More Michael Lewis in Vanity Fair

[Thailandnotes]

When Irish Eyes Are Crying

"First Iceland. Then Greece. Now Ireland, which headed for bankruptcy with its own mysterious logic. In 2000, suddenly among the richest people in Europe, the Irish decided to buy their country—from one another. After which their banks and government really screwed them. So where’s the rage?"

http://www.vanityfair.com/business/f...urrentPage=all

[don]

Re: More Michael Lewis in Vanity Fair

Thai: Are you suggesting that Americans selling their stuff to each other through Craig's List and garage sales won't keep the US #1?

[Thailandnotes]

Re: More Michael Lewis in Vanity Fair

"Four hundred thousand people make some money trading on eBay. That's a source that didn't even exist 10 years ago," said Vice President Cheney."

[Thailandnotes]

Re: More Michael Lewis in Vanity Fair

From the Q&A

"Last time we spoke, we discussed the possibility of a bankruptcy of the U.S. Treasury brought about by a default on American debt. We have Congress about to take a vote on raising the American debt ceiling. What percent chance do you think there is of a default happening?"

M.L. We’re not talking about our ability to repay because we have bottomless ability to repay. We could sell Yosemite. It’s our willingness. For the first time, our Treasury secretary, Timothy Geithner, is talking about the possibility of default. Treasury secretaries don’t usually do that. I don’t think this is imminent, but since the last time we spoke, a Chinese ratings agency downgraded U.S. Treasury debt to A+. I wouldn’t wager that owners of U.S. Treasury bonds aren’t going to be repaid their interest. I don’t think that’s how it’s going to happen. In the end, it’s most likely that we are going to inflate away our obligations to the extent we can.

One of the things the financial crisis shows you is that, despite the big and powerful institutions being mainly interested in their own success and survival, they are capable of suicidal acts. I would not put it past the U.S. government to do the same thing, but I wouldn’t bet on it. The most likely outcome is that it all gets fudged and the debt keeps going up and the Fed keeps printing money and eventually we get pretty bad inflation, which means that if you’re a Chinese investor who owns a trillion dollars of U.S. Treasury bonds, you’re not going to get a trillion dollars in buying power back.

[lektrode]

Re: More Michael Lewis in Vanity Fair

From the Q&A

....M.L. We’re not talking about our ability to repay because we have bottomless ability to repay. We could sell Yosemite. It’s our willingness. For the first time, our Treasury secretary, Timothy Geithner, is talking about the possibility of default. Treasury secretaries don’t usually do that.....

..... which means that if you’re a Chinese investor who owns a trillion dollars of U.S. Treasury bonds, you’re not going to get a trillion dollars in buying power back.

at what point will this sink in to them? (CCB)

with any luck at all, they (CCB) reads krugman (which should work out well...
for them (CCB)

[thriftyandboringinohio]

Re: More Michael Lewis in Vanity Fair

From the Q&A

... which means that if you’re a Chinese investor who owns a trillion dollars of U.S. Treasury bonds, you’re not going to get a trillion dollars in buying power back.

They won't close the entire position all at once at the last sell price; they'll unwind it slowly. If I were China, and I ended up with half the money AND impoverished the western powers to my strategic benefit, I would consider it an acceptable outcome.

[iyamwutiam]

Re: More Michael Lewis in Vanity Fair

From the Q&A

"Last time we spoke, we discussed the possibility of a bankruptcy of the U.S. Treasury brought about by a default on American debt. We have Congress about to take a vote on raising the American debt ceiling. What percent chance do you think there is of a default happening?"

M.L. We’re not talking about our ability to repay because we have bottomless ability to repay. We could sell Yosemite. It’s our willingness. For the first time, our Treasury secretary, Timothy Geithner, is talking about the possibility of default. Treasury secretaries don’t usually do that. I don’t think this is imminent, but since the last time we spoke, a Chinese ratings agency downgraded U.S. Treasury debt to A+. I wouldn’t wager that owners of U.S. Treasury bonds aren’t going to be repaid their interest. I don’t think that’s how it’s going to happen. In the end, it’s most likely that we are going to inflate away our obligations to the extent we can.

One of the things the financial crisis shows you is that, despite the big and powerful institutions being mainly interested in their own success and survival, they are capable of suicidal acts. I would not put it past the U.S. government to do the same thing, but I wouldn’t bet on it. The most likely outcome is that it all gets fudged and the debt keeps going up and the Fed keeps printing money and eventually we get pretty bad inflation, which means that if you’re a Chinese investor who owns a trillion dollars of U.S. Treasury bonds, you’re not going to get a trillion dollars in buying power back.

Who the heck is "we" -and how dot hey have the power to sell Yosemite? I am not sure if it were ever game to selling American anything -that many would 'allow' the premise that there is ownership of any countries assets. This getting to be a dangerous game for the bankster's because at some point -people will rip up those IOU's and I mean governments.

[c1ue]

Re: More Michael Lewis in Vanity Fair

Dr. Michael Hudson was spot on again: Ireland is being Latvia'd.

Working age population fleeing.

Taxes on wages/labor increasing.

Government services decreasing.

Economy stuck in a black hole.

[BigBagel]

Re: More Michael Lewis in Vanity Fair

Dr. Michael Hudson was spot on again: Ireland is being Latvia'd.

Working age population fleeing.

Taxes on wages/labor increasing.

Government services decreasing.

Economy stuck in a black hole.

After reading the article I thought the same thing. Why would a young adult tie themselves to this disaster that will possibly take decades to play out? They'll do what my father did in 1929 and my mother did some years later.......take a hard look around and then leave for better prospects.

[Thailandnotes]

Re: More Michael Lewis in Vanity Fair

After reading the article I thought the same thing. Why would a young adult tie themselves to this disaster that will possibly take decades to play out? They'll do what my father did in 1929 and my mother did some years later.......take a hard look around and then leave for better prospects.

from the Q&A...
M.L. ..."historically in Ireland, when there are these types of crises, the pressure valve is immigration; people go other places. Historically, they come here, and they can’t anymore. We don’t let them in. In fact, we throw them out if we find them without Green Cards. They’re kind of stuck where they are, and I think that’s going to cause lots of turmoil."

[don]

Re: More Michael Lewis in Vanity Fair

I guess part of that particularly Irish immigration gene would be the British Crown's propensity to sentence the Irish to transportation as a way of depopulating Ireland for English land barons. Yea, that gene .....

[BigBagel]

Re: More Michael Lewis in Vanity Fair

from the Q&A...
M.L. ..."historically in Ireland, when there are these types of crises, the pressure valve is immigration; people go other places. Historically, they come here, and they can’t anymore. We don’t let them in. In fact, we throw them out if we find them without Green Cards. They’re kind of stuck where they are, and I think that’s going to cause lots of turmoil."

They're part of the European Union. They can move about within it's borders easily. They still come to the States and stay although illegally. I can show you a neighborhood in New York City that has quite a few.

[Thailandnotes]

Re: More Michael Lewis in Vanity Fair

Economic downturns crimp immigration options. You can get out and then you can't. (Don's comment above is well taken.) Michael Lewis can be very flippant. Lewis's article mentions all the Polish workers disappearing from Ireland as the housing industry collapsed. It wouldn't surprise me if the EU tightens restrictions on moving around (ala prove you have a job.) If I had to make a prediction for the next five years, it would be that getting visas to move to different countries will be much more harder than moving money. Getting into the states legally is getting tougher and tougher, even if you have been married to an American for 20 years. Remaining foreigners (as my wife and I are in Thailand) will very likely become more troublesome.

[Spartacus]

Re: More Michael Lewis in Vanity Fair

Hey Michael, if you're reading this:n
good piece.
Beat the rush and get your research done on Canada & Australia now.

Note carefully the absolute refusal to learn lessons happening all around them
And (in Canada anyway) the malicious, mendacious politicians cynically feeding the situation for personal gain.

"the stupidest of the stupidest ... stupidity distilled and refined to its purest unadulterated form"