China's Star Rises As US Goes Nova

From NASA
July 24, 2008

Elaine Meinel Supkis

The US stock market responds to the price of oil the exact same way the Nikkei reacts to how weak or strong the yen is in relation to the dollar. Congress finally reacted to record oil prices and are suppressing the gnomic activities in the oil futures markets. But the main story today is China: the US still likes to pretend the 21st century will be the Unipolar world dominated by the US. Instead, we will be the frozen North Pole and China will be the red hot momma economy. And Zimbabwe hits a physical wall: they can no longer print money faster than the dread Inflation Goddess. Now, the army will revolt due to lack of pay.

Click here to watch 'China’s Economic Rise—Fact and Fiction---By Albert Keidel':

China’s economy will surpass that of the United States by 2035 and be twice its size by midcentury, a new report by Albert Keidel concludes. China’s rapid growth is driven by domestic demand—not exports—and will sustain high single-digit growth rates well into this century.

• Potential stumbling blocks to sustained Chinese growth—export concerns, domestic economic instability, inequality and poverty, pollution, social unrest, or even corruption and slow political reform—are unlikely to undermine China’s long-term success.

• China’s financial system, rather than a shortcoming that compromises growth potential, is one of the strengths of what the report calls “China’s money-making machine,” in part because of its ability to support the financing of infrastructure and other public investments necessary for sustained rapid growth.

• A Chinese economy that eclipses the U.S. by midcentury has both commercial and potential military implications. China will be the preeminent world commercial influence. China’s military capabilities are a small fraction of the United States’ today, so there is time to prepare for a very different world in fifty years, says the report.

• American policy makers should take this opportunity to enact wide-ranging domestic reforms and rethink their concepts of global order. [ELAINE: HAHAHAHA!]

“China’s economic performance clearly is no flash in the pan. Its growth this decade has averaged more than 10 percent a year and is still going strong in the first half of 2008. Because its success in recent decades has not been export-led but driven by domestic demand, its rapid growth can continue well into the twenty-first century, unfettered by world market limitation. China’s likely continued success will eventually bring an end to America’s global economic preeminence, requiring strategic reassessment by all major economies—especially the United States, the European Union, Japan, and even China itself.”

Slowly, reluctantly, Western G7 economics professors are being forced into admitting that China is doing something RIGHT. Hitherto, almost all commentary about China has been based on the stupid, ideologically insane premise that China was flubbing everything and the Chinese are very, very stupid or foolish or easily tricked economic children who are easy for us to CHEAT. This ridiculous and stupid template has been used by nearly everyone from top to bottom. In the US Universities, it is a religious doctrine that the Chinese are infantile, foolish and naive and the West is clever, cool, exploitive and far-seeing. Reality is exactly opposite!

This is the definition of 'hubris'. Since the first day I launched my own analysis of the news, I have mocked this pretension and warned everyone that the Chinese are far from stupid. They are indeed, intensely intelligent, collectively and individually. They are an awesome force in the intellectual landscape. Since so many are Americans, we tend to overlook the fact that they come from the Chinese culture. And this culture is merging with our Anglo-Saxon/Germanic culture. And a good thing, too! About time! We need this badly!

One example of the intense stupidity of US commentary about China is the whole business of China's FOREX reserves: everyone yapped here in the US, 'Holding and growing big FOREX reserves is stupid.' I challenged this infantile analysis with charts, graphs and thousands of words talking about how FOREX reserves are how trade partners with the US control relative values of their floating currencies with an obviously sinking dollar. And they do this for trade benefits! And we should stop them from doing this. But the campaign in the West to convince China to stop doing this failed. The IMF, World Bank, BIS and all the central bankers in the G7 including, amusingly, Japan, all tried to convince the Chinese that building a trillion dollar plus FOREX reserve was stupid. But Japan continued to build its own reserves and so China laughed at this con job by the G7 and continued forwards.

It amuses me tremendously to see that a professor finally figured out that China has a 50 year plan. Congratulations, Carnegie Institute! ABOUT TIME, GUYS!!!! HAHAHA. This is what happens when the US media buries commentators like myself. If I were on the news every week since 1984, why everyone in America would know very thoroughly all about the secret Chinese 50 year plan hatched back then. Today, we would be fully aware of the danger of free trade and why it could not be allowed. We would be taking severe measures to protect ourselves from going into debt to the Communist Chinese!

Instead, I was told to go jump in the lake and today, the US, not I, is drowning in a sea of red ink and the only entity capable of rescuing us is Communist China. And they will rescue us! For a price. As the Chinese figured back then, 'It is worth a trillion dollars to bankrupt the US and then be the bankers.' Or as Shen put it, 'I BE bank!' with his sardonic, short laugh. 'Ha. Ha.' Shen, by the way, was very much a gnome. He came to my house waving Mao's Red Book and left it rubbing his hands with glee, once he learned that women overlook everything if enough money is waved in front of their pretty goddess eyes.

Back the the smart professors who learned the truth about 30 years too late: I figured, eventually they would learn. After all, they are all very smart people. Smarter than I. So eventually, even obvious things will be noticed if they banged their toes against it enough times! When the Communist young upcoming leaders lived with me, I was stunned at the speed at which they picked up the business of real capitalism, US trade weaknesses, how to bribe US officials and how to manipulate the US media. They came to my house knowing nothing about profits, how to handle money, what money meant, they really were 'naive'. And learned fast as lightning, how to make, find and use money!

This includes daily howls from me concerning the real nature of inflation. I must have said an awful lot about that back then. Note how the Chinese took inflation far more seriously than the US this last year. Relentlessly, the government has raised banking reserve requirements and strangled the inflow of foreign funds. This is why they increased their FOREX reserves to now almost $2 trillion. This is over their target. But they are flexible. They can see the US and Japan are set to ignore inflation at home and are bent on exporting inflation to China. So China is no longer 'growing' its trade surplus with the US and Japan. The recent earthquakes in China has also given it more impetus to invest internally, anyhow.

By the way, I won't even link to the lastest 'bash the Chinese' garbage from the NYT. As usual, the Times puts the ugliest gloss on generosity and kindness. The government of China is being criticized internally and correctly so, for the tragedy of all those schools collapsing. This horror can't be ignored. So the Chinese government is now giving out death benefits to the families who suffered this greatest of losses. In the US, we can't boast because we still won't rebuild New Orleans. The residents were scattered to the four winds and we ignore them today. And now, this year, we can plainly see, we will have ferocious hurricanes! And the looming Great San Andreas Quake will come and we can't afford to rebuild and lord knows how many children will die when that hits!

Few nations pay families for losses of members in natural disasters. The very richest might do this but ONLY if the numbers are small. And frankly, the losses in China per capita from that latest blast from Mother Nature is a vanishingly small statistic compared to the population. Even the Great Boxing Day Quake and Tsunami barely changed the population growth statistics of Southeast Asia! Half a million out of several billion is a drop in the bloody bucket.

This has to be remembered when we consider these things. China is a HUGE market. Even with the death of 67,000, it still grows by this number every week due to births. Americans can't even begin to imagine the fertility of Asia. Japan is the exception. Due to cruel economic policies which the US is now actively imitating, the birth rates there have utterly collapsed. The same is true in Europe. The G7 nations are seeing a birth crisis of huge proportions. Only South America and Central America are still seeing a growing birth rate. And these areas are still quite poor.

Heroic CEOs can't save sick U.S. enterprise system

Signs of the American economy's perilous condition are everywhere - from yawning fiscal and current-account deficits to plummeting home prices and a feeble dollar.

But something that shows up in none of the economic indicators may be driving many of them: the deterioration of American management, which is undermining not only many of America's great enterprises, but also its legendary spirit of enterprise.

Paradoxically, one indicator that has been improving steadily in the United States - productivity - may be the clearest sign of the problem.
*snip*
Of course, no company can do that, but many U.S. companies have been shedding workers and middle managers in great numbers - the figures for January 2008 were up 19 percent from a year earlier.

Meanwhile, those employees left behind must work that much harder, often without increased compensation. Workers' wages, adjusted for inflation, fell in 2007, continuing a trend throughout this decade.

The Chinese are obviously irked by all the considerations being thrown at them like rocks. They have been counterattacking for the last year beginning in mid-July of 2007. It amuses me greatly. This article could have been written by me! Bravo, China! HAHAHA. I have written in the past how the US is destroying our own creative base. I have a friend who used to be an inventor working for IBM. He would go to China and work with them on his projects. Then he asked for a pay raise! OUT THE DAMN DOOR! What, the spoiled brats who run IBM reward one of their creators? NO WAY IN HELL. They wanted all the money for themselves. Then they could stomp around the planet, boasting about their economic powers. While selling of dying portions of IBM to the Chinese who then revive them.

Over and over again, we see this. All the 'creative' centers set up by both Japan and China here in the US are closing down due to the fact that creators have to be near the factories making the stuff. So everything is being built in Japan and China. But Japan, due to its dying domestic economy, is unable to fulfill the function of raising new engineers and inventors. And classes in these fields are falling rapidly as the youth refuse to go into these fields DUE TO LOUSY PAY. For the only way the Japanese can pretend there is no inflation is to crush wages of workers!

After Long Boom, China Faces an Industrial Downsizing

Those problems alone would be difficult to weather. But there are additional factors compounding the problems for businessmen like Cheng. The Chinese government is actively trying to phase out some of the lowest-wage assembly work, such as making clothing and cheap toys, to build up more complex and more valuable manufacturing operations, including cars and high-tech equipment. To that end, the government last year eliminated tax subsidies on some 2,000 products. A new labor law gives sharper teeth to existing minimum wage laws and other basic labor regulations. And high inflation has prompted curbs on bank lending, which has combined with weak export markets to push the country's growth rate lower for four straight quarters.

Most of the stuff shipped to the US in the last 7 years has been Xmas junk for Santa Claus. I said some time ago, this was destroying China because it ate up valuable resources, polluted the landscape and gave very little value-added capital to the system. It was a good opening for China to industrialize, it brought in investment funds. And I knew the Chinese government would start to hinder this activity. As we see today. The government doesn't want China to be a cheap goods warehouse enterprise. They want to be like Japan. And just as Japan went through the 'cheap toy' phase in the 1950's, so did China. But this is now over.

Japan and China's interrelationships are growing rapidly. Japan can't afford to pretend there is no inflation and hire workers in high-value factories so they are replacing workers with robots at home and moving factories to China and Southeast Asia. The Chinese and Indians are both now developing rapidly their own auto industries. They have to interact with the Japanese for use of the high technologies developed by Japan. Ditto, with Germany. Both Japan and Germany funded state enterprises and systems with high fuel taxes. The US did the exact opposite. So Ford today announces an $8 billion loss this quarter and is rapidly going bankrupt. Like all British auto enterprises, it will soon be owned by either the Indians or Chinese.

I am betting on the Chinese buying up Ford. Already, they have huge hunks of Ford. All my tractor stuff comes from China or Brazil. The most recent tractor part I bought was machined in China. China likes this. The government is applying pressure on the industries to raise wages so the workers can buy things. They clearly see that strangling the workers causes increased debt and the internal destruction of an economy like we see today in Japan. Japan just had another earthquake in the region where they put most of their nuclear plants. OUCH. China may be prone to earthquakes but even more so, is Japan. And just as badly, the US.

Bull Market in Chinese Teachers Hits Wall Street Just in Time

(Bloomberg) -- When the Yonkers, New York, public schools sought to hire a Chinese-language teacher, Superintendent Bernard Pierorazio expected to fill the job within weeks. He was off by two years.

Schools in the U.S. face a shortage of instructors in Chinese, stymieing efforts to prepare pupils for careers tied to China, the world's fastest-growing economy. The Schenectady, New York, schools will require only a third of pupils in grades 5 and 6 to take Chinese because the district couldn't find instructors for all the students, Ron Hamelin, world-languages coordinator, said in an interview on July 18.

Programs to teach Chinese in grades K through 12 have almost tripled since 2004 to at least 779, say the Asia Society and the College Board, two New York-based nonprofits. Americans fluent in Chinese will be needed for finance, business, diplomacy and security agencies, according to the U.S. Defense Department's National Security Education Program.

My children took, with my encouragement and blessings, Chinese and Japanese classes. They watch Asian TV and grew up watching Asian TV via cable. In California and New York, there are stations that carry foreign language TV from overseas including of course, Spanish stations. Europe has frantically enlarged the reborn Holy Roman Empire in the hopes of being bigger and stronger than China in the future. But Europe is splintered along over 25 languages and has no center. In the 16th century to 19th century, the main international language of Europe was French. Then it became English. Today, it is still English but this will fade over time if the US empire goes bust. These languages are imposed on the locals and falters and fails when an empire collapses. Just like the Napoleonic invasion of Russia turned the elites there from speaking nearly only French to becoming more Russian, if the English empire goes bankrupt totally, English will fade as the preferred language.

In the old days starting in 1600, Europeans didn't bother with learning anyone's language, they talked with guns. They would kick in the front door and begin shooting. Eventually, the natives would learn the new lingo and be able to follow the orders barked by the European invaders. Now, the shoe will be on the other foot.

Exactly one year ago I published this story about Basel II which had to be launched by August, 2007:

Switzerland became the bankers of the world thanks to running a system that was totally screened from any nation or police force investigation. All dictators and traitors loved Swiss banks. Over the years, the Swiss have been slowly drawn into the international regulatory system and the destination of all money seeking privacy is now to islands owned by the Queen of England or tiny principalities of Europe where left-overs from the Middle Ages still rule. The Basel II rules are the latest in a long line of attempt at eliminating risk from investment banking schemes. All these attempts have failed in the past and economists cannot figure out why. I have a rule: all attempts at controlling risk increase risk. All attempts at a Concert of Nations always ends up in economic warfare.

And exactly one year ago, I discussed Paulson's futile attempts at strengthening the dollar:

OK: the US government and all the economic minions from Financal Hell Hole, Bumbfuck USA, have been boasting about how a weak dollar is a good dollar and how making our currency worthless will make us all rich and other goofy things. Now this was all for home consumption but the stupid things these guys say at home end up, via the magic of the internet, read abroad. And the Chinese dragon reads EVERYTHING. So of course, the US Treasury official who works for Goldman Sachs, had to step forwards and contridict everything everyone said this last 7 days.

The Europeans were outraged by all the happy talk about the weak dollar. The Japanese were worried they would have to destroy even more Japanese voters on the Altar of Depression. Everyone wants the dollar to be stronger so they can continue this crazy trade going on that is destroying the US industrial base. The weak dollar was supposed to be this nifty monetarist trick to save us from ourselves. It is, of course, destabilizing the world financial system and will lead to a gigantic depression!

By the way, I was wrong about China no longer pouring more money into their FOREX reserves. They paused briefly but by January, 2008, decided to continue the torrid pace of increasing the FOREX reserves so it has doubled in size. Japan, which stopped doing this, joined the Chinese and increased their own reserves by over $200 billion.

LEHMAN AND MERRILL LYNCH DEFAULT RISK CHARTS

Below we highlight default risk charts as measured by 5-year credit default swap prices for Lehman Brothers and Merrill Lynch. We also include each company's stock price. As shown, default risk has increased significantly for both LEH and MER this week, and it is quickly approaching the highs reached in March. While CDS prices aren't at their March highs yet, the stocks are much lower than they were then.

Back to the US banking collapse: this webpage, Think Big, has some good charts showing clearly that these two investment banking giants are on the ropes, probably for the last time. No surprise. The world price of oil is dropping and this won't save these guys who happen to have rushed off to the oil markets to fix their bottom lines in the first place.

Huge oil trading loss sinks energy trader SemGroup

(Reuters) - SemGroup LP declared bankruptcy on Tuesday after $3.2 billion in oil trading losses torpedoed the formerly 12th-largest private U.S. company.

The Tulsa-based company racked up the massive losses as oil prices ran up record gains, undercutting short crude futures positions SemGroup bought to hedge against its 500,000 barrel-per-day trading business.

To meet obligations, SemGroup plans to sell off oil and natural gas gathering, transportation, and storage assets worth an estimated $6.14 billion that were purchased in a whirlwind of acquisitions since it was founded in 2000.

This highlights the great dangers in all bear markets that turn to commodity markets to save their wealth: NO government can allow this! The US government allowed this like a general allowing underpaid troops to loot a city that is captured. The US Treasury and Congress gave the hell hounds and pirates one year to loot the savings of the masses. Now, this is being brutally terminated. Anyone who tries to continue looting after last month's warnings to stop, are now being bankrupted.

Congress Pursues $80 Oil With Trading Limits, Disclosure Rules

(Bloomberg) -- Congress may outlaw elements of oil futures trading that lawmakers found distorted demand and contributed to the 69 percent surge in prices in the past year.

U.S. legislators are considering limits on the number of oil contracts an investor can hold and may increase disclosure requirements. Speculators such as Goldman Sachs Group Inc. use the practices to bet on price swings, which may drive up prices, though they have no intention of taking delivery of underlying goods, lawmakers say.

As I keep saying, the government still controls all things. If they want to apply the brakes on something, they do this. Also, as I keep saying, they don't give a fig's Newton about the value of gold, money is no longer attached to anything real. So they view gold as a great place to sop up inflationary dollars and keep them out of circulation. But NOT OIL. Oil is bad. Oil price hikes kill the economy. It is extremely inflationary since everything we do uses oil at some point and it kills profits as well as savings. Yet our government which is corrupt, let this oil looting to rage now for over a year. But an election looms and they see their doom so they are backing off on this. They saved their own assets this way and now have to find a new scheme. Oh, look! Why, they can sell all their risky investments to the US Treasury! HAHAHA.

ETF Liquidity Review
Bargains? Not So Fast

Charles Biderman, TrimTabs

New cash takeovers have come back to life, totaling $23.7 billion ($2.4 billion daily) in the past two weeks. Six deals totaling $7.7 billion ($1.5 billion daily) were announced in this past week alone.

The spike in cash mergers is not happening because stock prices are low relative to the economic prospects of companies. Instead, non-U.S. companies are taking advantage of the weak U.S. dollar to scoop up U.S. companies, and many of the deals that do not involve non-U.S. acquirers are related to natural resources or health care.
*snip*
The best leading indicator of corporate sentiment is new stock buybacks, not new cash takeovers, and buyback announcements have been persistently weak even though the S&P 500 is down 11.6% from its May closing high.

If only they can revive the stupid, wasteful buy-up/buy-out business. They get huge fees as well as happily driving up the value of stocks and then selling these inflated stocks to schmucks. Gnome heaven! They far rather do this than get hammered for driving up the value of food and fuel. That was much too exposed to the public! Everyone noticed this. And then began to demand these gnomes be arrested. As usual, when the gnomes rush back out of some door they hacked into the Cave of Wealth, some of the greedier ones who ignored the warnings of the Top Gnomes got trampled to death. Speaking about inflation and violence:

Soldiers await pay as Zimbabwe runs out of paper to print money

The Zimbabwean government was today struggling to find enough cash to pay its workers, and more importantly the military, after it was forced to severely cut back on printing money because sanctions severed its supply of banknote paper from Europe.

Officials involved in the printing of money said the regime was fearful that the presses could be shut down altogether if further political pressure causes the withdrawal of software licences used to design and print the notes.

Paper money was already in desperately short supply because the state-run Fidelity Printers & Refiners in Harare was unable to keep up with the demand created by hyperinflation and rapid devaluation that had caused notes to lose almost their entire value within weeks of being issued.
*snip*
Consider high technology, where America is supposed to excel. According to a November 2006 report by The Task Force on the Future of American Innovation, the high-tech trade deficit widened in 2005, for the third consecutive year.
*snip*
This deficit reflects an underlying research deficit. Of the 25 companies granted the most US patents in 2006, only eight were American; 12 were Japanese.

Perhaps this helps to explain why, in a survey of more than 60,000 people in 29 countries conducted in 2007 by the New York-based Reputation Institute to rank the "world's most respected companies,'' the first US company on the list appeared in 15th place; the second was in 25th place.

The gnomes love printing money. They make money printing money. Inflation means more money printing and thus more profits. But the Goddess of Inflation rapidly surpasses even the most powerful printing machines and the magic of zero turns everything to nothing. So it is here: Europe would cheerfully print fake money for Mugabe forever if they could. He had to pay them with REAL money to do this! Not his inflated currency.

But now others have twisted arms and said, 'Stop it.' So it comes to a crashing halt. Finally. And the troops that supported Mugabe just last month will now riot. They will go forth, seeking loot. Mugabe lives in a palace. The history of disgruntled troops looting palaces is very ancient. It happened to Rome. It happened to Egypt. It happened in the very earliest cities 8,000 years ago. It is one of the oldest of stories.

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Comments

[Tell]

Off-topic (maybe ?)

Thought you might like to see this.

Copy and paste into address bar...

http://tinyurl.com/6agmn5

[Roberto]

What a odd plot twist in the national soap opera that the previous "heavies", the red menacers, may well be the rescuers from the tainted vision of RFID chipped, amero wielding consumerist automatons it seems we've been consigned to be. Waking up from the matrix (we've been programmed from baby boomers to accept as consensus reality) is jolting sometimes. How enlightening to be a fly on the wall at a Rockefeller family picnic these days. Keep the journalistic hi-beams on, EMS, and thanks for the effort. Your track record predicting events gets better every day.

[Tell]

"And Zimbabwe hits a physical wall: they can no longer print money faster than the dread Inflation Goddess. Now, the army will revolt due to lack of pay"...

http://tinyurl.com/6elee5

[Christian W]

I thought the North Pole isn't frozen anymore, it's under water...

(tehee)

[Ralph]

Dear Elaine,
If the FED and GOVT dont care about the price of Gold, why do they suppress its price everyday,by using gold swaps, and leases? GATA has done extensive research and is actively suing the FED and treasury for breaking Anti-trust laws. Alan Greenspan said in Congressional testimony in 1999 "Central Banks stand ready to lease gold in increasing quantities should the price rise" I agree with you 100% GOVT controls basically everything. However, Gold is high on their priority list of markets to intervene in. Suppressing ownership, and investor interest. I beleive that the Gold suppression is being used by the "gnomes" to accumulate the metal at depressed prices. Am I insane? please help. Thank you.

[Paul S]

The story of the IBM reminded me of former GE chairman Jack Welch. To me Welch epitomizes what is wrong in the American business world. Of course, rags like BusinessWeek think Welch is this brilliant,giant "innovator". Innovator my a##. Welch turned GE into little more than a M and A company. But wait: GE IS a world class polluter--that spends LOTS of money on lobbyists so they don't have to pay their massive fines. No cost cutting there.

[Gary]

Famous quote from mobster Jack Welch:

"Ideally every factory should be located
on a barge"

Tens of small towns in S.Vermont, W.Mass,
and upstate NY were the homes of GE Machine
Shops.I'd drive thru these towns at night on my way back from a ski trip and the factories would be lit up like torches. The only things saving these towns
now is tourism and home buying by NY hedge
fund artists.

[Gary]

Famous quote by gangster Jack Welch.

"Ideally you would have every factory located
on a barge."

[rockpaperscizzors]

FDIC Chairman Shelia Bair Is Out Of Control
In a sad twist of irony Shelia Bair is accusing blogs of being "out of control".

...Here's an interesting statement from the article. "The FDIC also plans to begin airing public service announcements as part of a public education campaign on the nation's deposit insurance program."

When I first saw the headline "The FDIC plans to pay closer attention to the blogosphere" I thought, WOW the FDIC is going to watch the only people that have called the housing bubble and banking problems accurately: blogs.

Silly me. Instead, Shelia Bair wants to shut off the only source of information as to how unsound the banking system and FDIC is.
http://globaleconomicanalysis.blogspot.com/

Public Service Announcement #1 :Pay no attention to that man behind the curtain. I am the Great and Powerful Wizard of OZ; the FDIC.

See how that works, It's not the fault of bankers, Fed & GS Sec.Of Treasury pirates who hijacked the wealth of the citizens of the USA. Or the politicians who serve the Gollums, "Mustn't hurt the precious!"s. They sold the USA down the Yangtze river, flowing red with US citizens eternal servititude. No, it's the bloggers fault for ripping away the curtain of piracy, deceit, and destruction of OUR COUNTRY.

In the immortal word's of Elaine, ARREST THEM ALL

[rockpaperscizzors]

FDIC Chairman Shelia Bair Is Out Of Control
In a sad twist of irony Shelia Bair is accusing blogs of being "out of control".

...Here's an interesting statement from the article. "The FDIC also plans to begin airing public service announcements as part of a public education campaign on the nation's deposit insurance program.",..... Shelia Bair wants to shut off the only source of information as to how unsound the banking system and FDIC is.
http://globaleconomicanalysis.blogspot.com/

Government controlled Public Service Announcement #1 :Pay no attention to that man behind the curtain. I am the Great and Powerful Wizard of OZ; the FDIC.

See how that works, It's not the fault of bankers, Fed & GS Sec.Of Treasury pirates who hijacked the wealth of the citizens of the USA. Or the politicians who serve the Gollums, "Mustn't hurt the precious!"s as they sold USA's debt to Communist China and Japan who will never forgive Hiroshima and Nagasaki and despise us.

No, it's the bloggers fault for ripping away the curtain of piracy, deceit, and destruction of OUR COUNTRY.

In the immortal word's of Elaine, ARREST THEM ALL

[Anthony]

The median sales price fell 6.l% in the past year to $215,100.
The inventory of unsold homes on the market rose 0.2% to 4.49 million, an 11.1-month supply at the current sales pace, the second-highest inventory level since the mid-1980s.
In a separate report, the Census Bureau said about 6.1 million housing units are vacant and available either to rent or buy. About 10% of the homes built for sale in this decade are vacant, while more than 25% of rental units built in this decade are vacant, the report said.
"We are faced with a considerable excess of housing units that is only likely to worsen over coming quarters, and for which there is no quick solution," wrote Richard Moody, chief economist for Mission Residential.

http://www.marketwatch.com/news/story/existing-home-sales-fall-26-10-year/story.aspx?guid=%7B628E0C05-56FA-47EC-8EEF-B20C44D853CE%7D&dist=msr_11

This is nowhere near the bottom. (with unemployment climbing, more people will leave those houses)

[MI9LO]

BUT BAILOUTS WILL MAINTAIN HIGH HOUSING PRICES AND FOSTER HIGH LOCAL TAXES NOT SALES.........

[rockpaperscizzors]

The Freddie and Fannie taxpayer bailout should be listed in the "Dumb as a Rock" category. I assume that the mortgage payees who haven't paid in months, also are not paying the real estate taxes/city services either. Now, the city and state governments can't foreclose on anyone due to real estate tax delinquencies. HAHAHAHA! I'm just wondering why the heck should I be a shlub and pay my RE tax bill or my mortgage? They're not gonna throw me out thanks to Congress saving Gollums preciouuuuuus Paulson's GSachs and Bernanke's private bankers club! Am I in error?

[Elaine Meinel Supkis]

Tell, those burial containers are simply what happens when a manufacturer makes stuff and then stores it outside...a common thing in the South. Up here in NY, these things would be stolen and used as gun storage containers underground, dope storage hiding holes, etc.

Heh.

If we fear being killed by the government, remember, the government uses backhoes and simply covers the bodies in ditches or incinerates them a la Hitler.

As for the other comments here: The government cares about the price of gold! They want it to go up, not down. They hold a huge amount of gold and use it as collateral, etc. It goes up in value, their holding shoot up in value!

The gold investors who want gold to only go up get all knocked out of shape when it declines as all commodities and sales go up and down. So they think the government that can't control itself, is somehow controlling gold.

About central bankers selling gold in Europe: that was PURE INSANITY. They held on for 35 years wondering if the US would restart the gold standard. When Nixon quit the gold peg, he said, 'THIS IS TEMPORARY!'

But now it looks permanent. This is stupid. Usually, when people assume a status quo is forever, it collapses. The floating currency is a joke. Gold probably will come back. But when that happens, it will be after some great power confiscates a huge amount of gold, first. THEN they will use it as a currency peg again.

But then, we could float in this mess for another 50 years, first.

[Michael]

HAPPY ANNIVERSARY, AMERICA!!

The year 2008 is the 37th Anniversary of the montary catastrophe in which the U.S. government disconnected the Dollar from its last connection to gold. It was 1971, the number of Dollars sent overseas had become greater than the amount of gold the U.S. held in reserve (in spite of accumulating 90% of the world's gold supply by 1946), and those pesky foreigners were turning in their Dollars for our gold.

The year 1971 happens to be the 37th Anniversary of the monetary catastrophe in which the U.S. government disconnected the Dollar from gold for all Americans (maintaining the connection for foreigners as a priviledge of not being American). It was 1934, and - surprise! - those pesky foreigners were turning in their Dollars for our gold.

The year 1934 happens to be the 37th Anniversary of the catastrophe of the inauguration of William McKinley, who launched us into the never-since-to-be-ended-ever series of foreign wars that has led us to our beloved multi-war present time. It was 1897, the U.S. was in a massive Depression, which the U.S. government had made worse by selling its gold to buy silver (and you thought stupidity was a recent invention).

For our current 37th Anniversary party, those pesky foreigners are going to bring their usual present - the destruction of our currency (not that we need their help to accomplish that - again). This year China, Japan, Russian and the Oil Sheiks are going to pop out the cake, hand over all their Treasuries for cash, and cut the world loose forever from the soggy remains of the so-called Dollar. Have a Ball, America!!

[AF]

Check it out, the IOC has BANNED Iraqi athletes from Beijing:

http://news.bbc.co.uk/sport2/hi/olympics/7523708.stm

Anyone else suppose this is a thinly veiled slap at the US and its failed foreign policy adventure?

[Elaine Meinel Supkis]

What? No IED Hummer Races at the Olympics? Rats.

[calvino]

Michael, knocked down a couple of tumblers before sitting down to write. Treasuries for cash? Which cash is that? The europeans can not absorb any more liquidity in the East, nor can they absorb any more industry destruction in Club Med. The yen. Ask Elaine if Onishi Takijiro will allow his people to have any purchasing power. Gold? Not a chance. Not enough of it to abosorb the toilet paper the chairrat has foisted upon us. So we are left with hard American assets. That is not cash. That is capital. Ask Elaine. Now tell me what is the value of the NYSE listings, and then you get the idea of the sort of asset transfer that would take place. This is different from bank, assets, which are actually liabilities. Perhaps with this prez that is possible. Or with the past one. If you fund my prezidential library, you can have Michigan, for instance. There are no ways out, except to keep dancing, until someone drops on the floor. To paraphrase that genius of American finance, Chuck Prince.

[RobG]

Re: AF post on Iraqi Olympics:

Ahmad al-Samarra'i, chairman of the committee dismissed by the government, and several other members had previously been abducted by gunmen while attending a meeting in central Baghdad in July 2006.

They have not been seen since.

One never knows what to believe out of there, what is misinformation, what is perpetuated by evil forces and what is true sectarian violence - but if true - very sad indeed.

[PLovering]

Zi juus have all our gold, long since.

Raygun appointed a Gold Commission to find our gold in 1982. The Commission found no gold.

The banking system is kuput. Close the FED and start over.

[calvino]

Your gold? No. You pissed it away on liquor, whores, big trucks and playing social engineer. Chinese gold now.

[PLovering]

Zi juus European Central Bankers and Black Nobility have 2/3 of the world's gold under their control.

Zi juss talking heads, minor minions of Media and AIPAC, whisper sweet nothings over their whores and liquors about a new gold standard, and zi whores think it a grand idea.

Allah be praised.

[Richard]

The yen carry trade unwound today as the chart of the EUR/JPY, FXE:FXY, fell lower to 1.690.

Libra reigns supreme.

The neoliberal Milton Friedman floating currency regime and its policies has met its Waterloo suffering defeat at the hands of gold investors as is seen in the currency harvest, DBV, falling 1% and gold, GLD, rising 0.8%; here is DBV weekly for reference.

Not only was there an extinguishment of stock wealth today, there was an extinguishment of currency wealth: interest rate differential traders suffered a set back

The Great Unwinding Of Investments commenced today.

For more comments please visit the linked article

[Tell]

"Auction Rate Securities"...

http://www.goleft.tv/

[Paul S]

Final word on sleazeball Jack Welch. I bet he didn't get laid in college and look how he turned out. There is something to this sex business and money. Welch wants the factories to be on barges so he can live in his New York penthouse apartment--at GE expense. Also: I am reminded of something corporate America seems to have forgotten. It was UAW head Walter Reuther who commented on GM's automation plans by saying, "And how many cars will these automated machines be buying?"

[Michael]

You said it, Calvino, what cash? This time we have no place to hide. Of course we'll try a Zimbabwe-type Dollar print-fest, but everyone everywhere will know (as you and I already know) that the U.S. has actually gone bankrupt, because the market value of our debts will be exactly zero (as opposed to their current worth of 30 cents on the Dollar). Don't cry for me, Argentina!!

[RapidJourney]

OK so having a third of GDP based directly or indirectly on weapons production just hasn't done the trick. Markets are the russian mafia and certain wild eyed elements residing along the afghanistan-pakistan border, next... "But depressions are getting shorter aren't they? You said...[sob]" [slap][slap][slap]"Just get a hold of yourself!!!" Agribusiness, virtual hyper-reality farms, solar thermal - now there's an idea - we just need a few community minded saints to build everything and run the gauntlet of shareholder rage for about fifteen years.

[Penny Stocks]

Excellent post.I really like this.