Jim,
You look positively light and cheery compared to this guy! By the way, I don’t think capitalism failed. I think altruism failed. With socialism somebody else determines when and how much you sacrifice. With capitalism **you** determine when and how much to sacrifice (donate, save, invest, etc.). Your altruism is personal rather then forced.
CIGA Tim D
Tim,
Your viewpoint gives me something to think about.
Thank you,
Jim
Death of ‘Soul of Capitalism:’ Bogle, Faber, Moore
20 reasons America has lost its soul and collapse is inevitable
By Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) — Jack Bogle published "The Battle for the Soul of Capitalism" four years ago. The battle’s over. The sequel should be titled: "Capitalism Died a Lost Soul." Worse, we’ve lost "America’s Soul." And worldwide the consequences will be catastrophic.
That’s why a man like Hong Kong’s contrarian economist Marc Faber warns in his Doom, Boom & Gloom Report: "The future will be a total disaster, with a collapse of our capitalistic system as we know it today."
No, not just another meltdown, another bear market recession like the one recently triggered by Wall Street’s "too-greedy-to-fail" banks. Faber is warning that the entire system of capitalism will collapse. Get it? The engine driving the great "American Economic Empire" for 233 years will collapse, a total disaster, a destiny we created.
Dear Jim,
The residential mortgage debacle is about to gain momentum from a new source as the majority of pay option loans start to reset. Simultaneously, commercial real estate is going into a tailspin. There will be no slow down in QE; an acceleration is far more likely.
Respectfully,
CIGA Richard B.
Hotel Foreclosure Watch: Miami’s Swank Shore Club Goes Delinquent
The Wall Street Journal, October 20, 2009
Things aren’t so sunny for New York developers Philip and Michael Pilevsky at their swank Miami Beach hotel The Shore Club, which recently went delinquent on its $111.5 million securitized mortgage.
The special servicer overseeing the mortgage reported earlier this month that the Pilevskys had “withdrawn a threat to close the hotel after we agreed to fund payroll and critical expenses” from one of the mortgage’s reserves, according to credit-research company Trepp LLC.
That special servicer, Cerberus Capital Management LP’s LNR Partners Inc., declined to comment for this story. But, according to Trepp, LNR reported the Shore Club’s mortgage as 30 days delinquent this month. The hotel has another $11.5 million of debt on it in addition to the mortgage.
Dear Jim,
Please note the sections below that I have placed in bold!
JSMineset readers didn’t have to wait for Peter Bernholz research as we were warned years ago! Nonetheless the statistics and research are of value as this represents a "tipping point".
Here it is copy and pasted from below as well…
Regards,
CIGA Marc, the new Dad.
Will History Repeat Itself?
(Excerpts From Article)
So… The U.S. fiscal deficit for 2009 was $1.42 Trillion… Remember how I used to take the previous administration to the woodshed for posting $450 Billion fiscal deficits? How did we go from $450 Billion to $1.42 Trillion, that is if that’s really the number??? Well… That’s not a question to really answer, folks, we all know how we got here… But now that we’re here, what happens next?
I came across this when putting the two monthly newsletter together on Sunday, I think it would be appropriate to share it with you here…
Peter Bernholz (Professor Economics in Basel) studied the world’s 12 most important periods of hyperinflation and discovered that the tipping point occurs when deficits amounted to 40% of the expenditures.
For the United States we have arrived at exactly that point. The deficit of $1.5 trillion amounts to 41.7% of the $3.6 trillion in expenses.
You see, that Peter Bernholz, rounds some numbers, but for those of you keeping score at home, the real point is that the U.S. deficits are greater than 40% of expenditures… And you know me, I truly believe in this history repeating itself, or as Mark Twain put it, it may not repeat itself but it rhymes… Mark Twain also wrote: "It’s not worthwhile to try to keep history from repeating itself"…
So, the point I’m trying to make here is that according to Mr. Bernholz, we can soon expect a bout of hyperinflation! OH BOY! Where do I sign up for that? Not only do we have a falling dollar causing us to lose purchasing power, but what purchasing power we have left is going to be eaten away with inflation! Like I said, OH BOY! Gee Willikers, that sounds like the cat’s meow! NOT!
So… Here we go again, with me getting on the soapbox and telling you the only way to protect yourself from a falling dollar and hyperinflation is to diversify with non-dollar currencies and precious metals…
Hi Jim,
What is the significance of this?
CIGA Don
CME accepts gold as collateral for trades
Author: Katie Holliday
Source: Energy Risk | 20 Oct 2009
The clearing house of global exchange CME Group – CME Clearing – has announced it will now accept gold as collateral for trades on the exchange.
Gold is the first commodity that can be used for margins for CME trades, ranging from crude oil, gold, grains, equity indexes and Treasury bonds.
"During conversations with the London bullion market, it became clear that a lot of participants were holding physical gold, and this was proving costly to them," says Jeremy Hughes, spokesperson for CME Clearing. "They were interested to find out if they would look at accepting gold as collateral as an alternative to debt or equities."
Dear Don,
The most honest conclusion is gold is a valuable, fungible asset and good collateral.
The most probable conclusion is most commodity traders lose. This means most commodity traders lose their collateral, however the counter party always has been paid in cash.
I will assume that the counter party is the public and they will be paid in cash.
The clearing house will have to lend against the gold collateral, therefore to whom the clearing house sells the gold, gets the gold. Yes, gold goes to whom the clearing house sells it.
Alternatively, does the clearing house just take the gold and pay off the public or keep the gold if the counter party is a member of the clearing house?
Regards,
Jim
