Iceland Banks Facing a Run
I admit, I really do not follow world news very much. I do notice things that will impact financial considerations though. Yesterday and this morning I heard on the radio that the Central Bank of Iceland had their interest rates at 15% to curb inflationary pressures running at around 9% (they have yet to learn the US system for making inflation come in tame no matter what) as well as to stop a flight of capital from the country's banks. This USA today story is an OK article on the event:
http://www.usatoday.com/money/world/2008-04-01-iceland-banks_N.htm
Good quote: "Financial experts in Iceland say the market tremors are being fueled by speculators, not reality. On Friday, the head of Iceland's central bank, Davíð Oddsson, called for "an international investigation on such attempts to bring a healthy economic system to its knees."
What is funny about the above is that here in the US we have the opposite problem. Speculators are driving our markets higher through rampant speculation while the reality is that our banking system is in REAL trouble. Pretty funny. A bunch of my friends love to travel to Iceland, and are fond of the country. I wish Iceland good luck.
FED Considers Even More Ways to Lend Money to Insolvent Banks
Mish, as usual, has the best post out there concerning the FED's considerations of new ways to loan money to insolvent banks. I really cannot add anything else to this great piece titled:
"The Fed is Terrified":
http://globaleconomicanalysis.blogspot.com/2008/04/fed-is-terrified.html
I will include a scary graph (from Mish, from WSJ) that highlights the rapid degeneration of the FED's holdings over the past 9 or so months:
Read the post already!
Wednesday Night Rip Offs
I admit, I had planned to make the FED money pit story my main thought topic for this evening, but Mish both beat me to the punch and wrote a piece far better than I would have. It happens. I ran into a couple of other stories today that after I read them I said "Wow, that rocked!". As I am a little short on time tonight I will just rip off some more great works and link to them here!
A great "5 Things You Need To Know" today which uses the insightful Jean Baudrillard work I have recommended endlessly, "Simulacra and Simulation":
http://www.minyanville.com/articles/index.php?a=16645
Very insightful.
A piece from Financial Week (hat tip Prudent Bear) that hits Mr. Greenspan's "It wasn't my fault at all" defense pretty hard. Lots of folks lend their voice to pile on the blame:
http://www.financialweek.com/apps/pbcs.dll/article?AID=/20080409/REG/978108877/1036
Way Cool Video
This BMW commercial has unbelievable video of an ACTUAL engine in operation. No CGI computer generated effects, just a real engine observed with real cameras using special filming techniques to be able to see what is happening. Great explanation here:
http://www.autoblog.com/2008/04/07/video-cgi-be-damned-inside-the-bmw-m3s-v8/
The opening of the valves (two intake valves for this engine), the fuel droplets coming out, the valves closing, and then the spark plug firing is about as cool a scene as I have ever seen. It is a must see:
Have a good night.
7 comments:
Iceland has many of the same problems as the US, High trade and budget deficits, and their currency has become a victim of the unwinding of the Yen carry trade and is now falling like a rock after soaring.
This is a good read everyday and it has a global perspective.
http://www.dailypfennig.com/archive.aspx
Got 6"-9" of snow heading for me tomorrow really looking forward to that.
Kevin
Kevin,
Ah yes "The Daily Reckoning" with Chuck Butler and the Mogambo Guru. I read both every day as well. Isn't my blog one of global perspective and wild entertainment?
PS. about ready to prep the soil for the garden. Thanks for all the information. I think I may only slightly screw it up as opposed to totally!
I thought about posting something yesterday, but decided against it.
It was about how KD was saying that the bankers wouldn't let their product go to zero, and hence the "metalheads" are wrong, and there will not be hyperinflation (if I understand him correctly).
The Greenspan Debate, Starbucks, Hyperinflation And More
http://tinyurl.com/4e5ffb
I'm not trying to stir up strife on purpose, but I wish KD had a comments section at the bottom of his site (people like me are probably why he doesn't, I don't blame him, it's his site).
I would ask him whether or not the US being off the gold standard as compared to being on it in the Great Depression wouldn't have something to do with a possible dollar collapse.
I personally feel like it is possible for the bankers to lose control of this situation.
But what do I know?
The phrase "Those who rob Peter to pay Paul can always count on the support of Paul" keeps coming to my mind. I just can't see them doing the correct thing. They haven't done the correct thing up until this point in time, why would they start now? When I look at the M3 chart from 1959 to 2005 what I see is a rocket taking off from 1971(adios gold standard) (minus the flat spot from 1989 thru 1994). Then if you take a look at the US Current Accounts graph from Kennedy to "W", it's downright scary. Then throw in the rest, possible peak oil, the beginning of food shortages, etc. it looks like this could get serious in a hurry.
One of Jim Puplava's points as far as I can discern is that the government has a nasty habit of making a bad situation worse than it needs to be. The government doesn't seem to really think a "strong dollar" policy is beneficial if you look at their actions. Is there any difference between the bankers and the government? They look like they are starting to be joined at the hip with the recent Bear Stearns deal. I guess I could be wrong though, it's happened before:)
Been reading your blog regularly.
Good stuff, precise and realistic as usual.
It really is amazing how all bad news is exaggerated and masked as good news
Do check my blog and leave me feedback.
http://thebullishbear.blogspot.com/
Im no expert, just a beginner...so nothing too complicated, just stuff on finance that I observe
GYSC
You better get on that garden prep. we have 6" of snow with another 6 in the forecast, looks like some nasty weather will be heading your way in a few days.
Watchtower
I'm with Jim Puplava, I think they turn the US into Easter Island cutting the forest down to print money. Nothing to really stop them either.
Kevin
Watchtower and Kevin,
Good comments.
I liked the BMW commercial. But you know what would rock would be an all electric BMW that could knock the socks off their entire lineup.
Well for anyones that's interested I got my old job back and will be back doing security in an outdoor mall in FL....yeah should be nice and warm. I might even loose a few of these lbs I have accumulated over the last year. hehe
In times like these it's good to know a few good people to pull strings and what not. Also in my book it's who you know not what you know.
G
PS: Keep up the good work getyourselfconnected
Reading these kind of posts reminds me of just how technology truly is an integral part of our lives in this day and age, and I can say with 99% certainty that we have passed the point of no return in our relationship with technology.
I don't mean this in a bad way, of course! Societal concerns aside... I just hope that as memory gets cheaper, the possibility of transferring our brains onto a digital medium becomes a true reality. It's a fantasy that I daydream about all the time.
(Posted on Nintendo DS running [url=http://kwstar88.livejournal.com/491.html]R4i SDHC[/url] DS BlogServ)
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