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alstry (35.36)

MADOFFS EVERYWHERE!!!!!!

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June 05, 2009 – Comments (14)

Think of Alstry as the Markopolous of CAPs and many of the CAPs players like the SEC that just didn't want to listen after years of warnings by an expert....The Doctor of Alstynomics....the sythesis of the practical business rules to economics.

During the Bush/Pelosi era.....we now know that the Private Economy was not much more then one big Ponzi Scheme of tens of millions of Americans borrowing against the fictional or perceived equity in their homes and commercial real estate.

Tens of Trillions of Dollars of fictional profits and salaries were created and the government was the beneficiary of trillions of dollars of taxes transferred from the taxpayer to the government.  Few were able to see or cared that it was a Ponzi Scheme because the debt was allegedly backed by fictional equity.....sound familiar????

For those of us that saw it....it was easy to see that the Private Economy Ponzi Scheme would collapse simply when few could sustain the burden of an ever increasing debt load against stagnant income.  Just like Madoff not being able to bring in any new capital to pay his existing clients created the collapse of his Ponzi Scheme, when the Private Economy couldn't create NEW debt to pay off existing debt.....the Private Economy CRASHED!!!!!!

Now new home construction is DOWN 80%......Auto Sales DOWN 50%....High End American Retailers Down 30%.....Hotels 50% Vacant....and conditions are GETTING WORSE as people and business spend down their savings with no access to capital!!!!  A Depression is a 10% Decline in GDP.

What has been holding the economy up is Private Savings that is rapidly dwindling and $6.5 Trillion of Government Spending.  As long as the Government was receiving Tax Revenues.....all was relatively good....and for the last 230 years.....the government has brought in pretty much what it spent....save a hundred billion or so per year in recent years.........

But with the Madoffing of the Private Economy.....the Government is not bringing in much Revenues anymore!!!!!!!!!  Most of the high income earners responsible for most of the revenues are not making the high incomes anymore so they are not paying much in taxes.

So just like Madoff, without earnings or income, the Government must find suckers to simply hand over money so the government can continue to pay out its $6.5 Trillion dollar budget......and now it must come up with a quick $2 Trillion due to a shortfall in receipts!!!!! 

Unlike the Private Economy Madoff of a few years ago that could con people with Ficticious Real Estate Equity despite relatively no income, the Government Madoff does not have such ficticious equity to try and con people to hand over their money so it can be given out to welfare recipients and other purposes.....

So here we are, the Government Madoff needs $2 Trillion against rising spend obligations and an evaporating income.....how will the Government convince people to hand over their money.....well rising interest rates of course.......now the only question is how high will the Government Madoff have to go to raise $2 Trillion dollars?????????????????????????????????

14 Comments – Post Your Own

#1) On June 05, 2009 at 3:54 PM, millionby24 (< 20) wrote:

OP knows nothing.








Pullback next week, dow 9000 here we come

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#2) On June 05, 2009 at 4:01 PM, alstry (35.36) wrote:

WASHINGTON (AP) -- Borrowing by consumers fell by $15.7 billion in April as U.S. households continued to trim spending and put away their credit cards amid a severe recession.

The Federal Reserve said Friday the April decline was the second largest ever in dollar terms following March's drop of $16.6 billion. March's decline originally was reported as $11.1 billion, which had been the most on records dating to 1943.

The April decline was more than double the $6 billion drop that economists had expected. Analysts believe consumers will remain cautious as long as the unemployment rate keeps rising, which it did again in May.

JUST AS ALSTRY WARNED....OVER AND OVER....THE PRIVATE ECONOMY MADOFF IS NOW EXPOSED!!!!!!

NOW THE PRIVATE ECONOMY MADOFF CLIENT'S ARE NO LONGER GETTING THEIR CHECKS....INCLUDING THE GOVT.

THE LAST MADOFF LEFT IS THE GOVERNMENT MADOFF......THE MOTHER OF ALL MADOFFS OR WHAT WILL BE COMMONLY KNOWN AS MOAM!!!!!!!!

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#3) On June 05, 2009 at 4:31 PM, leo744 (< 20) wrote:

Alstry,

How come it has been widely reported that Americans are saving more than ever now than in the past 15 yrs. Yet you say they are using those savings up to support their unrealistic lifestyle??? Which is it??? Can you clarify this for me?

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#4) On June 05, 2009 at 4:36 PM, guiron (21.24) wrote:

Tens of Trillions of Dollars of fictional profits and salaries were created and the government was the beneficiary of trillions of dollars of taxes transferred from the taxpayer to the government.

So, I suppose the government is going to take its money and head off to the Bahamas, right?

Anyway, it's odd to me that you'd tie the government in here. GWB actually lowered taxes on the top bracket while he simultaneously deregulated the banks' lending practices. The whole 30-1-leveraged house of cards came crashing down, just like any other bubble. It's not a Ponzi scheme. There were fradulent analyst ratings and liar loans processed through mortgage brokers and lenders who did not do their job, or who outright lied in many cases, to the lender and to the borrower, as well as to the government and investors.

But governments tax income, so if people's incomes go up, then the government takes in more taxes. If it's a bubble and it crashes, then of course there will be less tax revenue after the crash. Not sure I see the conspiracy here.

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#5) On June 05, 2009 at 4:40 PM, alstry (35.36) wrote:

Under the definition of "saving".....paying down debt is considered savings....

The problem is with collapsing asset values and evaporating incomes......many American's no longer have enough savings to pay off debt so mathematically more Americans are or will soon be insolvent.....recent legal trade publication reports provide supporting evidence with the recent surge of private and corporate bankruptcies.

Expect bankruptcies and ZOMBULATION to explode in upcoming months as Americans spend down their savings to pay off debt.

Welcome to the higher "savings" rate of America.....otherwise know as Zombulation.

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#6) On June 05, 2009 at 4:47 PM, FleaBagger (29.03) wrote:

Are we calling "Ponzies" "Madoffs" now?

Ponzi did it first.

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#7) On June 05, 2009 at 4:50 PM, alstry (35.36) wrote:

quiron,

If you take interest rates down to historical lows, and fail to qualify borrowers for loans, anybody and their mother can qualify for loans.....

Those of us who saw what was going on.......and many in the government or quasi government agencies did....as is evidenced by FBI memos and Fannie and Freddie as well......this was a bubble that everyone encouraged and many knew would have horrible reprocussions....

Rep. Ron Paul testified about it with perfect foresight to the House Banking committee in 2003!!!!

What made this bubble different than all prior bubbles is that it affected the "real economy" and not simply the stock market like the Dot.Com Bubble.

The real economy created trillions in profits simply from lending and not making anything....as soon as the lending infected enough people, homes and commercial buidling.......and accumulated debt reached unsustainable levels......

ALL CRASHED.....Jobs evaporated.....Values Crashed.....and the real economy is coming to a grinding halt as many have HUGE debt burdens and lost jobs or evaporating incomes.

Tens of millions of Americans are simply living on credit or their last drops of credit.......the same is true for millions of companies.....as the companies run out of money....tens of millions of jobs will be lost.

Just wait for the news on CA over the next few weeks...Government workers will be the next area the FU virus infects and zombulates that population.

This is not hard to see if you just open your eyes.

If you wanted to destroy housing.....and the savings of millions of Americans.....simply loan out $10 Trillion dollars on homes only worth $3 Trillion.

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#8) On June 05, 2009 at 4:53 PM, alstry (35.36) wrote:

Madoffs, Petters, Enrons....Ponzi's.....Welfare based on borrowing

Borrowing or taking from one to pay another without producing much real value in between........

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#9) On June 05, 2009 at 5:24 PM, guiron (21.24) wrote:

What made this bubble different than all prior bubbles is that it affected the "real economy" and not simply the stock market like the Dot.Com Bubble.

That's a strange thing to say. Remember the Tulip craze in Holland? That's a classic bubble. Devastated the economy. It's also the first example known of a bubble economy, and the date was the 1630s. Lots of middle-income people were tied up in it and ruined financially.

The fact that the dotcom bubble didn't destroy the rest of the economy is not necessarily typical of a bubble. It had to do with the concentration of the bubble in one sector and then facing a wartime economy.

If you wanted to destroy housing.....and the savings of millions of Americans.....simply loan out $10 Trillion dollars on homes only worth $3 Trillion.

That doesn't make sense. Savings rates were below zero when we crashed. Paying down debt only counts as saving if you have equity. Housing equity has value, but borrowing on that is the only way to draw it out without selling. Anyone who bought a house to live in without worrying about price fluctuations is not affected by a drop in value, other than the potential issues with housing markets in general. People who borrow based on their equity are not in such good shape, but that's not really savings, is it?

And why would anyone want to "destroy housing?" I am not seeing the advantage here. Bubbles are often recognized before the crash, but most of the players are trying to get in on it. The trouble is knowing when to get out. But there was never any government mandate to take fraudulent mortgage applications, chop them up into securities rated AAA, and lever 30-1 with those "assets." Without the wild financial market backing this type of activity, there never would have been a problem this serious.

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#10) On June 05, 2009 at 5:30 PM, guiron (21.24) wrote:

Madoffs, Petters, Enrons....Ponzi's.....Welfare based on borrowing

No, not really. Madoff, yes. Petters, yes. Enron, no. Enron was a case of speculative purchasing getting ahead of company ethics and accounting. There was fraud. But it wasn't really a Ponzi scheme.

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#11) On June 05, 2009 at 5:48 PM, alstry (35.36) wrote:

All Frauds.....and many more to come....

Simply differences without much distinction......

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#12) On June 05, 2009 at 6:29 PM, lquadland10 (< 20) wrote:

So Alstray. What happens to the Retired Millitary?

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#13) On June 05, 2009 at 6:43 PM, alstry (35.36) wrote:

Good Question...

Think of America as USA Inc.

It's Income comes from generating taxes from its productive citizens, businesses, and other ways such as tarriffs....

It's employees are its workers and citizens on Welfare.....

And its fixed costs are its infastructure expenses....

It's military retirees are part of its pension obligations......

What happens to any pension when the underlying business runs out of money??????????????

Simply printing money obliterates pensions due to lack of buying power against rising costs....

 

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#14) On June 05, 2009 at 7:06 PM, WudoUknow (73.84) wrote:

Al, what is your strategy in this market?

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