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Captain Coma

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Everything posted by Captain Coma

  1. The FTSE at 2500 seems absolutely certain now. I've been saying it for months and it's right on schedule. Roubini said the other day that stockmarkets were as overvalued as property, and my opinion is that houses are going down 70% from peak (some maybe further) ...
  2. "Governments don't set interest rates, people with money do." It's really worthwhile reading in full the two threads over at Market Ticker listed below. They refer to the current disclocation (i.e. starting today) in the US Treasuries market, i.e. nobody wants to buy them, so they have suddenly been massively discounted, i.e. the US Gov isn't good for the money. What that means is the gov has to pay more to borrow, and that means much higher interest rates, which will destroy the housing market there (and it's coming here). Things haven't really started yet, but this could be the big one. UK in same (worse) position. Give it a couple of weeks, maybe less. Mortgage rates are going to get a LOT higher. The threads: http://www.tickerforum.org/cgi-ticker/akcs-www?post=66034 http://www.tickerforum.org/cgi-ticker/akcs-www?post=66049
  3. Make him read this: http://www.thisislondon.co.uk/standard/art...ster/article.do (from thread #1250617)
  4. This from the comments on the Telegraph article, by "Antoine", at 12:16 PM, if you think I'm pulling yer leg ...
  5. Cheers for that - what would you recommend? (It's correct on the DJIA, incidentally, now below 10,000.)
  6. What's going on? The BBC says the FTSE is down 6% but according to my chart (Yahoo, up to date) it's only 3.3%. Is there a rational explanation for this discrepancy or is the Beeb trying to stir things?
  7. Before a slump appears imminent and unavoidable, interest rates positively affect stock prices, but later, projections of growth influence sentiment negatively, so it's doubtful a dramatic lowering of interest rates would do anything but lead to a run on Sterling now, and LIBOR would ignore it under present conditions. As Nouriel Roubini put it last November: http://www.rgemonitor.com/blog/ He also said last week that stocks are as over-priced as houses, so another 30-50% to go? FTSE at 2500? You may laugh ... PS I know you were referring to the USA
  8. It's not every day you see a smart guy lose $8 billion.
  9. True, true, it's war by other means. "A la guerre comme a la guerre", as the man said.
  10. My guess is that it had to be large enough and dramatic enough to be plausible as a one-off hit. That was the disguise. The way the media have utterly missed the fact that it is a credit facility and not a single lump is beyond belief. Those that describe the bailout as treason are saying that the way forward is for the USA to default on its debt - in other words, to call China's bluff and say that they are not going to pony up a single plug nickel. There is virtue in this to the extent that, if China, Saudi, etc, did carry out the threat to dump their increasingly worthless T-Bills, it would not only destroy the dollar but their own economies as well. So bluff should be called by double bluff. What is annoying the folks at Market Ticker (who, it should be said, have howled at the whole bubble all along and can't be blamed as going along with the debt catastrophe: they are almost all fiscal conservatives from what I gather), is that in this game of Prisoner's Dilemma, the US is blinking first and rapidly. They want to say to the foreign debt holders, "Do your worst and see what happens". That Bush and the Fed (and now the Senate) are such cowering wimps is excruciating to them. We'll see if Congress can stand up and say "War? You want War? OK then ..." tomorrow.
  11. They're having kittens about this over at Market Ticker. Point 1 (correct as I understand it) is that the $700bn is not a fixed amount but a credit line, the key phrase being $700bn "at any one time". In other words, a money-laundering operation for the banks (or select banks of Paulson's close acquaintance). It works as follows: Fed buys toxic bonds above market price, say at 50% of "maturity", then resells them at say 30%. On a $1m bond a bank launders $200k. Rinse and repeat ad infinitum at taxpayers' expense. Point 2 is the kicker: foreign countries have the right to sell toxic debt to the Fed. They don't even have to have a company with an office in the USA. That means all the underwater worthless CDOs etc held abroad can be sold to the US for real money, so the US gets gang-banged indefinitely. Why the hell would Paulson insist (and insist is the word - he has threatened to veto the whole thing if this isn't allowed) on this rape of America? The belief is that the entire rescue package constitutes a huge "margin call" on US foreign debt. They've sold crap to the Chinese and Arabs, who now hold it on their balance sheets, and therefore hold the US to ransom: were they to divest it, the dollar would be history. Solution? Buy our crap and suffer. Or else. Karl Denninger calls it economic war (by China). Some on Market Ticker reasonably point out that it was the US that sold all the toxic crap and destroyed the dollar themselves, so how can they complain? Nevertheless, such a move marks the beginning of the end for the US and they ain't liking it!
  12. That was exactly my point. But Blair could have refused to go and he didn't. Neither did Smith back him up at the Home Office. Ergo there was some bad stuff which meant he had to go or have something very nasty revealed. Otherwise there would have been plenty of mileage in it for NuLab Blair to stand up to the "Tory toff", correcto?
  13. Yes Eric, and considering the fact that even a 50% deposit gives a lender little security against capital erosion, that means that prices are going to come down so quickly even us bears on this site might be unprepared for the shock of it. Hurrah!
  14. What's interesting is that Boris had no powers to fire Blair; only the Home Secretary can do that. Therfore Blair knew that Boris had the goods on him and had to resign - wouldn't have done so otherwise. Smith had to accept the resignation ("with regret") because she knew the political sh*tstorm that would have come out if Blair had made a stand. Whether it was the £15k to Blair's pal to "improve his image" or some other bung is not clear (I love Boris's line that it was no single transgression that tipped the balance, as if there were so many instances to choose from!), but it was more worthwhile for Blair to throw in the towel than defend himself and see his reputation ruined. That's the hard, cruel math of the case. Oh, happy day - the true beginning of the end of New Labour and a decade of the rule of the sociology lecturers' theory of the universe! Ahoy hoy.
  15. You are Richard Hammond and I claim my £5!
  16. My MOT was £80 last year with almost nothing done to the car, and I'd expect it to be about £90 this year under the same circumstances, so it sounds about right. Let you know in a couple of days ...
  17. Since we're on the subject, here's some advice from Lorna Bourke in yesterday's Evening Standard property supplement (I normally try to avoid it - "one-bedroom flat Belsize Park, superb potential for refurbishment [!], only £490,000", etc), but for hilarity it takes some beating. This is from an article titled "Positive thinking" on how falling equity is just fab: (not yet up on the interwebulator, so no linky) I don't quite know where to start with this! If they still have 10% equity left (i.e. £15,000 on a house now worth 150K, having lost, I suppose, £50,000 of equity already), it constitutes under 7% of a deposit for the more expensive place they now want. How does that work? Or am I missing something? Anyway, get out of trouble by trading up! Housing market saved!
  18. There was a very good thread started by ExtraDry Martini the other day when the bailout (bale out?) was first mooted, and he did a good job of both explaining and defending it, I thought. But that was before these damning details came to light (and if you haven't yet, then do read Karl Denninger's line-by-line analysis of the proposed Act). I wonder, if he is out there, whether EDM would change his opinion now we've all had a chance to look at what really does seem to be, right now, an attempt at a coup d'état by the banks, with GS at the head of the gang.
  19. http://www.tickerforum.org/cgi-ticker/akcs-www?post=61312
  20. The very act of buying HBOS means that LloydsTSB has taken a massive bet that house prices can only go up by a hell of a lot over the next 12 months. Because if they don't, the collapsing assets against which HBOS has lent will mean that LloydsTSB has just signed its own death warrant. Unless, of course, Gordon has guaranteed all possible losses with taxpayers' money ... (If I was Lloyds I wouldn't have gone near the deal otherwise). So if it's tax payers' money that they'll be p*ssing up the wall then there is of course nothing wrong with 95% mortgages.
  21. The question is are we surprised by recent events. I feel as if I'm not, and checking back over old posts I found this, from precisely a year and a day ago, where I wrote (re Lehman Bros): Well, Lehman has now gone, only GS and MS left standing, the latter tottering as we speak, and I wouldn't trust GS further than I could throw them. My thoughts were nothing special at all - they were informed by Karl Denninger ("If one big brokerage goes there is a very significant risk that they all will."), and lots of us did think all this would happen. We think this is still only the beginning in fact. More prosaically, concerning house prices ... 70% down now looks cautious. Yeah, ban short sellers, that'll fix everything. Yeah, set up a big dump for all the toxic balance sheet debt - the new strategy: debt is no longer debt!!! (Like Lehman's desperate "Good Bank/Bad Bank" idea of last week, ha ha.) That'll work for sure. Pillocks.
  22. They just said on telly that US treasuries have gone negative on yield. So, if you buy a $100 three-month T-bill now, you'll get about $99.70 or thereabouts just before Christmas. The market thinks this is the safest bet around. Be afraid ...
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