The ISEQ Thread Part I - March 2008 - October 2008 **LOCKED**

Squire wrote:

Just to get the US reserve in perspective as far as I am aware India imports about 700 tonnes a year. About 1/12 of the reserve. Turkey imported 230 tonnes last year. I wouldn't go rushing into a gold standard you may get a real shock where it is actually owned. I would guess that there is probably more gold in India than there is in the USA. Just a hunch.


ISEQ 4203

Plenty of good offers on the internet.

youngdan wrote:

It is a small but heavy cube. The situation in Zimbabwe will be everywhere. They have nothing to back a currency with. Rhodesia was a wonderfull country till fools decided that the Walli-Walli tribe should run the show.

Barter and swapping are getting to be big business. Currencies. Who needs them ?

http://en.wikipedia.org/wiki/Barter

Wonder how they work tax out on barter or LETS?

http://www.letslinkuk.org/

May be useful tax [avoidance] method for those on modest income?

It matters nothing how much gold is elsewhere if you don't own enough to corner the market. The US would issue the amount of currency for which they have gold to back, end of story. Other countries may or may not do the same.

Anyway some huge event is about to take place. The metal price is down but this is a PAPER MARKET. There is a massive run on the coins and they can not be bought at any price. http://uk.reuters.com/article/oilRpt/idUKN2140103820080821

Looks like the price is heading back up. Safe house?

Looks like the rumours surrounding Lehman's are correct.

http://www.cnbc.com/id/26337440

I wonder how much longer will it take for the economic woes of the various financial institutions to become clear? Very hard to envisage any recovery with this type of uncertainty common place.

youngdan wrote:

It matters nothing how much gold is elsewhere if you don't own enough to corner the market. The US would issue the amount of currency for which they have gold to back, end of story. Other countries may or may not do the same.

Anyway some huge event is about to take place. The metal price is down but this is a PAPER MARKET. There is a massive run on the coins and they can not be bought at any price. [url=http://uk.reuters.com/article/oilRpt/idUKN2140103820080821

http://uk.reuters.com/article/oilRpt/idUKN2140103820080821[/quote[/url]]

Quote :

NEW YORK (Reuters) - A shortage of American Eagle bullion coins due to soaring demand following a recent sharp retreat in gold prices has forced the U.S. Mint to temporarily suspend sales of the popular coins.


"Due to the unprecedented demand for American Eagle gold one-ounce bullion coins, our inventories have been depleted. We are therefore temporarily suspending all sales of these coins," the U.S. Mint told authorized coin dealers in a memorandum dated on Friday.

Michael White, a U.S. Mint spokesman, said that only the one-ounce 22-karat American Eagle coins are sold out, but the half-ounce, quarter-ounce, and 1-10th ounce coins as well as the less popular 24-karat American Buffalo coins are still available.

"We are working diligently to build up our inventory and hope to resume sales shortly," the Mint said.

Coin dealers from the United States to Canada reported a surge in buying of bullion coins and other gold products since prices plummeted from highs last month. The buying spree contributed to supply fears and helped boost gold prices sharply on Thursday.

Interesting, youngdan. Have they run out of the raw material ?

Why would the paper price be depressed? The coins I'd assume are also more accessible for the "small man" - is that who is buying them?

To be honest with you, it sounds like fear of war.

Squire wrote:

Looks like the rumours surrounding Lehman's are correct.

http://www.cnbc.com/id/26337440

I wonder how much longer will it take for the economic woes of the various financial institutions to become clear? Very hard to envisage any recovery with this type of uncertainty common place.

I suppose part of the problem is that the woes are increasing by the day with recession. And a lot more bad mortgages in the pipeline.

cactus flower wrote:

Squire wrote:

Looks like the rumours surrounding Lehman's are correct.

http://www.cnbc.com/id/26337440

I wonder how much longer will it take for the economic woes of the various financial institutions to become clear? Very hard to envisage any recovery with this type of uncertainty common place.

I suppose part of the problem is that the woes are increasing by the day with recession. And a lot more bad mortgages in the pipeline.

As you said before Squire, let them go to the wall - and as 20000miles (the new poster here) has said on his website, bailing out irresponsible banks is like lowering the insurance costs of irresponsible drivers or un-fining them or giving them penalty point breaks.

The Irish Times too today in the Finance section (check out the RSS feed) has a report about the Australian Investment bank which owns Eircom as losing 36% of its shareprice because it is seen ulitimately as a 'wheeler and dealer'.

Feckin great, robber barons own most of our comms infrastructure, maybe they'll put it on the market and sell it to a similar group of c****?

And Kerrynorth has it today in the Pin as reported in the Irish Times - Landlords hit by falling rents which means more bank debts that won't be paid. yet did I see the ISEQ lept up 60 points this morning?

cactus flower wrote:

I suppose part of the problem is that the woes are increasing by the day with recession. And a lot more bad mortgages in the pipeline.

I am not so sure that that is the problem. I think some have been more than economic with the truth. In fact I am certain that that is the case.

I am uneasy as are many others.


Audi

The markets sometimes react to current news items but I think it would take more than rent falls to depress the market especially now that it has dropped almost 60% of its value. If Lehmans goes down that news should act like a laxative!

Squire wrote:

cactus flower wrote:

I suppose part of the problem is that the woes are increasing by the day with recession. And a lot more bad mortgages in the pipeline.

I am not so sure that that is the problem. I think some have been more than economic with the truth. In fact I am certain that that is the case.

I am uneasy as are many others.


Audi

The markets sometimes react to current news items but I think it would take more than rent falls to depress the market especially now that it has dropped almost 60% of its value. If Lehmans goes down that news should act like a laxative!

A very wobbly house of cards is what I see. At one hyper-level for the last five years, but at another level from the 1970s. I'm not sure which "some" you're thinking of, but in the sphere with which I'm most in touch, there are a lot of unreal values being "consolidated" in a way which is giving me plenty of perfectly legitimate work, but which in no way is recuperable by the original lenders for many a long year.

. . . And indeed there will be time
For the yellow smoke that slides along the street . . .

And time yet for a hundred indecisions,
And for a hundred visions and revisions . . . (ts Elliot)

Well, how's about yees? Any new financial market millionaires this week? Again, I stayed out of the fray and paper traded my new'ish methodology. Paper profits reek - wrong kind of paper. 'Twas shaping up to be a bad week for the stock markets (bar the bears amongst us) and looking decidely brighter for the commodities. Oh, what difference a day makes. Did the stock traders on Friday decide that enough was enough and they needed to gather some dosh to get a good stiff drink after work? Or did they just decide the markets were oversold? Anyway the continuing theme stayed intact: Ignore the bad news and treat not-so-bad news as good news. All the major indexes, bar the top heavy commodity FTSE, all ended the week lower on short term average volumes. There is talk of a Korean bank's interest in Lehmans and there was no news on Freddie and Fannie to unsettle the markets. Happty days.

The poor Nikkei had another terrible week and sentiment is just about rock bottom. I see where the Japanese government is introducing another whopping fiscal stimulus package (bloomberg) but you have to wonder if the pesky Japanese consumer, unlike his/her Western counterparts, won't just continue to save money rather than spend, spend, spend.

There was a slight improvement in the Euribor rate but it remains pretty stubbornly set from its recent height. It's looking like the UK interest yields are becoming inverted meaning that short term lending sentiment is turning bery bearish. Bank lending is still very weak across most Western economies. The credit crunch still has a long way to go yet as Western economies begin the feel the affects of economic slowdown. Germany joined the other big and established economies in a GDP turndown. Mmmm.

I saw some posts, and read a few articles, that mention that gold and silver coinage for sale in the US has become very scarce. I have to believe that it's the average punter with excess cash that is buying these coins. The very wealthy may have precious metals but very little of it is hidden under the bed. This activity flies in the face of the most recent Univerity of Michigan Consumer Sentiment survey which posted better than expected results; although it must be pointed out that the upturn in sentiment begins at a very low base line. The halt in the rapid appreciation of the dollar might be another sign that money in going back into commodities in the short term. But, I'd be wary of the small investor stampede into precious metals. The small fella is always the last to know and the one most hurt by sudden swings in any asset price.

The best of luck and remember,as JM Keynes said: the markets can stay irrational longer than you can stay solvent.

[Oh, yeah, the ISEQ. Up bigger than other indexes on Friday but, then again, it goes down bigger than other indicies on bearish days. This market will always remain too thinly traded, and too open to major price adjustments by too few market participants and hence too volatile for my risk appetite.]

PS some might want to keep an eye for the soft commodity goods. Wheat has been very volative but it is on an upward trajectory again. While oil might be on everyone's inflation expectation radar, we also have to eat and these goods will have a very real impact on long term inflation as well.

Warren Buffet says a pile of banks will go, and Freddie and Fannie are bale out cases. I suppose this isn't news.

http://www.breakingnews.ie/business/mhqleygbcwid/

I would be caught between the dread and fascination of waiting for impending economic implosion, and the feeling that there's a great strength and robustness in all the productive capacities of the world.

cactus flower wrote:

Warren Buffet says a pile of banks will go, and Freddie and Fannie are bale out cases. I suppose this isn't news.

http://www.breakingnews.ie/business/mhqleygbcwid/

I would be caught between the dread and fascination of waiting for impending economic implosion, and the feeling that there's a great strength and robustness in all the productive capacities of the world.

I suppose at least they all aren't going together and are staggering out one by one and falling into the Abyss so at least there is still some money sloshing around though perhaps being directed to be used more fruitfully and carefully (GM is going to end up on the heap too because it invested too heavily in SUVs and Ford is likely to suffer also)

I wonder who it effects most when a bank goes to the wall - the reputation of that bank and its management, the ordinary indebted people directly, businesses directly or all in a roundabout way afterwards? Or other or none ... ?

Auditor #9 wrote:

cactus flower wrote:

Warren Buffet says a pile of banks will go, and Freddie and Fannie are bale out cases. I suppose this isn't news.

http://www.breakingnews.ie/business/mhqleygbcwid/

I would be caught between the dread and fascination of waiting for impending economic implosion, and the feeling that there's a great strength and robustness in all the productive capacities of the world.

I suppose at least they all aren't going together and are staggering out one by one and falling into the Abyss so at least there is still some money sloshing around though perhaps being directed to be used more fruitfully and carefully (GM is going to end up on the heap too because it invested too heavily in SUVs and Ford is likely to suffer also)

I wonder who it effects most when a bank goes to the wall - the reputation of that bank and its management, the ordinary indebted people directly, businesses directly or all in a roundabout way afterwards? Or other or none ... ?

This article by Dr Peter Morici on Finfacts doesn't answer your question, but it is a very clear description with what has gone wrong with the banking system. He is giving out to the Fed for propping up nonviable banks without conditions.
http://www.finfacts.ie/irishfinancenews/article_1014506.shtml

Just saw this on the Property Pin - a real-life horror drama

I.O.U.S.A - The Movie

youtube trailer
https://www.youtube.com/watch?v=HBo2xQIWHiM

I'm not so sure that I'd agree with Morici.

The problem is that banks need to shore up their capital bases and, at the moment anyway, the most efficient way of doing this is by trying to attract people's deposits. If the Fed lets a few large banks go to the wall, it affects confidence, meaning that people are reluctant to use the banks for savings, and the result will be that more banks will fail. The last thing anyone in society needs is a widespread collapse of the banking system... the effect on families and small businesses would be horrendous, furthermore, this would encourage the current debt culture big time ....one can just imagine people questioning the point of savings if they're all going to be lost. Why not let the banks go down with you owing them loads rather than the other way around??

We know that many of the large banks have been less than cautious, but sometimes we all suffer more if they are punished. unfortunately.

I suspect the above analysis has a lot to do with why people are buying coins... they figure gold will appreciate nicely "under the mattress". People with money have to find something to invest it in, and property is not in fashion these days. This might well explain why the stockmarkets (Iseq excepted) haven't suffered as much as they should have done as a result of the credit crunch

That's my theory anyway. The problem with Big Economics these days is that it spends too much time telling people what the logical response to certain events would be, and too little time trying to work out what millions of ordinary Joes might all do with their money at once, given a certain amount of (mis)information. Hence predictions are both difficult and uncertain

There has to be a way of allowing the banks to go down whilst protecting the customers? If you don't then the Banks can act with impunity knowing the government will bail them out if they blunder. Why stop at banks, what about local shops, the post office, any business that has customers. If you have put a deposit down for windows and the company goes under? Where does it stop?

****Squire posted just before me - see above

expat girl wrote:

I'm not so sure that I'd agree with Morici.

The problem is that banks need to shore up their capital bases and, at the moment anyway, the most efficient way of doing this is by trying to attract people's deposits. If the Fed lets a few large banks go to the wall, it affects confidence, meaning that people are reluctant to use the banks for savings, and the result will be that more banks will fail. The last thing anyone in society needs is a widespread collapse of the banking system... the effect on families and small businesses would be horrendous, furthermore, this would encourage the current debt culture big time ....one can just imagine people questioning the point of savings if they're all going to be lost. Why not let the banks go down with you owing them loads rather than the other way around??

We know that many of the large banks have been less than cautious, but sometimes we all suffer more if they are punished. unfortunately.

I suspect the above analysis has a lot to do with why people are buying coins... they figure gold will appreciate nicely "under the mattress". People with money have to find something to invest it in, and property is not in fashion these days. This might well explain why the stockmarkets (Iseq excepted) haven't suffered as much as they should have done as a result of the credit crunch

That's my theory anyway. The problem with Big Economics these days is that it spends too much time telling people what the logical response to certain events would be, and too little time trying to work out what millions of ordinary Joes might all do with their money at once, given a certain amount of (mis)information. Hence predictions are both difficult and uncertain

Fair points about letting all the troubled banks go to the wall - as you say, sentiment and good depositors good money goes with it. What about restructuring the debt of ones that are someway healthy? Bear Stearns had $33 dollars of debt for every $1 it possessed according to a Newsweek article I read a short while ago - surely this kind debt ratio must not be allowed to survive?

everyone wants someone else to be forced to protect. A total collapse would be a Gods-send to the regular person but don't expect this to be pointed out.

A collapse of either the economy or currency, or most likely both, are mathematically impossible to avoid. The currency should be saved but when has the right thing been done nowadays.

youngdan wrote:

everyone wants someone else to be forced to protect. A total collapse would be a Gods-send to the regular person but don't expect this to be pointed out.

A collapse of either the economy or currency, or most likely both, are mathematically impossible to avoid. The currency should be saved but when has the right thing been done nowadays.

I'm probably just thick, but how is this likely to benefit Joe and Josephine Soap?? If they owe the banks, failing would mean they are asked to pay money back very quickly, or have to find a remortgage deal, neither of which may always be possible, particularly not with negative equity and other banks not having vast capital reserves

Presumably if the government finances (whichever nation, they're all in a similar boat at the moment) are precarious and several banks fail at once, then Joe and Josephine lose their savings, if they have any.

Not to mention pension fund collapses.

So how does this benefit the ordinary Joe. Now I can see that Joe's kids might benefit in the long run if the whole effing system has to be reformed, but then, on the other hand, if their parents lose the shirt off their backs, there goes the college fund

So I'd say, keep propping 'em up and run laws through the legislatures that will rein in the banks the next time...

Nobody cares about Josephine except Joe every now and then and nobody cares about Joe ever. These bailouts are to bail out the bank owners and bond holders.

If the idea was to help those who could not longer pay their mortages then the mortages could just be cancelled and their house could be given to them. The poor taxpayers would not be hit with the bill and the bankers would have to eat the loss.

Why do you think the banking industry spends so much money buying politicians. The whole idea of politics is to grab the money. We are not talking about Buddist Monks here

youngdan wrote:

Nobody cares about Josephine except Joe every now and then and nobody cares about Joe ever. These bailouts are to bail out the bank owners and bond holders.

If the idea was to help those who could not longer pay their mortages then the mortages could just be cancelled and their house could be given to them. The poor taxpayers would not be hit with the bill and the bankers would have to eat the loss.

Why do you think the banking industry spends so much money buying politicians. The whole idea of politics is to grab the money. We are not talking about Buddist Monks here

Can't the mortgage terms be adjusted so Joe and Jo have a bit more dough every month and so has the bank? That way investor confidence stays up though less because the greedy ones will all feck off but isn't this being done now in effect - you can change your mortgage and save or in some cases I read in the NYT, banks are taking the cash back at a different pace.

The weak Joes should not have gotten a mortage as everyone knew they could not afford it.

youngdan wrote:

The weak Joes should not have gotten a mortage as everyone knew they could not afford it.

Read this on the Pin - a pitiful tale of a few people who can't afford the mortgage on their third home ...