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#1 March 14, 2007 15:24:00

TheAdvisor
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Teetering on the brink of collapse

This pretty much sums it up. You tain't seen nutin' yet.....

I've read that normally 2007 would be a correction year, then prosperious times ahead to 2010. But, this may just kick off the recession, leading to depression earlier than the projected 2011 time frame.

"The Magnifying Effect of Modern Finance

In case that litany of problems isn


*** "The trend is your friend, until the end, when it bends" ***
so, Don't bet the farm
.
The USD is doomed, or, if they keep it strong, the U.S. is doomed
.
Do you have your garden in yet? Have AMMO?

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#2 March 14, 2007 15:35:00

stevegee58
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Teetering on the brink of collapse

I remember Greenspan talking about this when either giving a speech or testifying before Congress. Greeny's a smart guy and I always remembered what he said, though the audience and media's eyes glazed over.

*yawn* "What's that he's babbling about? Deriv what?"


You are in a maze of twisty little passages, all alike.

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#3 March 14, 2007 22:34:00

scotthickman
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Teetering on the brink of collapse

Flyboy, I have an Idea that should help lots of people Im going to do it some time if the Eur goes down a bit.
Since It is a given that Usd is going to fall prob in the next 18 months very dramatically if not totally when we get nuked in a city or two.
Wouldn't it make sense to purchase real eur to have in possession in case lets say it goes 1,000:1 dollar then just trade them in as needed later or set up a eur account online but the brokers can go broke if you know what I mean.
I'm sure gold will serve the same purpose if in small coins etc..
this is survival mode that I am referring to.

I believe it is going to get much worse than we think . I am of the armageddon persuasion.


Peace agreement coming with Assyria

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#4 March 14, 2007 23:09:00

cwt74960
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Teetering on the brink of collapse

Armagedon? At the end of the Tribulation?


You can be too healthy

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#5 March 14, 2007 23:11:00

cwt74960
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Teetering on the brink of collapse

Salt will be worth more than gold.


You can be too healthy

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#6 March 14, 2007 23:17:00

scotthickman
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Teetering on the brink of collapse

Thats right, Minding the farm you got it. but there is going to be a period of time in which you can still use some purchasing power for a while at least. Its better than not having some kind of exchange power. Plus some don't and won't understand that what you are giving them for their food, or to get across a border, will not help them in the long run.
So it is a small tool maybe to help others also in the end . I think now is a good time to buy and store grain as Joseph. the seven good years are almost up. that's why the 18 month post. I'm sure you know what im saying.


Peace agreement coming with Assyria

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#7 March 15, 2007 01:06:00

andrewedwardjudd
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Teetering on the brink of collapse

Anybody got a link that breaks derivative value down by type?

For example put options, call options, bets on indexes by index type

I think it would help if we could see what kind of derivative in this mix is something that we need to scratch our heads over and worry about

Those that want to promote panic have a vested interest in their own derivative pay back

We need to be clear headed about this before we panic any more than i already am!

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#8 March 15, 2007 01:12:00

trbedell
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Teetering on the brink of collapse

OK... The downside. The world monetary system collapses. End of the world? Nope. Just start over. Start by writing new debt. As long as someone makes the payments... Who cares?

They say the FED just prints money. I am not so sure about that.... If a bank mints a new credit card with a $10,000 limit. Isn't that the same as printing money? Where did the money come from? Sure they have reserves, but where did the cash come from? Do they borrow it directly and re-lend it? Or do they just create a debt instrument and pull funds from the reserves?

Come on economics guru's. Weigh in.
Thomas


Never, Never, Never Quit.

Email: fxranger (at) gmail.com

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#9 March 15, 2007 01:43:00

scotthickman
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Teetering on the brink of collapse

Fractional reserve banking 10;1 money created from air.. nice job to have. maybe I'll loan myself some money.


Peace agreement coming with Assyria

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#10 March 15, 2007 04:18:00

andrewedwardjudd
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Teetering on the brink of collapse

I *think* it is a fallacy to say "just print money"

Ultimately the federal reserve offers credit for banks who lodge collateral.

In bad times that collateral can be very poor because in bad times there is more deflationary pressure than inflationary pressure so the fed can issues zillions of notes on this basis without it causing a monetary problem, but as times improve then the Fed can pressure the bank to offer better collateral or cut off its funding and therefore decrease inflation. You might have noticed that banks go out of business when times improve and survive thru the bad times? You might say oh well these were the bad banks but really they were liquidity vehicles to support the economy thru bad times.

If a small bank issues a credit card then at its simplest level the credit card holder goes to an ATM of that bank and withdraws 10000 dollars of notes and places them in his own pocket. The bank now has 10,000 less notes itself which it somehow needs to take in to replace them. It can sell for a profit the credit card debt and get the money for example where it provides the servicing of that card for a fee to the new owner while also making a profit on that. Alternatively it can lodge the credit card debt with the Fed as collateral and get something back if the Fed decides this is suffient collateral.

But money is not ever being made out of thin air as is popularly believed unless somewhere there is an iou placed such that the consequences of calling in that
IOU are in some way favourable for monetary policy as for example as above when the no longer required bank is destroyed and its ability to influence the economy is removed.

This has to be a guess but it is based on what i have read and decided must be happening.

[ March 15, 2007, 04:43 AM: Message edited by: EuroKiwi ]

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