[…] Regarding regulation, Dear FDIC and Fed, We Need a Genuine Safekeeping Bank, Not Band-Aids […]
WTFUSA
10 months ago
I am truly surprised that the FDIC isn’t hitting the non-Fed member banks the special assessment fee based on the bizarro world of finance going on currently. That would weaken them even more for the large predator banks to feed on.
That’s for sure! It would be more in line with their reverse robin hood strategy of the past several decades.
spencer
10 months ago
We are about to hit “Juncture Recognition in the Stock Market”. William G. Bretz used the Debit Series to forecast turns. I use money flows. I used the 10-month rate-of-change in our means-of-payment money supply to predict R-gDp. I got the distributed lag effect from the Bank Credit Analyst’s Debit/Loan ratio time series. The trajectory today is that the 10-month roc will turn negative at the end of June (signaling a recession). TBD.
TMS, Shadowstats, Divisia Aggregates, etc. have all turned south prematurely.
I think that there are always many analysts who get the market turns correct. Now, the Elliott Wave theorists are in agreement (“An ideal wave structure calls for a gap down then eventual fill and power higher sometime next week to mark the proper end of Minute [iii] of C of (2)”).
I Ching suggests towards the end of July, perhaps even the beginning of August.
Ramses II tha God
10 months ago
I can change my name here to Ramses II tha God. I Am sure that will impress everyone.
Jackula
10 months ago
Like the new site, the last one was painful to use. I agree with TT’s post, the financial system needs a FDR style makeover. The middle class has been eviscerated by the banks and the FED’s financial management. Not a surprise that most of the innovation in the US has been in software, just takes some smart guys with a few computers and some software, very little capital needed. Meanwhile the bulk of the capital goes to the already wealthy for gambling and rentier type investments. Elon Musk is the exception and invested his gains from software into heavy industry.
That’s the problem with economics. It’s Marxist. In the circular flow of income, unless the upper income quintiles’ savings (the bourgeoisie), are expeditiously activated, i.e., put back to work, then a dampening economic impact is generated (secular stagnation of the proletariat).
It’s a deceleration in the transaction’s velocity of funds), a stoppage in the circuit income velocity of funds.
Contrary to Dr. George Selgin, banks don’t lend deposits. Deposits are the result of lending/investing. Hence, all bank-held savings are lost to both consumption and investment, indeed to any payment or expenditure. It’s stock vs. flow. The expiration of the FDIC’s unlimited transaction deposit insurance in December 2012 is prima facie evidence. It caused the “taper tantrum” (as predicted).
Dr. Philip George’s equations corroborate this, in his: “The Riddle of Money Finally Solved” ( the ratio of M1 to the sum of 12 months savings ).
We were missing 6 days of posts so you may have been blasted, one time, with a set of emails as those posts were added.
Mike Cortopassi
10 months ago
Mish, I was subscribed years ago and now am getting random Mishtalk emails from years ago randomly in my inbox. When I hit unsubscribe, it says I don’t have a sub. Whatever you recently changed has messed something up for me.
Are you sure they are from years ago- If so that is a huge problem
There was a big blast of emails that did not move over about 6 days worth that were just added
Mish
Making available for sale securities match in size and time duration to a bank’s credit portfolio would help. Bad risk actors need to be rooted out. There’s only so much FDIC to go around.
KidHorn
10 months ago
Hedge funds typically have a 2 and 20 pay structure. 2% of assets under management and 20% of profits. They have every incentive of taking huge risks. They get a huge payday if they go up 50% and get nothing if they lose 50%. Same as if they break even. This is the main reason the markets are irrational and blow bubbles. All the hedge funds are making very risky investments so they drive up the value of each others assets. After a while they start taking profits and the whole thing starts to collapse.
Banks have a similar incentive. If they make risky investments that pay off, bank profits go way up, the stock goes way up and their stock options go way up. If they lose, worst case scenario is the bank goes under, but the people in charge aren’t personally liable. They get a final payout and find a job at another financial institution.
traders at banks, is heads they win, tails, bank loses. banks motto is same, heads they win, tails, the middlebrow tax cows lose. it’s a scam. FEDRESNY is private. that’s the kicker. tom jefferson was correct.
I believe the hedge funds get their 2% even with 50% losses.
It’s part of the heads I win, tails you lose, hedge fund agreement you sign.
TT
10 months ago
FDR did the correct thing, he shut down every bank in nation for a week and sent in auditors and shuttered the insolvent ones. the real unwinding problem was the glass steagall act was destroyed by the fake free market raygunites and slick willie crew, who pulled apart glass steagall. mish is half right. but historical context is needed. also, let’s face reality the FED RES of NY is privately owned. this is a fact. all the ancient wise men knew that once you privatize the money one creates socialized losses and privatized profits. the FEDERAL reserve is about as public as FEDERAL EXPRESS. the middlebrows in finance haven’t caught on. the FED is privately owned by the NYC banks. the rest is eyewash. the institutional investor did a deep dive a few years ago, and showed the modern ownership. this is fact. not fiction. the FED has one mandate. to keep her owners, the NYC banks in high cotton. the rest of the stuff is rubbish. and the middlebrows that think the FED is dumb, or in some business of unemployment or inflation concerns are just useful idiots. i find it comical, and just posting this so perhaps a few more will know. it doesn’t matter of course, it ain’t changing in our lifetimes. perhaps in a century more.
You’re right. Richard Werner points out that China’s success (“four decades of double-digit economic growth”) was dependent upon creating “thousands of banks, mostly small local banks, lending to small firms”.
The U.S. is experiencing a consolidation of the banking industry.
Yes. It’s by design. Basel rules favor big banks. Our economy is being consolidated and nationalized while central banks internationalize and financially repress the serfs. We need to get off debt money before it suffocates us. Mish what you are asking will not happen unless we take the money creation power away. They will not do a bailment system. They don’t care and want it to implode.
(1) The great German poet and playwright Bertolt Brecht would have agreed and once said it was “easier to rob by setting up a bank than by holding up (one).”
(2) As Willie Sutton said: his reason for robbing banks is ‘That’s where the money is’.
(3) Thomas Jefferson’s my favorite: “I sincerely believe the banking institutions having the issuing power of money are more dangerous to liberty than standing armies.”
Steve
10 months ago
Much better layout now!
Zardoz
10 months ago
Way too many powerful people profit from the Leakey bandaids for change to come from above. Change will come from below when the population decides it’s been bled enough.
The payment’s system is a closed system. The source of time deposits is demand deposits. And demand deposits are created by the Reserve and commercial banks.
Thus, it makes no sense, to pay interest on the deposits (to incur unnecessary costs), that the commercial banking system already owns. The banks should store their liquidity, and not attempt to buy their liquidity through an open market device. That was the purpose of Regulation Q ceilings in the 1933 Banking Act in the first place.
If the commercial bankers are given the sovereign right to create legal tender, then the DFIs must be severely circumscribed, regulations uniformly applied, in the management of both their assets and their liabilities – or made quasi-gov’t institutions.
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[…] Regarding regulation, Dear FDIC and Fed, We Need a Genuine Safekeeping Bank, Not Band-Aids […]
I am truly surprised that the FDIC isn’t hitting the non-Fed member banks the special assessment fee based on the bizarro world of finance going on currently. That would weaken them even more for the large predator banks to feed on.
That’s for sure! It would be more in line with their reverse robin hood strategy of the past several decades.
We are about to hit “Juncture Recognition in the Stock Market”. William G. Bretz used the Debit Series to forecast turns. I use money flows. I used the 10-month rate-of-change in our means-of-payment money supply to predict R-gDp. I got the distributed lag effect from the Bank Credit Analyst’s Debit/Loan ratio time series. The trajectory today is that the 10-month roc will turn negative at the end of June (signaling a recession). TBD.
TMS, Shadowstats, Divisia Aggregates, etc. have all turned south prematurely.
I think that there are always many analysts who get the market turns correct. Now, the Elliott Wave theorists are in agreement (“An ideal wave structure calls for a gap down then eventual fill and power higher sometime next week to mark the proper end of Minute [iii] of C of (2)”).
I Ching suggests towards the end of July, perhaps even the beginning of August.
I can change my name here to Ramses II tha God. I Am sure that will impress everyone.
Like the new site, the last one was painful to use. I agree with TT’s post, the financial system needs a FDR style makeover. The middle class has been eviscerated by the banks and the FED’s financial management. Not a surprise that most of the innovation in the US has been in software, just takes some smart guys with a few computers and some software, very little capital needed. Meanwhile the bulk of the capital goes to the already wealthy for gambling and rentier type investments. Elon Musk is the exception and invested his gains from software into heavy industry.
That’s the problem with economics. It’s Marxist. In the circular flow of income, unless the upper income quintiles’ savings (the bourgeoisie), are expeditiously activated, i.e., put back to work, then a dampening economic impact is generated (secular stagnation of the proletariat).
It’s a deceleration in the transaction’s velocity of funds), a stoppage in the circuit income velocity of funds.
Contrary to Dr. George Selgin, banks don’t lend deposits. Deposits are the result of lending/investing. Hence, all bank-held savings are lost to both consumption and investment, indeed to any payment or expenditure. It’s stock vs. flow. The expiration of the FDIC’s unlimited transaction deposit insurance in December 2012 is prima facie evidence. It caused the “taper tantrum” (as predicted).
Dr. Philip George’s equations corroborate this, in his: “The Riddle of Money Finally Solved” ( the ratio of M1 to the sum of 12 months savings ).
My migration back to WordPress is complete.
We were missing 6 days of posts so you may have been blasted, one time, with a set of emails as those posts were added.
Mish, I was subscribed years ago and now am getting random Mishtalk emails from years ago randomly in my inbox. When I hit unsubscribe, it says I don’t have a sub. Whatever you recently changed has messed something up for me.
Are you sure they are from years ago- If so that is a huge problem
There was a big blast of emails that did not move over about 6 days worth that were just added
Mish
I got about 20 of your emails going back as far as February. They all have Caitlin Johnstone as the sender.
I will look into that
Makes no sense
Making available for sale securities match in size and time duration to a bank’s credit portfolio would help. Bad risk actors need to be rooted out. There’s only so much FDIC to go around.
Hedge funds typically have a 2 and 20 pay structure. 2% of assets under management and 20% of profits. They have every incentive of taking huge risks. They get a huge payday if they go up 50% and get nothing if they lose 50%. Same as if they break even. This is the main reason the markets are irrational and blow bubbles. All the hedge funds are making very risky investments so they drive up the value of each others assets. After a while they start taking profits and the whole thing starts to collapse.
Banks have a similar incentive. If they make risky investments that pay off, bank profits go way up, the stock goes way up and their stock options go way up. If they lose, worst case scenario is the bank goes under, but the people in charge aren’t personally liable. They get a final payout and find a job at another financial institution.
traders at banks, is heads they win, tails, bank loses. banks motto is same, heads they win, tails, the middlebrow tax cows lose. it’s a scam. FEDRESNY is private. that’s the kicker. tom jefferson was correct.
I believe the hedge funds get their 2% even with 50% losses.
It’s part of the heads I win, tails you lose, hedge fund agreement you sign.
FDR did the correct thing, he shut down every bank in nation for a week and sent in auditors and shuttered the insolvent ones. the real unwinding problem was the glass steagall act was destroyed by the fake free market raygunites and slick willie crew, who pulled apart glass steagall. mish is half right. but historical context is needed. also, let’s face reality the FED RES of NY is privately owned. this is a fact. all the ancient wise men knew that once you privatize the money one creates socialized losses and privatized profits. the FEDERAL reserve is about as public as FEDERAL EXPRESS. the middlebrows in finance haven’t caught on. the FED is privately owned by the NYC banks. the rest is eyewash. the institutional investor did a deep dive a few years ago, and showed the modern ownership. this is fact. not fiction. the FED has one mandate. to keep her owners, the NYC banks in high cotton. the rest of the stuff is rubbish. and the middlebrows that think the FED is dumb, or in some business of unemployment or inflation concerns are just useful idiots. i find it comical, and just posting this so perhaps a few more will know. it doesn’t matter of course, it ain’t changing in our lifetimes. perhaps in a century more.
You’re right. Richard Werner points out that China’s success (“four decades of double-digit economic growth”) was dependent upon creating “thousands of banks, mostly small local banks, lending to small firms”.
The U.S. is experiencing a consolidation of the banking industry.
Yes. It’s by design. Basel rules favor big banks. Our economy is being consolidated and nationalized while central banks internationalize and financially repress the serfs. We need to get off debt money before it suffocates us. Mish what you are asking will not happen unless we take the money creation power away. They will not do a bailment system. They don’t care and want it to implode.
(1) The great German poet and playwright Bertolt Brecht would have agreed and once said it was “easier to rob by setting up a bank than by holding up (one).”
(2) As Willie Sutton said: his reason for robbing banks is ‘That’s where the money is’.
(3) Thomas Jefferson’s my favorite: “I sincerely believe the banking institutions having the issuing power of money are more dangerous to liberty than standing armies.”
Much better layout now!
Way too many powerful people profit from the Leakey bandaids for change to come from above. Change will come from below when the population decides it’s been bled enough.
Testing the new comments and logging in
They work but I don’t think we can scroll through your past post.
link to smbc-comics.com
Can still post comics. That’s a big plus!
The payment’s system is a closed system. The source of time deposits is demand deposits. And demand deposits are created by the Reserve and commercial banks.
Thus, it makes no sense, to pay interest on the deposits (to incur unnecessary costs), that the commercial banking system already owns. The banks should store their liquidity, and not attempt to buy their liquidity through an open market device. That was the purpose of Regulation Q ceilings in the 1933 Banking Act in the first place.
If the commercial bankers are given the sovereign right to create legal tender, then the DFIs must be severely circumscribed, regulations uniformly applied, in the management of both their assets and their liabilities – or made quasi-gov’t institutions.