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Blunt Force Trauma

"I got a new Dewalt drill for the price of buying 2 battery packs and this includes two battery packs!"

Me too! I guess it's a Home Despot-wide sale. In the Toronto area, the 18v is on sale at 149.99 (save 80 bucks). Methinks you paid a lot less than that.

What gets me is that the 'Loonie' is almost 6 cents greater than the 'Green Back' and Canadians still pay more for (the same) goods than the U.S. consumer.

Teddy

A few weeks ago, I posted about the stress of a global economy on the finite resources of the planet including food whose prices are rising worldwide and even in Japan. Now comes an article out of Tokyo today about a food-safety scandal in Japan. It seems that a lot of food companies there are using "outdated ingredients or falsely labeling their products, threatening Japan's reputation for impeccable sanitation". Sound familiar? Yesterday, there was a report that China is using 99% of their available farmland to feed its people, yet the land available is going down due allocation for building, to pollution and depletion of water, and global warming.

Cato

Commercial Mortgage Backed Securities
All the analysts are once again insisting - "no problems here". This is the next shoe to drop. Forget bank problems, more like bank failures.

Like MBS, but instead backed by loans secured with commercial property. Property includes retail, office, multi-family, etc., Not standardized. CMBS contain many complex details pertaining to structure, credit enhancement, diversification, etc. that need to be considered, understood or may not be clearly disclosed when valuing these securities.

http://www.cmalert.com/Public/MarketPlace/MarketStatistics/
index.cfm
http://www.markit.com/information/products/cmbx.html
http://www.markit.com/information/products/cmbx/history.html
http://calculatedrisk.blogspot.com/2007/10/cmbx-indices.html

Elaine Supkis

I visit MarkIt frequently. The numbers there are horrific. I can't believe my eyes sometimes. What was a plus at $100 a share are now dropping to $17 a share or less!

Teddy

Elaine, for the US to be the new carry trade, it would have to have a surplus in savings which would show up in a trade surplus. We not only have a enormous shortage of savings as witnessed by our humongous trade and current account deficits, we now have a negative savings rate among the people as well as the government with only corporate America having a surplus in savings. Japan has a huge trade surplus which means the country itself has a net, net huge savings rate. The red ink is due to the forced savings on their people by the Warlords involved in the carry trade. The red ink is internal, not external debt. They owe it to themselves. Japan owes "167% of its income" to ........itself. Actually, don't you think it's time for the carry trade to unwind with its consequent reduction in Japan's internal debt causing their trade and current account surpluses to shrink as the yen goes dramatically go up in value, and for Japan to enjoy itself and reward its people?

Al

Teddy,
you mentioned "forced savings". How can that be ? I read once that Japan does not have much of a social safety net, particularly for retirement so people are forced to save a lot for their old age. Is that the forced savings you refer to ?

Teddy

Al, the Japanese are by culture a nation of savers. However, awhile back, Elaine mentioned that the Warlords have in recent years changed the rules and will NOT allow the banks to make loans for consumption by its people for anything but the most basic needs, even for the younger generation. So if you cannot spend as much as your income, even if you now earn the same amount or less in nominal terms than previously and certainly less when adjusted for inflation, then this is the forced savings I am talking about.

Katya

Teddy,

Can you share a link to your post?

Katya

Elaine,

Are you building a place? My current dream is to build my own $50K house since it doesn't look like we will be fleeing to Canada real soon.

Saw your post re:fleeing the country. Seems to me that many in the U.S. fled here from something less than ideal. Sad to think of the process reversing. That said, our looking at fleeing isn't about us as much as it is about our 2 year old.

I had grandparents that survived the Depression - one was abandoned at a hospital by his family because they couldn't pay the bill for his treatment. He was sent to an orphanage then later ran away, did time in prison...not a happy story.

K

BTW, I can't friggin' believe that only 29% of Americans polled think that attacking Iran is a bad idea! A U.S. attack on Iran would be a serious alarm bell for me.

OC

Singapore is very similar to Japan in the late 80s...u need at least $3000 monthly income per person (approx) at that time when average middle class income is $2500 (approx) to get a credit card.
U don't qualify for the credit card even if you have $100,000 savings in the bank if you don't have the minimum salary of $3500/- per month.

CEO Nutcracker

Canada is looking very much an option. Being a dual citizen makes it quite an obvious choice for me. What are the downsides to moving there? They are commodity rich, while we are sooo very poor. Hopefully they are not deeply connected to our wiseguy Wall Street pirates, who have frigged up the economies of their allies and ours. Only commodity rich countries will withstand our Imperial implosion. And China of course. HAHAHA

Sounds like most people blogging here are terrified not by Iraq, Iran or Afghanistan, but their very own puppetmasters.

"We have met the enemy and he is us" -Walt Kelly!

Elaine, I agree with most bloggers that it is time to pull the plug and stop rescuing this stinky regime. People with the wherewithal to move on should do so and let it rot. Supplying more money is a rescue op, and is no longer a viable option. It will just continue to fuel more WWVVIIII######'s. That is the Neocon plan, afterall!

Elaine Supkis

Classic fight or flight. I am a fighter.

Yes, the drums of war are being beaten like crazy. People are told by TV that all is well in Iraq now, can you imagine that? And that all we have to do is carpet bomb Iran and we win total world domination and Iran won't carpet bomb the Saudi and other oil fields, right.

As for the carry trade: in Japan, the cheap loans are for the industrialists but they can weaken the yen by letting outsiders use these loans. The US can do the same. for the money being lent is NOT SAVINGS OF ANY SORT. This is inflationary money created by the central bank itself! If none of this stays home, if it goes strictly overseas, then the central bank can merrily grind out more and more money with total impunity.

Teddy

Elaine, the US could not conduct a carry trade to any great extent or over anymore than a short period of time because we have no savings to loan out and to attempt to give out loans to foreign countries w/o using some other, different foreign country's savings, would require creating money out of thin air and result in a complete collapse of the dollar and hyperinflation in the US in a very short period of time. We can get a loan from another country with savings and then loan it out to a different, foreign country, but in essence, this is not a carry trade. We can get a loan from another country and then use it for foreign aid or for wars, but this is not inflationary over the short term since that loan is another country's savings that is being used, granted that it is foreign savings that we probably don't intend to pay back, the "debt don't matter syndrome". I will say that in the present state of the global economy, I do not agree with Bernanke that there is a surplus of savings in the world since a surplus will show up as stable prices, and we are seeing worldwide inflation including inflation of significance in China, Japan, and India.

JSmith

"Sounds like most people blogging here are terrified not by Iraq, Iran or Afghanistan, but their very own puppetmasters."

Sounds to me like they're just terrified, if not by one thing then by another.

And there's Elaine, our little ray of sunshine, leading the parade.

Elaine Supkis

Yeah, I get my news from Demon Nightmare News. Alas, they are ALWAYS truthful.

Teddy

Chrysler to cut 12,000 jobs in the US and Canada by the end of next year. Gee whiz, I wonder where they'll get the cars to sell in the US and Canada from? This is not rocket science, but I think it's fruitless to believe bird watching would give you the answer, don't you think Elaine? Maybe that's why JS always comes back to the nest.

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