page-loading-spinner
Image | Follow the Money
Follow the Money
 PREVIEW
by Chris Martenson
Saturday, August 24, 2008

Nobody can borrow and consume their way to wealth; no city can do it, no state, and no country either. For the past 25 years the US has been progressively producing less and less, consuming more and more, and borrowing to cover the difference.

Today I stacked wood for the winter, which is always satisfying, and thought about where we really are in this credit crisis. That was decidedly less satisfying.

It is important to remember that we did not get here all at once, and that this crisis was not caused by subprime mortgage defaults. Rather, those were effects, while the cause was the cumulation of 25 years of progressively larger borrowing…
Follow the Money
 PREVIEW by Chris Martenson
Saturday, August 24, 2008

Nobody can borrow and consume their way to wealth; no city can do it, no state, and no country either. For the past 25 years the US has been progressively producing less and less, consuming more and more, and borrowing to cover the difference.

Today I stacked wood for the winter, which is always satisfying, and thought about where we really are in this credit crisis. That was decidedly less satisfying.

It is important to remember that we did not get here all at once, and that this crisis was not caused by subprime mortgage defaults. Rather, those were effects, while the cause was the cumulation of 25 years of progressively larger borrowing…
Image | U.S. arms dealers excited
U.S. arms dealers excited
by Chris Martenson
As always, there’s instant support and money for
weapons systems in the US, because they’ve got great lobbyists and
everybody in Washington knows how to play that game. It is a well-oiled
machine. While our bridges crumble, and desperately needed research on
alternative energy goes unfunded, there always seem to be instant
tens-of-billions for weapons systems.
U.S. arms dealers excited
 by Chris Martenson
As always, there’s instant support and money for
weapons systems in the US, because they’ve got great lobbyists and
everybody in Washington knows how to play that game. It is a well-oiled
machine. While our bridges crumble, and desperately needed research on
alternative energy goes unfunded, there always seem to be instant
tens-of-billions for weapons systems.
Image | A cat fight at Jackson Hole
A cat fight at Jackson Hole
by Chris Martenson

Bloomberg



– Former Bank of England
policy maker Willem Buiter sparked the biggest debate at the Federal
Reserve’s annual mountainside symposium, saying the central bank pays
too much heed to the concerns of financial institutions. 


A cat fight at Jackson Hole
 by Chris Martenson

Bloomberg



– Former Bank of England
policy maker Willem Buiter sparked the biggest debate at the Federal
Reserve’s annual mountainside symposium, saying the central bank pays
too much heed to the concerns of financial institutions. 


Image | FNM and FRE will cost you a bundle
FNM and FRE will cost you a bundle
by Chris Martenson
The
main reason that FNM and FRE are “too big to fail” is that they are
both far too deep in the derivatives game for anybody to have a
reasonable assurance of what would happen if they did fail. And nobody
wants to find out, because the fear is that such a scenario could
literally wipe out the entire banking system.
FNM and FRE will cost you a bundle
 by Chris Martenson
The
main reason that FNM and FRE are “too big to fail” is that they are
both far too deep in the derivatives game for anybody to have a
reasonable assurance of what would happen if they did fail. And nobody
wants to find out, because the fear is that such a scenario could
literally wipe out the entire banking system.
Image | Banking crisis ready to rumble
Banking crisis ready to rumble
by Chris Martenson
I see total bank losses as feeding
off of each other, leading to a total recapitalization need in the
neighborhood of $1 trillion. Couple this to a probable $800 billion in
Fannie and Freddie losses, and we’re talking about an amount that is in
the vicinity of the entire yearly income of the US government. Who will
lend all that money, and under what terms?
Banking crisis ready to rumble
 by Chris Martenson
I see total bank losses as feeding
off of each other, leading to a total recapitalization need in the
neighborhood of $1 trillion. Couple this to a probable $800 billion in
Fannie and Freddie losses, and we’re talking about an amount that is in
the vicinity of the entire yearly income of the US government. Who will
lend all that money, and under what terms?
Image | Bernanke speaks
Bernanke speaks
by Chris Martenson
First, I
think it’s entirely too cute that the world’s central banks, which
desperately needed the dollar to go up and commodities to fall so that
they could continue to flood the world with additional liquidity, got
exactly that. Markets are rarely so accommodating, and I suspect
official intervention to rally the dollar.
Bernanke speaks
 by Chris Martenson
First, I
think it’s entirely too cute that the world’s central banks, which
desperately needed the dollar to go up and commodities to fall so that
they could continue to flood the world with additional liquidity, got
exactly that. Markets are rarely so accommodating, and I suspect
official intervention to rally the dollar.
Image | Bad debt
Bad debt
by Chris Martenson

WSJ



– Will the U.S. Treasury repudiate its obligations
to its creditors, be they citizens or investors around the world? Most
observers would answer "no" without hesitation. But Congress, with the
complicity of the White House and the Fed, has arguably embarked on a
stealth repudiation.



Bad debt
 by Chris Martenson

WSJ



– Will the U.S. Treasury repudiate its obligations
to its creditors, be they citizens or investors around the world? Most
observers would answer "no" without hesitation. But Congress, with the
complicity of the White House and the Fed, has arguably embarked on a
stealth repudiation.



Image | China warns the U.S.
China warns the U.S.
by Chris Martenson
China is
sending clear signals that it will consider a breach of obligations by
the US on its debt to be, well, catastrophic. "For us, or for them?"
one wonders. At any rate, the $376 billion in agency debt held by the
Chinese could buy a big swath of U.S. corporate assets.
China warns the U.S.
 by Chris Martenson
China is
sending clear signals that it will consider a breach of obligations by
the US on its debt to be, well, catastrophic. "For us, or for them?"
one wonders. At any rate, the $376 billion in agency debt held by the
Chinese could buy a big swath of U.S. corporate assets.
Image | U.S. Mint suspends gold coin sales
U.S. Mint suspends gold coin sales
by Chris Martenson
As gold took its
tumble in the paper markets, demand for physical gold climbed sharply
by those seeking to take advantage of the lower prices. In response to
that demand, the U.S. Mint suspended sales. What an odd thing for a
manufacturer to do.
U.S. Mint suspends gold coin sales
 by Chris Martenson
As gold took its
tumble in the paper markets, demand for physical gold climbed sharply
by those seeking to take advantage of the lower prices. In response to
that demand, the U.S. Mint suspended sales. What an odd thing for a
manufacturer to do.
Total 4907 items
Image | Join Peak
Image | Peak Financial
Image | Proton Mail
Image | Big Red Button
Image | Crash Course 2.0 Now Available!
Image | Show Off Your Peak Pride!
Image | Join Peak

Daily Digest

Please login to submit a story to the Daily Digest.

View Past Daily Digests

Image | Peak Financial
Image | Proton Mail
Image | Big Red Button
Image | Crash Course 2.0 Now Available!
Image | Show Off Your Peak Pride!