The Economy, stupid

[BigSqwert]

Yes. I pointed it out 12 days ago in this thread.

By now you should realize 97% of Soxtalk has you on ignore.

[Balta1701]

By now you should realize 97% of Soxtalk has you on ignore.

And yet, things I post keep showing up as people's avatars...

[BigSqwert]

And yet, things I post keep showing up as people's avatars...

I'm one of the few still giving you a chance. You're lucky I like geology.

[mr_genius]

 

Take a look at this U.S population growth chart (based on census data) and take into consideration that we have had 0% job growth in the last decade and could easily see the next decade losing jobs rather than being able to break even. Anyone else see how this isn't going to work?

Edited July 15, 2009 by mr_genius

[southsider2k5]

 

Take a look at this U.S population growth chart (based on census data) and take into consideration that we have had 0% job growth in the last decade and could easily see the next decade losing jobs rather than being able to break even. Anyone else see how this isn't going to work?

 

It is called the collapse of a pyramid scheme.

[NorthSideSox72]

 

Take a look at this U.S population growth chart (based on census data) and take into consideration that we have had 0% job growth in the last decade and could easily see the next decade losing jobs rather than being able to break even. Anyone else see how this isn't going to work?

Definitely as problem. This is why the short term "stimulus" jobs aren't a real solution. We need to push forward into new technologies.

 

[Balta1701]

Definitely as problem. This is why the short term "stimulus" jobs aren't a real solution. We need to push forward into new technologies.

Which is of course why some of us wanted MORE of that type of investment in the stimulus package. Like what is being done in China.

[Cknolls]

I am putting this here because I am assuming it is part of the stimulus:

 

http://www.abc15.com/content/news/investig...mC7wJTm4uQ.cspx

 

 

WTF?

[Balta1701]

WTF?

When AIG et al. hold their big conferences, we get huge lectures from you folks about how they absolutely need to hold those things, they're a complete necessity to meet with contractors, vendors, people they do business with, etc.

 

Take note of the fact that SSA held this thing in Phoenix in the summer. You know why they might have done that? Because no one in their right mind wants to go to phoenix for a conference in the summer. It's 120 degrees every day. The only reason why you'd go there is that the hotels are really cheap. They paid like $85 a night.

 

The feds have paid retention bonuses to single AIGFP employees that cost more than that conference.

[southsider2k5]

When AIG et al. hold their big conferences, we get huge lectures from you folks about how they absolutely need to hold those things, they're a complete necessity to meet with contractors, vendors, people they do business with, etc.

 

Take note of the fact that SSA held this thing in Phoenix in the summer. You know why they might have done that? Because no one in their right mind wants to go to phoenix for a conference in the summer. It's 120 degrees every day. The only reason why you'd go there is that the hotels are really cheap. They paid like $85 a night.

 

The feds have paid retention bonuses to single AIGFP employees that cost more than that conference.

 

And here you are defending it after it attacking it when business did it...

[Balta1701]

And here you are defending it after it attacking it when business did it...

Just applying your standards.

[Flash Tizzle]

Definitely as problem. This is why the short term "stimulus" jobs aren't a real solution. We need to push forward into new technologies.

A significant problem in my mind is the loss of low skilled, mid-high level paying positions. The death of the blue collared worker. Obviously it's period of time that's not going to resurrect any time soon, but really, the issue I'm reading about in papers and online often deals with 30/40/50 year old factory workers who were paid well for their line of work let go with a limited opportunity to find the same salary in another position. These people have families to care for and bills to pay, so I wonder, what can the government do to benefit them? They're seemingly let go by the thousands every day. Are they now forced to attend college or switch professions, probably beginning with a meager salary? Even if the economy does rapidly improve, will their old positions be given back? Probably not.

 

It's as if we're becoming too efficient for our own goodI've always thought, as annoyed as people may become watching five people fill in a pot-hole across Chicago, it represents a necessary evil. These are exactly the type of jobs we need more of. Wasteless positions. Think about how many city workers are scared s***less that one day someone is going to find that, low and behold, it doesn't take that many people to efficiently fill in a pothole. That's why I'm glad to be associated with a profession that fights tooth and nail for job security. Even if some researcher from the University of Chicago analyzes data concerning police employment, compares it with other cities across the world, uses some unknown algorithm, and concludes that you only need 3,000 cops to be efficient, it'll never be taken under consideration. Even in the worst of economic times

 

I agree with you that we need new technologies. The issue then becomes, with whatever is developed, employment opportunities have to benefit the common person. Not just some scientist or an applicant with a PHD in Mechanical Engineering.

Edited July 16, 2009 by Flash Tizzle

[southsider2k5]

Just applying your standards.

 

So what contractors, vendors, and customers is Social Security worried about losing?

[NorthSideSox72]

A significant problem in my mind is the loss of low skilled, mid-high level paying positions. The death of the blue collared worker. Obviously it's period of time that's not going to resurrect any time soon, but really, the issue I'm reading about in papers and online often deals with 30/40/50 year old factory workers who were paid well for their line of work let go with a limited opportunity to find the same salary in another position. These people have families to care for and bills to pay, so I wonder, what can the government do to benefit them? They're seemingly let go by the thousands every day. Are they now forced to attend college or switch professions, probably beginning with a meager salary? Even if the economy does rapidly improve, will their old positions be given back? Probably not.

 

It's as if we're becoming too efficient for our own goodI've always thought, as annoyed as people may become watching five people fill in a pot-hole across Chicago, it represents a necessary evil. These are exactly the type of jobs we need more of. Wasteless positions. Think about how many city workers are scared s***less that one day someone is going to find that, low and behold, it doesn't take that many people to efficiently fill in a pothole. That's why I'm glad to be associated with a profession that fights tooth and nail for job security. Even if some researcher from the University of Chicago analyzes data concerning police employment, compares it with other cities across the world, uses some unknown algorithm, and concludes that you only need 3,000 cops to be efficient, it'll never be taken under consideration. Even in the worst of economic times

 

I agree with you that we need new technologies. The issue then becomes, with whatever is developed, employment opportunities have to benefit the common person. Not just some scientist or an applicant with a PHD in Mechanical Engineering.

 

Let's use an example - solar panels - for technology. By having that industry in the US be successful, you get a very nice profile of higher paying jobs. You have a few researchers and scientists, a bunch of engineers, and yes, also semi-skilled labor positions in plants that build them.

 

 

[mr_genius]

When AIG et al. hold their big conferences, we get huge lectures from you folks about how they absolutely need to hold those things, they're a complete necessity to meet with contractors, vendors, people they do business with, etc.

 

Take note of the fact that SSA held this thing in Phoenix in the summer. You know why they might have done that? Because no one in their right mind wants to go to phoenix for a conference in the summer. It's 120 degrees every day. The only reason why you'd go there is that the hotels are really cheap. They paid like $85 a night.

 

The feds have paid retention bonuses to single AIGFP employees that cost more than that conference.

 

AIG is an abomination. I wouldn't want to defend an organization I supported by stating "But AIG did it".

[Balta1701]

By the way, I'd just like to take a moment and express my astonishment at how amazing Goldman Sachs is at gaming the system. They literally have ripped off the American taxpayer wholesale and did so with Goldman executives on one side and former Goldman executives and stockholders on the other side.

 

It really is a marvel how well they've maneuvered through the maze of legalized corruption in the banking industry. A virus typically makes its host sick or kills its host. Goldman, instead, has convinced the host that it needs the virus to survive, and thus the host should hand over to Goldman anything it wants.

 

You really do have to be impressed.

[kapkomet]

A lot of these so-called profits this go round on the banks is due to the relaxation of mark to market accounting rules. I knew the banks would show a pretty healthy profit, if not for this reason alone.

 

[NorthSideSox72]

By the way, I'd just like to take a moment and express my astonishment at how amazing Goldman Sachs is at gaming the system. They literally have ripped off the American taxpayer wholesale and did so with Goldman executives on one side and former Goldman executives and stockholders on the other side.

 

It really is a marvel how well they've maneuvered through the maze of legalized corruption in the banking industry. A virus typically makes its host sick or kills its host. Goldman, instead, has convinced the host that it needs the virus to survive, and thus the host should hand over to Goldman anything it wants.

 

You really do have to be impressed.

I don't get this, at all. Goldman has paid back their government debt entirely, and early. They are now, again, a healthy IB.

 

I can understand the risk you see in having such large IB's as one piece, I agree with you there. I can also understand the anger at some of the things they, and to a GREATER extent others, did that led up to the financial mess we had and have. But your statements as to Goldman's manipulation are way over the top.

 

[StrangeSox]

A lot of these so-called profits this go round on the banks is due to the relaxation of mark to market accounting rules. I knew the banks would show a pretty healthy profit, if not for this reason alone.

 

So, in other words, its nothing but vapor.

 

Why was the M2M the cause of all this again? Because banks couldn't make up arbitrary values for their holdings?

[Balta1701]

I don't get this, at all. Goldman has paid back their government debt entirely, and early. They are now, again, a healthy IB.

 

I can understand the risk you see in having such large IB's as one piece, I agree with you there. I can also understand the anger at some of the things they, and to a GREATER extent others, did that led up to the financial mess we had and have. But your statements as to Goldman's manipulation are way over the top.

Getting people to pretend that the TARP funds themselves are the only thing that matters is part of the beauty of their corruption. They've been handed somewhere between tens of billions and hundreds of billions of dollars through all the other bailout programs going on, and all anyone pays attention to is the basic TARP funds.

 

Where would Goldman be had the government not handed over something like $13 billion to them as a major counterparty to AIG, which they were key to bringing down in the first place?

 

Where would Goldman be without the "TARP warrants" (No I don't know how to explain those) that still exist and still provide an explicit government backing of the banks regardless of whether they paid the handout-funds back? (And oh yeah, they're lobbying heavily to get the Treasury to buy those back at a huge discount)

 

Where would Goldman be without the FDIC guarantee that was given out to all the banks last fall that basically turned all of them in to AAA rated agencies because they're now backed by the full faith and credit of the government in anything they do?

 

Where would Goldman be without the who knows how much of the pie they've dumped on the Federal Reserve? The Fed has taken on at least $2 trillion or more in pieces of the big s(*^pile and handed out cash for it, basically taking the losses themselves. The Fed has refused to disclose who has received this money and how much each one has taken on?

 

Where would Goldman be if the government hadn't allowed its major competitors to fail?

 

Where would Goldman be if it wasn't profiting hugely off of the TARP repayments? (Any company that wants to repay its TARP funds needs to raise capital. Who is the only company left standing who can help them to do that? You guessed it. Frank Stallone)

 

Where would Goldman be without the ban on Short Selling the government gave out last year that they lobbied hard for?

 

Where would Goldman be if they weren't one of the few companies in the world that is a primary dealer of U.S. treasuries? We've sold off a few of those over the past year for some reason.

 

And beyond that, where would Goldman be without the implicit guarantee that the government has given to all of these institutions that the government won't let any bank that is too big to fail actually fail again? (thus, they've gone right back to doing exactly what they were doing before the bust, making huge, overleveraged bets and running away with the profits as fast as they can before things go bad. Their instutition-wide leverage has actually increased by about 30-40% since last fall since they now realize they've got this explicit government guarantee that they can't lose money)

[kapkomet]

So, in other words, its nothing but vapor.

 

Why was the M2M the cause of all this again? Because banks couldn't make up arbitrary values for their holdings?

I never did post my award winning post about this. Something about getting fired from my job and getting all wrapped up in that.

 

The "banks" argued that FASB (the accounting standards board for US) was forcing them to write down assets to an arbitrarily low value. That's the short answer. So now that the value can be set to "market value (whatever that means, hence the problem)" again, they are seeing "gains" from their balance sheets.

 

That's a waaaaay simplistic answer, there's obviously much more to it.

[Balta1701]

I never did post my award winning post about this. Something about getting fired from my job and getting all wrapped up in that.

 

The "banks" argued that FASB (the accounting standards board for US) was forcing them to write down assets to an arbitrarily low value. That's the short answer. So now that the value can be set to "market value (whatever that means, hence the problem)" again, they are seeing "gains" from their balance sheets.

 

That's a waaaaay simplistic answer, there's obviously much more to it.

And to oversimplify it further...since the Feds have effectively declared that the big guys can't take any more losses on this stuff...the value for them is arbitrarily inflated (Wells Fargo just sold off a chunk of their sh*tpile for $.30 on the dollar and that was probably a high price, for example.)

[Cknolls]

Getting people to pretend that the TARP funds themselves are the only thing that matters is part of the beauty of their corruption. They've been handed somewhere between tens of billions and hundreds of billions of dollars through all the other bailout programs going on, and all anyone pays attention to is the basic TARP funds.

 

Where would Goldman be had the government not handed over something like $13 billion to them as a major counterparty to AIG, which they were key to bringing down in the first place?

 

Where would Goldman be without the "TARP warrants" (No I don't know how to explain those) that still exist and still provide an explicit government backing of the banks regardless of whether they paid the handout-funds back? (And oh yeah, they're lobbying heavily to get the Treasury to buy those back at a huge discount)

 

Where would Goldman be without the FDIC guarantee that was given out to all the banks last fall that basically turned all of them in to AAA rated agencies because they're now backed by the full faith and credit of the government in anything they do?

 

Where would Goldman be without the who knows how much of the pie they've dumped on the Federal Reserve? The Fed has taken on at least $2 trillion or more in pieces of the big s(*^pile and handed out cash for it, basically taking the losses themselves. The Fed has refused to disclose who has received this money and how much each one has taken on

Where would Goldman be if the government hadn't allowed its major competitors to fail?

 

Where would Goldman be if it wasn't profiting hugely off of the TARP repayments? (Any company that wants to repay its TARP funds needs to raise capital. Who is the only company left standing who can help them to do that? You guessed it. Frank Stallone)

 

Where would Goldman be without the ban on Short Selling the government gave out last year that they lobbied hard for?

 

Where would Goldman be if they weren't one of the few companies in the world that is a primary dealer of U.S. treasuries? We've sold off a few of those over the past year for some reason.

 

And beyond that, where would Goldman be without the implicit guarantee that the government has given to all of these institutions that the government won't let any bank that is too big to fail actually fail again? (thus, they've gone right back to doing exactly what they were doing before the bust, making huge, overleveraged bets and running away with the profits as fast as they can before things go bad. Their instutition-wide leverage has actually increased by about 30-40% since last fall since they now realize they've got this explicit government guarantee that they can't lose money)

 

 

Not to mention the fact that GS is technichally a bank but I did not see anything about how many loans they issued in the 2nd quarter.

 

 

How about GE? They are, IMO, the biggest beneficiary of this gov't bailout. They have over issued somewhere in the neighborhood of $75 billion in commercial paper with the full backing of the gov't. With a ton more to come. GE should be forced to spin off GE Capital with the rest of their commercial paper float as the govt's leverage. Let's see how much influence Immelt really has in this administration.

 

Also, I believe GE marked their commercial real estate loans at 1.00 in their earnings. Are you serious??? GE remains a problem

 

[NorthSideSox72]

And to oversimplify it further...since the Feds have effectively declared that the big guys can't take any more losses on this stuff...the value for them is arbitrarily inflated (Wells Fargo just sold off a chunk of their sh*tpile for $.30 on the dollar and that was probably a high price, for example.)

If the assets are actually sold, then whatever price they get is by definition the market price. So that is a non-issue in that case.

 

As for the stuff sitting on their books, its very, very different for different asset classes. Exchange-traded investment instruments with reasonable levels of open interest, or even OTC stuff with good liquidity, are just fine on MTM. Its the illiquid, exotic and one-off contract type stuff where MTM is an utter fail.

 

[Balta1701]

Not to mention the fact that GS is technichally a bank but I did not see anything about how many loans they issued in the 2nd quarter.

 

 

How about GE? They are, IMO, the biggest beneficiary of this gov't bailout. They have over issued somewhere in the neighborhood of $75 billion in commercial paper with the full backing of the gov't. With a ton more to come. GE should be forced to spin off GE Capital with the rest of their commercial paper float as the govt's leverage. Let's see how much influence Immelt really has in this administration.

 

Also, I believe GE marked their commercial real estate loans at 1.00 in their earnings. Are you serious??? GE remains a problem

Is GE paying out $20 billion in taxpayer subsidized and guaranteed profits to its employees? If they are then they're annoying me too. GS is at the top of the list because they're raking in the dough, giving it out to themselves...and all the people who are making decisions for the government happen to be ex Goldman employees or GS stockholders.