Interest Rates

[parsley]

Going up?

I thought rates would be considerably higher than they are right now, but the bill in the US last week will most likely prompt the non-confidence that inevitably hikes rates.

I also made a bet if you recall, soon coming up:


"parsley posted Jul 22, 2009 1:41
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You will have to dig up some of those old Nabob coffee cans. Are they rusty?

I have Euros. But $1.00 bet only. Lack of restraint only causes grief, so $1.00, take it or leave it.
IP: Logged
Edit?

bduke posted Jul 22, 2009 1:58
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Parsley... you must be tired also... I have 5 quarters
being Oct. 2011.... should be 2010!

So ... not over 12% by Oct 2010,,,,,

I will take your bet.... you will likely win as I am not
thinking clearly tonight.... barley bins... not brewed!

LOL... Bill"
UNQUOTE
______________________________

Well, as you see, I have until October for interest rates to rise if I am to win.
I pay my bets, but I am a begruding loser and especially to a banker. LOL

Any predictons on interest rates?

Pars

[TOM4CWB]

Parsley,

It looks to me like Japan is a case in point of what has... and will happen.

THE US can't afford to let interest rates rise. The system will collapse if they do. Same for Japan. Any economy with marginal growth... can not pay interest of any significant amount.

This is part of the 08/09 financial collapse structure. The cost of money SHOULD have increased... instead it dropped. Gov. can only spend trillions they don't have... if interest is close to zero.

[parsley]

They owe 13.4 Trillion in debt, though. Japan didn't owe that mass of money. Neither did New Zealand.

The US deficit is unmanageable, as well.

It seems they want to keep stimulating, and continue to expand government control of key industries, health care, information, banking, etc. their priority.

Business @ meaningful savings sit on cash, wary of the Nicaraqua type climate, not hiring or expanding. Lenders will become yet more antsy.

Do you think this climate sustainable, Tom, not only politically, but economically?

[TOM4CWB]

Parsley,

What is 'quatitative easing'?

"The term quantitative easing (QE) describes a monetary policy used by central banks to increase the supply of money in an economy when the bank interest rate, discount rate and/or interbank interest rate are either at, or close to, zero.[citation needed] A central bank does this by first crediting its own account with money it has created ex nihilo ("out of nothing").[1] It then purchases financial assets, including government bonds, mortgage-backed securities and corporate bonds, from banks and other financial institutions in a process referred to as open market operations. The purchases, by way of account deposits, give banks the excess reserves required for them to create new money, and thus a hopeful stimulation of the economy, by the process of deposit multiplication from increased lending in the fractional reserve banking system. Risks include the policy being more effective than intended, spurring hyperinflation, or the risk of not being effective enough, if banks opt simply to pocket the additional cash in order to increase their capital reserves in a climate of increasing defaults in their present loan portfolio.[1]

"Quantitative" refers to the fact that a specific quantity of money is being created; "easing" refers to reducing the pressure on banks.[2] However, another explanation is that the name comes from the Japanese-language expression for "stimulatory monetary policy", which uses the term "easing".[3] Quantitative easing is sometimes colloquially described as "printing money" although in reality the money is simply created by electronically adding a number to an account. Examples of economies where this policy has been used include Japan during the early 2000s, and the United States and United Kingdom during the global financial crisis of 2008–2009."

Japan seems to be getting by... what makes you think anyone will stop the US/EU from doing the same???

[TOM4CWB]

Parsely,

http://www.usdebtclock.org/

Have a peak... 110 T in unfunded liabilities...

53 T in total US debt...

[parsley]

You're a guy with wheelbarrows full of cash, so it is interesting to read your views.

One of the things Obama has done, is to annoint his favorites: 'Freddy and Fanny'. With tax-cash.

I recently spent an afternoon of 'one on one time' with a Boston banker, who's particular bank is closely tied with the taxpaid fortunes of F&F. The bank is presently in really good shape, but having zero confidence in Obama, because he is headed for 'rabid socialism' and will transform USA.
No voting for him, either. Worried about invested cash. Obama is viewed as socializing anything that will provide money for his grand plans.

So what I am saying, is that CONFIDENCE wanes every day, even those making a killing at the present time.

Without citizen confidence, how well does a free market system function?

[TOM4CWB]

Parsley,

Since your wheelbarrow of cash is much bigger than mine.... the reason I can reflect with personal experence... borrowing $ keeps us humble.

Obama is in way over head... don't think he knew how bad US was... who would have thought in 08?

Choices are very limited at the top...

[parsley]

You cannot hide wealth modesty behind those AV designer sunglasses, Tom. LOL

But I will give you an example of a labored-breathing canary in the US septic tank:

Obama favored GM. Even appointed his own CEO. And GM responds by building a brand new plant.

But in Mexico.

Americans are left to pay off GM loans/ grants, but the Mexicans get the jobs.

If Americans@ $$ continue to hold back their money, and yes, even invest in other countries, interest rates will have to rise.

Will this be the final straw to launch hyperinflation alongside delation?

That spells disaster. Pars

[parsley]

When you go to http://www.smalldeadanimals.com/

and read the commentary on climate warming, making sure you click on the links, you will further see what liars the Obama administration put into place, who's only purpose can possibibly be, to further the goal of downloading the cost of manufactured climate change on wealthy countries.

In other words: WEALTH DISTRIBUTION was the goal.
Climate Change was the means.

Schemers and liars cannot sustain their actions IF you are vigilant.

Interest rates respond to lacking confidence. Pars

[jensend]

what is happening is merely the result of the maturation of the north american economy into a higher cost environment as people demand a higher standard of living and debt is taken on because the living standard is not sustainable. the amount of wealth that has been wiped out in housing valuations and asset deflation will keep the printing presses running for a while in order to inflate the economy. this is a normal evolution of a superpower as its reach exceeds its grasp. the usa has lived by the principle of exceptionalism for so long that reality was only a distant concept. now the chickens are coming home to roost. if the financial markets drop again as more people are forecasting inflation and higher interest rates will be put off again. the recent runup in wheat and other grains smells of the same speculative play of 2008. there is plenty of wheat around to get the world to summer of 2011.

[TOM4CWB]

Parsley, if logic or common sense was behind the present system... you would allready have your answers... Japan set up in Korea... then Indonesia... now India.

Japan does not like China... the EU/US and Arabs are behind much of their development.

I would have done what Obama did with GM... too much culture wrapped up in GM for it to be wound up. PM Harper did it right too. Money is supposed to serve people... not people serve money!

[cottonpicken]

The problem is there is no solution.

[per]

Kato do you think that this is a targeted turn of events? Squeaky wheel gets the grease kind of thing? I would hope not but it wouldn't be hard to believe and it would be fun if you could prove it.

[kato]

It's crossed my mind..... I'm trying to resist paranoia though. That's a slippery slope to go down, and I would hope we live in a country that's better than that.

[workboots]

Inflation of the usd currency

There’s your debt solution.

There’s your global trade imbalance
solution.

Only problem is you’d be stuck with Lots of pissed off yank’s with a devalued currency.. therefore it would have to be a slow transition over a decade or two so people could evolve into a different lifestyle. Ah the psychological effects of time. The US commodity producer would have a nice hedge against this inflation and a new world with a more favorable currency exchange to buy up these goods.

Corporate America, you know.. the ones that runs this world, they dont give a shit about Americans. They care about the only thing that keeps the fat corporganism alive. $Money$
The world is flat, money can be made globally and the United States won’t be the best or only place to rake in the nice margin.

think of how many more big mac's that mcdonalds could sell to china...

But of course there are lots of arguments against this theory like any.