Thursday, May 29, 2008
Good charts on oil, housing, banking stocks, mortghage finance, bond insurers, and gold
Market Oracle: Imminent Banking Stocks Destruction
The totally unreported story lately is that banks face larger losses, as housing prices continue their historic decline, ensuring profound additional bond losses. Banks have openly admitted it. Watch for the bond insurers to basically go bust, belly up, after failing to replace their capital core. The charts tell the story. The financial press networks do not, as they continue to obey their advertisers who pay the bills and dictate the messages, even if totally false. This USGovt Administration might do well to formalize a new cabinet post, Secy of Information, in keeping with a tradition started seventy years ago in Berlin
Posted by sold 2 rent 1 @ 12:32 PM (432 views) Add Comment
8 Comments
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1. sold 2 rent 1 said...
"The bond insurer MBIA is the largest, and it is doomed to go bust in dramatic fashion. This event is written in stone. If not the downgrade of its own corporate bond rating, then surely their payouts on failed mortgage bonds will kill them. The former makes recapitalization impossible, while the latter drains them into bankruptcy. As MBIA and its small group of competitors go down in flames, the bank industry will entire utter turmoil of unmistakable terms. Calls will be made for nationalization, as in USGovt takeover of bond insurance. Such calls will join those for the mortgage Resolution Trust Corp. While the self-serving nitwits in Congress argue with the syndicate representatives in the Administration, the national home equity and bank capital will continue to tragically burn. THE NATIONAL RESPONSE WILL BE MONETIZATION OF BANK AND EVENTUALLY HOME EQUITY BANKRUPTCY AND INSOLVENCY. Gold & silver will skyrocket as policy kicks into gear during desperate times. The irony, another black eye to the financial sector, is that MBIA will likely continue to bear a shiny AA or AAA rating, even as it goes bankrupt. That is a fine closing statement for this article."
2. rickyb said...
Does anyone else ever get the impression that s2r1 wants us all to buy gold with our hard earned savings?
3. lvmreader said...
@S2R1,
Can you post a chart of the last 50 years of oil price vs Gold price? This would illustrate the destruction of the purchasing power of the Western Currencies rather well.
4. sold 2 rent 1 said...
rickyb,
Time is running out to protect your savings.
GBP is going to crash
Of course you know best eh
5. sold 2 rent 1 said...
lvm,
6. sold 2 rent 1 said...
The graph really shows the USD debasement.
If you keep your money in fiat currency, it will eventually become worthless.
Rickyb, stay in your bubble world if you want to.
7. rickyb said...
It seems I hit a nerve.
8. shipbuilder said...
I don't think anyone is arguing about the devaluation of currency - but isn't the only thing that makes gold a store of wealth the only thing that makes fiat money a store of wealth - belief by a large amount of people?
What if they pick something else? Is this the idea of the gold-ramping by investors, to create that belief?