I love the doom and gloomers out there, calling for default in Greece, Portugal, Italy, Ireland, even here in the U.S. They mask their mental illness with claims that by “taking the medicine now” we are saving our grandchildren later. Are you people fucking nuts? What you are asking for is voluntary acceptance of a great depression. By chance, have any of you dicksuckers lived through a great depression and failure of your domestic currency?
I did’t think so.
Say what you want about moral hazard, but I’d rather give myself a fighting chance to fix things later, than guarantee my death now. Who knows, perhaps in 10 years some sort of renewable energy will be main streamed that will help spur another boom, allowing us to grow out of our problems. By asking Greece to default is equal to letting Lehman fail. Now, we all know after Lehman failed, we had to bail out AIG. If Greece is Lehman, Spain is AIG. We are going to have to deal with these problems right now, else all of the QE money, TARP funds and stimulus that has been injected into the system will be null and void, as we will descend back to the lows of 2008.
Now if you were a policy maker, does that sound like a reasonable course of action?
The problem with Greece is that it’s full of Greeks. Even if they approve austerity, their government may get voted out and then we will have to start the ham and egging process all over again.
Early going, futures are improving, which is a good sign. Like the Analyst Bomber said, ” if the stocks stop going down in the face of bad news, they are probably done going down.” I agree 100%. Should the market stop trading down in the face of bad news, we will have a tradable bottom. The situation is very fluid, as news flow dictates the money flow.
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Got long SMH for daytrade @ 32.25.
Hope I am not first here.
I like your take on all this flyseph. Still, the revolutionary in me can’t help but think that we might be better off in the long run, even after the facing an awful failure of the currency and the banking system. Of course I only consider what it would mean for my children, which causes me great distress. In the end, I believe it would be repaired, and made better. Perhaps I am a fool for thinking so. I think there is less of a chance that the politicians have the ability to fix things later, assuming a default is avoided. I think there is a good chance that the same problems will keep re-occurring until the system fails and is reset.
Don’t you think your children could better manage a depression as adults, than as kids?
Check out the demonstrators in Euroland.
Most are young and fancy themselves as Socialists,Marxists, and Commies (they vote for leftist kooks in Spain although unemployment is over 20% there).
The vast majority of young people in this country voted for Obama.
Young people are going to get what they voted for- they are just mad that they are running out of other peoples money to pay for their lifestyle.
And this is coming from somebody who voted for McGovern in ’72 ,when in college, because he was going to “give” all Americans a check (I did wise up and vote better after I graduated and got a job).
every body that voted for obam thought they were gonna get a check to. they got their hope, and only chump change.
Ah, but some of us have children the age of many posters here. System failure and reset seems somehow massively unappealing.
Great post, senor. Cogent and logical.
Neither cogent or logical, only arrogant and naive. This thinking is the fundamental reason we have a problem today. You people arrogantly think someone owes you something. Wake up!
LOL —
Are you sure you are not that Arizona sherriff, and not just a border guard?
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Iceland. Are they better off? Or worse off?
We are better stop comparing Greece to Iceland: Iceland didn’t back banks obligations and devalued. And they are out of the debt market for a while. Issues? None.
Now let’s say Greece default on public debt: with 4% primary deficit/GDP, who is going to lend them that 4%? You?
Default alone is not an option. Exiting EUR would help by increasing growth but, again, they need some financing today. How do you play that?
Use their 111 tons of gold to make a gold backed currency immediately. No debt. They would have to adjust to some kind of austerity, but at least they wouldn’t be paying impossibly large sums to bankers who refuse risk. Joe Pita stand in Greece didn’t ask for large risky loans to be taken on by his government.
Ah, but what becomes of Sy Souvlaki Stand, then?
Bread is one thing, but where will he get his meat?
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you are joking right? Iceland?
The Icelandic government said “Fuck you banks, it was YOUR risk and you will NOT make debt-slaves of our children.” I am a proponent of failure and reset. Pull the bandaid. Pick up the can and hit yourself in the head with it (instead of kicking it at your kids heads).
We don’t have 10 years.
Agreed with respect to the depression comment.
I hate the idea of money printing, but if not papering over the issue results in a massive slowdown of industry, then who fucking cares that the US dollar is “strong.” What the hell are you going to buy with them?
If actual goods increase as a result of everyone getting robbed, then it’s worth it. It looks bad at first but everyone comes out on top in the end. Whether or not that would actually happen is sort of a sticking point though.
It’s a lose-lose situation. I’d rather lose less.
You are wealthy enough that it wouldn’t have much of an effect, if any, on your standard of living.
His standard of living has already been affected by the parasitic draining of wealth around him. Like a fish who lives in water and has no concept of moisture, however, he has never known any different and has no frame of reference. He has yet to live in a place where his relatively high rate of income (and likely, savings) would bring maximum standard of living benefits.
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The Icelandic government said “Fuck you banks, it was YOUR risk and you will NOT make debt-slaves of our children.” I am a proponent of failure and reset. Pull the bandaid. Pick up the can and hit yourself in the head with it (instead of kicking it at your kids heads).
The “problem” with that is that the Greek debt is owned by the French and German banks. Blowing those up would not be a very good thing. If the failure would not have systemic consequences, then let them fail. That is not the case today.
600 trillion in derivatives. It MUST deleverage at some point. Is it paid through generations of tax payments from all corners? Or do we take the painful restructure pill. Like chemo for cancer. It sucks, but you might live. It isn’t like the factories, farms, and production capacity disappear. Soup lines till the dust settles, sure.
Cancel ALL mortgage derivative contracts (both sides) and bar all lawsuits to try to recover.
Teach those derivative BUYING AND SELLING fuckers a lesson they won’t forget.
And what lesson would that be?
That contract law can be ignored as is politically feasible? Yeah, that’s exactly the message I want given to people sitting across from me in purely contractual obligations (equities, bonds, futures, swaps, etc.)…
Please think things through before running around on revolutionary tirades.
If I lend you 5 bucks (plus interest) it is because I figure you’ll pay me back, recognizing that the risk is on me. If you don’t pay me back, spend it all on booze, and have no job, I might not lend you $5 again. I wouldn’t threaten your children.
And the thing is……No one in their right mind, let alone investment bankers who, it would seem should have been trained in this type of thing, would have the temerity to expect clear sailing for the type of financial vehicles they were driving.
$600T??? Cmon people…….That amount of money can’t actually be “made” in a century if things went well. Who the flip was driving when this car went over the cliff and what the heck were they thinking??
To state that letting things crash would destroy wealth is false. There was never any wealth in the first place except on paper. True wealth is created when something grows or has value added to it in some tangible way, not when some dickhead makes a few percent by signing his name to a contract and reselling it to the next sucker down the line.
All it would destroy is debt and hopefully more than a few of the investment bank CEO’s (may the die a slow, heinous and infected death) that orchestrated this unholy mess.
There…… I think that pretty much sums up the mood of the general populace here in the USA……..
The real losers if Greece defaults would actually be the American banks who wrote the credit default swaps for Greek debt. Germany and France have American insurance against it. Maybe Obama will bomb the greeks next…
People can either riot in the streets, or get their asses to work. Appeasing rioters only puts off the depression and makes it worse when it hits. We can only live on our credit cards for so long, then the whole deal crashes.
People who advocate for blowing up the system in a giant Randian flush, are being intellectually dishonest at best, and just plain ignorant at worst. There is no benefit to blowing up the system for the sake of ideology. Depression is never an option. Ask someone who went through one if you can still find them.
Ask someone in Iceland.
My old Grampa (who was over for lunch yesterday) joined the tree army and worked on national parks. It was actually waaaay better for him than the dusty rural texas town he grew up starving in through the teens and twenties.
The old CCC. Young men went to work there and earned $30/month. $25 of that was sent home to their family. They lived army barracks style and did all kinds of public works projects. It didn’t really get us out of the depression, but it did put some money in people’s pockets. You could not do that today with minimum wage laws and all.
Wage laws wouldn’t need to change much. Inflation makes that $30 more like $550/month. http://www.shadowstats.com/inflation_calculator?amount1=30&y1=1933&m1=5&y2=2011&m2=5&calc=Find+Out
In my Grampa’s case, he was mainly glad to get regular meals and the chance to work (both of which were a lot more scarce for him before the depression).
@G2M – Exactly! I think you just proved my point.
I agree that it would be difficult and take some time for things to reset. CCC would be back. My point is that I think its a better plan than the alternative (hyper-inflation and/or debt-enslavement).
yogi, if one does not prepare for a rainy day then they are a fool at best and deserve to go down.
There is an interesting chart on the Economist site today about the aftermath of defaulting. Not as bad as you might think.
It’s pretty similar to defaulting on the house where you are upside down on the mortgage. Live there as long as you can for free. I know one guy who has been living free in a house in Arizona for 3 years. So you get a bad credit rating. What’s that worth?
link or it didn’t happen.
Some stocks working very nicely. Long GR
LMLP should hit 3.95 today…because I said so
I have no clue as to how this will play out. One thing I DO know for certain. The average investor will form a view based on what they glean from the financial press, they will panic as told, on cue; and then opportunity will as always, knock for the prepared.
Surely you can’t really believe what you say. Personally I don’t care weather the markets go up or down at this point but a child could understand that the moral hazard is fundamental to the problem. If you are unable to service your debt no matter the reason you have failed. I do not wish for another great depression but I can assure you if one should occur me and my prudent brethren will flourish.
I for one would not be happy flourishing while our country falls further into a hole. Anyone that doesn’t realize something big has to happen to get people back to work is blind. Defaulting etc. is giving up, the same thing Greek’s working age people did. Someone clever needs to figure something out fast, unfortunately until that happens we have to wait. I might be jaded because I just got back from visiting Buffalo.
People who flourish generally think it’s because they are smarter than the average person and deserve it. I see a lot of leakage going on. The shovel ready projects didn’t work. Oh well, just the better part of a $Trillion in added national debt. Laugh it off.
not much for a country that just produces tourism,feta, and olive oil……thats it,thats all they have…..greece was sold a bill of goods cause they wanted to be world players and stuff cash in there pockets.now they have to sell the country just to pay back everything they lost to the ones that sold them the bill of goods…….almost like goldman losing billions of dollars on gahdaffi crap that they were sold……. i have some junk silver………maybe i can buy yellowstone park, privatize it, then charge your first born to get in…………….it’s coming
Defaulting is not giving up. It’s dealing with reality.
Iceland defaulted and their economy recovered nicely already.
Screw the IMF.
Amen!
The people who are unable/unwilling to accept the root causes are the truly blind. Here is a clever thought, don’t risk more than you can afford. I would argue that defaulting is not giving up it is simply accepting reality. Look, you make a bad bet you lose. Move on.
if you did your job, then we wouldnt have jose illegal, vs joe six pack. joe six pack earns 50k a year and pays taxes adjusted to 31 k per yr. jose iilegal gets paid under the table @ 31 k a year and doesnt pay any taxes. joe six pack needs to get insurance for his wife and rug rats @ a cost of 4k a year leaves him with 27k. jose illegal needs insurance for his,he goes to medicaid, doesnt have a documented income, and he still has 31k. joe six pack needs to feed his family @ 4k a year,leaves him with27k. jose illegal gets food stamps, and still has his 31k………arizona boarder gaurd !!!!!!!! your fucking full of shit,and your probaly on the fucking take,because you sound like you got yours,by hook, or by crook and your ready……..fucktard, ,its people like your sorry fucking ass that IS THE PROBLEM.arizona border guard more like your really an arizona opportunist guard.
I hear ya we need to get these people into the system ASAP so they can pay into the system.
Slave labour Sucks 🙁
Wow, you came to the conclusion that I am a crook from me stating that are country spends money they don’t have. I am a “fucktard” and “the problem” because I CHOOSE to live within my means? Can you not see the absurdity? The problem is no one wants to take responsibility. They want the problem fixed ONLY if it does not affect them negatively. This is a character flaw that has infected our nation. It has obviously blinded many from what a third grade child can comprehend, that you cannot spend more than you make for long periods of time and expect to remain solvent. The fact is that if our government continues down this path a default at some point is inevitable. Step outside your biased mind for a few minutes and please explain to me where I went wrong.
Move on? I just had copper water pipes stolen out of operating hotel rooms in the middle of the night. Second time in the past 2 years that we have had significant theft. 0 times in the 28 years before that that we have been operating. Defaulting is going to improve our country how? And its going to teach whom how to do what? I don’t get that part. We made a wrong turn somewhere but punishment isn’t going to hurt who it needs to, just make it worse for the poor bastard that was told it was the right thing to do to go to work at that factory where his father works.
Defaulting will force our government to live within it’s means. The government will not default but will be forced to make needed cuts that will allow the servicing of the debt to continue and will be a non event. Would you not teach your child that living beyond there means is bad? I’ll answer your first question with a question. How can having a sound fiscal policy that does not spend more than it can take in ultimately be bad for our nation? It will teach people who have ignored the obvious fundamental fact that they inexplicably missed that spending more than you can earn is disastrous. I would argue it will punish exactly who it should. Will it punish the prudent person who has lived within their means? No. In my late teens and early 20’s I lived beyond my means and the negative consequences of that choice led to enough fear and suffering that I learned the errors of my ways. Without that pain and fear there would have been no lesson learned. I have no sympathy for the reckless.
For starters, repeal the Gramm-Leach-Bliley Act.
They aren’t going to ring a bell.
Chips up, Q’s up notwithstanding AAPL going below 200dma.
It’s a sign we go up large this PM.
PS Also check KREW etf (regional bank etf)- it’s up while majors are down.
Fly is DEAD BALLS accurate here, this is Lehman ALL OVER AGAIN, have the Eurofags learned ANYTHING?
lift the cap for fica, or eliminate it altogether.
Why? That only works if you are willing to pay people more in long term SS payments. Otherwise, scrap the whole thing and just put old fuckers on welfare, because you are merely creating another welfare program.
If SS is really a long term pension program, then it should work the way they do in the private sector. If they cannot make that work, they need to outsource it, not make it into yet another wealth transfer device.
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better yet jake, give me all my money back that i paid for over 43 years, and they can all go piss up a rope. because if you privatise it,you’lll end up needing a lawyer just to collect it….. kinda happening now though.isnt it
We’re all fooling ourselves, the world economy is fucked. So how do you play this can kicking bullshit? Go long gold and lead?
On the other hand, I did go to a private retro bowling party in Seattle this weekend. Lovely four lane setup, attentive staff, good drinks-not too much preening. Will I have to learn to set my own pins and bowl by lantern after the coming crash? Hope not.
Greece is just the first domino of a systemic failure that would send us back to the stone age. The losers short 200 FAZ and advocating for a default are fooking nuts.
Woops I meant long 200 FAZ
I would rather wait for the inevitable, instead of inviting it to happen today.
HRBN buyout offer of $24 / share and it’s trading at $14. hmmm….
Fly, I see you are getting some flack here from those who worship at the first church of Von Mises. It’s interesting how there are fundamentalist religions of politics and economics in the U.S. today. People seem to take their position based on beliefs or values, and then they find ways to fit the facts into their system of beliefs, bending and twisting the facts if necessary.
There’s a good article on this in Mother Jones. It uses creationism and some other issues as examples, but it actually applies to the whole of our political and economic discussion in the U.S.
http://motherjones.com/politics/2011/03/denial-science-chris-mooney
ROFL — Mother Jones, aka “The Bible of Atheistic Socialism.”
Hell, at least the Fundies can point to the occasional unexplainable miracle as some proof there is a God… what are the clowns at MoJo using these days to back their claim that socialism can work?
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Hey Fly – you almost had me in TEARS with that little speech about never leaving the kids etc etc {sniff sniff}
bwahahahahahahahaha
You’re too fucking SOFT for this game man!
Yes, fly – everything is cheerful. The economy is forming a baseline, housing is bottoming, jobs are everywhere, blue chip stocks are trading at single digit P/E. The government stimulus has worked marvelous.
You are talking your book, and don’t even know it. That is what is troubling.
I always talk my book.
Anyone who talks opposite their book is a stupid fuck.
“Short term OEW charts remain negative and the market will need to clear 1280 to turn them positive again.”
Check!
Since the snap back will be worse the longer the can gets kicked down the road I see no logic in your comment other than typical selfish human response
Time to suck it up – and we are still in a contained depression soon to be non contained. Debt saturation no way out brother.
http://ibankcoin.com/flyblog/2011/06/20/be-careful-for-what-you-ask-for/#comment-221422
Jeremy … time sequence is out of alignment … must be those solar flares unless you spilt gravy on the servers again.
Iceland defaulted and their economy is already doing well again.
Why would defaulting on loans to the IMF cause anyone any problems?
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