Charlie Rose

winter  05/20/2011 11:13 AM Report

Feldstein is the beneficiary of a sort of employment Ponzi scheme since his advocacy of deregulation has gotten us to where we are in the economy yet somehow he stays afloat and is listened to. If results are any measure of competency then his outlook should be relegated to the dead letter file but since it did work for his contitutency he remains as someone people interview and listen to. I guess he "talks" a good game but out on the court ...worse than nothing.

Ricardo_Amaral  11/15/2010 11:27 AM Report

November 15, 2010

The US$ 27 Trillion dollar question??????

The US dollar has reached the end of the road after a long ride that lasted over 60 years - From the Marshall Plan days around 1946 to the Ben Bernanke QE1 and QE2 also known as the "Confetti" days.

The enclosed information I posted on the Elite Trader Economics Forum in January 2008 - since that time the United States government has added at least another US$ 5 to US$ 7 trillion dollars to the over-supply of US dollar...s circulating outside of the United States.

In November of 2010 there is an estimated $ 27 trillion US dollar in circulation in the world and most of them are in the form of electronic computer-credits. Only about five percent is in physical cash form. Half of those $ 27 trillion dollars float around the world outside of US borders and outside the US economy.

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January 10, 2008

SouthAmerica:...Here is some food for thought regarding the US dollar:

…Today over 70 percent of US currency circulates outside the United States. The major holders of this currency are the euro countries, Japan, China, Hong Kong, Taiwan, South Korea, Indonesia, and Singapore. (We are talking about trillions of US dollars.)

Over 70 percent of the US dollars ever created are flying around the world completely outside of the power and of the influence of the US government including the US Treasury and the Federal Reserve Bank.

…About 75 percent of the US dollars circulating outside the United States are in the hands of these few Asian central banks, and if any one of these countries decides to sell their US dollar monetary reserves to buy gold it will produce a stampede to exit the US dollar, creating a gold and euro buying panic.

… This oversupply of US dollar circulation outside the United States might prove to be the Achilles heel of the US economy and also can become a nightmare to the Federal Reserve. The Federal Reserve would need to raise interest rates in the US, creating a major problem for the US economy and the financial markets.

As of 2007, the US dollar still has the largest share (65.7%) of foreign reserve holdings by central banks from around the world, and the Euro has only a 25.2% market share.

In 2008, the current global currency composition of official foreign exchange reserves includes the US dollar with about a 65 percent market share and the euro has about a 26 percent market share – and combined these 2 currencies accounts to 91 percent market share of official foreign exchange reserves held by central banks around the world.

Here is another issue to keep in mind: the global financial system has been very creative and dynamic for many years and today there is an estimated 20 trillion US dollar in circulation in the world and most of them are in the form of electronic computer-credits. Only about five percent is in physical cash form. Half of those 20 trillion dollars float around the world outside of US borders and outside the US economy.

If we have a major international monetary crisis in the near future and a large portion of that half of the global floating US dollars suddenly returns to US shores, instant hyperinflation in the US would be the result and also the collapse of the current international monetary system.

The day the world loses faith on the future value of the US dollar and the US economy - that's the day when the Titanic will hit the iceberg and sink.

http://www.elitetrader.com/vb/showt...rld#post1742934

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JohnGelles  11/14/2010 06:47 AM Report

Who -- at UMKC? Mathew Forstater. He teaches economics there with others who understand functional finance. He will explain that money must have a purpose if you expect it to do something favorable for our nation. The same is true for all nations. Money without a purpose is never enough to solve our millennial problems which are obviously to end poverty, pollution, waste, intolerable corruption and ignorance. Money can be created to meet our needs. Debt can be reorganized to remove it from jamming the gears of our economic engine. People can be informed if Charlie Rose goes back to school. He never died when he had the chance. Now let him justify his luck. He has been fiddling while Rome is burning. Are their no mirrors in the place where he lives?

JohnGelles  11/14/2010 06:32 AM Report

The youtube cartoon Ricardo recommended was very funny and more or less reasonable. If you believe Bernanke is right (as I am confident he is,) and his critics are wrong, you have little choice but to wait for the time it will take for the American and global economies to get worse.

If, instead they get better, you may be able to see if QE was the main reason (as I believe it will be). Of course the present question is whether 600 billion is enough. The actual need is for spending of many TRILLIONS (not hundreds of billions), for demand to meet the supply necessary for full employment.

As I read them, the comments submitted by others did not even mention full employment at fair wages and sufficient real results to end poverty and pollution where possible, as our goal.

In fact, the comments were not goal oriented. They were in my view even more stupid than Feldstein and all the guests who also never define the right goals.

It is a crying shame that the Rose Show does not ask for full employment, full production and consumption of the necessities of life that economics and money are supposed to make possible NOT IMPOSSIBLE.

Obama and his ignorance in the face of our unmet economic priorities is a disaster in midstream. I keep waiting for him wake up. It does not happen. India was OK. Korea was a flop. And only Bernanke seems to be desperate enough to TRY a little more money printing. But it certainly is far from enough to get us to maximum output and adequate demand in the pocketbooks of people now in need for circumstances wholly unrelated to their merit.

It is the lack of merit in our leaders and all the voices here against Keynesian solutions that ought to be punished. Our workers want to contribute the productivity we need. But the wealth that evaporated since 2006 has overwhelmed all means we had to re-finance our economy. Don't you idiots see that? I know some of you do see some of the true picture. Why don't you join with me to tell Rose he needs to do better or quit. He has had three years to interview the right people -- from the University of Missouri Kansas City. And he keeps on interviewing baboons.

Ricardo_Amaral  11/13/2010 08:09 AM Report

My message about currency has been getting through "loud and clear" to Guido Mantega the Finance Minister of Brazil, and to other top leaders of the Brazilian government.

This video gives a very good explanation regarding QE1 and QE2.

In a Nutshell:

Quantitative Easing Explained

http://www.youtube.com/watch?v=PTUY16CkS-k&feature=player_embedded

*****

Goldman Sachs is it a Cancer or just a Parasite of the US financial system?

http://www.elitetrader.com/vb/showthread.php?s=&threadid=195957

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doodah  11/13/2010 06:11 AM Report

REMant,

Youtube - "money as debt".

Yes, they are cartoons, and start out very elementary, but evolve into 'revealing insight' (at least for me, it did). I think it would interesting for you as well.

Ricardo_Amaral  11/12/2010 11:30 PM Report

You need to be patient regarding the current real estate market in the United States.

If wait until the QE15 government program – then you will be able to get the house for free.

If you wait a little longer for QE16 government program – then you will be able to get the house for free, and the government will also pay for all utilities for the year - as an incentive for the government to be able find takers to move some of the inventory from the Fed's balance sheet.

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Ricardo_Amaral  11/12/2010 11:22 PM Report

The truth is the figures that these guys dreamed up doesn't mean anything.

If you read many of my articles and postings then you would know that I used to say that the Chinese would be able to wallpaper the inside of every house in Asia with US $ 100 dollar bills.

Then about 2 years ago I saw Warren Buffet saying something similar, but instead of wallpaper he used the word confetti.

Today China has an over-supply of Confetti taller than Mount Everest.

It is not that the new prices are inflated here in the United States – the truth is the real value of the US dollar has gone to hell on a hand basket, and that reminds me of a joke:

A fellow had been in a coma for a few years, then he finally woke up from this coma, and the first thing he wanted to do was to call his broker to find out how his investments were doing.

The broker answered and said I have very good news for you: you just became a millionaire.

At that point, the conversation was interrupted by the phone company and a voice announced: please deposit US$10,000 dollar to continue your conversation for another 5 minutes.

*****

I mentioned on the enclosed posting that the value of the 1947 US$ 1.00 – in 2008 that US dollar was worth only $ .09 cents that is how much of the value of the US dollar has evaporated because of inflation.

But the real value would have been even lower if the Reagan administration had not changed the way they calculate inflation – if they had not changed that inflation calculation then the value of the 1947 US$ 1.00 – in 2010 would be worth only around $ .02 cents.

The way things are going, In the future the US dollar will be traded by the kilogram of US$100 bills in international transactions.

Here is what I posted on the Elite Trader Economics Forum in early 2008 as follows:

There are many reasons for the decline of the US dollar, and here are just a few of them:

First, we have reached the end of the line for the US dollar currency supremacy, and that has to do among other things with the economic and geopolitical changes that we had in the world since 1945.

The US dollar served its purpose since the end of WW II and became the major foreign exchange reserve currency for the system that emerged after the war. The days of the US dollar playing that special role that created an international monetary system that revolved around the US dollar as its main currency – that system is very sick and it is dying a slow death.

Very soon the world will need to put that patient out of their misery, and after the major collapse of the US dollar finally arrives creating the biggest international monetary crisis the world have ever seen – a real US dollar global meltdown – from the ashes of the old system it will emerge the new international monetary system that it will be more useful for the first century of the new millennium.

The US government and Americans in general lost sight of the role that the US dollar has been playing in the world international monetary system since 1945 when the US dollar started becoming a part of the foreign exchange reserves of many countries.

When a currency achieves that status of a major reserve currency the world expect at a minimum that the currency would be managed in a way to protect its intrinsic value over time.

That is not what has been happening to the US dollar for a long time. The value of the 1947 US$ 1.00 – in 2008 that US dollar is worth only $ .09 cents that is how much of the value of the US dollar has evaporated because of inflation.

Since the US dollar became the center of the international monetary system – an unusual place for any one country's currency to stay for a long period of time – the world has changed in drastic ways during all these decades resulting in a system that it is completely broken today and ready to be replaced by a new system that represents the new circumstances that have evolved.

Today we have too many US dollars flying around the world an over supply of US dollars that can be considered more as a massive bubble than a currency that can be justified by the prospects of the economic performance of the United States in the coming years. (Today over 70 percent of the US dollar currency ever created if flying around the world outside the circle of influence of the Federal Reserve and the US government.)

Since 1975 the United States has added $ 10 trillion dollars to the supply of US dollars flying around the world. (an economist specialized on the international currency market mentioned that fact on Bloomberg News on television 2 days ago.)

Today, the United States are not masters even of its own currency, since the accumulation of US dollar reserves by other countries around the world – have transferred a lot of the economic policy powers from the United States to other countries.

Today China and Japan have become the masters (since they hold a large chunk of the US dollars flying around the world) and the United States needs not only that these countries keep lending money to keep the US economy afloat, but the private sector in the US also has started collapsing and they need the inflow of money from Foreign Sovereignty Funds and other Chinese sources of money to keep major financial institutions afloat in the United States.

The currency of other countries are going up versus the US dollar because their governments have a more responsible monetary policy than the US government regarding deficits and so on – that’s why the currency of countries such as Brazil is going sky high versus the US dollar.

Brazil has never been in such a great financial shape as in 2008 – not only Brazil’s foreign debt has been paid, but Brazil has about $ 200 billion dollars in foreign exchange reserves on hand, and for the first time on its history Brazil has become a credit nation in January of 2008 - and Brazil has gone from a borrowing country to a lending and investing country.

You also said: “No one is pulling out of the dollar, otherwise interest rates would be sky high.”

The Chinese and the Japanese among a number of countries that are heavily invested in US dollar assets – these countries are stuck with their accumulated US dollar assets and they can’t afford to diversify out of this mess. They are watching their investments turning into confetti and if they start getting out of the US dollar then they can cause a stamped and the financial meltdown that I am talking about.

The question is: which central banker will spook the herd and start the Panic?

I guess central bankers in Asia very soon they might be getting to the point very that they can’t justify adding more US dollars to their foreign exchange reserves and they have to stop accumulating their US dollar assets any further – since these US dollars are turning into confetti – and when they do that they are going to influence the direction of interest rates in the US markets and interest rates will go sky high.

When a currency turns into confetti, interest rates go sky high.

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robdverity  11/12/2010 05:48 PM Report

We're a nation of children and are appropriately represented by the same. There's no way we will apply any of the grown-up measures set out in the recent study.

Our culture has been hi-jacked by the banking thuggery which will continue to exploit and re-exploit (so called moral hazard), which will export and re-export our dreary form of anything goes capitalism. Case in point close to home: the Mexican drug cartel internecine wars. Our appetite for both drugs and (easy) money for the big banks laundering it for the cartels, along with the gun sale profits. They profit going and coming.

The same scumbags that devised CDOs and CDSs are fueling Mexico's dilemma. Bernie Madoff needs company. The world (economy) is waiting. Incarceration of big bank CEOs would send an affirming signal of trust that the world's financial wise-guys were being dealt with proportional to their deeds (instead of obscene bonuses).

REMant  11/12/2010 11:49 AM Report

The problem re entitlements and most everything else is that we run it all on the basis of credit. Even if we had a balanced budget, it wouldn't balance unless the banks stopped manufacturing credit. It not only deters saving, it eventually makes it impossible. That more than any other reason is why we have had none. And it becomes difficult to convince ppl to even be responsible when everyone believes with just a little more credit we will be able to "grow" our way out of any problem. So I'd say if you are serious about reducing debt, not just govt deficits, start with the banks that create it, and the ppl who demand it. After that you can deal with tax expenditures, commonly called loopholes, by scrapping the tax code and enacting a flat-rate income tax. The GOP, represented by these gentlemen, may be in favor of the latter, but I doubt seriously they will to anything about the former. And the Dems would probably oppose both.

CarolJ  11/12/2010 11:34 AM Report

This video stopped at 11 minutes.