“Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate… It will purge the rottenness out of the system…values will be adjusted, and enterprising people will pick up the wrecks from less competent people…” That is the advice from a ghost - U.S. Treasury Secretary Andrew Mellon. But this is 2008, not 1928… the climate has changed. This week began with heavy weather - and then got worse.
October 6th, 2008 | Bill Bonner | 3 comments | ContinuedMarket
Commentary on global share markets by your Daily Reckoning editors in Melbourne, Australia. Still haven’t subscribed to the Daily Reckoning? What are you waiting for… sign up here, it’s free!
A chronological listing of articles is below.
The Senate Votes to Burden the Entire Nation with Wall Street’s Mistakes
“The masters of the universe, those brilliant Wall Street insiders who have made more money than the average American can even dream of, have brought our financial system to the brink of collapse…
October 3rd, 2008 | Bill Bonner | 0 comments | Continued
Artificially Created Credit by the Federal Reserve System Got Us into This Crisis
We are in this crisis because of an excess of artificially created credit at the hands of the Federal Reserve System. The solution being proposed? More artificial credit by the Federal Reserve. No liquidation of bad debt and malinvestment is to be allowed. By doing more of the same, we will only continue and intensify the distortions in our economy - all the capital misallocation, all the malinvestment…
October 3rd, 2008 | United States Congressman Ron Paul | 2 comments | Continued
The Battle Against a Bailout is a Lost Cause
The party line is that the world needs a bailout. Everyone says so. And now the Senate, in its magisterial wisdom, has vowed to get back on the case until it comes up with something…
October 2nd, 2008 | Bill Bonner | 0 comments | Continued
Making Bad Investments in a Rising Market
That trade was a ticket to wealth and everybody knew it. During the ’90s…up until 2007…investment banking was probably the best-paid profession in the world…
October 2nd, 2008 | Bill Bonner | 0 comments | Continued
The Bailout is Approve So Now It’s Time to Buy Gold
Investors are sure getting their share of information overload. In just two months, the economic landscape in America has markedly changed. It will change in the rest of the world, too. And not for the better, despite the pleasantly surprising news that the U.S. House of Representatives actually rejected the $700 billion bailout - the Treasury’s latest harebrained idea. Maybe it demonstrates there is a limit to how much the American people will tolerate…
October 2nd, 2008 | Ed Bugos | 0 comments | Continued
Business Cycle Theory Explained by Joseph Schumpeter
Schumpeter is important because he developed a theory of business cycles which puts its emphasis on industrial innovations rather than banking. Most business cycle theories put their emphasis the other way, and are essentially monetary. Maynard Keynes is just as much a monetary economist as Milton Friedman when he comes to his explanation of business cycles. This is surely an argument which is going to be reopened…
October 2nd, 2008 | William Rees-Mogg | 1 comment | Continued
Bailout Rejected by the House
The House voted down the $700 billion bailout. Investors were downcast. They had hoped for an easy, quick rescue. The Dow fell 777 points - its worse day ever…
October 1st, 2008 | Bill Bonner | 2 comments | ContinuedCredit Markets Threaten Retail Banking, Bank Runs Next?
The share market is not the most important story today. That may be tough for you to believe. After all, the 777 point figure decline on the Dow is the most visible symptom of what’s killing the market. But in terms of percentages, Monday’s 6.9% decline in the U.S. doesn’t even rate as one of the top ten worst one day percentage declines in history. Maybe that will come later this week. It might come in emerging markets. The big story, though, is in the credit markets…
September 30th, 2008 | Dan Denning | 11 comments | Continued
Mortgage Backed Securities Put Our Financial System at Risk
Many investors assumed these securities were trustworthy, and asked few questions about their actual value. Two of the leading purchasers of mortgage backed securities were Fannie Mae and Freddie Mac…
September 29th, 2008 | Bill Bonner | 1 comment | Continued
