zanardm

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  • Living on Debt Gives Way to Fiscal Prudence
    The obvious fallacy is that all aspects of society and economy have to work off debt, except for the federal gov. All bubbles have to deflate in an extreme deleveraging environment. So the politicians as usual are playing the only card they have - debt; they call it a 'stimulus package'. Hopefully the treasury market and dollar don't tank; if only the gov would avoid the temptation of low yield borrowing, and resultant increased supply of treasuries - and eventual effect on price and the dollar.
    Nov 26 23:34 pm |Rating: +1 0 |Link to Comment |View article
  • The Euro Bubble Is Gone. It Will Not Reflate.



    On Nov 26 04:17 PM zanardm wrote:

    > If the Euro dollar can have a bubble, then why not the U.S. dollar
    > and treasuries, after VIX subsides? Are treasuries closer to a top
    > or bottom? When everyone has bought in, and is safe in the treasury
    > bubble, who's left to creat demand? One might not have a warning
    > of a slow evolving yield curve, but rather in, our extreme volatile
    > deleveraging environment, perhaps a stampeed of sellers for some
    > retrospective reason; markets don't need an excuse to deflate; they're
    > just top heavy; everyone is in. So plain old profit taking can snowball.
    Nov 26 23:25 pm |Rating: 0 0 |Link to Comment |View article
  • Enjoy the Strong U.S. Dollar While You Can



    On Nov 26 01:35 PM sbenard wrote:

    > The Fed has become the world largest and most leveraged hedge fund.
    > The Fed's balance sheet as of todays stand at about $3.25 trillion.
    > The leverage is almost infinite.
    >
    > The Mother of all Bubbles is building. It is U.S. government debt.
    > When it pops, it will be mayhem in the markets!

    amen.
    Nov 26 16:31 pm |Rating: 0 0 |Link to Comment |View article
  • The Euro Bubble Is Gone. It Will Not Reflate.
    If the Euro dollar can have a bubble, then why not the U.S. dollar and treasuries, after VIX subsides? Are treasuries closer to a top or bottom? When everyone has bought in, and is safe in the treasury bubble, who's left to creat demand? One might not have a warning of a slow evolving yield curve, but rather in, our extreme volatile deleveraging environment, perhaps a stampeed of sellers for some retrospective reason; markets don't need an excuse to deflate; they're just top heavy; everyone is in.
    Nov 26 16:17 pm |Rating: 0 0 |Link to Comment |View article
  • The Great Experiment
    Debt (building for 25 yrs) is the cause of the present problem. More debt is not the solution. Markets are deleveraging; but not the government. What is the logical extrapolation? You mean, governments (politicians) don't have to deleverage? Repeating 'Bubbles Law': in an extreme deleveraging environment, ALL bubbles have to deflate.
    Nov 25 00:49 am |Rating: +1 0 |Link to Comment |View article
  • 10 Reasons Christina Romer Is a Good Choice to Head the CEA
    Again there is the assumption that if you just appoint well qualified people, and do all the 'right just so' moves, every thing well resolve sooner. Anything that was done in the 30's, in my view, probably did not shorten it's duration. And if there was no WWII, perhaps it would have been longer. So for this severe downturn (gas prices at embargo level of '73!, as indicator), it will take a long time. Economic cycles are longer than political cycles. Piling on debt since 80's, and the government continuing to max out on piling on debt, is wrong. We will pay dearly for this, by assuring a lengthening of this extreme deleveraging environment. One generation (25 yrs) is my call to deleverage completely. Why? Because the politicians will ignore astronomical debt. Good luck to all of us. Only 'Adam Smith's' creditors (via capital market) can stop the DEBT JUGARNAUT, by there economic votes.
    Nov 25 00:22 am |Rating: 0 0 |Link to Comment |View article
  • Bond Market: Unsafe at Any Yield?



    On Nov 23 01:20 AM zanardm wrote:

    > p.s. could one have a marked decrease in demand for treasuries, with
    > minimal antecedent yield curve changes, due to extreme deleveraging
    > environment? Can a stampeed in treasuries occur very rapidly, and
    > unannounced? Was Freddie Max and Fannie Mae sudden decrease in demand
    > by creditors a precedent and harbinger of future events?

    Might Oct 2008, beginning of 2009-2010 fiscal year, and the rumor of a coming 3-4 trillion deficit, be a critical time for the treasury market? IF it becomes increasingly clear that the politicians have only more debt (stimulus) to offer as there only card, how might the Invisible Hand of creditors respond?
    Nov 23 02:43 am |Rating: 0 0 |Link to Comment |View article
  • Bond Market: Unsafe at Any Yield?
    p.s. could one have a marked decrease in demand for treasuries, with minimal antecedent yield curve changes, due to extreme deleveraging environment? Can a stampeed in treasuries occur very rapidly, and unannounced? Was Freddie Max and Fannie Mae sudden decrease in demand by creditors a precedent and harbinger of future events?
    Nov 23 01:20 am |Rating: 0 0 |Link to Comment |View article
  • Bond Market: Unsafe at Any Yield?
    The yield curve has behaved reasonably; the VIX is on. But supply will certainly increase this and next yr - 2 trillion plus budget deficit? Creditors, both domestic and international are unpredictable, in such an extreme deleveraging environment. How extreme? Not seen all the way back to 50's. Next stop - 30's. Where perhaps nothing actually worked; a long deleveraging period is required, both for actual debt, and for deleveraging in our brains. Of course the latter does not apply to politicians - who are hopeless. '... stimulus package' just more debt. Debt is not the solution; rather it is the problem; theprivate sector is dealing with it. Not so for the public federal level, where the solution is always the same - more spending (debt), another stimulus package. As mentioned, the 50% drop in gas prices (stimulus package, but without more debt), didn't change any economic numbers; consistent with the importance of time and reducing debt. The reasonable yield curve (temptation for gov borrowing -why not), and TIPs - no inflation in sight for 10 yrs perhaps, is another indicator of the severity of what we are in; none of us have experienced this extreme situation. Of course the drop in gas and other commodity prices, also evidence for severity of downturn. Again it's the future of the treasuries market, which I find disturbing. One seems to more easily come up with negative scenarios than positive just so scenarios. Politicians can make the prolonged deleveraging situation worse, but they can't make it better. Gridlock for DC is good - less debt. 'we must have patience' Kutazov in War and Peace.
    Nov 23 01:08 am |Rating: 0 0 |Link to Comment |View article
  • Bond Market: Unsafe at Any Yield?
    One more bubble to go?

    The American economy has already had an enormous stimulus package, called the hugh (50%) drop in energy gasoline) prices. The result: no change in general economic activity, although transportation of goods, commuter confidence, and core inflation, benefit. Stimulus package (politician code word for more debt) is obviously not the solution; rather it is the problem. the private sector is deleveraging, but not the public (federal) sector). Do the polies have only one note - more debt? How come they never use the debt word? Get ready for one long slog. Bubbles Law: in a deleveraging environment, all bubbbles must deflate. Watch out treasuries, supply and demand will eventually crater the debt market and the polies. Creditor 's economic vote in the marketplace does count; part of Adam Smith's invisible hand. Command and control does not work economically nor politically.
    Nov 21 15:17 pm |Rating: 0 0 |Link to Comment |View article
  • The renewed stock market selloff has been stunning, credit markets are again shaky, and junk bond yields are soaring. With all eyes on Washington, some say there's no time to wait for a stimulus package. "We can’t get from here to Feb. 1 if the current ‘who’s in charge?’ situation continues."
    The American economy already had an enormous stimulus package, called the hugh (50%) drop in energy gasoline) prices. The result: no change in general economic activity, although transportation of goods, commuter confidence, and core inflation, benefit. Stimulus package (poly code word for more debt) is obviously not the solution; rather it is the problem. the private sector is deleveraging, but not the public (federal) sector). Do the polies have only one note - more debt? How come they never use the debt word? Get ready for one long slog. Bubbles Law: in a deleveraging environment, all bubbbles must deflate. Watch out treasuries, supply and demand will eventually crater the debt market and the polies. Creditor 's economic vote in the marketplace does count.
    Nov 21 15:09 pm |Rating: 0 0 |Link to Comment |View news story
  • Treasuries and the U.S. Dollar: Twin Bubbles
    Bubble's Law: In a deleveraging environment, all bubbles must deflate. Is the last bubble, the treasury bubble?
    Nov 14 03:44 am |Rating: 0 0 |Link to Comment |View article
  • Shorting Treasuries: What's the Rationale?
    Bubble's Law: In a deleveraging environment, all bubbles must deflate. Is the last bubble, the treasury bubble?
    Nov 14 03:43 am |Rating: 0 0 |Link to Comment |View article
  • The End of the Economy As We Know It?
    Can one fully deleverage without ALL bubbles deflating? As mentioned by others, is the ultimate bubble, the treasury bubble coming? Was foreigners' markedly decreased purchase of Fannie Mae and Freddie Mac securities, a harbinger of the future for treasuries? Would the resultant lack of government ability to borrow be what is required to deleverage politicians? Possible dual currencies here, like for Europe, since there is greater faith in ECB than our Fed? Possibly an attempt by U.S. to borrow in eurodollar and yen denomination securities overseas? Is this the worse case scenario? Would a U.S. budget deficit less than $1 trillion+, and other fiscal conservative measures, send the right message to creditors, both domestic and foreign? Or is it the same old spend and spend (code word for debt); what did the vote on bail out indicate? The private sector is deleveraging; but not the public sector. A generation (25 yrs) for the excesses of the last 25 yrs, to be deleveraged? Good luck to all of us.
    Nov 11 23:41 pm |Rating: 0 0 |Link to Comment |View article
  • Obama Honeymoon Likely To Be Cut Short By Bond Market
    As mentioned, is the ultimate bubble, the treasury bubble coming? Was foreigners' markedly decreased purchase of Fannie Mae and Freddie Mac securities, a harbinger of the future for treasuries? Would the resultant lack of government ability to borrow be what is required to deleverage politicians? Possible dual currencies here, like for Europe, since there is greater faith in ECB than our Fed? Possible U.S. borrowing in eurodollar and yen denomination securities overseas? Is this the worse case scenario? Would a U.S. budget deficit less than $1 trillion, and other fiscal conservative measures, sent the right message to creditors, both domestic and foreign? Or is it the same old spend and spend (code word for debt); what did the vote on bail out indicate? The private sector is deleveraging; but not the public sector. A another generation (25 yrs) for the excesses of the last 25 yrs, to be deleveraged? Good luck to all of us.
    Nov 08 23:46 pm |Rating: 0 0 |Link to Comment |View article

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