Jim Sinclair’s Commentary
This is madness unless you want a planetary Weimar with the only difference being whose currency hits the deck first. Fellows, it is not bad business causing derivatives problems. It is bad derivatives extending a normal business contraction into an unprecedented disaster. Aim at the cause, not at the symptoms.
G-20 Says Its Ready to Urgently Boost Growth, Stimulus Needed
By Ben Sills and Shamim Adam
Nov. 10 (Bloomberg) — The Group of 20 nations is prepared to act “urgently” to bolster growth and called on governments to cut interest rates and raise spending as the world’s leading industrialized economies battle the threat of a recession.
“We stand ready to urgently take forward work and actions agreed by our leaders to restore and maintain financial stability and support global growth,” the group said in a statement released yesterday following a meeting in Sao Paulo. “Countries must use all their policy flexibility, consistent with their circumstances, to support sustainable growth.”
Those measures include “monetary and fiscal policy,” it said.
China, the world’s largest developing economy, announced an economic stimulus package worth almost a fifth of its output to sustain domestic demand as the credit crunch drags down growth from New York to Tokyo. Officials in the U.S. and Europe already have slashed borrowing costs and boosted spending in a bid to contain the effects of the slump.
Jim Sinclair’s Commentary
I never thought I would ever see this.
If Bloomberg is successful, you will not be able to believe how the US Federal Reserve has sold the US citizens straight down the pooper.
Bloomberg Sues Fed to Force Disclosure of Collateral (Update1)
By Mark Pittman
Nov. 7 (Bloomberg) — Bloomberg News asked a U.S. court today to force the Federal Reserve to disclose securities the central bank is accepting on behalf of American taxpayers as collateral for $1.5 trillion of loans to banks.
The lawsuit is based on the U.S. Freedom of Information Act, which requires federal agencies to make government documents available to the press and the public, according to the complaint. The suit, filed in New York, doesn’t seek money damages.
“The American taxpayer is entitled to know the risks, costs and methodology associated with the unprecedented government bailout of the U.S. financial industry,” said Matthew Winkler, the editor-in-chief of Bloomberg News, a unit of New York-based Bloomberg LP, in an e-mail.
The Fed has lent $1.5 trillion to banks, including Citigroup Inc. and Goldman Sachs Group Inc., through programs such as its discount window, the Primary Dealer Credit Facility and the Term Securities Lending Facility. Collateral is an asset pledged to a lender in the event that a loan payment isn’t made.
Jim Sinclair’s Commentary
25 billion will do nothing to keep automakers making autos that they cannot sell. 25 today, 50 tomorrow and 100 next week.
Emanuel Says Auto Industry Essential to U.S. Economy (Update1)
By Todd Shields
Nov. 9 (Bloomberg) — Rahm Emanuel, President-elect Barack Obama’s chief of staff, called the auto industry an “essential” part of U.S. manufacturing, while stopping short of endorsing a proposal to use some of the $700 billion financial-rescue fund to aid automakers.
“The auto industry is an essential part of our economy,” Emanuel said on ABC’s “This Week.” Lawmakers should speed up the availability of $25 billion in government loans for the development of fuel-efficient cars, he said.
In addition, there are “other authorities” the administration can use immediately and Obama “has asked his economic team to look at different options of what it takes to help bridge the auto industry so they are a part of not only a revived economy, but part of an energy policy going forward.”
Emanuel didn’t directly respond to whether Obama endorses a proposal by House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid to use some of the $700 billion approved to stabilize the financial services industry to aid automakers.
