State of the country

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gil
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Re: State of the country

Post by gil » Mon Mar 20, 2023 7:14 pm

A few months back I saw some very attractive interests rates on new bonds from the Swiss bank Credit Suisse. Of course I knew there is no insurance on such accounts but I considered taking the risk. In the end I didn't.

Fast forward, it looks like the holders of these bonds (AT1 = "additional tier one" bonds) are completely SOL. Typically, bondholders are paid before shareholders, but the Swiss regulators are doing it differently (i.e, with UBC taking over Credit Suisse).

I think a lot of people don't understand the connection between "risk" and "expected return" (as in "riskier investments can have a higher expected return"). I get the sense that some people feel smart when they cash in on a risky investment, but then go looking for someone to blame when something goes south.

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seattlefan-daBronx
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Re: State of the country

Post by seattlefan-daBronx » Wed Mar 29, 2023 10:35 pm

https://energy.economictimes.indiatimes ... 0statement.

And there she blows! We are witnessing in our lifetime the end of the U.S. dollar.
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Donn Beach
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Re: State of the country

Post by Donn Beach » Thu Mar 30, 2023 6:32 am

You can thank The Donald for a really terrible decision to exit the Asian trade pact, leaving it for China to dominate

https://www.forbes.com/sites/stuartande ... 6104bb5e80

Mel Bradford
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Re: State of the country

Post by Mel Bradford » Thu Mar 30, 2023 12:51 pm

TPP was crafted by the transnational corporations. Borderless economic hegemony. And not surprisingly the corporate press has their advocacy hacks selling FOMO. Currency manipulation, inability to place tariffs on goods, and even more of a front door to US consumer market by China and company.
Trump was right to pull out (IMO). We have no idea how insatiable is the money lust of the one worlders. Its probably too late to stop it.

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seattlefan-daBronx
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Re: State of the country

Post by seattlefan-daBronx » Thu Mar 30, 2023 4:02 pm

https://www.theedgemarkets.com/node/661530

More BRICS members shutting out the U.S.
Not sustainable long term.
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Donn Beach
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Re: State of the country

Post by Donn Beach » Thu Mar 30, 2023 4:09 pm

If that concerns you then I would say the strategy for America is to engage such countries. The way to do that is with agreements of mutual interest. You can't have it both ways. Play the isolationist card, but also complain about china filling the vacuum when America refuses to engage

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seattlefan-daBronx
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Re: State of the country

Post by seattlefan-daBronx » Thu Mar 30, 2023 5:19 pm

Donn Beach wrote:
Thu Mar 30, 2023 4:09 pm
If that concerns you then I would say the strategy for America is to engage such countries. The way to do that is with agreements of mutual interest. You can't have it both ways. Play the isolationist card, but also complain about china filling the vacuum when America refuses to engage
https://www.theatlantic.com/ideas/archi ... sm/616499/

Maybe you'll like this article. It argues that the term "Isolationist" gets a bad rap and Trump's foreign policy for that matter. Imho we have to scale back our economic dependence of foreign countries, while staying out of their fights, and yet support. It's a balance perhaps unattainable. But I'd argue both sides of the isle and this generation are trending "inward". Isolation once made us great but needs to be redefined.
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Donn Beach
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Re: State of the country

Post by Donn Beach » Fri Mar 31, 2023 2:50 pm

Interesting, thanks for the link. What they seem to be talking about generally is military intervention, military adventures. But on the other hand the isolationist can still be in favor of economic engagement, such as treaties that reduce resistance to free trade. For a conservative believe that's generally been viewed as favorable to the growth of the united states economy. In terms of Donald, wasn't sure how to phrase it. He certainly isn't a traditional conservative, perhaps his populist perspective viewed it with an isolationist perspective. I did read he didn't like the treaty because it was too long. It's interesting it's an issue him and Hillary seemed to agree on, strange bedfellows? I do believe promoting American economic growth requires engagement to reduce trade restrictions with our trading partners.

DanielVogelbach
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Re: State of the country

Post by DanielVogelbach » Sat Apr 01, 2023 8:49 pm

gil wrote:
Tue Mar 14, 2023 7:47 pm
Here is something I don't understand: A lot of us believe that the free market works better - a LOT better - than socialism, right? But then when something goes wrong in the free market, the government gets blamed.

Take Silicon Valley Bank. Paul Krugman wrote in The NY Times: "Just a few years ago, S.V.B. was one of the midsize banks that lobbied successfully for the removal of regulations that might have prevented this disaster, and the tech sector is famously full of libertarians who like to denounce big government right up to the minute they themselves needed government aid."

As I understand it, deposits up to $250,000 are insured by the FDIC. When an individual or business deposits more than 250K in one bank, he or she is taking a risk. Just like the banks are taking risks with their investments. But when there was a bank run, who does the fault lie with?
(a) investors who didn't insure their positions
(b) the bank that left itself exposed
(c) the Biden Administration.

As it turns out, the Biden administration is guaranteeing SVB deposits above 250K. So yes, it's a bailout by the government, saving the asses of rich investors. And yes, the bank's managers got big bonuses just days before the run and failure. And yes, the bailout will be paid for by increased bank fees - i.e., money paid to the FDIC by other banks. Which of course, affects other people and other business who use banks.

Kind of like that train derailment in Ohio.
Act I: Industry lobbies for deregulation and is successful.
Act II: Horrible accident.
Act III: People who believe in free markets blame the accident on the Biden Administration for its insufficient oversight.

The free market is not perfect, because humans are not perfect. But, the free market is by far and away the best system of social and economic interaction. The key is to realize that we currently all live under statiism. There currently is no free market. The United States is very socialist. Very regulated. Very controlled. We aren't very free as we're brainwashed to believe. We have nothing even close to a free market. Every citizen has half their wealth stolen from them through taxation and inflation.

A bank run is based on the central bank fiat currency ponzi scheme. For a free market to prosper, you need sound money, which has historically always been gold and silver. The US Dollar came off the gold standard in 1971, and the middle class has been disappearing every since. Now we have cryptocurrencies, which can also be considered real money. They are limited in supply, portable, divisible, etc. The only issue is they're not physical and rely on the internet. Gold and silver are a little less divisible and portable, but they're time tested and you can hold the coins or bars in your hand.

It's impossible to "regulate" the free market to get better results. That is the great lie of "government". Every problem we face has been legislated into existence. Nothing beats the free market. The trains will be a lot safer in a truly free market than they will be under any tyrannical government / central banking scheme. If the people want safe trains, then the free market will deliver safe trains. The only thing government will every do is get in the way, extort massive amounts of wealth, and cause tons of problems.

If you want the trains to be inspected, then the free market can deliver a highly reputable, third-party inspector to certify the trains for safety. With the free market, it all comes down to trust. Companies earn your trust through free market activity. If they lose your trust, then you go to a competitor. Nobody trusts the government. We know it's all just lies, lobbyists, money, media, and bullshit. That is the very nature of government as an immoral monopoly over the use of force. Government is designed to serve the ruling class. The free market is designed to help every single participant in the market.

Mel Bradford
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Re: State of the country

Post by Mel Bradford » Sun Apr 02, 2023 2:03 am

Well said Daniel.

The Commerce clause empowered Congress to regulate commerce "among" the states...not "of" the states. It essentially gave congress the duty to protect the free market between the states. Not control it.

Ironically it was the railroads and the regulation there of that opened the door for the Interstate Commerce Commision (1887). The High Court ruled that Congress could regulate all interstate commerce and override state laws that protected state interests. Thus began the long march to the sea of economic tyranny....and its brain child...centralization.

In our lifetime we have watch the regulatory agencies write their own laws, establish their own courts, make their own rulings. First Congress took the power, then gave it to unelected commissions, and it the process turn states into welfare disbursement centers.

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