World economy talk

[creepy]

The printing presses in the States are now working overtime. Inflation here we come!

It's becoming very likely we'll see what happened in Asia 10 years ago (Asian financial crisis) happen in the States.

Maybe it's time for the Asian countries to start lecturing George Bush and Helicopter Ben. After all, most of us in this part of the world actually experienced this not so long ago.

[uls]

Now more than ever, me must get out of the US Dollar. Helicopter Ben has again flown and thrown money at the amount of $200B to bail out troubled financial institutions by accepting their toxic subprime securities as a collateral. The equity markets might see this as a good thing I don't think it will be good in the long run especially on the inflation picture. Gas prices, food prices are all up and the supply is getting limited and now to add $200B of new money to chase that limited supply thats what we call inflation folks

the Fed is in panic mode... the Dow has plunged below 12000 and no bottom in sight.

Bear Stearns was rumored to be insolvent.

things are really bad in the credit market. Everything's frozen.

Banks wont lend people money.

Banks wont lend each other money. Coz they wont accept each other's collateral (which is mostly junk)

Except the Fed hehe

the Fed tells the banks: "Dudes, we will lend you treasuries, and accept your junk as collateral."

Banks: "Yaaaaaaaaahhhhhhhhhooooooooo!!!!!"

Dow up 416 points.

[empy]

i didn't hear that about Bear Stearns...if it's true, then they haven't learned a damn thing. they already took a bath on the last junk bond crisis (the emerging markets one of a couple years ago). shows you how greed overrides common sense sometimes....i guess the market thinks they're overinvested in mortgage backed securities to ride the real estate bubble.

i have to admit that the $200b infusion sounds like an act of desperation, since it looks like the Fed is taking long term risk (the banks' debt) to boost short term liquidity. liquidity is obviously a good thing, but the cost may be very high.

it also sounds like they're trying to "save the rate cuts for a rainy day", or for use if the economy slows further. or else they would just get it over with and make the cuts.

[uls]

There were rumors Monday that Bear Stearns was having liquidity problems. Causing its stock to plunge big time.

A top Bear exec even had to call CNBC to deny the rumors.
http://www.marketwatch.com/news/stor...FE0BB9C0183%7D

Then last night, the Fed action.

People believe the Fed action was triggered by the Bear Stearns "rumors".
http://www.marketwatch.com/news/stor...&dist=hplatest

[tidus1203]

Its so funny no matter how much Bernanke prints money and debases the currency to "supposedly" help the economy it always ends up in his face One thing is for sure though and that is inflation will go higher and I urge everyone here to get out of the US Dollar, get out of US denominated assets (stocks and bonds) and stack up on commodities and foreign currencies like the Euro, Swiss Franc, Australian Dollar and the Japanese Yen....

Don't say I didn't warn you. In 5 years time if you look back I am sure you glad you got out of this abused currency....

[uls]

Ben isnt helping the US economy... Ben is helping his banker friends hehe

I would love to see what other tricks Ben has in his magic hat.

there's an expected interest rate cut again next week.

[tidus1203]

Thats already an old trick, he can cut it all the way to 0% but they will have to take the losses regardless. Maybe this time he would try buy all the sub-prime securities and just print the necessary money to buy all of them Now thats the true bail out the bankers really want (I hope they don't get it, but with a money printer at the helm you never know)

My suggestion though is allow the recession to happen (although IMO the US is already in recession the government denies it though) and let the banks that need to go bankrupt go bankrupt so we clean out all the system of excesses and restart again on a more solid base.

[uls]

Ya interest rates used to be their only trick.

Now they have the TAF (term auction facility), then the TSLF (term securities lending facility)

what other fancy names for "bailout" are they gonna come up with?

[mazingerZ]

everyone will be affected. global financial meltdown again

[uls]

Last night, Standard & Poors -- one of the ratings agencies that put AAA ratings on bad paper -- came out with news that the end of subprime related writedowns is in sight...

Do these guys still have any credibility?