Official Stock Market & Economy Thread

[theone2401]

Please let me know when one person "dumps" treasuries. I'll still be here.

We can address this two ways you ready?

First logic.

If you have a promise from someone (The Fed) to overpay for your asset (treasuries) no matter what the price is what are you going to do? keep it or sell it?

You will sell it unless you are an idiot of course. Why do you think the price of treasuries jumped right after the announcement? Because people are trying tobuy them now and be the first ones to sell them to the government.

Second way to address your false statements

Fed TIC data

Treasury International Capital (TIC) Data for January

Washington -The U.S. Department of the Treasury today released Treasury International Capital (TIC) data for January 2009. The next release, which will report on data for February 2009, is scheduled for April 15, 2009.

Net foreign purchases of long-term securities were negative $43.0 billion.

• Net foreign purchases of long-term U.S. securities were negative $18.8 billion. Of this, net purchases by private foreign investors were negative $10.2 billion, and net purchases by foreign official institutions were negative $8.5 billion.

• U.S. residents purchased a net $24.2 billion of long-term foreign securities.

Net foreign acquisition of long-term securities, taking into account adjustments, is estimated to have been negative $60.9 billion.

Foreign holdings of dollar-denominated short-term U.S. securities, including Treasury bills, and other custody liabilities increased $30.9 billion. Foreign holdings of Treasury bills decreased $15.4 billion.

Banks' own net dollar-denominated liabilities to foreign residents decreased $118.9 billion.

Monthly net TIC flows were negative $148.9 billion. Of this, net foreign private flows were negative $158.1 billion, and net foreign official flows were $9.2 billion. .

Complete data is available on the Treasury website at www.treas.gov/tic.

Now run along child.

Note the trend of treasury buyers moving from long date debt to short term debt...this is why the fed is buying long dated and not short because they see thewriting on the wall. They have defaulted plain and simple.

Cats on hear swear their economists and understand monetary policy its actually hilarious to sit back and see. Read a few articles on inflation and the great depression and instantly their mini Milton Friedmans

Yea because these "geniuses" have been so successful. There are many different theories in economics and some of them work better thenothers. Neoclassical Economics doesnt have a good track record if you stop drinking the koolaid for a second.



Now lets look at the most recent example of Quantitative Easing....Japan which began doing it in the late 90's early 2000's

Their currency did not collapse but it fell about 20%. They have the highest debt to GDP ratio in the world and their stock market has not significantly risenin 10 years. Now when you factor in the fact this is a saving/exporting economy and the fact that the largest credit bubble in the history of the universe"saved" them over the past 10 years you have to be extremely worried about the outcome for the US because none of these two things are present tosave us.

 

[dajoka004]

Originally Posted by cguy610

Originally Posted by DaJoka004

Originally Posted by cguy610

This is a stock market thread, why don't all you gloom and doomers put your money where your mouth is and short financials. Come back in 6 months and let me know how it works out. Disclosure: I'm long Bank of America.

Why would you hold on to a short for six months?

Financials are way up again in after market trading. I'm tempted to get in, because I think this will continue for a little bit. Could make a decent profit in a short time.

This has to come to an end though. I can't believe it's already gone on this long.

If this is bad for financials, they will be much lower 6 months from now, right? You don't like to make money?

Bank of America up 20% yesterday and another 4% today in premarket trading.

SKF down 20% yesterday.

And doooown we gooooo!

We might rally tomorrow. I think next week we'll see a big turn toward the red. Might play FAZ/DXD Monday or Tuesday. Hopefully I can make up for my FAZloss earlier this week. Although gold and silver has already done that for me

 

[Betonblck]

Originally Posted by theone2401

Please let me know when one person "dumps" treasuries. I'll still be here.

We can address this two ways you ready?

First logic.

If you have a promise from someone (The Fed) to overpay for your asset (treasuries) no matter what the price is what are you going to do? keep it or sell it?

You will sell it unless you are an idiot of course. Why do you think the price of treasuries jumped right after the announcement? Because people are trying to buy them now and be the first ones to sell them to the government.

Second way to address your false statements

Fed TIC data

Treasury International Capital (TIC) Data for January

Washington -The U.S. Department of the Treasury today released Treasury International Capital (TIC) data for January 2009. The next release, which will report on data for February 2009, is scheduled for April 15, 2009.

Net foreign purchases of long-term securities were negative $43.0 billion.

• Net foreign purchases of long-term U.S. securities were negative $18.8 billion. Of this, net purchases by private foreign investors were negative $10.2 billion, and net purchases by foreign official institutions were negative $8.5 billion.

• U.S. residents purchased a net $24.2 billion of long-term foreign securities.

Net foreign acquisition of long-term securities, taking into account adjustments, is estimated to have been negative $60.9 billion.

Foreign holdings of dollar-denominated short-term U.S. securities, including Treasury bills, and other custody liabilities increased $30.9 billion. Foreign holdings of Treasury bills decreased $15.4 billion.

Banks' own net dollar-denominated liabilities to foreign residents decreased $118.9 billion.

Monthly net TIC flows were negative $148.9 billion. Of this, net foreign private flows were negative $158.1 billion, and net foreign official flows were $9.2 billion. .

Complete data is available on the Treasury website at www.treas.gov/tic.

Now run along child.

Note the trend of treasury buyers moving from long date debt to short term debt...this is why the fed is buying long dated and not short because they see the writing on the wall. They have defaulted plain and simple.

Cats on hear swear their economists and understand monetary policy its actually hilarious to sit back and see. Read a few articles on inflation and the great depression and instantly their mini Milton Friedmans

Yea because these "geniuses" have been so successful. There are many different theories in economics and some of them work better then others. Classical Economics doesnt have a good track record if you stop drinking the koolaid for a second.



Now lets look at the most recent example of Quantitative Easing....Japan which began doing it in the late 90's early 2000's

Their currency did not collapse but it fell about 20%. They have the highest debt to GDP ratio in the world and their stock market has not significantly risen in 10 years. Now when you factor in the fact this is a saving/exporting economy and the fact that the largest credit bubble in the history of the universe "saved" them over the past 10 years you have to be extremely worried about the outcome for the US because none of these two things are present to save us.


Just give it up man. Nothing in the data suggests the Federal Reserve defaulting. Moreover, data for one month doesn't indicate anything. We aren'tJapan and we aren't Iceland.

Have you ever read the story of the boy that cried wolf?

 

[theone2401]

Originally Posted by cguy610

Originally Posted by theone2401

Please let me know when one person "dumps" treasuries. I'll still be here.

We can address this two ways you ready?

First logic.

If you have a promise from someone (The Fed) to overpay for your asset (treasuries) no matter what the price is what are you going to do? keep it or sell it?

You will sell it unless you are an idiot of course. Why do you think the price of treasuries jumped right after the announcement? Because people are trying to buy them now and be the first ones to sell them to the government.

Second way to address your false statements

Fed TIC data

Treasury International Capital (TIC) Data for January

Washington -The U.S. Department of the Treasury today released Treasury International Capital (TIC) data for January 2009. The next release, which will report on data for February 2009, is scheduled for April 15, 2009.

Net foreign purchases of long-term securities were negative $43.0 billion.

• Net foreign purchases of long-term U.S. securities were negative $18.8 billion. Of this, net purchases by private foreign investors were negative $10.2 billion, and net purchases by foreign official institutions were negative $8.5 billion.

• U.S. residents purchased a net $24.2 billion of long-term foreign securities.

Net foreign acquisition of long-term securities, taking into account adjustments, is estimated to have been negative $60.9 billion.

Foreign holdings of dollar-denominated short-term U.S. securities, including Treasury bills, and other custody liabilities increased $30.9 billion. Foreign holdings of Treasury bills decreased $15.4 billion.

Banks' own net dollar-denominated liabilities to foreign residents decreased $118.9 billion.

Monthly net TIC flows were negative $148.9 billion. Of this, net foreign private flows were negative $158.1 billion, and net foreign official flows were $9.2 billion. .

Complete data is available on the Treasury website at www.treas.gov/tic.

Now run along child.

Note the trend of treasury buyers moving from long date debt to short term debt...this is why the fed is buying long dated and not short because they see the writing on the wall. They have defaulted plain and simple.

Cats on hear swear their economists and understand monetary policy its actually hilarious to sit back and see. Read a few articles on inflation and the great depression and instantly their mini Milton Friedmans

Yea because these "geniuses" have been so successful. There are many different theories in economics and some of them work better then others. Classical Economics doesnt have a good track record if you stop drinking the koolaid for a second.



Now lets look at the most recent example of Quantitative Easing....Japan which began doing it in the late 90's early 2000's

Their currency did not collapse but it fell about 20%. They have the highest debt to GDP ratio in the world and their stock market has not significantly risen in 10 years. Now when you factor in the fact this is a saving/exporting economy and the fact that the largest credit bubble in the history of the universe "saved" them over the past 10 years you have to be extremely worried about the outcome for the US because none of these two things are present to save us.


Just give it up man. Nothing in the data suggests the Federal Reserve defaulting. Moreover, data for one month doesn't indicate anything. We aren't Japan and we aren't Iceland.

Have you ever read the story of the boy that cried wolf?

When you have to buy your own debt that is for all intensive purposes defaulting. And if one month of data doesnt indicate anything why did the Fed startbuying debt? They obviously think this one month of data means something. You really think its a coincidence that they started doing this right after this datawas released? You are just denying the facts now. You are right about one thing WE ARE NOT JAPAN we are worse. You seriously think the Fed buying their owndebt, something they have never done before isnt a significant even in history you are kidding yourself, they would not do this haphazardly they know there wasnot going to be the demand for the amount of debt that is coming on the market in the next couple of months and they are taking action. No one is calling forthe end of the world here just that easing does not work and never has worked but you wouldnt have any "meaningless" data to support that claim wouldyou? Ill wait.

I see arguing with you is a waste of time not because of who is rightand who is wrong but because you have no support for your arguments and completely deny the facts that I have just laid out.

You havent countered one thing I have said or anyone else really with anyfacts...because you dont have a counter argument except "have you ever heard of the boy who cried wolf"

 

[Betonblck]

Originally Posted by theone2401


When you have to buy your own debt that is for all intensive purposes defaulting. And if one month of data doesnt indicate anything why did the Fed start buying debt? They obviously think this one month of data means something. You really think its a coincidence that they started doing this right after this data was released? You are just denying the facts now. You are right about one thing WE ARE NOT JAPAN we are worse. You seriously think the Fed buying their own debt, something they have never done before isnt a significant even in history you are kidding yourself, they would not do this haphazardly they know there was not going to be the demand for the amount of debt that is coming on the market in the next couple of months and they are taking action. No one is calling for the end of the world here just that easing does not work and never has worked but you wouldnt have any "meaningless" data to support that claim would you? Ill wait.

I see arguing with you is a waste of time not because of who is right and who is wrong but because you have no support for your arguments and completely deny the facts that I have just laid out.

You havent countered one thing I have said or anyone else really with any facts...because you dont have a counter argument except "have you ever heard of the boy who cried wolf"

You and others on here are calling for a Great Depression and saying "we're doomed".

"Open market operations--purchases and sales of U.S. Treasury and federal agency securities--are the Federal Reserve's principal tool forimplementing monetary policy."

http://www.federalreserve.gov/fomc/fundsrate.htm

 

[jcash da kid]

wish I never held visa and sold in the 80's

wish I never brought wamu

. Wish I actually openned a book and saved my money before acting stupid in themarket. /end rant

 

[theone2401]

Originally Posted by cguy610

Originally Posted by theone2401


When you have to buy your own debt that is for all intensive purposes defaulting. And if one month of data doesnt indicate anything why did the Fed start buying debt? They obviously think this one month of data means something. You really think its a coincidence that they started doing this right after this data was released? You are just denying the facts now. You are right about one thing WE ARE NOT JAPAN we are worse. You seriously think the Fed buying their own debt, something they have never done before isnt a significant even in history you are kidding yourself, they would not do this haphazardly they know there was not going to be the demand for the amount of debt that is coming on the market in the next couple of months and they are taking action. No one is calling for the end of the world here just that easing does not work and never has worked but you wouldnt have any "meaningless" data to support that claim would you? Ill wait.

I see arguing with you is a waste of time not because of who is right and who is wrong but because you have no support for your arguments and completely deny the facts that I have just laid out.

You havent countered one thing I have said or anyone else really with any facts...because you dont have a counter argument except "have you ever heard of the boy who cried wolf"

You and others on here are calling for a Great Depression and saying "we're doomed".

"Open market operations--purchases and sales of U.S. Treasury and federal agency securities--are the Federal Reserve's principal tool for implementing monetary policy."

http://www.federalreserve.gov/fomc/fundsrate.htm

You obviously have a very rudimentary understanding of "Open Market Operations". When the Fed resorts to monetizing the debt the situation is DIRE.Deliberate devaluation of the dollar is not a normal policy action by the Fed. And regardless of the fact that they have the power to do this it stillfunctionally works just like a default. The market has told the Treasury that they will not buy the supply of debt that is coming to the market at the currentinterest rate. And the Fed is saying that they cannot afford to have interest rates increase any further because they do not want to (cannot) pay.

But anyway I am not calling for doom. I am saying that 10 years of deflation like Japan are the best case scenario where hyperinflation is a worst casescenario. Calling for a Great Depression? We are already in one. Look at U-6 unemployment and compare it to how unemployment was calculated in the 30's.Protectionist policies all around and massive stimulus packages and banker witch hunts, stock market down 50+% unless you believe the bottom is in. What moredo you need for a depression? What are you looking for?

And if you think QE will work you would get the hell out of financials fast because flattening the yield curve will kill bank profits smart guy. Someone whobelieves QE isnt going to keep interest rates low would probably get long financials. Also, It doesnt matter if the stock market goes up less than the dollargoes down you are still losing money.
[h1]
[/h1]

 

[cue45]

Well put ^^

 

[theone2401]

[h1]http://www.reuters.com/ar...Rpt/idUSLJ93633020090319
[/h1] [h1]China backs talks on dollar as reserve -Russian source[/h1]
Thu Mar 19, 2009 11:24am EDT

Email | Print |
Share
| Reprints | Single Page

[-] Text [+]

[h3]Market News[/h3]

Oil surges 7 percent past $51 on Fed plan, weak dollar

Misgivings about Fed plan spark stocks sell-off | Video

Dollar tumbles as market digests Fed Treasury plans

More Business & Investing News...

By Gleb Bryanski

MOSCOW, March 19 (Reuters) - China and other emerging nations back Russia's call for a discussion on how to replace the dollar as the world's primary reserve currency, a senior Russian government source said on Thursday. Russia has proposed the creation of a new reserve currency, to be issued by international financial institutions, among other measures in the text of its proposals to the April G20 summit published last Monday.

Calls for a rethink of the dollar's status as world's sole benchmark currency come amid concerns about its long-term value as the U.S. Federal Reserve moved to pump more than a trillion dollars of new cash into the ailing economy late Wednesday.

Russia met representatives of China, India and Brazil ahead of the G20 finance ministers meeting last week, as the big emerging powers seek to up their influence on decisionmaking globally. Their first ever joint communique did not mention a new currency but the source said the issue was discussed.

"They (China) did not formally put forward their position for the G20 summit but unofficially they had distributed their paper regarding the same ideas (the need for the new currency)," the source told Reuters, speaking on condition of anonymity.

The source said the Chinese paper envisaged the International Monetary Fund's Special Drawing Rights (SDRs) being first assigned a role of a clearing currency on some transactions and then gradually becoming the main global reserve currency. "They said that the role of reserve currency should be given to SDR," the source said.

A U.N. panel of experts is also looking at using expanded SDRs, originally created by the International Monetary Fund in 1969, but now used mainly as an accounting unit within similar organisations as a new reserve currency instead of the dollar.

Currency specialist Avinash Persaud, a member of the U.N. panel, told a Reuters Funds Summit on Wednesday that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket.

The SDR and the old Ecu are essentially combinations of currencies, weighted to a constituent's economic clout, which can be valued against other currencies and against those inside the basket.

The Russian source said Moscow was aware that the emergence of the new global currency would not happen overnight and said its goal was to initiate a discussion about it at the G20 summit in London on April 2.

The source said that India did not object to the discussion but was not prepared to take the lead. The source said South Korea and South Africa backed the idea, while developed nations were not "allergic" to it.

"We are not waiting for everyone to say: 'How beautifully it has all been formulated, let's subscribe to it'," the source said. "The main idea is to start a discussion about it."

Russia holds about half of its reserves, the world's third-largest, in dollars, with the rest in euros and pounds. Prime Minister Vladimir Putin has called on reserve currency issuers to show more financial discipline.

Finance Minister Alexei Kudrin told reporters on the sidelines of the G20 finance ministers meeting that it would take up to 30 years to create a new super-currency, suggesting there was no unity in Russia on the issue.

President Dmitry Medvedev's top economic aide and G20 sherpa Arkady Dvorkovich is behind the Kremlin's G20 proposals, made public one day after Kudrin returned from England. (Reporting by Gleb Bryanski; editing by Mike Dolan/Patrick Graham)

I dont know how much truth to this there is but if any..."that was quick"

 

[reigndrop]

Originally Posted by theone2401

[h1]http://www.reuters.com/ar...Rpt/idUSLJ93633020090319
[/h1] [h1]China backs talks on dollar as reserve -Russian source[/h1]
Thu Mar 19, 2009 11:24am EDT

Email | Print |
Share
| Reprints | Single Page

[-] Text [+]

[h3]Market News[/h3]

Oil surges 7 percent past $51 on Fed plan, weak dollar

Misgivings about Fed plan spark stocks sell-off | Video

Dollar tumbles as market digests Fed Treasury plans

More Business & Investing News...

By Gleb Bryanski

MOSCOW, March 19 (Reuters) - China and other emerging nations back Russia's call for a discussion on how to replace the dollar as the world's primary reserve currency, a senior Russian government source said on Thursday. Russia has proposed the creation of a new reserve currency, to be issued by international financial institutions, among other measures in the text of its proposals to the April G20 summit published last Monday.

Calls for a rethink of the dollar's status as world's sole benchmark currency come amid concerns about its long-term value as the U.S. Federal Reserve moved to pump more than a trillion dollars of new cash into the ailing economy late Wednesday.

Russia met representatives of China, India and Brazil ahead of the G20 finance ministers meeting last week, as the big emerging powers seek to up their influence on decisionmaking globally. Their first ever joint communique did not mention a new currency but the source said the issue was discussed.

"They (China) did not formally put forward their position for the G20 summit but unofficially they had distributed their paper regarding the same ideas (the need for the new currency)," the source told Reuters, speaking on condition of anonymity.

The source said the Chinese paper envisaged the International Monetary Fund's Special Drawing Rights (SDRs) being first assigned a role of a clearing currency on some transactions and then gradually becoming the main global reserve currency. "They said that the role of reserve currency should be given to SDR," the source said.

A U.N. panel of experts is also looking at using expanded SDRs, originally created by the International Monetary Fund in 1969, but now used mainly as an accounting unit within similar organisations as a new reserve currency instead of the dollar.

Currency specialist Avinash Persaud, a member of the U.N. panel, told a Reuters Funds Summit on Wednesday that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket.

The SDR and the old Ecu are essentially combinations of currencies, weighted to a constituent's economic clout, which can be valued against other currencies and against those inside the basket.

The Russian source said Moscow was aware that the emergence of the new global currency would not happen overnight and said its goal was to initiate a discussion about it at the G20 summit in London on April 2.

The source said that India did not object to the discussion but was not prepared to take the lead. The source said South Korea and South Africa backed the idea, while developed nations were not "allergic" to it.

"We are not waiting for everyone to say: 'How beautifully it has all been formulated, let's subscribe to it'," the source said. "The main idea is to start a discussion about it."

Russia holds about half of its reserves, the world's third-largest, in dollars, with the rest in euros and pounds. Prime Minister Vladimir Putin has called on reserve currency issuers to show more financial discipline.

Finance Minister Alexei Kudrin told reporters on the sidelines of the G20 finance ministers meeting that it would take up to 30 years to create a new super-currency, suggesting there was no unity in Russia on the issue.

President Dmitry Medvedev's top economic aide and G20 sherpa Arkady Dvorkovich is behind the Kremlin's G20 proposals, made public one day after Kudrin returned from England. (Reporting by Gleb Bryanski; editing by Mike Dolan/Patrick Graham)

I dont know how much truth to this there is but if any..."that was quick"

It's a bluff. If anything, Russia's toast after Eastern Europe falls apart.

 

[wawaweewa]

Originally Posted by reigndrop

It's a bluff. If anything, Russia's toast after Eastern Europe falls apart.

Russia will never be toast because it is a resource rich country.
It's corrupt and mismanaged about as much as any other nation and that's its downfall. However, it can never be "toast" because they alwayshave resources to fall back on. Both to use domestically and as a source of GDP.

There are only a handful of nations on this globe who are in the same position resource wise. US, Russia, Brazil, Venezuela, and Canada.

 

[reigndrop]

Originally Posted by wawaweewa

Originally Posted by reigndrop

It's a bluff. If anything, Russia's toast after Eastern Europe falls apart.

Russia will never be toast because it is a resource rich country.
It's corrupt and mismanaged about as much as any other nation and that's its downfall. However, it can never be "toast" because they always have resources to fall back on. Both to use domestically and as a source of GDP.

There are only a handful of nations on this globe who are in the same position resource wise. US, Russia, Brazil, Venezuela, and Canada.

True, toast was a bit too powerful of a word.

 

[beermann2]

I got this from another site that QE won't work and the FED will fail.
______________________________________________________________________________________________________________
http://www.runtogold.com/2009/03/federal-reserve-will-fail-with-quantitative-easing/

Quantitative easing; everybody is doing it like the Bank of England, Japan and even Switzerland. Quantitative easing is a toolof monetary policy. The effect is an increase in the quantity of currency without regard to maintaining its quality. Quantitative is relating to, measuring, or measured by the quantity of something rather than its quality. On 18 March 2009Bloombergreported that the Federal Reserve announced the intent to purchase $300B of longer-term Treasuries. Predictably, the Federal Reserve has decided to exacerbatethe quantitative easing party.

What is really going on is the great credit contraction. The system does not collapse but evaporate. As the evaporation has continued and intensified capital, both real and fictitious, has soughtsafer and more liquid assets by moving down the liquidity pyramid. A significant, but still miniscule amount, of capital has already evaporated over the pastyear. This is basic economic law being asserted. A predictable consequence has been for Treasury rates to near 0% because they areconsidered among the safest and most liquid assets.



But the UnitedStates Treasury bubble is the biggest of all and there are reasons how and why the Treasury bubble willburst.

At all times and in all circumstances gold remains money. Gold is the ultimate form of payment and is always accepted. Gold is the safestand most liquid asset. As I surgically explained, the ETFs GLD and SLV are NOT gold or silver. The question then becomes: Will capital move up or down the liquiditypyramid?



How did gold perform in reaction to Bernanke's announcement? A monstrous and almost immediate rise of about $60 per ounce. The gold cartel GATA has shined a light on must of had its hands full today. This is all the more ominous because gold is not just a commodity or portfolio asset but a currency which, through tools like GoldMoney, can be used in ordinary daily transactions. Because silver isalso money; the chronic silverbackwardation is equally if not more ominous.

I have long asserted that the FRN$ will be the last major fiat currency to evaporate in the great credit contraction and that gold will still be there when the nextcredit expansion begins. This misguided action by Mr. Bernanke will only hasten the rate of evaporation. The great credit contraction has just begun and in the aggregate capital will continue moving down, not up, theliquidity pyramid.

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[theone2401]

Originally Posted by reigndrop

Originally Posted by theone2401

[h1]http://www.reuters.com/ar...Rpt/idUSLJ93633020090319
[/h1] [h1]China backs talks on dollar as reserve -Russian source[/h1]
Thu Mar 19, 2009 11:24am EDT

Email | Print |
Share
| Reprints | Single Page

[-] Text [+]

[h3]Market News[/h3]

Oil surges 7 percent past $51 on Fed plan, weak dollar

Misgivings about Fed plan spark stocks sell-off | Video

Dollar tumbles as market digests Fed Treasury plans

More Business & Investing News...

By Gleb Bryanski

MOSCOW, March 19 (Reuters) - China and other emerging nations back Russia's call for a discussion on how to replace the dollar as the world's primary reserve currency, a senior Russian government source said on Thursday. Russia has proposed the creation of a new reserve currency, to be issued by international financial institutions, among other measures in the text of its proposals to the April G20 summit published last Monday.

Calls for a rethink of the dollar's status as world's sole benchmark currency come amid concerns about its long-term value as the U.S. Federal Reserve moved to pump more than a trillion dollars of new cash into the ailing economy late Wednesday.

Russia met representatives of China, India and Brazil ahead of the G20 finance ministers meeting last week, as the big emerging powers seek to up their influence on decisionmaking globally. Their first ever joint communique did not mention a new currency but the source said the issue was discussed.

"They (China) did not formally put forward their position for the G20 summit but unofficially they had distributed their paper regarding the same ideas (the need for the new currency)," the source told Reuters, speaking on condition of anonymity.

The source said the Chinese paper envisaged the International Monetary Fund's Special Drawing Rights (SDRs) being first assigned a role of a clearing currency on some transactions and then gradually becoming the main global reserve currency. "They said that the role of reserve currency should be given to SDR," the source said.

A U.N. panel of experts is also looking at using expanded SDRs, originally created by the International Monetary Fund in 1969, but now used mainly as an accounting unit within similar organisations as a new reserve currency instead of the dollar.

Currency specialist Avinash Persaud, a member of the U.N. panel, told a Reuters Funds Summit on Wednesday that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket.

The SDR and the old Ecu are essentially combinations of currencies, weighted to a constituent's economic clout, which can be valued against other currencies and against those inside the basket.

The Russian source said Moscow was aware that the emergence of the new global currency would not happen overnight and said its goal was to initiate a discussion about it at the G20 summit in London on April 2.

The source said that India did not object to the discussion but was not prepared to take the lead. The source said South Korea and South Africa backed the idea, while developed nations were not "allergic" to it.

"We are not waiting for everyone to say: 'How beautifully it has all been formulated, let's subscribe to it'," the source said. "The main idea is to start a discussion about it."

Russia holds about half of its reserves, the world's third-largest, in dollars, with the rest in euros and pounds. Prime Minister Vladimir Putin has called on reserve currency issuers to show more financial discipline.

Finance Minister Alexei Kudrin told reporters on the sidelines of the G20 finance ministers meeting that it would take up to 30 years to create a new super-currency, suggesting there was no unity in Russia on the issue.

President Dmitry Medvedev's top economic aide and G20 sherpa Arkady Dvorkovich is behind the Kremlin's G20 proposals, made public one day after Kudrin returned from England. (Reporting by Gleb Bryanski; editing by Mike Dolan/Patrick Graham)

I dont know how much truth to this there is but if any..."that was quick"

It's a bluff. If anything, Russia's toast after Eastern Europe falls apart.



Yea I figured as much. But this will not be the last we hear of this.

What isnt a bluff though is Iran wanting to trade oil in another currency. Same thing Saddam did and we know what happened to him

 

[wawaweewa]

Originally Posted by reigndrop

Originally Posted by wawaweewa

Originally Posted by reigndrop

It's a bluff. If anything, Russia's toast after Eastern Europe falls apart.

Russia will never be toast because it is a resource rich country.
It's corrupt and mismanaged about as much as any other nation and that's its downfall. However, it can never be "toast" because they always have resources to fall back on. Both to use domestically and as a source of GDP.

There are only a handful of nations on this globe who are in the same position resource wise. US, Russia, Brazil, Venezuela, and Canada.

True, toast was a bit too powerful of a word.

Yeh. Got what you meant. Answer wasn't really directed at you. Just a general thing. Shoulda said that.
When %%*@ really hits the fan I rather live in these countries that actually have something of intrinsic value.

btw, cguy610.

Forgot to mention with QE driving up commodity prices it's great for American workers who are either unemployed or are taking wage cuts.
Watch prices rip up on you right when you can least afford them too.

 

[reigndrop]

My computer might be playing tricks on me, but checking futures before I head off to bed, we're down 91 points

Tomorrow will be quite they day. Especially with many derivatives expiring.

Okay maybe not, only down 54, but still tomorrow will very fun to watch

 

[wawaweewa]

From Tim Knight:

From EvilSpeculator

Just some possibilities to think about.

 

[theone2401]

Forgot to mention with QE driving up commodity prices it's great for American workers who are either unemployed or are taking wage cuts.
Watch prices rip up on you right when you can least afford them too.

A big reason why QE didnt work in Japan and probably wont work here. The inflation is going to "tax" away any increase in spending forthe little guy. The more QE, the lower the dollar, the more everything costs. Its a great Idea!

 

[wizards23]

^lmao

 

[freakydestroyer]

whats going to happen today?

 

[superantigen]

I don't know but based on what reigndrop's statement:

My computer might be playing tricks on me, but checking futures before I head off to bed, we're down 91 points

Tomorrow will be quite they day. Especially with many derivatives expiring.

Okay maybe not, only down 54, but still tomorrow will very fun to watch
Seems like something bad (for the markets) might go down tomorrow--literally speaking...

If that's the case, I welcome it cause I need to recoup my losses in FAZ, SRS, and RFN...

...

 

[be4chst]

Originally Posted by brettTHEjett

^^ just bought 1200 shares @ $17.53 on investopedia.

Why did you have confidence in PEGA?

It's got a nice chart, a new high, and a nice track record of earnings. I bet ur liking Pega so far!

 

[dajoka004]

Futures are way up. I'm still confident this will all come back down.

 

[cruthik3]

U.S. Treasury Announces $1 Trillion Toxic-Debt Plan (Update1)

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By Rebecca Christie and Brendan Murray

March 23 (Bloomberg) -- The U.S. Treasury announced a plan aimed at financing as much as $1 trillion in purchases of distressed assets to help a financialsystem that is "still working against recovery."

The Public-Private Investment Program will use $75 billion to $100 billion from the $700 billion Troubled Asset Relief Program enacted last year, giving thegovernment "purchasing power" of $500 billion, the Treasury said today in a statement in Washington. The program may double "over time," itsaid.

Today's announcement provides more details on an initial strategy laid out by Treasury Secretary Timothy Geithner last month, which caused a slump in stocks because it lacked an explanation of howthe effort would work. The Treasury, Federal Reserve and Federal Deposit Insurance Corp. will provide capital and financing for private investors to buyilliquid loans and securities held by banks, according to today's statement.

"This approach is superior to the alternatives of either hoping for banks to gradually work these assets off their books or of the governmentpurchasing the assets directly," the Treasury statement said. "Simply hoping for banks to work legacy assets off over time risks prolonging afinancial crisis, as in the case of the Japanese experience."

'Legacy Loans'

Half of the Treasury's funds will go to a "Legacy Loans Program" that will be overseen by the FDIC. The Treasury would provide half of thecapital going to purchase a pool of loans from banks, with private fund managers putting up the rest. The FDIC will then guarantee financing for the investors,up to a maximum of six times the capital, or equity, provided.

The FDIC, which has extensive experience disposing of devalued loans from taking over failed banks, will hold auctions for the pools of loans, which will becontrolled and managed by the private investors with oversight by the FDIC.

A "broad array of investors are expected to participate in the Legacy Loans Program," the Treasury said, encouraging insurance companies, pensionfunds and even individual investors to join in.

The second half of the Treasury's contribution will go to the "Legacy Securities Program." The objective of the initiative is to generateprices for securities backed by mortgages that are no longer traded because investors have little confidence about the underlying value of the home loans.

Under this program, the Fed will expand an existing facility that provides financing for investor purchases of asset-backed securities. The TermAsset-Backed Securities Loan Program will be broadened to take on assets such as residential and commercial mortgage-backed securities that were originallyrated AAA and sold by private banks.

The Treasury will also approve as many as five asset managers "with a demonstrated track record of purchasing legacy assets" that will buy thesecurities.

The managers will be given time to raise private capital and receive matching funds from the Treasury. They will also be able to get "senior debt"from the Treasury of 50 percent to as much as 100 percent of the fund's capital.

To contact the reporters on this story: Rebecca Christie in Washington at Rchristie4@bloomberg.net; Brendan Murray in Washington at brmurray@bloomberg.net
Last Updated: March 23, 2009 08:35 EDT

 

[foodgoeshere]

^The unveiling of the toxic assets plan giving investors hope. US dollar going to doo-doo.