DC Tom Posted January 7, 2016 Share Posted January 7, 2016 I'll never admit to reading most of it. Of course not. Let's be honest: has it ever been worth reading when I've indulged gatorman's particular stupidity? Link to comment Share on other sites More sharing options...
keepthefaith Posted January 7, 2016 Share Posted January 7, 2016 Of course not. Let's be honest: has it ever been worth reading when I've indulged gatorman's particular stupidity? There is some entertainment value but you might consider indulging him less. It's a strain on the site. Link to comment Share on other sites More sharing options...
Deranged Rhino Posted January 12, 2016 Share Posted January 12, 2016 Hmm... https://www.sovereignman.com/trends/federal-reserves-net-worth-collapses-33-in-two-weeks-18532/ In the US, the Federal Reserve’s assets total $4.486 trillion, including more than $2 TRILLION in US government debt. The Fed also has total capital (i.e. net worth) of $39.5 billion. That sounds like a lot. Until you realize that it constitutes just 0.88% of its total assets. Not even 1%! This is a tiny, almost nonexistent level of capital at the Federal Reserve. Put another way, the issuer of the United States dollar, the most widely used currency on the planet, and the central bank of the largest economy in the world, has almost no margin of safety. This puts the entire global financial system at a tremendous level of risk. Central banks can and do go bankrupt. It happened most notably in Iceland back in 2008, causing an epic currency crisis in that country. So running the Fed’s balance sheet down to the nub like this is not exactly a consequence-free course of action. But what’s really astonishing about all of this is how quickly the Fed’s balance sheet deteriorated. And why. Just two weeks ago, the Fed’s total capital was nearly $59 billion. And even that wasn’t very much given the size of its balance sheet. Today it’s $39.5. This is an incredible 33% drop in just two weeks! Imagine your net worth collapsing by 33% in two weeks; it would probably be a huge personal crisis. Yet the Fed seems completely cool about it. I did some digging and found out why this happened. It turns out that Congress and the President passed a law last month called the Fixing America’s Surface Transportation (FAST) Act. We’ve talked about this one before– the FAST Act is supposed to provide funding for America’s highway system. But one of the provisions is that a US citizen can have his passport revoked if the government believes in its sole discretion that he owes too much tax. Crazy. And, buried deep within the nearly 500 pages of legislation is a neat little section demanding that Federal Reserve bank surpluses above a certain amount must be turned over to the United States Department of Treasury. In other words, the US government is so broke that they’re now confiscating assets from the Fed, putting the entire global financial system at even more risk. It’s genius! You just can’t make this stuff up. It’s so absurd it would be comical if it weren’t true. So, yes, it should be completely obvious by now that there is a tremendous amount of risk in the system. Governments are completely bankrupt. And even central banks now are being pushed into insolvency by the bankrupt governments they support. This is not a story that has a happy ending. Also, tangentially related, RBS is telling everyone to sell. http://www.theguardian.com/business/2016/jan/12/sell-everything-ahead-of-stock-market-crash-say-rbs-economists Link to comment Share on other sites More sharing options...
Chef Jim Posted January 12, 2016 Share Posted January 12, 2016 Also, tangentially related, RBS is telling everyone to sell. http://www.theguardian.com/business/2016/jan/12/sell-everything-ahead-of-stock-market-crash-say-rbs-economists So a 20% drop in one year of a market that has more than doubled in value over the past 7 years is cataclysmic? Hey RBS. STFU!!! Link to comment Share on other sites More sharing options...
TPS Posted January 12, 2016 Share Posted January 12, 2016 (edited) Hmm... https://www.sovereignman.com/trends/federal-reserves-net-worth-collapses-33-in-two-weeks-18532/ Also, tangentially related, RBS is telling everyone to sell. http://www.theguardian.com/business/2016/jan/12/sell-everything-ahead-of-stock-market-crash-say-rbs-economists This is the kind of **** that stokes conspiracy theorists. This guy doesn't understand how the Fed works at all. As the issuer of the nation's currency, the Fed does not operate like any other entity, nor should it. It's main function is to maintain stability of the financial system, and with its currency monopoly, it can do almost anything it wants, including operating with negative equity (this would've been the case when it bought all the bad **** from the banks during the crisis, as it was bought at market value, but was worth pennies on the dollar and carried at market value in various LLCs). It operates as an independent agency, but since it was created by an act of congress, congress can certainly change the act. It's well-known by anyone who follows this stuff that the Fed returns the interest it receives on its government bonds back to the Treasury, after it covers its costs and pays the banks a small dividend. This is why most people tend to exclude that $2 trillion in government debt held by the Fed when discussing the US government's "burden of debt". Edited January 12, 2016 by TPS Link to comment Share on other sites More sharing options...
GG Posted January 12, 2016 Share Posted January 12, 2016 So a 20% drop in one year of a market that has more than doubled in value over the past 7 years is cataclysmic? Hey RBS. STFU!!! It is cataclysmic because your base is last year, not seven years ago. Link to comment Share on other sites More sharing options...
Chef Jim Posted January 12, 2016 Share Posted January 12, 2016 It is cataclysmic because your base is last year, not seven years ago. I'm not sure I follow you unless you're being sarcastic. Link to comment Share on other sites More sharing options...
GG Posted January 12, 2016 Share Posted January 12, 2016 I'm not sure I follow you unless you're being sarcastic. A 20% drop in a year is cataclysmic, because very few funds care about where the market was seven years ago. You get scored on a YoY basis. Link to comment Share on other sites More sharing options...
VABills Posted January 12, 2016 Share Posted January 12, 2016 So a 20% drop in one year of a market that has more than doubled in value over the past 7 years is cataclysmic? Hey RBS. STFU!!! So if the market has double in 7 years, but we lose 20% this year, then at the end of the year the market will have been up only 60% from the basis 7 years ago. That obviously can't show what happened with any new investigates, but 60% over 8 years with that much risk isn't such a great investment. Link to comment Share on other sites More sharing options...
Chef Jim Posted January 12, 2016 Share Posted January 12, 2016 A 20% drop in a year is cataclysmic, because very few funds care about where the market was seven years ago. You get scored on a YoY basis. Oh cataclysmic to a manager's bonus and performance. But to a long term investment it's going to happen and happen several times. So if the market has double in 7 years, but we lose 20% this year, then at the end of the year the market will have been up only 60% from the basis 7 years ago. That obviously can't show what happened with any new investigates, but 60% over 8 years with that much risk isn't such a great investment. Not such a great investment is hardly cataclysmic. I'm mostly pointing at RBS's use of the work cataclysmic. Telling all their clients to sell all their equities is reckless. Link to comment Share on other sites More sharing options...
GG Posted January 12, 2016 Share Posted January 12, 2016 Oh cataclysmic to a manager's bonus and performance. But to a long term investment it's going to happen and happen several times. Not such a great investment is hardly cataclysmic. I'm mostly pointing at RBS's use of the work cataclysmic. Telling all their clients to sell all their equities is reckless. How is it reckless when their advice can save clients 20% of their equity assets? Especially when their clients are institutional investors. Link to comment Share on other sites More sharing options...
Chef Jim Posted January 12, 2016 Share Posted January 12, 2016 How is it reckless when their advice can save clients 20% of their equity assets? Especially when their clients are institutional investors. Because their institutional investors are not the only ones that will be getting/hearing their message. And what if their gloom and doom prediction doesn't happen and the market actually rises by 20%? If you're that concerned about a one year return on your investment you should not be in the equity market. Link to comment Share on other sites More sharing options...
GG Posted January 12, 2016 Share Posted January 12, 2016 Because their institutional investors are not the only ones that will be getting/hearing their message. And what if their gloom and doom prediction doesn't happen and the market actually rises by 20%? If you're that concerned about a one year return on your investment you should not be in the equity market. That's why their message is to their institutional clients, who are in the equity markets and are interested in one year returns. Individual investors should not be in the equity markets until they pass a proficiency test. Otherwise, they deserve to lose. Link to comment Share on other sites More sharing options...
Chef Jim Posted January 12, 2016 Share Posted January 12, 2016 That's why their message is to their institutional clients, who are in the equity markets and are interested in one year returns. Individual investors should not be in the equity markets until they pass a proficiency test. Otherwise, they deserve to lose. This is not the "good ole days" when messages like this didn't make it past their institutional investor clients. It is in the main stream media already hence blzrul's thread here. And that is why I called it reckless. Link to comment Share on other sites More sharing options...
GG Posted January 12, 2016 Share Posted January 12, 2016 This is not the "good ole days" when messages like this didn't make it past their institutional investor clients. It is in the main stream media already hence blzrul's thread here. And that is why I called it reckless. And as I said in the other thread. If they don't sound the alarm, and stock drop 20%, they'd get killed for not predicting the doom. Let's rewind to 2005-2006, when soprogs didn't want to hear any bad news about a real estate bubble because it would incite a panic. Link to comment Share on other sites More sharing options...
Tiberius Posted January 13, 2016 Author Share Posted January 13, 2016 Hmm... https://www.sovereignman.com/trends/federal-reserves-net-worth-collapses-33-in-two-weeks-18532/ Also, tangentially related, RBS is telling everyone to sell. http://www.theguardian.com/business/2016/jan/12/sell-everything-ahead-of-stock-market-crash-say-rbs-economists Well, look at who is still retarded The government is confiscating assets of the Fed? Link to comment Share on other sites More sharing options...
Chef Jim Posted January 13, 2016 Share Posted January 13, 2016 Well, look at who is still retarded The government is confiscating assets of the Fed? Oh and look who's back. The petulant name calling child. Link to comment Share on other sites More sharing options...
B-Man Posted January 13, 2016 Share Posted January 13, 2016 Oh and look who's back. The petulant name calling child. Now, now, give Gator a chance. Maybe his first sentence , marking his return, was kind of a self revelation............... . Link to comment Share on other sites More sharing options...
Tiberius Posted January 13, 2016 Author Share Posted January 13, 2016 Oh and look who's back. The petulant name calling child. You just called me a name, hypocrite Link to comment Share on other sites More sharing options...
DC Tom Posted January 13, 2016 Share Posted January 13, 2016 You just called me a name, hypocrite No, he didn't. You are petulant. Link to comment Share on other sites More sharing options...
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