The End.

[bodhi]

Regardless of which political twist you want to put onto this, the fact remains that the USA (and, by implication, everybody else) is experiencing the most dire financial crisis since at least the 1930s.

no **** Sherlock

tell me something I don't know !

 

[Tassidar]

No more prizes for guessing when TSHTF; it has already happened. The climate has now also tended its resignation but will work a short notice period until 2038 before finally retiring:

A new study published by The Open Atmospheric Science Journal says the concentration of CO2 in the planet’s atmosphere has reached the point at which irreversible changes to climate start. Even if the concentration of carbon dioxide is lowered from its current level in record time, the catastrophic effects will still occur. The scientists give us about 30 years till the end of the planet to which humans are adapted.

The bottom line is that it doesn't matter if you are one of those types that believe that climate change is caused by natural causes (there's many of those around these parts). Whatever you choose to believe, it still is GAME OVER.

I don't know where you got the quote from, since nowhere in the paper does it say anything of the sort. To quote from the paper:

The time available to reduce the human-made
forcing is uncertain, because models of the global system
and critical components such as ice sheets are inadequate.

Note: I'm not disputing the urgency of reaction to global warming. However, I am disputing the facts that you are using.

 

[krycor]

and in the 1930's who benefited? are those same people benefiting again? weird how history repeats

 

[StrongTurd]

On Friday November 21 the world came within a hair’s breadth of the most colossal financial collapse in world history according to bankers on the inside of events with whom we have contact. The trigger was the bank which only two years ago was America’s largest, Citigroup.

The scale of the hidden losses of perhaps the twenty largest major US banks are so enormous that if not before, the first Presidential decree of President Barack Obama will likely have to be declaration of a US ‘Bank Holiday’ and the full nationalization of the major banks, taking on the toxic assets and losses until the economy can again function with credit flowing to industry once more.

Without access to DIP bridge financing GM would likely be forced into a partial, or even a full liquidation. The ramifications are nightmarish. Aside from the loss of 100,000 jobs at GM itself, GM's business is critical to keep many US auto suppliers in business. If GM failed soon most, possibly even all of the US and even foreign auto suppliers go under. Those parts suppliers are important to other auto makers. Many foreign car factories would be forced to close due to loss of suppliers. Some analysts put 2009 job losses from a GM failure as high as 2.5 million jobs due to the follow-on effects. If the impact of that 2.5 million job loss is seen in terms of the overall losses to the economy of non-auto jobs such as services, home foreclosures caused and such, some estimate total impact would be more than 15 million jobs.

It is only the beginning. The 2009 year will be one of titanic shocks and changes to the global order of a scale perhaps not experienced in the past five centuries. This is why we speak of the end of the American Century and its Dollar System.

Note of that last paragraph. That's just sick!

Source.

 

[StrongTurd]

The United Nations says the world economy faces its worst downturn since the Great Depression.

It expects world economic output to shrink by as much as 0.4% in 2009, due to a slump among developed countries - particularly the US and in Europe.
This would mark the world economy's first year of contraction since the 1930s, the UN said.

Interesting. I would have thought that previous recessions would also have meant negative growth for the world economy. So 2009 will be the first year since the '30s that the world economy is going to experience negative growth. This might well turn very ugly.

 

[StrongTurd]

The U.S. credit-card industry may pull back well over $2 trillion of lines over the next 18 months due to risk aversion and regulatory changes, leading to sharp declines in consumer spending, prominent banking analyst Meredith Whitney said.

The credit card is the second key source of consumer liquidity, the first being jobs, the Oppenheimer & Co analyst noted.

"In other words, we expect available consumer liquidity in the form of credit-card lines to decline by 45 percent."

http://www.pyrabang.com/contenteditor.php?ps=7771&target=http://www.reuters.com/article/newsOne/idUSTRE4B01HI20081201

That should be the final nail in the coffin of the world economy.

 

[Xarog]

Actually I thought of a convenient little solution to our current problem :

Just have the world governments all agree to monopolise a new business : terraforming.

No one can complain as it's currently not something that anyone is doing (carbon credits exist, but they're really shortsighted and don't mean anything in the long run, plus they're being used as a speculative commodity which again is totally different from what actual terraforming would involve.)

Government can fund this by taxing people and corporations, and then they can use the funds to employ people and to buy the required raw materials. Under such a system it could well be possible to remove CO2 from the air, seperate the carbon from the oxygen, and then seal the carbon in metal containers which basically means that the carbon will be permanently removed from the atmosphere for all practical intents and purposes.

We will reach a period where maximise our use of the earth's natural resources, but that time isn't yet. I say we invest what we have *now* in order to protect our future on this planet. It will be a while before such projects become "profitable" in terms of the world climate (most of the assembly will probably have to use oil as the main source of energy, for example), but if we place research into alternative energy resources at the same time (preferrably solar energy or other natural sources), then over time it could indeed become sustainable.

We've seen from the recent events that the economy can balloon through cheap debt. I.e. everyone believes they have more than they have and humans generally go into overdrive regarding their productive capabilities. I believe the governments of the world can create a similar kind of system, but one that is much less volatile, and one that is beneficial to the world at large.

 

[StrongTurd]

Actually I thought of a convenient little solution to our current problem :

Just have the world governments all agree to monopolise a new business : terraforming.

No one can complain as it's currently not something that anyone is doing (carbon credits exist, but they're really shortsighted and don't mean anything in the long run, plus they're being used as a speculative commodity which again is totally different from what actual terraforming would involve.)

Government can fund this by taxing people and corporations, and then they can use the funds to employ people and to buy the required raw materials. Under such a system it could well be possible to remove CO2 from the air, seperate the carbon from the oxygen, and then seal the carbon in metal containers which basically means that the carbon will be permanently removed from the atmosphere for all practical intents and purposes.

We will reach a period where maximise our use of the earth's natural resources, but that time isn't yet. I say we invest what we have *now* in order to protect our future on this planet. It will be a while before such projects become "profitable" in terms of the world climate (most of the assembly will probably have to use oil as the main source of energy, for example), but if we place research into alternative energy resources at the same time (preferrably solar energy or other natural sources), then over time it could indeed become sustainable.

We've seen from the recent events that the economy can balloon through cheap debt. I.e. everyone believes they have more than they have and humans generally go into overdrive regarding their productive capabilities. I believe the governments of the world can create a similar kind of system, but one that is much less volatile, and one that is beneficial to the world at large.

Yeah, that's definitely a good theory. In fact, there are numerous viable strategies to get us out of this mess.

In practice, however, you'll find that a democracy is unable to invest heavily in very expensive projects that promise long term salvation due to the fact that a democratic political dispensation is predominantly concerned with the short term (i.e. four of five years). Any politician who attempts to sell an idea to his voters that promises a bright future for the next generation but at the expense of very heavy taxes and considerably reduced expenditure in less essential areas will almost certainly commit political suicide. His opponent in the next election will win by a landslide due to offering more popular policies and less taxes. In effect a democracy is incapable of planning for the long term.

 

[Xarog]

Well yes, there is that...

Democracy can be a vehicle for this, but it will just require the peasants all realising that they're screwed if they don't. I don't think that would be THAT difficult to do, all things considererd. But you and me aren't going to be the ones to do it.

 

[StrongTurd]

Malls are next to face foreclosure

WASHINGTON - The full scope of the housing meltdown is not clear, and already there are ominous signs of a new crisis -- one that could turn out the lights on malls, hotels and storefronts nationwide.

Even as the holiday shopping season begins in full swing, the same events poisoning the housing market are now at work on commercial properties, and the bad news is trickling in. Malls from Michigan to Georgia are entering foreclosure.

That is bad news for more than just property owners. When businesses go dark, employees lose jobs. Towns lose tax revenue. School budgets and social services feel the pinch.

Companies have survived plenty of downturns, but economists see this one playing out like never before. In the past, when businesses hit rough patches, owners negotiated with banks or refinanced their loans.

But many banks no longer hold the loans they made.

"It's a toxic drug, and nobody knows how bad it's going to be," said Paul Miller, an analyst with Friedman, Billings, Ramsey, who was among the first to sound alarm bells in the residential market.

The worst-case scenario goes something like this: With banks unwilling to refinance, a shopping center goes into foreclosure. Nobody can buy the mall because banks will not write mortgages as long as investors will not purchase them.

"Credit markets have seized up," corporate securities lawyer Michael Gambro said. "People are not willing to take risks. They're not buying anything."

"The system has never been tested for a deep recession," said Ken Rosen, a real estate hedge fund manager and University of California at Berkeley professor of real estate economics.

Source.

This thing might well dwarf the housing crisis. And, seeing that South Africa's housing bubble pretty much followed the same pattern than in the US, this will almost certainly blow over to our shores. Seeing that the commercial property sector is currently the only thing keeping our property market afloat, this is bound to hit us hard. 2009 Will certainly be an interesting year, if nothing else.

 

[StrongTurd]

Bank of England mulls "nuclear option" of cash injection

In what would be a major departure for British monetary policy, the Bank is considering pressing the button on printing presses by engaging in a so-called policy of quantitative easing. It emerged after the Monetary Policy Committee cut borrowing costs by 1pc to just 2pc - the lowest level since 1951.
In the statement published alongside its decision, the Bank warned that "it was unlikely that a normal volume of [bank] lending would be restored without further measures."
The measures under consideration include direct purchases of assets, such as government debt or commercial investments, by the Bank or the Treasury, as well as expanding the Bank's balance sheet, a means of pumping extra cash into the banking sector.
The radical proposals, which are currently being explored by Bank experts, could be put into action within weeks, although they would have to be vetted by the Treasury, which is thought to remain sceptical. The main obstacle is that the policy could be found to conflict with European Union laws on how governments manage their budgets.

If the plans do go ahead it would be the first time since the 1970s that the Bank of England has effectively attempted to target the volume of cash in the economy, by using its balance sheet, rather than the price of money through interest rates.

Source.

Some of these events are enough to scare even a die-hard doomer like myself. If the UK is openly considering "the nuclear option" then it leaves one user no illusion as to the gravity of the situation.

So the Brits are actually ready to start printing money (just like Mad Bob) in a desperate attempt to get the economy going again. You know what will happen the the value of the Pound when they do that, right?

 

[DavidJ]

The "free-market" system is just not working

lol .. what a load of rubbish.

 

[BrrIan]

But seriously, Capitalism is the only way to go.

Yes, but not unfettered capitalism.

 

[BBSA]

Yes, but not unfettered capitalism.

You not actually suggesting that government must interfere in the free market?

And before you answer that are you aware of the fact that the freer a country's economy are the higher the per capita gross domestic product hence prosperity for everybody. Go and have a look at the freedoms of the Hong kong economy and how successful it is for them.

 

[noxibox]

You'd think people would have learned by now that each country and economy is different.

 

[BBSA]

You'd think people would have learned by now that each country and economy is different.

No, but there is a direct relationship between the economic freedom a country enjoys and its prosperity.

 

[DavidJ]

You'd think people would have learned by now that each country and economy is different.

Humans are humans. Everywhere.

 

[Xarog]

You not actually suggesting that government must interfere in the free market?

And before you answer that are you aware of the fact that the freer a country's economy are the higher the per capita gross domestic product hence prosperity for everybody. Go and have a look at the freedoms of the Hong kong economy and how successful it is for them.

Ya, maybe for the rich. I don't consider having to live in an apartment with 6-8 other people just to afford the rent to be a good indicator of "prosperity".

 

[BBSA]

Ya, maybe for the rich. I don't consider having to live in an apartment with 6-8 other people just to afford the rent to be a good indicator of "prosperity".

I talking about GDP per capita. Which means their economical success filters through to everybody.

 

[Xarog]

I talking about GDP per capita. Which means their economical success filters through to everybody.

Yeah, trickle down economic theory really works.

In reality it was just another line of BS fed to the plebs by the plutocrats.

GDP per capita means sweet nothing. Mean GDP is probably a more useful statistic to go by.

The Wealth Distribution

In the United States, wealth is highly concentrated in a relatively few hands. As of 2001, the top 1% of households (the upper class) owned 33.4% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 51%, which means that just 20% of the people owned a remarkable 84%, leaving only 16% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth, the top 1% of households had an even greater share: 39.7%. Table 1 and Figure 1 present further details drawn from the careful work of economist Edward N. Wolff at New York University (2004).

Take out the top 20% of the US population, and you effectively remove 80% of the US's wealth.

Sadly I can't conveniently find statistics of any other countries. However, it is fair to say that the average wealth of the average US citizen has been falling steadily since the 1950's. Wages just didn't keep pace with inflation. So much for the trickle-down effects of the world's biggest economy, eh?