Important Economic indicator turning negative - A Must Read Thread for all US Residents & Foriegn In

[itsnotme90]

Next month will turn out to be a disaster for markets world wide. I personally think that even gold will take a deep correction from here. Jp Morgan bank might go bankrupt. These are my personal analysis over current situation coz i dont think fed will announce QE 3 untill the new election as they dont want that qe3 become part of presidential debate.

 

[AsifAmeer]

There are several diversing opinions about state of US economy, some people say that its all doom and gloom whereas some paint a very rosy picture, the reality, however, is somewhere in between.

There is no doubt that US economy has major issues to deal with, the top on the list for me is derivatives. I don't know if you are old enough to remember Barings Bank, it was over two hundred years old bank, even the Queen of England had her account there. The head derivatives trader made an unauthorized unhedged speculative trade of $1.3 billion only in Singapore. His unhedged losses escalated rapidly which eventually led to the bankruptcy of barings Bank. Similarly, LTCM (Long Term Capital Management), managed by couple Nobel prize winners in economics, a hedge fund dealing in derivatives, averaging annualized gains of around 40%. With the onset of east Asian financial crisis they lost $460 million initially, this was made worse by the exit of Solomon Brothers from arbitrage bussines. these losses were further accentuated by Russinan financial crisis. The fund finally eneded up losing $4.6 billion in just four months. It was bailed out by Federal Reserve and eventually liquidated.

There was a news couple of hours ago that JP Morgan lost $4 billion to $6billion in their flawed derivatives portfolio. JP Morgan's derivative position is in trillions.

Right now JP Morgan is in worse position than LTCM or Barings Bank back in 1990s.

The reason I don't disagree with Asif Ameer is because I know a little bit about financial markets, btw I don't live in fools paradise.

Gotta flight to catch so will keep it short. JPM is looking at north of $9bill. BoomBustBlog is comparing JPM to Bear Sterns. He called for puts on BS when BS was trading north of $50. JPM is stuck in synthetic short trade... So JPM itself is the market! You can sell if you are the market urself.. Its amazing the JPM got stuck in it because JPM is 1 of the best managed i-bank after GS. Jamie is a heck of a qualified guy to understand risk.. But someone trader is gonna write a book on the details of this trade. I know Fed is using Blue Mountain to try to unwind these bets.

Bhai Asif, do you remember Sugarcane desi machine.... from one side you pump in fresh sugarcane and the operator kind of repeat the process again and again.. till the time every drop of sugarcane juice is taken out.

Same here .... Tell me one thing .. in all this process, some one is getting rich.. name me that Company.

Even at the height of WW1 and WW2 there were institution that made money on human misery. I bet my sweet Rs 5/- some one some where is making Billion of $$$ in this whole affair.

Thats easy to answer.. Golden Sacks.

 

[A.Ali.T]

Next month will turn out to be a disaster for markets world wide. I personally think that even gold will take a deep correction from here. Jp Morgan bank might go bankrupt. These are my personal analysis over current situation coz i dont think fed will announce QE 3 untill the new election as they dont want that qe3 become part of presidential debate.

Once investors start receiving margin calls, they will start dumping good with the bad.
QE3 is a done deal, its a matter of when not if. Like Asif Ameer's charts show, if they want to increase money velocity they will have to put money in the consumers pockets.

 

[A.Ali.T]

Bhai Asif, do you remember Sugarcane desi machine.... from one side you pump in fresh sugarcane and the operator kind of repeat the process again and again.. till the time every drop of sugarcane juice is taken out.

Same here .... Tell me one thing .. in all this process, some one is getting rich.. name me that Company.

Even at the height of WW1 and WW2 there were institution that made money on human misery. I bet my sweet Rs 5/- some one some where is making Billion of $$$ in this whole affair.

Before Great depression John F. Kennedy's father's net worth was around one million, when US came out of depression his net worth was around hundred million. There is always another person on the other side of the trade, one person's loss is other persons gain. No matter who gains or losses the broker always get his commission. ;)

 

[indigo]

Aap bilkul darusat keh rahi ho, lekin tariqa drust nahi hai.... hum bhi Insaan hain hum se bhi bhool hojati hai

Jo looh yeh samajhtay hein Keh US deewaliya punn kashikar honein wala hay, wo ahmaqoon ki jannat mein rah rahay hein. US ki economy dunya ki sub se bari economy hay, more than 14 trillion $, Japan, more than 5 trillion $, on 3rd, it is Germany 3.5 trillion $, then China ya France hay jo 3 se 2.5 trillion $ k kareeb hein.

US ki economy Japan, Germany, aur China aur France, inn sub ki majmoee economy se bhi bari hay.....Jo yeh samajhta hay keh US financially melt down honein wala hay, wo realitiesse bey khabar hay.

Mein US ki aqalat nahn ker rahi yeh facts hein, aur aik andazay k mutabiq agar China issi raftar se jiss se wo abb ker raha hay, taraqi karta raha tu US ki maojooda economic position ko 2066 mein hasil ker sakay ga....

 

[AsifAmeer]

And this time its Goldman Sachs! Just got done reading Money and Power - How Goldman came to rule the world.. An amazing thick history and a detailed version of the recent events..

Before Great depression John F. Kennedy's father's net worth was around one million, when US came out of depression his net worth was around hundred million. There is always another person on the other side of the trade, one person's loss is other persons gain. No matter who gains or losses the broker always get his commission. ;)

 

[AsifAmeer]

I think you pretty much covered everything correctly in the broader sense. What I cant back in your statement is this
"A major part of foreign spending goes to arms industry"

Mein ye nahi keh raha that its a wrong statement lekin even after going to heaps of data, I cant look at the numbers and confirm this statement. I mean this could be a part of MINING, manufacturing, Department of Defense budget, Info services, Service sector.. I cant pinpoint to numbers and say k if i add these, these and these numbers, it will give me what the arms industry add to the US GDP.

Baki rahi baat banks ki. Thats absolutely true. Its the Banks and the Govt thats raping Americans!

There are those who believe that Wars are good for economies. They site examples of WW2, conveniently discarding the fact that WW2 was fought by the Europeans money. If wars are thay good for the economy, how come USA went into a stagflation after the Vietnam+Korean War? That war was a big war right..? This is a propoganda by the intellectually dishonest leadership of the US.

Dollar retains value because of the power of the Global Central Bankers, which also includes the State Bank of Pakistan and Mr Yaseen and Mr Sheikh. I took a jab at them here..
http://blogs.thenews.com.pk/blogs/2011/12/09/we-make-it-the-‘mighty’-dollar/

Hi Mr. Asif Ameer ... My understanding is that American economy is being destroyed by their banks, big private corporations and arms industry ... Because it seems like only these three sectors are earning huge profits ... Rest of the economy is sinking ... American stock market is showing unrealistic activity ... This activity resumed after American Government gave a huge bail out ... I think that in 2014 or 2015 this bubble will bust and create a melt down similar to 2008 but it will be much worse and will be much more intense ... I think that all the money injected into American economy ends up in banks because majority of American population is in debt of banks ... A major part of foreign spending goes to arms industry ... Domestic business is captured by big private corporations ... Thats why all the money is being accumulated in these three sectors ... Money flow in major part of the society is decreasing because of this reason ...

I think America is fighting all these wars to save it's economy ... With these wars America is fueling up it's arms sector which is earning a huge profit ... Secondly I heard an economist saying that due to American Army might the dollar is maintaining it's value ... As soon as America looses it's military power, the dollar will collapse instantaneously ...

Am I right ??? I am trying to study world economy ... Please correct me if I am wrong, this will help me to get a better understanding ...