(privately)Highways?

"The Dollar Will Fall Enormously," an interview with Harvard economist Kenneth S. Rogoff, is available at
http://portland.indymedia.org/en/2007/09/365962.shtml

"The American balance of payments deficit must be reduced. Today's business model is dead. Moody's rating agency will be the Arthur Andersen of this decade."

quote:

Having the government and the Federal Reserve in cahoots with each other reminds me of a humorous classroom exercise where the teacher had the students complete some well-known phrase. For the phrase fragment, "When the blind lead the blind…", one insightful young student had completed the sentence as "get out of the way" - which is perfectly correct, and damned good advice!

However, if the teacher had asked the kid to complete the phrase, "When the Congress leads the Federal Reserve to create more and more money so that Congress can borrow and then spend more and more money to 'fix' more and more problems of more and more people…", he would have been correct if he had finished the phrase by saying, "Then The Mogambo is right! We are freaking doomed!"

And so while even little kids know the terrible price we will pay for our stupidity and greed, there is a salvation! Adrian Ash at bullionvault.com writes, "the last time America's credit rating came into crisis - during the late '70s - inflation ate both equity and fixed-income investors alive", but "Gold, on the other hand, rose by 510% for dollar-based buyers."

Gold! Just like I have been yelling about! See? I'm not as stupid as you thought!

He also notes that it wasn't just us clever Yanks that made a bundle, but, "The metal rose five times over against the British pound (GBP) too, and spot gold prices gained more than 370% for German investors. Japanese gold buyers made four times their money inside three years."

On the other hand, let's not forget silver, and to that end SilverMiners.com featured a mineweb.com

http://www.kitco.com/ind/Daughty/sep242007.html

quote:

by The Mogambo Guru

I was "on vacation" last week, combining a few days of Mogambo crap with a few days of touring around Glacier National Park and environs, and purposely did not catch much news; no email, no Internet, no news, work, although I did inadvertently catch the news that the freaking Federal Reserve massively reduced (as was easily predicted) interest rates, by lowering both the Fed Funds rate (the rate at which banks lend overnight to each other, secured by collateral, to meet the requirements that they balance their books for the day, because you can't be in arrears, by law, and you don't want to end up sitting on truly idle cash, either, earning literally nothing, when the other bankers are down the street making more money than you by another 0.000003%, and you have already screwed up so much other stuff this year that your lack of profits make you look like a complete moron ("What are you, some kind of Moron Mogambo Thing (MMT) or something?"), and you are practically dead meat right now as a result, and your own mortgage is eating you alive because you believed your own lies and nonsense and invested heavily in real estate, and you are losing your stupid little butt and are now getting fired, too) and cutting the discount rate (where the stinking crook banker trash comes up, with their hats in their hands, and admits that they screwed up and they have to borrow from the Fed to balance their books for the day).

As to magnitudes, the Fed lowered them both by........

http://www.dailyreckoning.com/Writers/Mogambo/DREssays/MG092707.html

$2000 gold within two years... buy at $17-$23 pullbacks.

quote:

Originally posted by Ronald Rutherford:

quote:

Originally posted by meljomur:
I am curious Ron, what do we export to Japan?

Do you want a list or what?
Our great outdoors
Salmon
Softwood
Honey
Beef
Tobacco
Grains and Cereals
Foodstuffs
Copper
Numisimatic coins
...
Hell, why don't you look yourself: U.S. Exports to Japan

In other words, our exports are those of a third world country to a developed one.

Retired Monk
"Ideology is a disease"

quote:

Originally posted by polycarp:

quote:

Originally posted by Ronald Rutherford:

quote:

Originally posted by meljomur:
I am curious Ron, what do we export to Japan?

Do you want a list or what?
Our great outdoors
Salmon
Softwood
Honey
Beef
Tobacco
Grains and Cereals
Foodstuffs
Copper
Numisimatic coins
...
Hell, why don't you look yourself: U.S. Exports to Japan

In other words, our exports are those of a third world country to a developed one.

Thanks Poly, I really wasn't sure of the trade balance...

Retired Monk
"Ideology is a disease"

(privately)Bi-ways?

quote:

The week ahead promises to be a busy one for precious metals.
With the dollar continually on the back foot, precious metals
should see continued support. The dollar has depreciated by
over one cent against the euro since Friday morning, and is
currently trading around the US$1.4260 level.
Two major data releases due in the US this week might move
the markets. The first is pending US home sale for September
(due on Tuesday morning). This data is a leading indicator of
actual home sales, and expectations are that sales will continue
to decline. The second release is the US non-farm payroll data
(due on Friday). The benchmark remains 100K new jobs for
September, and anything less would be seen as bad news.
In between the US data releases, the ECB and BoE are set to
announce their interest rate targets for the next two months on
Precious metals end the week on a high
1 October 2007
Walter de Wet CFA*
+27 11 378 7239
Walter.deWet@standardbank.com
* Open interest
Thursday. Although no change by either central bank is expected,
a surprise rate cut might see the US dollar regain
some strength against the euro.

Standard Bank/Commodities Research
A few events to pay attention to-

01Oct EU ECB’s Trichet speaks 01:00
JP Tankan manuf. (Q3) 01:50 21 23
EU PMI manuf. (Sep) 10:00 53.2 53.2
UK M4 money supply (Aug) 10:30 n/a 13.5% y/y
UK PMI manuf. (Sep) 10:30 55.6 56.3
US Alan Greenspan speaks 15:00
US ISM manuf. (Sep) 16:00 52.5 52.9
US ISM prices (Sep) 16:00 62.0 63.0
02Oct JP Monetary base (Sep) 01:50 0.1% y/y 0.7% y/y
US Alan Greenspan speaks 09:00
EU PPI (Aug) 11:00 1.8% y/y 1.8% y/y
EU Unemployment (Aug) 11:00 6.9% 6.9%
US Pending home sales (Sep) 16:00 -2.0% -12.2%
US Fed’s Fisher speaks 19:00
03Oct EU PMI (Sep) 10:00 54.5 54.5
UK Reserves (Sep) 10:30 n/a $344m
US ABC cons conf. (Oct 1) 11:00 n/a -11
EU Retail sales (Aug) 11:00 0.5% y/y 0.5% y/y
US MBA mortgages (Sep 28) 13:00 n/a -2.8%
US ADP employment (Sep) 14:15 53k 38k
US ISM services (Sep) 16:00 55.0 55.8
04Oct JP BoJ’s Iwata speaks 07:00
UK BoE announces rate 13:00 5.75% 5.75%
US Fed’s Mishkin speaks 13.20
EU ECB announces rate 13:45 4.0% 4.0%
US Jobless claims (Sep 29) 14:30 n/a 298k
US Factory orders (Aug) 16:00 -2.3% 3.7%
US Fed’s Fisher speaks 18:45
05Oct JP Leading index (Aug) 07:00 30.0% 72.7%
EU OECD index (Aug) 12:00 n/a 107.9
US Non-farm payrolls (Sep) 14:30 113k -4k
US Unemployment (Sep) 14:30 4.7% 4.6%
US Consumer credit (Aug) 21:00 $9.7bn $7.5bn

quote:

Market Commentary
Gold opened at 742.30/742.80 in New York. The metal was range
bound during the early morning until light profit taking pushed it to a
low of 741.10/741.60. Gold rallied from the lows on fund buying,
pushing it to new highs of 748.00/748.50. The climb was not sustained
and gold began to drift south as dealers sold, taking note of
falling oil prices and a stronger USD. Support was found near 745.00.
Gold rebounded from this support level to finally close at
747.20/747.70.

ScotiaMocatta

-we may be approaching a buying opportunity-

Fascinating article

I guess this article tells its own story about how our failing economy really isn't going to have a huge international impact.
Hmm, food for thought...

Why would it?

quote:

Originally posted by GoodBusiness:
Why would it?

????????

I admit, half the time I don't follow your logic, but perhaps that is the point

Your finger stuck on the question marks.

Well there seems to be a common sentiment in this country that China will NOT call in our debt, because is so dependent on our buying their products, etc., however according to the article I posted this seems to be a myth.
-----------------------------------------------------------
If America sneezes
If neither a surge in inflation nor a bust in asset prices seem likely to derail China's economy over the next year or two, what about a recession in America? Exports account for over 40% of China's GDP, so some economists predict that a fall in exports as a result of a downturn in America would create massive excess capacity and a sharp fall in profits and investment—the making of a nasty hard landing. But the popular notion that China is dependent on export-led growth is a myth; domestic demand is much more important. This year the increase in China's net exports (ie, less imports) is likely to account for about one quarter of its growth—a record amount. But even without this external boost, GDP growth would still have been a respectable 9%.

During America's 2001 recession, China's export growth fell by 25 percentage points, but imports also slowed sharply, so GDP growth (as officially reported) remained strong. Since then, the share of its exports to America has shrunk; the European Union and other emerging economies are now more important markets. In the three months to August, Chinese exports to America increased by 14% compared with a year earlier, whereas those to the EU grew by 40%.
----------------------------------------------------------

I wonder what kind of "business" you are good at?????????
(oops stuck finger syndrome)

U.S. job growth rebounds to 110,000 in September

quote:

WASHINGTON (MarketWatch) - The U.S. unemployment rate rose to 4.7% in September, but job growth was stronger than expected over the past three months, the Labor Department reported Friday. Nonfarm payrolls rose by 110,000 in September, including 73,000 in the private sector, very close to expectations of 113,000 total payrolls. Payroll growth in July and August was revised higher by 118,000, the government said. The unemployment rate ticked up to 4.7%, the highest in a year. The labor force expanded by 573,000, and employment as measured by the household survey rose by 463,000, the most in more than two years. The details of the report paint a picture of a stronger job market than expected and could lead financial markets to lower their expectations for another interest-rate cut by the Federal Reserve at the end of the month. End of Story

Looks like the BIG boys are starting to feel the pinch

quote:

Originally posted by meljomur:
Looks like the BIG boys are starting to feel the pinch

Thanks Melissa. Are we now suppose to feel sorry for those poor investment bankers? We can always count on Guardian Unlimited to find some sector that is suffering unemployment. Instead of recognizing this as transitional unemployment they present it as a trend.
Next week buggy whip manufacturing jobs...

The transitional trend towards flipping burgers and creating an army of domestic servants is a good thing?

I suppose theoretically we could support a national economy by exporting Big Macs and maids, but I wouldn't count on it.

You could call the loss of financial jobs "karma"...or just an economic enevitability of cause and effect.

Retired Monk
"Ideology is a disease"

I was just pointing out how the job losses aren't just being felt by the working middle class, that many of these high end earners are feeling the heat too.

Karma, perhaps.

Hey I suppose an ex-investment banker could just transition into a job at McDonalds

Ron, the Guardian is a much better source of what is going on in our own country than any paper here, I know it is tough to read the truth sometimes.

quote:

Originally posted by meljomur:
I was just pointing out how the job losses aren't just being felt by the working middle class, that many of these high end earners are feeling the heat too.

But then why do we not see any articles about the human face when we get rises in employment levels? I guess it is in the nature of News to go out and find someone/anyone that has lost their job and somehow think it is bad. Do you think it is good that only 1-2% of our population is devoted to food production? Our economy is constantly shifting and thus you will always find someone losing their job.

quote:

Karma, perhaps.

Hey I suppose an ex-investment banker could just transition into a job at McDonalds

Karma to you maybe. But any investment banker with any brain should have saved enough that he can now open a McDonalds Franchise and yes he could get himself a job flipping burgers but only for himself.

quote:

Ron, the Guardian is a much better source of what is going on in our own country than any paper here, I know it is tough to read the truth sometimes.

I really do not consider it "a much better source". At beast marginally worse that US papers on most issues and marginally better on a couple.

If that paper was the truth then we are all in deep shit. But please continue to post their articles, gives me something to laugh at.

May my Karma never get onto your chocolate...

The Big boys article is a nice glimpse of the the possibility of things to come meljomur IMHO.
Seems like that subject is still at the official, US press black-out phase.

You know, Citigroup lost 6 billion dollars just in the last quarter. And get this, its shares rose 1.00 on the news. Sounds like the US plunge Protection team has it's hands full and those guys on Wall Street are smoking something.The Wall Street crowd is still under hypnosis.
Last week Quatar and Vietnam announced they are reducing their holdings of US dollars. The dollar gained a little last week but that may be just a dead cat bounce.

quote:

The possibility of a ‘domino effect’ is very real. In any event, I expect gold and silver to soon start ignoring the ups and downs in the US dollar, and move up on their own fundamentals. The sub-prime credit mess has not been solved, merely delayed.

It was a beautiful day here in the Sierra. I went climbing at the Spire near Strawberry with a few friends. Caught the BBC business report on NPR in the truck on the way home. I agree with you meljomur, reporting from across the pond has far less fluff and opinion than anything offered by mainstream US media. Just MHO.

No opposition to half-point cut on Sept. 18: Fed minutes

quote:

WASHINGTON (MarketWatch) - With the economic outlook in the wake of the financial market turmoil highly uncertain, Federal Reserve officials agreed that a half a percentage point rate cut was "the most prudent course of action," but said only that future actions would depend on how the economy fared in coming weeks, according to a summary of the Sept. 18 meeting released Tuesday. There was no opposition to the rate cut. Fed officials were so uncertain about the outlook that they refused to provide the traditional balance of risk statement, language that indicates to the market whether the Fed believes it must focus its policy attention on higher inflation or slower growth. Such a statement in mid-September "could give the mistaken impression that the FOMC was more certain about the economic outlook that was in fact the case," the summary said. The FOMC cut rates by a half-point to 4.75% on Sept. 18, a decision that caught many analysts by surprise.