestyles whether they want them or not. This is what people are worrying about now. Soon they are going to worry about things even more basic and "primitive" when it comes to lifestyle.

reply to post by redhatty


We will, you can not print paper from nowhere with not value, devalued the dollar and then think that inflation can be control.

What the fed did yesterday is sending a big sign to the rest of the world that America is in big trouble.

Whos controlling the Fed now? the trillion dollar question.

Dollar lost another percent...

Index Value: 83.74
Trade Time: 7:41AM ET
Change: Down 0.86 (1.01%)

Index Value: 83.60
Trade Time: 7:46AM ET
Change: Down 1.00 (1.18%)

Limited inflation is probably the best solution, since nobody is going to prosecute the thieves.



[edit on 19-3-2009 by DangerDeath]

reply to post by redhatty


Having "fear" is already quality of life lost

The problem with people is they never see it coming...

It is truly miraculous how big the power of delusion is.

Originally posted by marg6043
reply to post by redhatty

 

We will, you can not print paper from nowhere with not value, devalued the dollar and then think that inflation can be control.

Absolutely true.

It won't happen this month or probably even this year. One of the posters above said it well--if people don't have enough money to afford the basics, prices can't rise. But my worry is that as soon as the economy starts to recover (assuming it does), inflation is going to hit hard. And then we're going to be in a whole different kind of trouble.

Holy!

Index Value: 83.29
Trade Time: 7:54AM ET
Change: Down 1.31 (1.55%)

Watch out the avalanche!

Index Value: 83.19
Trade Time: 8:01AM ET
Change: Down 1.40 (1.66%)

finance.yahoo.com...

More than 4,5% in less than a day. Next global currency - chopsticks!

Index Value: 82.99
Trade Time: 8:19AM ET
Change: Down 1.61 (1.90%)



[edit on 19-3-2009 by DangerDeath]

MSM are ignoring this.
But this means devaluation...

Gold $950 at 08:23

Originally posted by marg6043
What the fed did yesterday is sending a big sign to the rest of the world that America is in big trouble.

It's not like they exactly needed the sign I think that's been pretty obvious to all by now.

Unfortunately, the populace elected an untested, inexperienced jr. senator to be Pres. So now the Fed is running the show, because no one has the stones to stand up to them.

Banker's Manifesto anyone?

Citi asks regulators to approve reverse stock split
www.marketwatch.com...

NEW YORK (MarketWatch) -- Citigroup Inc. said Thursday that it has filed with regulators for approval of its plan to issue common stock in exchange for convertible and non-convertible preferred and trust preferred securities. Citi first announced the plan in late February, and said it hopes it will convert about $52.5 billion of preferred shares into common shares. The bank said it hopes to launch the exchange offer in early April, subject to regulatory approval. Citi also said it is asking for approval to execute a reverse stock split of its common stock.

Citi, Morgan Stanley running short on shares for bonus
www.marketwatch.com...

NEW YORK (MarketWatch) -- Both Citigroup Inc. are facing a problem as they try to pay their employees: They're running out of shares.

Both companies in the next few weeks will announce plans to authorize or repurpose shares to have enough stock to compensate employees, people familiar with the matter said. The need to add or free up stock has been exacerbated by plunging share prices for financial companies.

Citi will ask holders to boost its authorized share count far beyond what it needs to meet a capital restructuring announced last month. Morgan Stanley may need to use more of its currently authorized shares for bonus payments, which will require shareholder approval.

The dilemma the companies face reflects the devastation that the bear market has inflicted on their share prices. Lower prices means they must pay out a larger number of shares to meet a given compensation sum. Other companies have run into this problem as well; the problem is more tricky for financial-services companies because their acceptance of government money prevents them from buying back shares to use in compensation.

Analysts believe it isn't just Citi and Morgan Stanley that will be going to shareholders. Others could follow suit in the coming months if banking stocks don't bounce back.

When asking shareholders for authorization, banks "are going to leave the reason very broad and indeterminate so they aren't limited to how they'll ultimately make use of the stock," said Richard X. Bove, an analyst with Rochdale Securities. "But, the critical issue is the market is not going to be receptive to a major stock offering by a bank."

Citigroup is finalizing plans to seek shareholder approval to boost its share authorization to 40 billion shares or more from 15 billion, said two people familiar with the matter. The bank doesn't immediately need all the shares it is requesting since it has 5.5 billion outstanding and needs 16 billion for its capital restructuring.

Citi is requesting the huge overhang in large part to pay out equity-based compensation, say people familiar with the matter.
Shares of Citi were trading just above $3 recently, after having fallen to as low as 97 cents earlier this month.

Morgan Stanley may need to look at expanding its 3.5 billion share authorization in the coming months. More immediately, according to a person familiar with the matter, it is expected to ask shareholders to allow it to use some of the roughly two billion share it has authorized but hasn't yet issued for compensation.

Shares of Morgan Stanley were trading at about $23 on Wednesday, well below the year-ago price of $51.80.

Spokesmen for both Citigroup and Morgan Stanley declined to say exactly how much stock they will need for future compensation payments.
Public companies must specify the reasons for issuing shares, such as the need for compensation, general corporate purposes, or acquisitions. Any changes would require shareholder approval.

One reason banks are finding it harder to grant stock bonuses is the depletion of their treasury stock, which is comprised of previously repurchased shares that are kept on the books for later use.

When companies repurchase shares, they can retire them and take them out of existence or they can place them in treasury. Treasury shares can later be used to pay bonuses, satisfy option exercises and make acquisitions, among other things.

The amount of treasury stock at some of the biggest U.S. banks has been dwindling. Financial companies that accepted bailout money are restricted from freely buying back shares, which leaves them unable to replenish treasury stock.

For example, Citi burned through 261.2 million treasury shares in 2008, leaving it with just 221.7 million for use this year and beyond.

Hhhmmm...


[edit on 3/19/2009 by Hx3_1963]

S&P 500 +4.60 796.20 3/19 8:36am
Fair Value 790.78 3/18 8:41pm
Difference* +5.42

NASDAQ +0.50 1213.25 3/19 8:17am
Fair Value 1207.34 3/18 8:41pm
Difference* +5.91

Dow Jones +37.00 7480.00 3/19 8:33am
===
DXY 82.98
TNX 25.10
===
Gold $946.39
===
C Pre-Market $3.27 Change: +0.19 +6.17%
===
FTSE 100 3,888.16 8:36AM ET 83.17 (2.19%)
CAC 40 2,808.67 8:52AM ET 48.33 (1.75%)
DAX 4,109.34 8:37AM ET 113.02 (2.83%)
===
[atsimg]http://files.abovetopsecret.com/images/member/c88efe4e08f3.png[/atsimg]Is this our "Brave New Future"???
(I see that peak just after 1931 for current comparisons...)


[edit on 3/19/2009 by Hx3_1963]

Hx3 - help me out here - relevant links we've been exchanging all am - please post here if appropriate Thanks!

Bernanke Inserts Gun In Mouth

A very sobering ticker that will make you want to get stinking drunk

The United States Of Ponzi

and how about the "Personal Finance Guru?" - well....
A Change in Credit Card Strategy

OKay so that's enough bad news for one morning - let's hope it gets better today

[edit on 3/19/09 by redhatty]

From George Ure:

This is all part of a massive global readjustment that has the avowed purpose of repairing a terribly out-of-whack global economy whose problems stem from the fact that cannibal corporatism has reached the 'edge of the Petri dish, and the 'food supply' for further growth via legitimate means has been reached. What's ahead now is only one course that's going to be somewhat painful: a new kind of company which is motivated by something other than growth of EBITDA and the bonus pool, something that's been in the wings since the model started blowing up in early 2000 as the Internet Bubble was pricked.

www.urbansurvival.com...

Who want's to bet "they" won't be able to figure that?

The change of paradigm...

The root is much deeper, right into the schizophrenic Divide et Impera minds...

Bernanke's Grand Experiment Continues
globaleconomicanalysis.blogspot.com...
We are in the middle of a grand experiment. Bernanke upped the ante today in his foolish quest to beat deflation.

Information received since the Federal Open Market Committee met in January indicates that the economy continues to contract. Job losses, declining equity and housing wealth, and tight credit conditions have weighed on consumer sentiment and spending. Weaker sales prospects and difficulties in obtaining credit have led businesses to cut back on inventories and fixed investment. U.S. exports have slumped as a number of major trading partners have also fallen into recession. Although the near-term economic outlook is weak, the Committee anticipates that policy actions to stabilize financial markets and institutions, together with fiscal and monetary stimulus, will contribute to a gradual resumption of sustainable economic growth.

In light of increasing economic slack here and abroad, the Committee expects that inflation will remain subdued. Moreover, the Committee sees some risk that inflation could persist for a time below rates that best foster economic growth and price stability in the longer term.

In these circumstances, the Federal Reserve will employ all available tools to promote economic recovery and to preserve price stability. The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and anticipates that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period. To provide greater support to mortgage lending and housing markets, the Committee decided today to increase the size of the Federal Reserve’s balance sheet further by purchasing up to an additional $750 billion of agency mortgage-backed securities, bringing its total purchases of these securities to up to $1.25 trillion this year, and to increase its purchases of agency debt this year by up to $100 billion to a total of up to $200 billion. Moreover, to help improve conditions in private credit markets, the Committee decided to purchase up to $300 billion of longer-term Treasury securities over the next six months. The Federal Reserve has launched the Term Asset-Backed Securities Loan Facility to facilitate the extension of credit to households and small businesses and anticipates that the range of eligible collateral for this facility is likely to be expanded to include other financial assets. The Committee will continue to carefully monitor the size and composition of the Federal Reserve's balance sheet in light of evolving financial and economic developments.

:snip:

Bernanke Has Failed

Please note that Bernanke has already failed. "It" (deflation) has arrived. And deflation has arrived in spite of the fact that Bernanke has slashed rates to 0%, instituted numerous lending facilities that have all failed, squandered $trillions in taxpayer money, and has already implemented phase II (or do I mean phases 2 through 20) of his plan, that being the "offer fixed-term loans to banks at low or zero interest, with a wide range of private assets as collateral."

Much more at Link...


[edit on 3/19/2009 by Hx3_1963]

Flow of Funds Q4 2008: Debt Deflation confirmation
www.itulip.com...

Buried in the details of yesterday’s quarterly Fed Flow of Funds report is the collapse of the private credit market in Q4 2008 and attempts by the Federal Reserve and Treasury Department to compensate for the loss with government credit as the world's largest lender of last resort.

Much attention is paid to the health of US banks, but a more pressing problem as the Flow of Funds reveals is that the magic securitized debt machine broke in the final quarters of 2008 that for decades fulfilled the endless demand for credit by households and businesses. Now that unemployment is rising, demand for credit is falling, and with the securitized debt machine broken, the supply of private credit has dried up, too. Where does that leave us?

Questions:

Can the securitized debt market be restarted?

How can the supply of private credit be restored to even close to previous levels without it? (The securitized debt market will not be restored to anywhere near its previous level. Private credit markets going forward will be a function of sound investment demand, not issuance creativity.)

Can confidence in the debt securitization model be restored in time to boost the credit supply before the economy contracts so much that credit demand falls to comatose levels?

How can household borrowing be restored when unemployment is rising? The US economy desperately needs organic job creation to raise incomes from salaries, and high interest rates to motivate saving. (Household borrowing will never reach previous levels relative to income.)

What will happen to GDP short term if credit supply and demand are not quickly restored? (GDP will decline precipitously. In the future a pool of savings more than credit will finance expansion.)

What will happen to sales, income, capital gains, and property tax receipts as sales revenues fall with a decline in consumer and capital spending, incomes fall with rising unemployment, capital gains fall with declining asset prices, and property taxes fall along with property valuations? (Tax receipts will fall dramatically.)

How can the federal government stimulate jobs creation with spending programs at the same time state governments are laying off employees in droves to meet budget restraints? (The government cannot "create" jobs, but can move them from one part of the economy to another, or from the future into the present when they are needed more. The net long term results is, however, negative. The only "solution" to the credit collapse problem is to not allow a credit bubble to develop in the first place.)

Won’t the federal government find itself needing to finance state and local budgets to achieve the politically desired net job creation, and won't that add substantially to federal budget liabilities? (Yes.)

How will the federal government stimulate demand by job and income growth at the same time household net worth is falling with asset prices, creating an undertow of negative wealth effects?

Won’t the Federal government for political reasons need to step up the financing of public pensions, and even private ones to at least backstop those losses? (Yes, further increasing budget liabilities.)

In sum, we see the risk that, much as in 2001 following the collapse of the technology stock bubble but driven by considerably more extreme circumtances, tax receipts in 2009 are vastly over-estimated while demands on the federal government to finance both fiscal stimulus and to act as a long term lender of last resort are vastly underestimated.

Much More Marvelous News at Link...


[edit on 3/19/2009 by Hx3_1963]