The Fed: Dishonest or Incompetent?

[Charles Mackay]

Re: The Fed: Dishonest or Incompetent?

EJ, I am not getting notified of threads unless I've answered a specific subtree of this topic. Is this really the best way to do this? It seems like all replies within a topic should be linear rather than subtee upon nested subtree. I'm getting email notification only if I happened to have answered within a given subtree. I have to sort of surf the threads in order to find the ones that I'm not notified on.

Is anyone else bothered by this?

CM

[bart]

Re: The Fed: Dishonest or Incompetent?

EJ, I am not getting notified of threads unless I've answered a specific subtree of this topic. Is this really the best way to do this? It seems like all replies within a topic should be linear rather than subtee upon nested subtree. I'm getting email notification only if I happened to have answered within a given subtree. I have to sort of surf the threads in order to find the ones that I'm not notified on.

Is anyone else bothered by this?

CM

I was, and I changed the behavior in the User Control Panel and no longer deal with the default tree. This board's software is pretty powerful.

[bart]

Re: The Fed: Dishonest or Incompetent?

The only quibble is with what is probably not an essential element, and that is the particulars of timing. I think we may already be at the cusp of that intermediate deflation/disinflation. On the other hand, given that the Ka-Poom chart uses the CPI as its inflation bogey, that may be more form than substance, too. As a lagging indicator, the CPI is likely - to continue to register higher inflation even after the underlying cycle has turned.

Very likely on the cusp, but the boys at the Fed also have quite the ability to confound... I have the account losses to prove it... and there is an election coming up too.

There is likely enough horsepower on this board that any major turn will be noticed soon after it occurs (he says as he keeps his fingers crossed).

Sounds like you are describing this:

http://users.zoominternet.net/~fwuth...kGoldTrend.png

Oddly however, we can get ourselves into some semantic trouble if we don't exercise care with our terms. In a very real sense, the 1970s were hugely deflationary. That decline on yonder chart represents a collapse in the normalized volume of real credit. From the point of view of the Austrian school, that is deflation. The only reason we don't recognize it as such is the dollar was devalued so fast that it outran the pace of credit collapse.

This is very much the kind of environment we've been in for the past four years.

Can you develop that concept of a "collapse in the normalized volume of real credit" a bit more?
I think what you're saying is that credit issuance grew slower in the '70s than inflation?

[bart]

Re: The Fed: Dishonest or Incompetent?

Bart:

I visited your site before I signed up. It's terrific. So you have me blushing.

I am in New Zealand for six weeks. It is a way to get away to focus on redoing www.solari.com to reflect what we have learned from prototyping. What's up now is quite stale.

This involves writing introductory materials on Solari Circles -- investment clubs for people who want to shift their investment of time and money away from large governments, large banks and large corporations -- and into a more diversified portfolio and networks that help them navigate the changes underway. Our areas of focus include (i) natural resources, particularly precious metals, (ii) local private and government investment and (iii) sustainable technologies. I will also rehaul our concept for Solari Venture Funds -- its still at a very conceptual level.

I was planning on doing this last year and then put it down to write www.dunwalke.com.

If you are interested, I will post a link to the next piece for comment...should be about 2 weeks from now. Having never before participated in the transformation of a planetary investment system, I am in over my head as I believe some posters in the thread noticed. So I would be deeply grateful for any insight and comment you would be willing to share.

Sir Peter Medawar once said, "what is relevant is what solves the problem. If we had thought through real relevancies, we would be on Sirius by now."

Bushwhacking towards Sirius,

Catherine

Now its my turn to blush - you're very kind about my site. I even have a custom icon too:

What a delightful getaway/recharge in New Zealand - I hope to experience the beauty one day.

I have little clue or experience with investment clubs but I sure would love the opportunity to review any of your efforts and give my $.02 worth (in real copper pennies of course ;)) and then some... especially since its anti-Fed, etc.
It being a planetary effort is even better - I'm a space cadet from way back as many of my friends will attest. ;)

I like that Medawar quote - here's one of my favorites from Einstein that also seems apropos: “We can’t solve problems by using the same kind of thinking we used when we created them.”


Hoping the Schwarz will be with us all, in non serious mode,

bart

[Charles Mackay]

Re: The Fed: Dishonest or Incompetent?

I was, and I changed the behavior in the User Control Panel and no longer deal with the default tree. This board's software is pretty powerful.

ahhh, great.. I'll try that... thanks for the tip Bart

[Catherine Austin Fitts]

Re: The Fed: Dishonest or Incompetent?

Charles:

Greetings as well!

Aaron is one of those people who makes everyone welcome, invites them all in. He has done a remarkable job of reaching out and drawing in from many places. I was amazed when I saw the final piece -- he pulls no punches. That took a lot of courage.

He was going to open on July 28th. He did, then pulled back to edit and I have not seen the redo. His site says they movie is going back out on September 28th. The coincidence is that this comes towards the end of a high risk period.

After labor day, Congress will return to finalize appropriations in advance of the federal fiscal year for 2007, starting October 1, 2006. The last time I said that the pig would not make it through the snake in the appropriations process was after Rumsfeld was asked about the missing money at DOD at a press conference on September 10, 2001. We know what happened the next day, and indeed the pig flew through the snake with huge increases, the Fed pumping and printing all the way.

We have a similar problem this year with getting the pig through the snake.
Now through October 1 (assuming they make it) will be a time of serious strife behind the scenes to be followed by the markets then having to digest the consequences of the pig making it through or not.

Either way it is getting harder and harder to make the system look like it has any real liquidity in it.

Enjoying and thanking you for itulip.com,

Catherine

[Catherine Austin Fitts]

Re: The Fed: Dishonest or Incompetent?

Bart:

What is the ka-poom theory?

In cahoots,

Catherine

[jk]

Re: The Fed: Dishonest or Incompetent?

catherine, re ka-poom theory, see


http://www.itulip.com/retrospective2006.htm

http://www.itulip.com/forums/archive...php?t-102.html

http://www.itulip.com/stagflationgodzilla.htm

http://www.itulip.com/forums/showthread.php?p=1085

http://www.itulip.com/forums/showthread.php?t=252

[WDCRob]

Re: The Fed: Dishonest or Incompetent?

In a very real sense, the 1970s were hugely deflationary. That decline on yonder chart represents a collapse in the normalized volume of real credit.

What does the Y-axis on yonder chart represent? Is it a ratio of inflation/credit issued?

[Finster]

Re: The Fed: Dishonest or Incompetent?

What does the Y-axis on yonder chart represent? Is it a ratio of inflation/credit issued?

I hope you won't be sorry you asked ... ;)

This is a reprise of a chart posted earlier; hence the lack of explanation. The Y-axis is the log of global stock prices in terms of ounces of gold.

[Finster]

Re: The Fed: Dishonest or Incompetent?

Bart:

What is the ka-poom theory?

In cahoots,

Catherine

The post he is replying to contains a link to the chart used in that context:

Ka-Poom chart

[Finster]

Re: The Fed: Dishonest or Incompetent?

Very likely on the cusp, but the boys at the Fed also have quite the ability to confound... I have the account losses to prove it... and there is an election coming up too.

There is likely enough horsepower on this board that any major turn will be noticed soon after it occurs (he says as he keeps his fingers crossed).

...

Can you develop that concept of a "collapse in the normalized volume of real credit" a bit more?
I think what you're saying is that credit issuance grew slower in the '70s than inflation?

Something like that. The key term is real credit. I don't have actual figures for outstanding credit, but it seems quite safe to say that either real credit contracted in absolute terms, or it grew much more slowly than normal.

I'm using the stock/gold ratio as a rough proxy for the ratio between claims on stuff and actual stuff. The former is credit in the broadest sense. Claims on stuff can actually exceed the amount of real stuff, and that's the barrier central banks are always pushing against when they attempt to expand credit. Eventually people start to realize the emperor has no clothes and the market value of that credit must decline.

I was just rummaging around your site (hopefully you will find everything as you left it ;-) in search of historical data on nominal per capita GDP. Do you happen to have such a thing or know where a good place to find it would be?

[bart]

Re: The Fed: Dishonest or Incompetent?

Something like that. The key term is real credit. I don't have actual figures for outstanding credit, but it seems quite safe to say that either real credit contracted in absolute terms, or it grew much more slowly than normal.

I'm using the stock/gold ratio as a rough proxy for the ratio between claims on stuff and actual stuff. The former is credit in the broadest sense. Claims on stuff can actually exceed the amount of real stuff, and that's the barrier central banks are always pushing against when they attempt to expand credit. Eventually people start to realize the emperor has no clothes and the market value of that credit must decline.

I was just rummaging around your site (hopefully you will find everything as you left it ;-) in search of historical data on nominal per capita GDP. Do you happen to have such a thing or know where a good place to find it would be?

Very interesting and also counter intuitive on real credit. I wish I had the full credit picture so I could chart it, but I only track a few of the credit measures.

I actually do track census info and thought I had a chart on one of the two massive chart pages but obviously it went astray. I just re-created it:




There is also a chart in the CIA Factbook that lists GDP per capita in different countries. Its in purchasing power parity terms, and for what its worth shows the US at around $42,000.

[Finster]

Re: The Fed: Dishonest or Incompetent?

I actually do track census info and thought I had a chart on one of the two massive chart pages but obviously it went astray. I just re-created it:




There is also a chart in the CIA Factbook that lists GDP per capita in different countries. Its in purchasing power parity terms, and for what its worth shows the US at around $42,000.

Interesting... possible to download the data?

Very interesting and also counter intuitive on real credit. I wish I had the full credit picture so I could chart it, but I only track a few of the credit measures.

If it seems counterintuitive, remember part of the thesis is that inflation drove the dollar down at such a rate as to outrun the decline in real credit, so that in nominal terms there was expansion. But an even bigger issue is what I'm referring to as "credit in the broadest sense" - i.e. "claims on stuff". This includes not only credit in the conventional sense of bonds an other fixed income securities, but stocks as well. They are "claims on stuff", too. The delineation between "stuff" and "claims on stuff" I am making here is probably closer to the notion of paper versus physical assets. Here, though, I'm emphasizing the relationship between the two in such a way as to suggest there is a fundamental link and certain bounds on how far "credit" can go. It it very literally like a game of musical chairs when the amount of credit (claims on stuff) exceeds the actual stuff - when government and banks deliberately expand credit, they are actually encouraging the development of such a state of affairs - and this relationship tells us why such artifically expanded credit must eventually come back into line with physical reality.

Look again at the chart - you can almost see it happening.

[Corporate Plebe]

Re: The Fed: Dishonest or Incompetent?

I already have my tinfoil hat on so it didn't take much.

Basically, I agree with her views and documentation, even though I can't comment on the 100% accuracy of a number of the specifics. It aligns quite well with other sources and my own research, as well as a number of the public charts on my site.

John Perkins and his "Confessions of an Economic Hit Man" book covers similar areas.
Here is an interview that Jim Puplava did with him last year. http://www.commondreams.org is Perkin's site.

The bottom line for me is that most people are good folk, and to have stuff get as messed up as it is today doesn't happen by accident or coincidence... it takes intentional actions. And "evil" people do exist, in spite of what some namby pamby dilettantes, etc. want folk to believe.

If that makes me a real tinfoil hat person in all the negative senses to some, then so be it. I see what I see, and its not pretty. Most of this stuff does not involve smoke filled rooms and Snidely Whiplash type evil laughs but rather is about a few "very best people" - who aren't.

And yes, it has been very upsetting at times to me over the last two years as I've been looking and researching - despair has not been an unknown state.

But to have isolated things like the very high correlation between various actions of the Fed and the level of the US stock market - well, I just don't view it an unrelated and do view those Fed actions as causative. Other central banks, to the degree that I've reseached them, show similar actions. My web site is my own vehicle for exposing a few of the actions of the small group of anti-social control freaks, and is something I can actually do about it.

More power to Catherine Fitts and others like her!

One of my favorite sound bites:
http://www.nowandfutures.com/grins/oz_curtain.wav

Thank you iTulip for posing the question about the Fed, and a big thank you for showing us www.solari.com.

Great call, bart!
Mr. Perkins fits into what Catherine has termed "syndicate management teams" or projects with management teams sponsored by the "syndicate."

I saw him at a speaking engagement promoting his book where the venue was filled over-capacity and people could only hear him. There were hundreds of people, and he remarked how only 30 people had shown a few years prior.