So, how bad could our TSP Accounts be hurt by who Bush picks to replace Greenspan?

[bkrownd]

imported post

Where are all these "broke" people? I've been around long enough to remember what "broke" really means, and I don't see much of it these days. I do see as much or more consumption than ever, though. That's a fact, Jack.

 

[Wimpy]

imported post

Many of these “broke” people are living in the city of Denial on borrowed money. When the money spigot gets turned off it is going to be worse than ever. It is one thing to be broke, but quite another to be ‘broken’. The ‘gotta have it now’ crowd will soon be ‘broke’ and ‘broken’.

I personally think the current rise in oil price is more of a ‘price’ crisis than ‘supply’ crisis. The oil producing countries recognize a need to protect themselves from a falling dollar. With China and other third world countries coming into their own, a ‘supply’ crisis could certainly develop, but right now those receiving dollars for their oil are getting nervous about the dollar and feel vulnerable. There is a move afoot, at least among those countries we aren’t on the best of terms with, to shift away from receipt of dollars for oil and to accept another currency for payment. Saudi will be the pivot point in this movement. The first drop of Saudi oil that goes up in smoke may be all that is necessary for them to make the shift to accommodate and pacify the extremists.

There is also something very serious going on in the South China Sea right now. China, Vietnam, and the Philippines have collaborated and are organizing joint sea patrols of this region to protect oil interests that Japan has officially ‘spoken’ for. The next major war between the superpowers won’t be over ‘ideology’ but instead will be fought over RESOURCES. This is no small event.



And then there is REFCO. The silence on REFCO is deafening…

 

[cowboy]

imported post

bkrownd wrote:

Wimpy wrote:

When Joe and Suzie are stuffing 80-100 dollars in those gas tanks on one fill-up they aren’t buying the low inflation spiel.

Why do I keep hearing this nonsense repeated everywhere? Let's cut the BS for a moment. Nobody is paying $100 to fill up their tank. Even at $3 per gallon, $100 is over 33 gallons. If your vehicle is so absurdly HUGE that it has a 35 gallon tank, then you have NO business complaining about the price of gas, food, or anything else. Nobody gets to cry about it costing $100 to fill up their tank, because that's just pure bullpuckey.

LOL!!! It is not uncommon if you have a diesel vehicle! Whoops.:shock:A lot of people bought diesels as it was cheaper to fuel up but now the price is over a $1 higher than gasoline. The oil boys are making some cash before Ol good-boy-Bush gets out of office.

 

[Wimpy]

imported post

Yeah, I think a person's perspectivemight be influenced by wherethey live and their lifestyle. Where I live all I see are Ford Excursions, Expeditions, and 1-ton Ford and Dodge crew cabs w/dual wheels on the rear. Hey, back in the early eighties I had a 3/4 ton with a reserve tank giving me a total of 50 gallons of fuel capacity. At 3 bucks a gallon that would be $150 to fill up, if running on fumes. I think the SUV Ford Excursion hasmore than a 40 gallon tank.

I thought $80-100 for a SUV fill-upwas rather conservative, at least where I live.

The last twotimes I was in Hawaii, however, I noticed most of the car rental lots hadmostly two-door coupes and convertibles. Tanks on thosevehicles are probably 13-18 gallons which would be enough to take you around the island until you were dizzy. I can't even visualize a 1-ton dually in Hawaii. It would be hard turnin' one of those behemoths around without gettin' your tires wet. I'm sure they've got cowboys down there but I'm thinkin' they've probably downsized to Ford Rangers, baseball caps,andsmall ponys.

The people where I work are consistentlyhowling to the moon about feeding their 1-tons and SUVs. I'm hearing prices in the range of$80-87 for a fill-up withthe needle resting on 1/4 tank. I need to getbkrownd to come down here and help me shame 'em a bit. I can't get much work done with the way they carry on about it.

 

[Dave M]

imported post

My little Ford with a 10-gallon tank got flooded out, so I picked up my Dad's old 1986 Pontiac station wagon, with a 22-gallon tank and a 305 V8. Two weeks ago I drove it 1650 miles down here for $183 in fuel -- 79 gallons. My last fillup was $45 with 1/8 tank left, so $50 a pop is my new reality.

But, I put 100 miles on my bike in the last month, going to work, mostly. The Pontiac remains full two weeks later. The barge sticks out of my garage two feet. It is longer and lower than my neighbor's new Land Rover. My "Estate Wagon." Fun.

What happened in the 70's was that the high price of energy filtered down through all the many pathways from the producers to the consumer, resulting in rising prices over time = inflation. Today there are fewer domestic producers, aren't there. If our stuff comes from China, they're the ones paying more to make it and ship it, not us. So high fuel costIS more of a tax, a cost that hits all equally and at the same time -- the instant they raise the price at the pump. Are prices in other sectors rising?Is there upward pressure on wages? Is unemployment rising? No. No. No.

Dave



Dave

 

[Wimpy]

imported post

Dave M wrote:

So high fuel costIS more of a tax, a cost that hits all equally and at the same time -- the instant they raise the price at the pump. Are prices in other sectors rising?Is there upward pressure on wages? Is unemployment rising? No. No. No.

I would disagree high fuel costshit all equally and at the same time.

If we take a look at those individuals who, in order to find affordable housing, bought into the sprawl and are now having to commute an hour or moreto work...theyare quicklyfinding outthere is a new twist to the concept of 'affordable housing'. Some may decide to stick it out and continue feeding their hungry SUVs while others may decide to throw in the towel and move back to the city or buy a hybrid.

Any sector tied to transportation is affected by higher fuel prices. Chinese products still have to be moved from the port of entry to the store shelves. The cost of transportation is paid for by the consumer...in the long run.

Wages have definitely taken a hit. The average blue collar job in this town pays 12.00an hour and there is a lot of competition for these jobs. In 1980 dollars that would be $5.00-5.50 an hour. The majority of jobs start around 7.00-8.00 an hour which would be around $3.25-3.75 an hour in 1980 dollars.

Underemploymentseems to be the order of the day. A lot of people have jobs and are pedalling at high RPMs, but the gear ratios they've been assigned are not allowing them to make muchfinancial headway.

There are going to be a lot of baby boomersbegin to wonder if these types of jobs,now that we've lost our manufacturing base,will provide buyers for the stocks in their portfolios when theyneedcash forbasic expenses such as increased health care, social security off-set, and bankrupt pensions plans. Who among generation Xers andtheir kids will be able to afford those overvalued stocks? There WILL be buyers for those stocks, but at much lowerprices.

 

[Dave M]

imported post

Well of course I meant all users of gasoline. My post was an attempt af finding a reason as to why the recent sudden increase in fuel prices has not had the kind of resultsthat took place in 1973.

Are you looking at a finer scale than I, and seeing the potential? I am looking at results and not seeing any. That may be becausethe shortages had a different basis -- market action now versus the cartel then.

"...move back to the city or buy a hybrid...." In either case the economy prospers since someone will be making money on either of those transactions.

Dave

 

[Wimpy]

imported post

As for a reason as to why the recent sudden increase in fuel prices has not had the kind of results that took place in 1973...I think, in large measure, the difference between now and 1973 is credit.Credit is much more available today than yesteryear and is being used heavily as a face saving measure by those attempting to keep pace with their neighbors.

If the sprawlersall move back to the city at once those homes they abandoned, because of a lack of buyers, will represent a loss to someone. In many cities, renting is a better value than buying right now. Often times the landlords are not evengetting enough rent to cover the mortgage and they are justifyingthat foolish practice because theyare banking on a flip. When flippin' flops,we might as well stick a fork in the real estate market...it will be done for. That will be a good time for renters to turn into buyers, but it will take a higher down payment and a more expensive mortgage rate. Those with cash will get the best deal.

In actuality, the sprawlerswill probably feel fortunate if they can afford a bus pass. The hybrid will probably be out of the question.

 

[cowboy]

imported post

LOL!!! Maybe with the airlines all going broke. The big shot executive doesnt have to fly to the next city to see a mistress and with e-mail he can just send her a hallmark and get on the internet and head over to his neighbors house for action. So were not using all that airplane fuel. Besides they don't want us hicks to carry a nail clipper or pocket knifeanyway. We might hurt somebody!The know-it-allskeep on making them lawsthat only the law abiding follow! Meanwhile I'll ride in my pickup and carrying a rifle. Which by the way folks doesn't shoot high nor low, just in case someone is thinking about stealing transportation. :sIf you comment to this, realize I am being sarcastic.Thereason why capitalists developed the stock market;1. You don't know who's money your stealing. 2. Your just after your fair share. 3. Mostonly know what that is when their old and ready to retire and by then they won't care. There are some exceptions.

 

[Wimpy]

imported post

I’d just as soon stay off those flying cattle cars and drive where I need to go. It appears many people are becoming de-sensitized to the whole process of being herded and prodded through those security chutes. Not a good thing…in my opinion.

 

[Quips]

imported post

I would not agree that the cost of a gallon of gasoline or the increase of its price affects all people equally. Those who make $120,000 a year are less affected by its cost or its increase far, far less than those who may make $30,000.

The increase in gasoline prices acts as a tax on consumers, but as a flat tax and not a progressive tax. If it acted as a progressive tax then, yes, its increase wouldbe shared byall equally.

Wimpy notes, "There are going to be a lot of baby boomersbegin to wonder if these types of jobs,now that we've lost our manufacturing base,will provide buyers for the stocks in their portfolios when theyneedcash forbasic expenses such as increased health care, social security off-set, and bankrupt pensions plans. Who among generation Xers andtheir kids will be able to afford those overvalued stocks? There WILL be buyers for those stocks, but at much lowerprices."

Um, aren'tAmerican equities traded overseas now as ADR's? I think the reference to the (potential/hypothetical) securitization of the dollar would tie into that. Last summer the Chinese communist government was rebuffed inits attempt to purchase an American oil company, but wasn't the problem there the idea of a governmental purchase as opposed to an individual's or its purchase by a mutual fund or a pension fund (in another country)?

 

[JOVARN]

imported post

May be of interest for I fund holders. Its way to confusing for me to make 100% IFT to I fund. I have been lucky at times but its all luck as far as I can determine.

AP
[size=Dollar Holds on to Overnight Gains vs. Yen][/size]
[size=Friday December 2, 1:53 am ET][/size]

http://biz.yahoo.com/ap/051202/asia_dollar.html?.v=1



I read one article this am that said the market will continue to rise no matter what the charts say as; long as people continue to buy stocks. And he got paid to report that.

 

[Wimpy]

imported post

The I Fund has been marching in step with the C and S for the most part of late. While the C & S charts look a little overbought, the I Fund looks like it has a bit of room to extend its run. The dollar looks like it is catching airsomewhat like Wiley Coyote when he late braked at the cliff's edge while chasing Roadrunner.I think the FED is buying its own paper right now in an effortto defy gravity and keep Wiley levitated. I think the ECB 25 basis pointrise in rates yesterday will represent more of a downdraft than theWiley (the dollar) can handle. In the next 3 months there will be nothing left of Wiley other than a smoking hole in the ground. If that happens, the C and S will tank and the I Fund will zoom. Just my opinion, do your own due diligence.

 

[Wimpy]

imported post

Quips wrote:

Um, aren'tAmerican equities traded overseas now as ADR's? I think the reference to the (potential/hypothetical) securitization of the dollar would tie into that. Last summer the Chinese communist government was rebuffed inits attempt to purchase an American oil company, but wasn't the problem there the idea of a governmental purchase as opposed to an individual's or its purchase by a mutual fund or a pension fund (in another country)?

In this day and age, if one is willing, they (anyone) can buy any equity on any exchange in the world.

Just because someone is a foreigner,however,doesn't automatically mean they won't be looking for value. The Asians are buying gold right now. Eventually they may buy boomer held equities, but at much lower prices. They are looking for value and have a lot of patience the boomers don't have.

 

[Soldat]

imported post

So let me get this straight, we are selling gold to the asians for currency to buy the paper we are printing. Whilst using the asian currency we have from selling them the gold to buy american dollars raises the position of the USD. All the while we are not telling anyone how much or even that we are printing paper. We are selling debt overseas mainly to isreal who uses that debt consolidation as leverage to petition the USA to go to war for them. THEN, we go to war to temporarily boost the economy and create jobs which actually only tries to KEEP unemployment from going, because its not dropping. We let illegal immigrants stream across the border in an attempt to boost small cap stock profits. Sounds brilliant in theory, but the problem is, its a short term solution to a long term problem. It alleviates the symptoms while allowing the disease to thrive?!?

Sounds crazy enough to be true and I think I am now as paranoid as Birchtree. Of course I am just an alias so I dont even exist?

 

[Wimpy]

imported post

Personally, I think Ft. Knox was emptied long ago. There hasn't been a public audit of that entity in decades. Kind of reminds me of the M3 thingee a few days ago. There is less and less transparency when it comes to Treasury and FED accounting practices. And the U.S. gov't points fingers at ENRON...go figure.

The Asians are reducing their treasury purchases and buying gold...from who knows where. For the last five years or so we heard of various central banks (CBs)conducting gold auctions where they auctioned off tons of the stuff in a concerted effort to keep the price of gold down. Reason? The price movements in gold were making their paper currencies look injured...and that was totally unacceptable. One thing very interesting about those gold sales...they always said who was selling but theynever outed the buyers. I think the CBs were simply selling the same gold back and forth to each other in an attempt to convince the public there were tons of that worthless stuff circulating in the market anddiscourage the buying of gold. Actually, I think this started around 1995, and it worked up until around the 2000-2001 time frame. I think the gig is up for the suits. There is going to be a mad scramble on the part of allCBs to fill upthosesecure warehouses they've emptied, but they will do so at much higher prices.

 

[Wimpy]

imported post

The dollar is looking a little shaky here and the traditional inverse relationship between the dollar and gold appears to be attempting to restore itself.

If the ‘gotta have it now’ crowd so much as hiccups while looking at their credit card statements, from the post-Thanksgiving day ‘shop til you drop’ ritual, the implications for the economy could be enormous. Those statements will probably begin arriving in the mailthelast of December and continue pummeling consumersthrough all of January...at least for those who pay them off in full.Many otherswill bepaying for their pastbinge spendingfor a large portion of the year.

The Problem: The FED controls the supply of money, but it has no control over DEMAND. When the debt junkies finally pass out while staring at those credit card statements and they, en masse, enter rehab, all that liquidity will be sloshing around all over the globe looking for a safe harbor…and there won’t be any.

The FED can put liquidity into the system, but they have no mechanism for taking that liquidity out of play. Unintended consequences are often conceived from good intentions. The problem is arrogance. Those responsible for these decisions look at consumers as raw matter they can shape and form into their own image. It works for awhile…but the gig is showing signs of wear around the edges, through the middle, and just about every place else.

It isnot a matter if...only when.

 

[Quips]

imported post

The Fed HAD to say something different than "accomodative" and "measured pace" since gold has reached the $520 level, off $10 from a week ago.

The price of gold rather than anything else has shown the results of its monetary policy. Lately, gold has become the best place for financial returns, and that is a poor reflection on the Fed if not the economy.

By changing its wording the Fed would have the optimists even more optimistic and the pessimists more pessimistic. Like whistling through the cemetary we all hope that oil prices and debt spending/financing are abating ... and the pessmists are betting it won't or it hasn't.

Don't get me wrong, I'm better than 80% in equities, but it seems too phoney to me that the Fed signals a policy change as gold is on a nice run up. And it is as hard for many to bet against gold as it is equally hard for them to have faith in the mechanisms of the Fed.

Gold is at $520 and oil is still pricey at $60. Some say the Fed willhold after two more 0.25% rate increases, but it is hard to believe that either gold or oil is overpriced now.

The markets will hope that currency used to make those oil and gold purchases will not stop the demand for purchases from the US Treasury. That wouldkeep the US economy in its consume mode. I guess thatcould be the Goldilocks story.

Yet the run up in gold and oil stubbornly at 60proves many more are hedging their bets.

 

[Birchtree]

imported post

I bought 15 U.S. Mint gold coins at one ounce each back in the 1980s before I knew better and all at prices above $520. They are known as Grant Woods, Louis Armstrongs, etc, very pretty and probably collector items on their own merits. Watch for the U.S. Mint to start up sales again if gold trends higher. Those were the days of the Alden sisters, but there are still gold bugs everywhere you look - anyway I've got mine and now I want lumber stocks.

 

[roguewave]

imported post

You're almost on to it Wimpy. Ask yourself, why did the Euro come into existence? Walk with giants friend. TheUncle always has an ace up his sleeve.



Dawn of a New Gold Market

"EXECUTIVE SUMMARY"


It began with a statement released jointly by European central banks from Washington, D.C. on Sunday, 26 September 1999 under support of the following signatories---

The European Central Bank and the central banks of Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, Switzerland, and England.

Mr. Wim Duisenberg, President of the European Central Bank, announced the joint Statement on Gold:

"In the interest of clarifying their intentions with respect to their gold holdings, the above institutions make the following statement:

1. Gold will remain an important element of global monetary reserves.

2. The above institutions will not enter the market as sellers, with the exception of already decided sales.

3. The gold sales already decided will be achieved through a concerted programme of sales over the next five years. Annual sales will not exceed approximately 400 tons and total sales over this period will not exceed 2,000 tons.

4. The signatories to this agreement have agreed not to expand their gold leasings and their use of gold futures and options over this period.

5. This agreement will be reviewed after five years."
​

The following remarks are from George Milling-Stanley, Manager, Gold Market Analysis--World Gold Council, from an October 6, 1999 address to The 12th Nikkei Gold Conference in regard to this important announcement:

"Central bank independence is enshrined in law in many countries, and central bankers tend to be independent thinkers. It is worth asking why such a large group of them decided to associate themselves with this highly unusual agreement...At the same time, through our close contacts with central banks, the Council has been aware that some of the biggest holders have for some time been concerned about the impact on the gold price -- and thus on the value of their gold reserves -- of unfounded rumours, and about the use of official gold for speculative purposes.

"Several of the central bankers involved had said repeatedly they had no intention of selling any of their gold, but they had been saying that as individuals -- and no-one had taken any notice. I think that is what Mr. Duisenberg meant when he said they were making this statement to clarify their intentions.

"But it is important to recognise that the agreement represents something of infinitely greater significance than a mere repetition of statements central bankers had already made, or a clarification of positions they already held. This is a binding agreement, signed by central bank governors on behalf of their respective institutions and/or governments. Moreover, the European Central Bank is among the signatories, and 11 of them are full members of the ECB, which has already assumed a large say in the management of the gold holdings of its individual members. The UK and Sweden are members of the European System of Central Banks. Therefore the agreement can be monitored.

"This should finally put to rest the fear that has kept the gold market in its paralysing grip for years, the fear that central banks have abandoned gold as a reserve asset, and are planning to sell all that they have.

"That fear flew in the face of all the observable evidence. It is a matter of fact that only five governments have sold a significant quantity of gold in the past 10 years, if we define a significant quantity as 100 tonnes or more. A handful of others have indicated that they would like to sell, but it is only a handful, as the recent statement from the world's largest gold holders demonstrates. That leaves something like 120 or so governments that own gold, and who have neither sold in significant amounts, nor indicated any desire to do so. In all, countries not covered by the agreement hold 4,800 tonnes of gold, and are free to sell; But in fact they are just as likely to buy. Several of them have in fact been buying to build up their gold reserves - Russia, Poland, and the Philippines, to name just three."
​

Wimpy wrote: [/b]

Personally, I think Ft. Knox was emptied long ago. Theh re hasn't been a public audit of that entity in decades. Kind of reminds me of the M3 thingee a few days ago. There is less and less transparency when it comes to Treasury and FED accounting practices. And the U.S. gov't points fingers at ENRON...go figure.

The Asians are reducing their treasury purchases and buying gold...from who knows where. For the last five years or so we heard of various central banks (CBs)conducting gold auctions where they auctioned off tons of the stuff in a concerted effort to keep the price of gold down. Reason? The price movements in gold were making their paper currencies look injured...and that was totally unacceptable. One thing very interesting about those gold sales...they always said who was selling but theynever outed the buyers. I think the CBs were simply selling the same gold back and forth to each other in an attempt to convince the public there were tons of that worthless stuff circulating in the market anddiscourage the buying of gold. Actually, I think this started around 1995, and it worked up until around the 2000-2001 time frame. I think the gig is up for the suits. There is going to be a mad scramble on the part of allCBs to fill upthosesecure warehouses they've emptied, but they will do so at much higher prices.