Friday, July 21, 2006

Consequences

They are increasingly hard to hide. One truism of the global financial markets is that there's no free lunch. Rates are not rising because "the economy's strong" (seen the stock market recently?). They are rising because foreign central banks are refusing to underwrite us on favorable terms, and because of the situation in Iraq we've lost the leverage we once had to change that.

Consequences are particularly unwelcome in Washington during election years. That has important geopolitical implications, which I'll try to post about in the next few days.

8 Comments:

Anonymous Lord said...

I don't think central banks are refusing to underwrite us (maybe Norway); long rates here are still below short rates. The problem is the economy is strong - in China - and resource demands there are feeding inflation here. Since China insists on its peg and has little control over its own economy, the Fed must slow China by slowing the market for its goods here resulting in the inverted yield curve.

7/21/2006 3:22 PM  
Anonymous Anonymous said...

Okay, I'm no economist, not even close. I teach American literature for a living. But I'm currently in the housing market, hoping to go under contract TODAY and lock a 30-year fixed mortgage before end of business tomorrow.

Contrary to everything that is being said about mortgage rates, from Bankrate.com to the Detroit Free Press, rates are dropping, not rising.

I wish someone would give Middle America a clear picture of what the hell is going on - with EVERYTHING! Sometimes I honestly believe that our addiction to spin will be our ultimate demise. Everyone is so wrapped up in their own interests, it's difficult to know which way is up anymore.

7/21/2006 4:40 PM  
Blogger Dr Victorino de la Vega said...

Saudi Arabia’s Pilates Help President Bushmert Destroy Lebanon

After having washed their hands of the daily carnage taking place in Palestine and Iraq, Saudi Arabia’s Pontius Pilates chose to offer a bleeding Lebanon as sacrificial lamb to the people of Israel.

This “new friendship” bringing together Wahhabi Islamist thugs and rightwing Israeli fascists should come as no surprise for those who know the history of the Middle-East.

But I’m sure the Saudi government will eventually meet the retribution it deserves, for, as Winston Churchill famously said:

"They've been given a choice between dishonor and war. They've chosen dishonor and they shall have war."

7/22/2006 11:24 AM  
Blogger kaimu said...

ALOHA !!

Quite simply put the USA has a corrupt monetary system ... That is the truth Middle America or any part of America or the World never hears. Collusion by all central banks to support their corrupt paper currencies will ultimately fail as economic history will attest.

I am constantly surprised by those who can't figure that out ... All you have to do is have a pulse for the past fifty years! I recall times when a gallon of gasoline cost $0.35 USD ... Need I say more? Over thirty years that is an average 1000% price rise based on $3.50 current gasoline prices. The rest of the World pays more ... Yet central banks, expecially the US Federal Reserve, would have you believe there is no money inflation(printing)! The US government statistical lies and accounting fraud are just too numerous to list here. Only your wallet know the truth ...

Now you know. What are you going to do about it?

7/23/2006 3:49 PM  
Blogger BullandBearWise said...

The clear picture of what's going on is Asians are financing our purchase of their goods. As long as we keep buying, they keep lending. Heaven help is if we don't feel like spending, though...

Have you bought your Asian gizmo today?

7/24/2006 7:05 PM  
Anonymous Anonymous said...


WHAT IS THE REAL NATURE of American capitalism today?
, The Predator State by James K. Galbraith

"The Best Way to Rob a Bank Is to Own One", by William Black (Saving and loan crisis whistle blower).

"So, how can the political system reform itself? How can we reestablish checks, balances, countervailing power, and a sense of public purpose? How can we get modern economic predation back under control, restoring the possibilities not only for progressive social action but also—just as important—for honest private economic activity? Until we can answer those questions, the predators will run wild."

One of these years, we really have to take our politicians and our elections seriously.

7/27/2006 4:04 PM  
Anonymous Anonymous said...

The bank of Walmart?

"The moratorium, which takes effect immediately and extends until next Jan. 31, will give the regulators time "to assess developments in the ILC industry, to determine if any emerging safety and soundness or policy issues exist involving ILCs, and to evaluate whether statutory, regulatory or policy changes need to be made in the oversight of these charters," the agency said"

7/28/2006 11:04 PM  
Anonymous Anonymous said...

Keep up the good work » » »

4/23/2007 11:12 PM  

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