Sunday, October 5, 2008

Hank and Ben Missed it

Good afternoon!

Just a little video today. I liked this timeline from CNN that shows how clueless Paulson was over the past year as this crisis developed. How on earth did Congress decide to give this guy $700 billion?


John Maynes said...

Hi Jeff,

thanks for the video. The best part was this:

Stephen Leeb: "Ben Bernanke studied the Great Depression probably in greater detail than anybody else."

Peter Schiff: "He wasted his time!"


Matt Waters said...

I'm going to ask a question that has been on my mind lately and have had no one to ask.

What happens to the other economies in the world when the U.S. economy goes into a depression? This may sound a bit conspiratorial but I'll press on because I'm curious. If all the other economies tank worse than the U.S. because they can't afford to bailout all of their banks then what position does that put the U.S. in? Here we were seeing our role as the one and only world power being challenged by European and emerging economies, so at the end of all this where will those economies be? Is this the "Mother of all Power Plays"? Is the game being reset back to post WWII when the U.S. was the big man standing and everyone needed assistance? Would like to hear your thoughts on how a global depression would affect U.S. compared to other economies.


Jeff said...

Hi Matt

Good question. I have the same thoughts.

From what have read, most economists believe that the US will get out of the recession/depression first so its best to have your money over here if its going to be global.

This is why you are seeing a huge rise in the dollar. The theory is "We're screwed but the world is screwed worse".

I am not sure if this is the case this time, but I would lean towards this holding true. Europe appears to be coming unglued at the seams.

One of my senior contacts on Wall St. believes that China is waging a "financial" was against the US in an attempt to become the financial power of the world.

He believes China is attempting to weaken our financial markets in an attempt to grab our banks at cheap prices thus becoming the global leaders in the financial markets.

This sounds a little "tinfoil" but I gotta take him seriously because he is way more connected than i am, and has spent 4 decades on Wall St. I really respect what he tells me.

Time will tell, but the "mother of all power plays" is most likely being attempted by China.

They are basically "paying the bills" for the US by buying our treasuries.

This puts us in a very vulnerable position. We will se ehow it all plays out.

jeff said...

Gee what a coincedence:

Look at who Paulson hired to run the bailout program. A former GS banker who specialized in international affairs.

I guess you need an international whiz when you plan on spending $700 billion of our tax dollars on bad mortgage debt from countries like China.

God this whole thing stinks!

PHILADELPHIA (Reuters) - U.S. Treasury Secretary Henry Paulson is expected to name Neel Kashkari to oversee the $700 billion program to buy distressed assets from financial institutions, The Wall Street Journal reported on Sunday.

Kashkari, a Treasury assistant secretary for international affairs and a former Goldman Sachs banker, is expected to be named interim head of Treasury's new Office of Financial Stability as early as Monday, the newspaper reported in its electronic edition.

Kashkari, who headed Goldman's information technology security investment banking practice in San Francisco before joining Treasury, has been advising Paulson on a variety of issues since his nomination in November 2007.

In his new position Kashkari would oversee Treasury's effort to buy bad loans and other distressed securities, the newspaper reported, citing unnamed people familiar with the matter. A Treasury spokesperson was not immediately available to comment.

John Maynes said...

@Matt: USA and Europe are the old world. China will come out first of this depression and become the number 1 world power sooner than we wanted. Thank you America. Well done. LOL

John Maynes said...

€ is tanking against the $ because of the banking crisis in Europe. HRE in deep shits. Will drop again today in German trading like a stone.

John Maynes said...
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