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alstry (35.45)

Alstrynomics Final Summation

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October 11, 2009 – Comments (6)

It is now certain that credit is being cut off to mainstreet yet flowing to Wall Street banks in unlimiated quantities and for practically free.

Banks cutting back on loans to businesses

U.S. banks are reducing their lending at the fastest rate on record ... According to weekly figures provided by the Federal Reserve, total loans at commercial banks have fallen at a 19% annual rate over the past three months, while loans to businesses have dropped at a 28% annualized pace.

'Democratization of Credit' Is Over

The recession has forced a reckoning for low-income Americans who relied on borrowing to gain the trappings of middle-class life.

The problem is mainstreet is responsible for much of the employment in America and with mainstreet shutting down, many are losing jobs and livlihoods.

It is also clear that the unemployment rate is much higher than the BLS is reporting simply because the Labor Participation rate (those counted in the labor force) is much lower today than a few years ago.....likely doubling the actual unemployment rate.

"There has never been an expansion cycle in the past 45 years in which the participation rate (those actually in the labor force as a percent of those that could be in the labor force) trended lower save for the current one. Had the labor participation rate risen in a normal cyclical fashion, today’s unemployment rate would be considerably higher"

Now the question is WHY isn't labor participation rate higher....especially since spouses and others are being forced to look for work compensating for lower incomes.

If we applied U6 figures to a normalized labor participation rate, unemployment would be much closer to 25%.

As are result of credit being cut off and unemployment skyrocketing...revenues to American business is evaporating which is evident in new home construction, auto sales, and manufacturing to name a few. 

In addition to revenues to business and families shrinking.....now tax receipts to government are contracting rapidly. 

Precipitous Drop In State Tax Collections

This is a huge issue because collective government spend and consumption is responsible for half of our GDP.  With credit being cut off to the private sector, and receipts evaporating to government....there is a strong likihood for much deeper contraction and little chance for a catalyst for growth.

The problem is our asset base, retirement plans and pension require growth to fund the assets and service debt.....

Steep Losses Pose Crisis for Pensions

The financial crisis has blown a hole in the rosy forecasts of pension funds that cover teachers, police officers and other government employees, casting into doubt as never before whether these public systems will be able to keep their promises to future generations of retirees.

U.S. Office Vacancies Reach Five-Year High of 16.5%, Reis Says
US apartment vacancy rate hits 23-year high-report
Shopping center vacancy rate hits 17-year high: report

With figures like the above, it is little wonder that the Pension Guaranty is out of money, the FDIC is out of money, and the FHA is out of money.....and it is clear that the FDIC has a long haul ahead.

The coming CRE losses for Local and Regional Banks

About $870 billion, or roughly half of the industry’s $1.8 trillion of commercial real estate loans, now sit on the balance sheets of small and medium-size banks like these, according to an analysis by Foresight Analytics, a research firm. ... And as a group, small banks have written off only a tiny percentage of the losses that analysts expect them to incur.

With all of this data so easy to see....it makes one wonder why Benny B and Timmy G are telling the American People that the recession is over......it makes one wonder how Pensions, or Social Security, or Medicaid, or any government promise can ever pay?

These issues are not years off, these issues are today....for the first time in American history government is simply printing money.  In the past, printing meant borrowing, today it is printing money out of thin air.......and hoping that engaging in counterfeiting will be permissible when no other nation in the history of the world has ever done it without massive negative consequences on the society.

It is interesting now that we KNOW tax receipts to government are evaporating in 9.09, credit being cut off to main street, unemployment still increasing massively and commercial real estate collapsing.....our government officials are telling us things are getting better????

Is it possible they know they can't payoff and we are being set up for something????

Government Violates The Citizens (Again)

Now we find out that indeed (as I have long suspected) the government's insane FHA approvals of patently unsustainable loans was an intentional act:

Barney Frank, the Massachusetts Democrat who is chairman of the House Financial Services Committee, said in an interview that the defaults were, in essence, worth it.

“I don’t think it’s a bad thing that the bad loans occurred,” he said. “It was an effort to keep prices from falling too fast. That’s a policy.”

Got that?  It's a policy to intentionally bankrupt people so as to allow banks who have made bad mortgages a chance to avoid their own bankruptcy.

Quite frankly no one knows for sure......the only thing we know is that government is bailing out Wall Street Bankers and citizens are being cut off........in the past government supported citizens to grow out of recessions which benefitted all.  Under this policy and at this rate, the assets of the citizens will be practically worthless while Wall Street enjoys its new taken wealth overseas.................

and the strangest part of all, you will find very few of the Alstrybaters actually debate or question any of the above facts.

6 Comments – Post Your Own

#1) On October 11, 2009 at 9:33 AM, alstry (35.45) wrote:

WHAT IF the American citizens are the terrorists to Government and the Bankers?????

Government promised us over $100 Trillion dollars it knows it can't pay....bankers can no longer lend to Americans profitably without manupulating the loan with derivitives....

If you really think about it, the citizens of America are a BIG liability on government and the bankers.  With only a few trillion dollars in savings, we really can't make much of a dent in paying down the debt without massive defaults and the only way we can spend is if the government debases the currency we owe the bankers.

You think the bankers want to be paid back in worthless currency????  To bankers, you would be better off dead and they taking your assets....and from the government's perspective that wouldn't be bad either because it wouldn't have to pay any entitlements.

This is the best possible financial outcome for govenrment and the bankers:

Indigent Burials Are on the Rise

Otherwise, government will have to continue to counterfeit money destorying the asset base of our Wall Street Banks......money.

So think about what is really in the interest of government and bankers as you see blackhawks flying above your city doing "training exercises" or LRADs being shipped to police departments across the country.

When citizens are collectively insolvent and government must choose between bankers and citizens....who do you think is going to win??????????????????????????????????

Why do you think the bankers are getting bailed out and citizens NOT????  Guess what is next????

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#2) On October 11, 2009 at 10:40 AM, Tagit (57.52) wrote:

Alstry – you must be an attorney for the “The American Medical Marijuana Association” and live in or near Northern California’s Mendocino County. Therefore, no worries of zombulation, just grow your cash crop become a millionaire and don’t worry about stocks, government, bankers and politics. If a Blackhawk fly’s over – roll one; put your sun glasses on; give them a wave and a smile – while sitting on that 100 LB sack of seed.

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#3) On October 11, 2009 at 11:03 AM, alstry (35.45) wrote:

Now flanking me in L.A. and Seatle......I may have to move my location;)

Blackhawk helicopters buzz downtown in military exercise | L ...Night-time military helicopter flights over downtown Los Angeles this week are part of training exercises.....

With Bankers getting bailed out and America cut off and shutting  down......looks like the bankers are going to have a lot of natural resources to harvest.....the question is what are they going to do with all of the people first????? 

Credit Crunch: Stimulus Fails To Reach Small-Business Sector SPRINGDALE — Chris Knodle approached a dozen local banks for a business startup loan earlier this year armed with a stellar credit score and a 35 percent down payment.

Longtime hardware store calls it quits LONDON GROVE -- Pyle's Home and Supply, the something-for-everyone hardware store just west of Avondale, is going out of business.

Store closes FIVE jobs were lost in Hexham at the weekend when a national retail chain went into administration. Simply Food & Drinks, the off-licence, convenience store and news agency on Priestpopple, was part of the Wine Cellar group.

Lasserâs future dim as Mt. Olive Saturn closes down MOUNT OLIVE TWP. – The “different kind of car company” is closing its doors and Saturn dealership owner Stu Lasser said he was “shocked and catatonic” at the news.

Big dream in bad times Terry Lee of Burlington risked everything when he opened a garden accessories store in Over-the-Rhine. He plundered his savings to chase a dream of owning a small business. So far it hasn't turned out the way he had hoped.

Crazy Gideon Closing Shop DOWNTOWN LOS ANGELES - The economy may have gotten too crazy even for Crazy Gideon.

Winona grocery story to close A long-time Winona grocery business is closing one of its stores and consolidating into the other store.

What is amazing is how few caps players really want to accept the consequences of cutting off credit to American citizens....further, few really comprehend the massive consequences right now facing the dollar and the implications of simply printing.....which is understandable  because there is no domestic historical precedent...but history is replete with other examples.

THIS IS THE KIND OF STORY THAT IS ONLY REPORTED IN EUROPE BY FOX....IT APPEARS  FOOLS ARE SIMPLY TOO STUPID IN AMERICA TO BE FED THE TRUTH.....OR IS SOMETHING ELSE BEING PREPARD FOR AMERICA and its citizens????

 

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#4) On October 11, 2009 at 12:19 PM, alstry (35.45) wrote:

STUPID FOOLS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

http://www.calculatedriskblog.com/2009/10/policy-supporting-house-prices.html

You just got bent over by your government officials and Wall Street bankers and didn't even know it.....but don't say you weren't warned by Alstry over and over again.

WE NOW KNOW some in government supported a policy of artificially inflating home prices by loaning trillions against assets that weren't worth close to what the people were paying AND improperly making loans to people that weren't qualified to borrow.

DON'T WE STILL SEND PEOPLE TO JAIL FOR FRAUD????

And to add insult to injury, after millions borrowed trillions, they raised interest rates 17 times and cut off credit GUARANTEEING A MASSIVE CRASH!!!!!!  A REALLY MASSIVE CRASH!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

HA HA HA HA HA...can't you just hear them laughing at you as they count their money and inventory of new assets!!!!

And now you are stuck with lots of debt, HIGH PROPERTY TAXES, and high homeowners insurance premiums........while bankers get bailed out and showered with billions in bonues for bending you over.......HOW COULD YOU STUPID DUMB FOOLISH TURKEY'S NOT KNOW THIS WAS HAPPENING??????

Just wait until the layoffs and income drops REALLY kick in from revenues evaporating...especially to government....

Houses could easily drop 50-70% from current prices.....especially on the high end where few will even be able  to afford the property taxes and maintenance....less any mortgage.

And when housing prices crash around  your house...guess what the value of your house is going to do??????

Hmmmmmmmmm.  Your government and Wall Street bankers knowingly inflated the value of homes, loaned trillions against the artificial value of homes, sold those loans to YOUR pension fund and mutual fund, and engineered a crash destroying your retirement account and permitted them to take back your home.....GENIUS!!!!!!!!!

And now many of the small banks are broke and Wall Street gets to take those assets too....plus all the commerical real estate................

Pretty soon....Wall Street will pretty much own most of America......and many of you guys will be unemployed, broke and still be Fools!!!!!!!!

And some of you are still questioning Alstrynomics??????

My suggeston is go to your store and by some Vasoline....things are about to get very interesting.

 

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#5) On October 11, 2009 at 12:56 PM, Pennyperson (< 20) wrote:

Questioning Alstrynomics - no way

My suggeston is go to "your" store and by some vasoline and give to the Blackhawk pilots and start cultivating like Tagit suggested. :) IF - your not already doing so. :)

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#6) On October 12, 2009 at 11:15 AM, jdlech (< 20) wrote:

About the negative consequences of printing money out of thin air.

The value of money is a relative measure.  When one nation prints money, the value drops like lead.  But when all nations print it in relatively equal amounts, the value remains the same.  Indeed, the subject of the last several economic summits has been about who should print how much.  The value of a currency compared to another should not change much since they are all trying to print relatively similar amounts..   But compared to physical commodities which are not similarly made more abundant; there's your inflation and negative consequences.  But don't look to FOREX as a guage, Europe, China, Japan, India, Brazil; nearly everyone is printing money and conspiring with each other to keep relative values stable.

I expect FOREX to be a big disappointment in the coming years, but not so for commodities whose demand is not greatly reduced by this economic downturn.

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