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TranceAddict Investors Club @ Marketocracy (pg. 142)
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| Krypton |
| quote: | Originally posted by Capitalizt
The closest info I could find was on page 138-148 of Americas Great Depression, the e-book I posted in the other thread. The data shows a 7.7% annualized increase in the money supply from 1921-1928..not hyperinflation, but still nothing to scoff at. Just as now however, the fed had more stimulative tools in it's arsenal back then than money supply alone. Combine the 7.7% growth with the low bank reserve ratios (3-12% at the time) and loose margin requirements (only around in 10% in many cases as you said earlier) and we had a recipe for large amounts of credit expansion which led to the speculative boom and bust.. And of course you are right about Bernanke not repeating the mistakes of the past. He's not going to do what was done after the crash of 29' and tighten credit. On the contrary, he (and Obama too for that matter) are throwing every inflationary tool including the plumbing behind the kitchen sink at this problem. Everything he has said and written indicates than when in doubt he will always err on the side of monetary easing. There is no frakkin way we will have deflation so long as every government and central bank around the world is on this path.. They will win the battle against deflation. The sheer amount of money being spent/loaned/created guarantees that much.. |
Good. Because deflation devastated the economy and prevented a recovery, especially with the money supply falls by a third, nothing good can come of it. So good. When deflation hits, you inflate the currency. That's the rational response. You don't just sit back and let it happen because if you did, the people would quickly be up in arms at the inaction.
| quote: | Check this out, the total commitments by the fed/treasury so far.. http://www.bloomberg.com/apps/news?...tCA4&refer=home
:eek: :eek: :eek:
This really is a staggering amount of stimulus. My only argument is that the unintended consequences from this down the line will be tremendous. All this new money sloshing around is baking another speculative boom into the pipeline now, and I'm afraid Bernanke will leave the easy money spigot open too long just as was done in the late 90s and early-mid 2000s. Maybe he is smarter than every previous fed chairman and will know precisely when to choke off the stimulus to prevent any problems without causing another recession. Maybe he really can time things perfectly..but if history is any guide, I doubt it. $12.8 trillion is a LOT of stimulus to unwind and I doubt it can be done in an orderly or timely fashion. Oh well...We'll know in a couple years won't we? |
Unfortunately, in a downturn such as this, the government must run a deficit. Unfortunately, the previous president ran a huge deficit, AND THERE WAS NO DOWNTURN. What a scumbag!
And of course there will be another bubble. That's like saying, it's going to rain one of these days. Well, NOT ! :P
| quote: | | P.S. I'm leaving town for the next 6 days so don't think I'm bitching out if I don't respond to any posts here for a while. :) Have a good week. |
Why you runn'n, you scared? I know you scared. |
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| Krypton |
Give me stocks you want an in-depth stock analysis on and I will get on it as soon as I can. With your analysis, you will get a simple valuation indicated by a metric I call the gamma. If that is not enough for you, I can do an in-depth valuation, but keep in mind this is labor intensive, so try not to give me too many of those. But the stock analysis, give me as many as you want.
Gamma is a metric I developed which takes a stock rating on a scale of 0-100 and divides it by the stock's relative strength. This provides a number usually hovering around 1. If the gamma is above 1, the stock is undervalued. If the stock is below 1, the stock is overvalued. Why do I call it gamma? Names are so hard to come by, I just use Greek letters for the convenience.
Below are a stock analysis and an in-depth valuation as an example to what you can expect.
TCK valuation
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| jerZ07002 |
Is anyone familiar with a resource that tracks historical US consumer debt (i.e., mortgages, credit card debt, and other types of consumer debt)? I am in the planning stage of writing an article on a tax policy issue for submission to a law journal, and prior to sorting through resources that track economic data (which is unfamliar territory to me) I thought I would throw the question out here since I know there are several economists who post in this thread.
EDIT: Oh yeah, I'm also looking for a study that analyzes the amount of debt consumers could support given their income (i.e., a sustainable consumer debt/income ratio).
If anyone has a lead for me I would greatly appreciate it. My social life also thanks you in advance. ;) |
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| Shakka |
Ned Davis Research has done excellent work on debt levels and has decades worth of data. Not sure exactly what you're looking for, but they are a well known, reputable institution and could be a potential resource for you.
http://www.ndr.com/invest/public/publichome.action |
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| jerZ07002 |
| quote: | Originally posted by Shakka
Ned Davis Research has done excellent work on debt levels and has decades worth of data. Not sure exactly what you're looking for, but they are a well known, reputable institution and could be a potential resource for you.
http://www.ndr.com/invest/public/publichome.action |
Thanks - I'm really looking for something that was already published in a journal or a book. Fee based services are too expensive for what i'm doing.
Oh yeah, I have to be able to cite to the information. As a result, I can't use independent research and unpublished data. |
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| Krypton |
Microsoft (MSFT)
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| Moongoose |
EXM issued its earnings report today after market close. I speculated that it would come out better than expected so bought it at 5.77$/s. Now its 7.16$/s. Then again AA reported a huge loss yesterday and they still traded in the green today. Guess any news short of bankruptcy is enough for a tock to trade in the green these days.
I only wish i bought it with more money. |
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| Krypton |
This taken off my Motley Fool CAPS blog...
http://caps.fool.com/MyPlayer.aspx?tab=qs
Well, the economy as it is, is driven by credit. Debt drives this economy. That's just a fact of life at the moment. But what happens when credit dries up? Well, we'r seeing that unfold right now. The money supply without the Fed devaluing the currency, is dropping precipitously. Think about the money multiplier and how it works with bank reserves and the amount of money they can lend, or essentially, create out of thin air. For every dollar in deposits, they can lend, 9 more dollars, which essentially is created money, and an increase in the money supply. Well, right now, banks are hardly lending, even to each other. So, with banks hoarding more rather than lending more, the money supply either drops (because of hoarding), or, remain flat (which isn't happening).
There are more loans being defaulted and paid off than new loans to replace them. That means a drop in money supply according to that one metric. Add into the mix, falling asset prices across the board...commodities, equities, real estate...and all this means an even more precipitous drop in money supply. Not only that, but banks will have to write off $1 trillion plus, because their asset values are falling so much. Deflation with a severe sting.
If you take all these things into account, you should be able to understand why the Federal Reserve has had to make huge liquidity infusions into the economy, and had to re-capitalize the banks with hundreds of billions of dollars. Inflation truly is the least of our worries. In fact, inflation is one of the solutions to the problem to the vast losses of capital/liquidity in the economy.
Is it no wonder to you that the dollar has been rising since this crisis began? Two things, firstly, decreasing money supply (due to huge capital losses) and deflation. Secondly, the flight to risk-free government bonds. The Federal Reserve has plenty of room to inflate, and inflate they will, because if they don't, they will be held accountable for their inaction when a deflationary spiral sets. Luckily, we don't have to worry about that scenario because the Fed's are doing exactly what their supposed to do. We should all be thanking Bernanke for his stewardship at this time.
Lastly, it helps to have an education in economics. I'v found through my education, that 99% of the politicians, pundits, and commentators out there in the media, don't know what the f0ck they'r talking about. Key among them, Rush Limbaugh, Sean Hannity, Glen Beck, and our favorite Libertarian, Ron Paul. None of these idiots have a background in economics, let alone read Maynard Keynes The General Theory of Employment, Interest, and Money, or Adam Smith's The Wealth of Nations, and yet claim to be free market champions. They don't know what the hell a free market is! |
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| Krypton |
I have just finished a new calculator which I think is my best one yet. It allows you to become your own stock analyst, not to mention, an invaluable tool in your own stock analysis. Download the spreadsheet by clicking the link on my home page...
www.finance.com |
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| Capitalizt |
| quote: | Originally posted by Krypton
Inflation truly is the least of our worries. |
Quoted for posterity. |
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| sean5 |
| quote: | Originally posted by Krypton
This taken off my Motley Fool CAPS blog...
http://caps.fool.com/MyPlayer.aspx?tab=qs
Well, the economy as it is, is driven by credit. Debt drives this economy. That's just a fact of life at the moment. But what happens when credit dries up? Well, we'r seeing that unfold right now. The money supply without the Fed devaluing the currency, is dropping precipitously. Think about the money multiplier and how it works with bank reserves and the amount of money they can lend, or essentially, create out of thin air. For every dollar in deposits, they can lend, 9 more dollars, which essentially is created money, and an increase in the money supply. Well, right now, banks are hardly lending, even to each other. So, with banks hoarding more rather than lending more, the money supply either drops (because of hoarding), or, remain flat (which isn't happening).
There are more loans being defaulted and paid off than new loans to replace them. That means a drop in money supply according to that one metric. Add into the mix, falling asset prices across the board...commodities, equities, real estate...and all this means an even more precipitous drop in money supply. Not only that, but banks will have to write off $1 trillion plus, because their asset values are falling so much. Deflation with a severe sting.
If you take all these things into account, you should be able to understand why the Federal Reserve has had to make huge liquidity infusions into the economy, and had to re-capitalize the banks with hundreds of billions of dollars. Inflation truly is the least of our worries. In fact, inflation is one of the solutions to the problem to the vast losses of capital/liquidity in the economy.
Is it no wonder to you that the dollar has been rising since this crisis began? Two things, firstly, decreasing money supply (due to huge capital losses) and deflation. Secondly, the flight to risk-free government bonds. The Federal Reserve has plenty of room to inflate, and inflate they will, because if they don't, they will be held accountable for their inaction when a deflationary spiral sets. Luckily, we don't have to worry about that scenario because the Fed's are doing exactly what their supposed to do. We should all be thanking Bernanke for his stewardship at this time.
Lastly, it helps to have an education in economics. I'v found through my education, that 99% of the politicians, pundits, and commentators out there in the media, don't know what the f0ck they'r talking about. Key among them, Rush Limbaugh, Sean Hannity, Glen Beck, and our favorite Libertarian, Ron Paul. None of these idiots have a background in economics, let alone read Maynard Keynes The General Theory of Employment, Interest, and Money, or Adam Smith's The Wealth of Nations, and yet claim to be free market champions. They don't know what the hell a free market is! |
sounds like it was written by somebody with ben shalom's circumsized in their mouth. if ron paul doesn't know what he's talking about then why does zionist media have to censor him so much? the guy has been right all along. |
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| Krypton |
| quote: | Originally posted by sean5
sounds like it was written by somebody with ben shalom's circumsized in their mouth. if ron paul doesn't know what he's talking about then why does zionist media have to censor him so much? the guy has been right all along. |
WHy are you paranoid conspiracy nut job? |
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