How bad can the global economy get?

[Friday]

Here's a link to the text of the "Financial Services Regulatory Relief Act of 2006":
http://www.govtrack.us/congress/bill.xpd?bill=s109-2856

Stefan Molyneux has a podcast, I forget which one, about how he believes that, when the powers that be know that the whole house of cards is about to collapse, everyone in a position to do so will just loot the hell out of the system.  By the time the information trickles down to the man on the street, there'll be nothing left.  I interpret this Financial Services Regulatory Act of 2006 as that sort of thing.  A couple of years ago, the powers that be judged that the system had about 5 years left.  In the past couple of weeks, they realized they were overly optimistic, and changed the effective date to today (Oct. 1 was the day the Senate passed the bailout).   

[John Edward Mercier]

Currency or Capital?

[memenode]

Hard to say...

If the UK joined the EU, the Euro might dominate nearly overnight. And its much more likely that different countries will join the EU rather than become Republics of the United States.

UK has been in EU since 1973. They just didn't accept the euro as a replacement currency for their pound.

One of their european parliament representatives, Nigel Farage, seems quite opposed to the way things are going in EU though and seems to advocate a fall out. You can watch the circus here: http://www.youtube.com/europarl

You can imagine I sympathize with Nigel's message because EU is going to be a disaster for our freedoms here. They're pushing the Lisabon treaty down everybody's throats and the treaty is essentially a constitution which would make the EU into the similar kind of federation that USA is - a superstate with central authority - if not even worse (erasing nations and remaining sovereignty of states).

[John Edward Mercier]

I think they may have a delusional belief that the US system is somehow much better.
Lots of the advantages of the US results from geography and history.

[Pat McCotter]

http://www.iht.com/articles/2008/10/07/business/fed.php


[The Fed announced] a radical new plan to jump-start the engine of the financial system.

Under the plan, which was endorsed by the Treasury Department, the Fed will buy vast amounts of commercial paper, the unsecured short-term debt that companies rely on to finance their day-to-day activities. That means the central bank will lend directly to businesses, not only to banks.

[John Edward Mercier]

I think the twelve private banks are starting their own secessionist movement.

[memenode]

Here's something interesting.. The Data Don't Justify Financial-Market Panic

One of the things that caught my attention is that US inflation is only 3%. Inflation in Croatia is currently 7% and it doesn't seem like we're gonna hyperinflate any time soon so what the hell? Given that and that USD is currently highest this year (and compared to last too actually), it's like the USD is stable and the real catastrophe just isn't happening. So what the hell?

How can inflation in US be so low after all that happened?

[Mike Barskey]

One of the things that caught my attention is that US inflation is only 3%.
...
How can inflation in US be so low after all that happened?

It's not.

Shadow Government Statistics

Worl Net Daily article

InflationDate.com

Texas Hold 'Em Blogger

[Friday]

Here's something interesting.. The Data Don't Justify Financial-Market Panic

One of the things that caught my attention is that US inflation is only 3%. Inflation in Croatia is currently 7% and it doesn't seem like we're gonna hyperinflate any time soon so what the hell? Given that and that USD is currently highest this year (and compared to last too actually), it's like the USD is stable and the real catastrophe just isn't happening. So what the hell?

How can inflation in US be so low after all that happened?

gu3st, that inflation figure sounds totally bogus (although Robert Higgs is a good guy, so... hmmm).  Anyway, the official figure comes from the US government, so they have every incentive in the world to lie about it.

As for the USD being strong, the book I'm reading (Financial Armageddon) discusses that.  I may not be paraphrasing this exactly right, but I think what the book says is that, short-term, the USD will look pretty good because people all over the world are dumping their U.S. investments in exchange for USD.  It won't last.

[David]

The price of food has gone up, and up till very recently, the cost of fuel has been in record territory.  I do not believe the official numbers either.  I suppose in theory the inflation rate is low now, I just do not trust those reporting the numbers.  Specifically, they need the money to pay for all their promises, the politicians that is.  The get a lot of money borrowing and taxing, but those are expensive, and they still run a deficit every year. 

[memenode]

Hm yeah, I wouldn't expect strong USD to last either, unfortunately, but I guess this situation might be buying us some time (months, maybe a year?) so we can diversify (I ought to start getting paid as much euros as possible).

[John Edward Mercier]

Here's something interesting.. The Data Don't Justify Financial-Market Panic

One of the things that caught my attention is that US inflation is only 3%. Inflation in Croatia is currently 7% and it doesn't seem like we're gonna hyperinflate any time soon so what the hell? Given that and that USD is currently highest this year (and compared to last too actually), it's like the USD is stable and the real catastrophe just isn't happening. So what the hell?

How can inflation in US be so low after all that happened?

I think he wrote will be running greater than 3% for the foreseeable future...
The current rate quoted by the government for the previous twelve months on combined items is 5.4% Aug 2007-2008.
September will be released in about a week. The media normally only release the month-to-month change.

[David]

The dow jones is down 39% since its high in oct 2007, the japanese stock exchange lost 10% value in one day.  Hong kong 8%. 

[memenode]

CROBEX (croatian index) lost 20% in last two days. 

[Friday]

I was watching the U.S. stock market all day yesterday, just for sick and twisted entertainment, and it was c r a z y  .  Down hundreds of points, then up hundreds of points, then repeat a few more times.