For people expecting interest rates to rise significantly, take a look at yields on 30 year Japanese bonds, it is 1.62%.  Link

Interest rates must be kept low, otherwise the debt cannot be serviced.  

While I agree with Kyle Bass that Japan is headed for disaster, I think the US has a good 5-10 years before significant interest rate increases will be allowed.  Japan has been years ahead of us in the insane debt game, and still have an (apparently) functioning economy.

Good point,

But Japan had us to prop them up for the past decade or so.   There's plenty of instances where the FED pumped USD's into the Euro and the JPY to keep things going.  

There's no one to prop us up, not to mention at this point we're a much bigger snowball rolling down a much steeper hill (our economy is around $15trillion compared to Japan's $5 trillion).   Seriously, we pumped more than $5 trillion into the markets in 2008 like a Rap-Game baller tossing $20's on stage for his favorite dancer.  

In either case, I'd like to refi at 3.25% so hopefully things hold out longer!  

ETA:

Don't forget that we are in a very interconnected economic world. If one large economy falls (or even a big bank) it will have an effect on the others. This is not a linear game where Japan has X number of years and we have X +5 years. When a large component falls (i.e. defaults, liquidity crisis etc.) it's effect will be felt by the world's banking system. Everyone has loans and investments with everyone else and it is all horribly magnified by derivatives. Once one falls it will start a chain of events very quickly. If it is not brought under control it is anyone's guess how far it spreads.

Do not underestimate the speed and scope which a crisis can spread. The 2008 crisis was such an event and was stopped by central banks backstopping defaults with trillions in liquidity.
Can they do it again? Well wait a bit and we will see.

Whether they can or not is moot.   We know that there is a 100% chance they will try to do it again regardless of outcome or consequences.  

And another thing:   What did Obama and Wall Street Executives talk about last Thursday at 11AM?  

We refi'd at 3.75% earlier this year.

His cancer analogy is good.  If you think of the economy as a living organism it is sick.  We are undergoing massive experimental treatment.  Treatment that is based on the theories of John Maynard Keynes.  












 

Just when I thought I've seen it all, I read this...Data shift to lift US economy 3%...

snip...

"We
are carrying these major changes all the way back in time – which for
us means to 1929 – so we are essentially rewriting economic history,”
said Mr Moulton.

The changes will affect everything from the measured GDP of different
US states to the stability of the inflation measure targeted by the
Federal Reserve. They will force economists to revisit policy debates
about everything from corporate profits to the causes of economic
growth.

The revision, equivalent to adding a country as big as Belgium to the
estimated size of the world economy, will make the US one of the first
adopters of a new international standard for GDP accounting.

"We’re capitalising research and development and also this category referred to as entertainment, literary and artistic originals,
which would be things like motion picture originals, long-lasting
television programmes, books and sound recordings,” said Mr Moulton.

No wonder Hollywood loves this Administration, and never misses a Party...at OUR expense













Traitorous Pimps...
eta



US GDP Will Be Revised Higher By $500 Billion Following Addition Of "Intangibles" To Economy

 

 
 
 

This will dovetail nicely with their planned revision of the CPI formula.  They've no need of rolling that out just yet.  But when the time comes they'll change the calculation that just happens to reflect lower CPI numbers.   LOL, fixing the economy by fixing the accounting.  magic!  

So...  huge DOW rally on the upcoming "2.X" GDP numbers...  showing "above consensus growth?"

We had a locked in 3.25%/30yr, no points in October - but due to issues with the online co we used outside of our control, it took several months; which was long enough for the company to back out of the deal once rates shot back up.   Complicated mess (loan officer left the company, etc), but now we're trying a more reputable company just to get the deal done.  

Always something.  

We used USAA.

Could have gone lower, but wanted to have enough $$$ to pay off credit card debt.

Aside from the card I use for business and the house, we are effectively debt free.

And when this doesn't work????

Keynesian Economics explained....

 

Add in the profits from the drug trade, duh.

Hackers...   well, hack AP's twitter account, make a fake post that Obama was injured in a White House blast.

DOW, S&P and NYSE all instantly drop 150 points in literally a second across the board, before rippling into other markets.

I guess all the day traders have Bloomberg terminals with a tweet window now?  


http://www.courierpress.com/news/2013/apr/23/stocks-briefly-drop-recover-fake-bomb-tweet/

How scary is that?

That's really not all that far-fetched anymore.

Hmm...test run to see what the reaction would be if it actually happened?  Sorry, lame tinfoil joke

I thank you guys for the wealth of knowledge in this thread!

I don't think that's out of the realm of possibilities at all.

I have a feeling that quite a few "news bits" are created and then released to the media from time to time to gauge the reaction of not only the markets but also social media, mainstream media, foreign media, etc.

No.

The Algo-bots that do 99% of the exchange trading actually watch the news feeds, and will trade accordingly.
That drop was initiated by the computers that are the "market", not by day traders.

All fiat currency eventually goes to zero, there are literally hundreds of historical examples w/*no* exceptions.
There is no reason to believe that the USD can avoid this fate.
Tomac

Paging LRRPF52...

Market went DOWN??

I wish I knew what that means.

I would make a few points about OUR Dollar:




1) The only 'Investment' not in a Bubble




2) Prices for everything are based on the strength/weakness of OUR Dollar




3) WE are not the only ones manipulating & printing




4) For OUR Dollar to be worth Zero, WE have to lose the next 'War' or the Traitors in Congress/Treasury/FED sell OUR Country & US out




5) WE aren't Weimar or Zimbabwe...OUR Dollar remains the 'Gold' Standard for the World 'Players'




6) WE won't see OUR Dollar 'Dumped' anytime soon...Countries trading in their own currencies does not mean they Dumped OUR Dollar; their Pricing is still set by OUR Dollar




7) WE need Interest Rates to rise & some Inflation; Strong Dollar = Real Independent Wealth for Everyone, Globally




8) Since OUR Independence, a Majority of the World wants to see OUR Republic Fail




9) As long as WE the People Barter in Dollars, the Republic will never Fail




10) WE currently are not 'Bartering' as much as WE should, so things are a little 'crazy'
WE are breathing & are still Surfing the Web...Life is Good





eta

Visualizing Life In America From 1983 To Today

 

 
 

What what means?

Recessions are caused by Governmental Spending, not 'Cuts'


WE are heading for another Recession, even with all their funny math


Wait until October when the Obamacare nightmare really begins
 

What is nice about mid 2013 is we now have nearly 5 years since the banking crisis to actually look at.





My answer is we are in for more of the same. The new normal, which is about the only true thing that has come out of the Kenyan's mouth. Median incomes are lower than 2007. Unemployment is higher than 2007. Prices of staple items are higher than 2007.





Lowered standard of living than what otherwise would have been. People can still make money and many do. But not as many as could have.





That is the good news.





Unfortunately it looks as if the politicians are perfectly willing to spend $1T more than we take in every year...forever. Worse it looks as if the electorate doesn't mind either.





As some point something will break. I personally think it will be our country. Some states will just say no at some point. Hopefully it will be relatively peaceful like breakup of the Soviet Union and not a bloodbath like Yugoslavia.

...I still stand by what I wrote





 

The breakup will vary by state. Places like MA and RI will probably be glad to get rid of Texas and Texas will be glad to get rid of them. Purple states like VA and FL will be bloody. West Virginia again might get bigger after a Civil War.

 

1) If true, why has the USD lost 95% of its purchasing power over the last 100yrs? Doesn't sound like a very good rate of return on an "investment".
2) What does this have to do with the USD eventually going to zero? Prices are misleading: 100yrs ago 2 silver dimes would purchase a loaf of bread or a gallon of milk. Those two silver dimes (melt value) will still purchase a loaf of bread or a gallon of milk *today*. What will 2 current mint dimes get you?
3) Agreed, but again, what does this have to do with the USD eventually going to zero?
4) Already done.
5) So we're in First Class on the Titanic after it hits the iceberg, how does this prevent the USD from eventually going to zero?
6) Again, how does this prevent the USD from eventually going to zero?
7) Even at these current artificially-low interest rates, interest payments on the Nat'l debt consume appx 25% of all Fed tax revenues. When interest rates inevitably go up, the interest payments alone on the Nat'l debt will consume *all* Fed tax revenues. Then what happens?
8) Agreed, but what does this have to do w/the USD eventually going to zero?
9) The only reason our fiat currency is worth anything is perceived value. There's nothing backing it whatsoever. When that confidence is lost, it becomes a worthless piece of paper (linen, actually). People won't barter for something they think is worthless, especially a piece of paper. Offer them something tangible w/intrinsic value (ie: food, tools, ammo, silver/gold) and you have the basis for barter. Money is different from currency in that money holds its value over time, currency doesn't (which is why PM's like silver/gold have historically been used as money for thousands of years).
10) Life is still good? Explain that to the millions who are unemployed and dependent upon govt handouts for their next meal. Explain it to the growing unemployable underclass who will gladly vote for anyone who promises them more of the taxpayer's money. Explain it to the taxpayers who are getting hammered more and more by increasing taxes, pushing them ever-closer to govt dependence. Explain it to *everyone* as they discover daily that their dollar buys less and less at the grocery store w/each passing day. Go ahead and savor your brandy in the Titanic's lounge while the rich & powerful head for their lifeboats and 3rd class is locked in steerage.
Tomac

The easy thing to do is Blame a Politician, but 90% of the 'Idiots' were reelected.




My problem: If they are never held accountable, why are WE?




No Checks, No Balance, No Constitution...2 Sets of Laws won't last






Just the opinion of a 'Genius'






BTW, When did Communism become a good thing? It's still an Illusion...The USD Reserve Exodus Continues - Australia Diversifies Reserves Into China


Global Useful Idiots will regret doubting OUR Nation
 
 
 
 

 

Yeah, I know.   It was more of a rhetorical question (poking fun at the nearly instant "market" reaction).   :D

More fun:

It's over, Paul Krugman won and this article is biased



http://finance.yahoo.com/blogs/daily-ticker/economic-argument-over-paul-krugman-won-150247189.html?vp=1

Wow! I guess I know who the target audience is for THAT malarkey. Baaaa   Baaaa

Nobody had the balls to put their name on that article, unless it's being hidden on mobile devices for some reason.

Henry Blodget put his name on it, but what does he care - the SEC fined him $2 million and banned him from the securities industry in '02.

This won't end well...

Reinhart and Rogoff are Keynesians and the leftists are trashing them.  Dumbasses eat their own.

 

Nothing anymore magical than a rule of thumb that has been used for decades, and is probably programmed into an algorythm somewhere along with arbitrary stop loss percentages that are multiples of 5 (ie 5%, 10%, etc).   Meaningless, but they have meaning because so many people attribute meaning to them...  like looking for patterns in market levels (head and shoulders, etc).

Anyway, here's your daily dose of algos-gone-wild and "Free Market" confirmation:  $11 to zero in three seconds.   Back to $11 in seven seconds.

What is, will be no more.
What was, will be again.

Perfect quote for your username.

 

Is that chart orders for factory goods or orders for new factories?
Link to associated article please?

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