Comments on: Others bring problems, I bring solutions

By: felix culpa

felix culpa — Sun, 05 Oct 2008 22:06:12 +0000

Mike, IIRC the interest rate was verging on negative already.

By: burritoboy

burritoboy — Sun, 05 Oct 2008 21:25:02 +0000

“You’re so right, I was rather inartful. What I should have said is that most of us commoners are on the wrong side of the equation.”

It’s rather that most individuals don’t act in the role of bankers in modern society, so we just aren’t familiar with being in the position of a bank. Most people don’t hold money in their mattresses for crazy uncles and so on.

By: Mike Alexander

Mike Alexander — Sun, 05 Oct 2008 15:45:37 +0000

That’s what I thought the Fed would do once the housing bubble peaked, slash interest rates, perhaps also on longer-term securities as Bernanke hinted at in 2002 and ignite a new bubble in stocks.

Instead the Fed cut rates less than they for the stock market crash, and started blathering about inflation.

By: dr

dr — Sun, 05 Oct 2008 02:40:24 +0000

Just saw the newest Rhapsondy ad on the TV and couldn't help but think of this post.

By: felix culpa

felix culpa — Sun, 05 Oct 2008 02:29:08 +0000

eddie:
That’s what I thought we had already.

Well yeah. It’s all a rolling repackaging anyway. You were expecting something new?
Sorry, we don”t do that here. ‘New’ is just a marketing slogan. It is thus largely meaningless.
But you knew that.

By: nick s

nick s — Sun, 05 Oct 2008 02:10:15 +0000

Creating a gun-buyback bubble by offering $25k per? I could go with that, given that an Obama victory will presumably be a recruiting goldmine for militia types. You’re not talking your book there, are you, Daniel? No medium-sized arms cache in the Oklahoma panhandle?

(Bubble gum bubble. Limited edition Bazooka Joe comics! Or bubble tea bubble. Tapioca hoarding ahoy!)

By: virgil xenophon

virgil xenophon — Sat, 04 Oct 2008 21:09:16 +0000

burritoboy,

You’re so right, I was rather inartful. What I should have said is that most of us commoners are on the wrong side of the equation.

By: burritoboy

burritoboy — Sat, 04 Oct 2008 18:40:40 +0000

“To a bank, cash is a liability, loans are assets. With ordinary people it’s the other way round.”

Xenophon, you know better than that. It’s the same way with both banks and ordinary people. The bank’s own cash is an asset. Cash deposits that belong to customers aren’t. (Same with individuals: your cash is your asset. Money that your crazy uncle stuck under your mattress isn’t, it’s his asset). Taking on debt is a liability for a bank and an individual. Loaning out money is an asset for both banks and individuals.

By: ShaunR

ShaunR — Sat, 04 Oct 2008 14:57:03 +0000

Well, I’m just thankful that Beanie Baby makers didn’t also sell insurance to other Beanie Baby makers against any fall in the value of Babies. And didn’t buy it themselves. And didn’t need to buy Babies from other makers who might not be able to deliver. And didn’t need to sell to them too.

Had there been such a tangled web of dependencies we really would have been fucked.

By: des von bladet

des von bladet — Sat, 04 Oct 2008 11:10:21 +0000

Who’s Keynes?

Well, you could always start another war…

By: bad Jim

bad Jim — Sat, 04 Oct 2008 08:12:17 +0000

I spent Friday night watching PBS, MSNBC and HBO: Lehrer, Ifill, Maddow, Moyers and Maher, and the consensus of the pundits was sadly consistent with Herbert Hoover’s response to the crash: balance the budget at all costs. Now is not the time to expand public expenditure. We can’t affort universal health care or anything else. Who’s Keynes?

By: felix culpa

felix culpa — Sat, 04 Oct 2008 06:51:25 +0000

It’s a truism to you (and I should have thought at least your Greek half would have relished the delovely classical leap); to me it’s Art.

Cash is weak, but loans are strong.
Yum.
And so true, don’cha think?
Been dodging that one my whole life, I have, and me old enough to be yer grandpa..

By: virgil xenophon

virgil xenophon — Sat, 04 Oct 2008 05:59:32 +0000

nnyhav’ s little ditty is more of a truism than most would like to admit. To a bank, cash is a liability, loans are assets. With ordinary people it’s the other way round.

By: nnyhav

nnyhav — Sat, 04 Oct 2008 05:09:11 +0000

Croesus loves me, this I know,
For the Bubble tells me so.
Paper gains to me belong;
Cash is weak, but loans are strong.
…

By: eddie

eddie — Sat, 04 Oct 2008 03:46:47 +0000

Re felix culpa – bubble bubble, toil and trouble;

That’s what I thought we had already.
Perhaps a better phrase for it would be ‘pyramid tranching’.