Comments: Slip Slidin' Away

OT: POST AIG'S BOOKS ONLINE, call Pelosi @1-202-225-0100. YOUR money, YOUR,company, YOUR books.

Posted by Mike Meyer at March 28, 2009 07:04 PM

What's most amazing to me about this thing is the integral of the chart - Chinese banks are on top, but even they lost a huge fraction of their market cap in 2009. Which leads one to ask - where the fuck did all the money go? Bonds?

Posted by saurabh at March 28, 2009 09:14 PM

where the fuck did all the money go?

It didn't go anywhere; it really never existed in the first place. The previous valuations were all based on imaginary bubble wealth that only existed as magnetic patterns on hard drives. The bubble gaveth, and now the bubble hath taken away.

Posted by Jonathan Schwarz at March 28, 2009 09:34 PM

Sure, I get that, the money never existed in the first place, it's all fictitious, banks create funny money, etc., etc. But I still have to use that shit to buy a loaf of bread. What gives?

Posted by saurabh at March 28, 2009 09:41 PM

Is some of this due to businesses merging, too?

Posted by Save the Oocytes at March 29, 2009 12:33 AM

You can buy bread with special pieces of paper that have George Washington's face and the phrase "legal tender for all debts" printed on them. Those banks have different pieces of paper. Different words and no pictures.

Posted by abb1 at March 29, 2009 12:16 PM

Finally, a definition of globalization that I can understand and to which I now can relate:

Question:
What is the truest definition of Globalization on?

Answer:
Princess Diana's death.

Question:
How come?

Answer :

An English princess
with
an Egyptian boyfriend

crashes
in a French tunnel,

driving a
German car

with
a Dutch engine,

driven by
a Belgian

who was drunk on
Scottish whisky,

(check the bottle before you
change the spelling),

followed closely by
Italian Paparazzi,

on Japanese motorcycles;

treated by
an American doctor,

using
Brazilian medicines.

This is sent to you by
an Arabian,

using
Bill Gate's technology,

and you're probably reading
this on your computer,

that uses
Taiwanese chips,

and a
Korean monitor,

assembled by
Bangladeshi workers

in a
Singapore plant,

transported by
Indian lorry-drivers,

hijacked by
Indonesians,

unloaded by
Sicilian longshoremen,

and trucked to you by
Mexican illegal's.... .


Posted by Globalization On at March 29, 2009 12:27 PM

The Federal Reserve uses a little tool called inflation to make the wealth disappear. Now most places you look will tell you that inflation is a
mysterious beast caused by a wealth of factors.

This just isn't so. Inflation is caused by the direct actions of the Federal Reserve, what they call "printing money". When they "print money" each dollar is a smaller percentage of the total money supply (which has a fixed value). Therefore your dollar is worth less by a sleight of hand.

The transfer of wealth happens because the people in control of that process have their wealth stored in any capital other than US Dollars-- the price of which (in US dollars) has magically just risen. One of those things just too complicated for the mere mortals actually holding dollars to understand, ~RIGHT?

As for the values of companies and stocks, I'll bet it isn't to hard to leverage these facts to fuck a few people in fly-over country by manipulating the value of mutual funds.

I just read an article about Bernake saying he wasn't "worried about inflation" http://www.moneymorning.com/2009/02/19/federal-reserve-inflation/

I wonder if he's worried after the Fed printed a trillion + dollars last week.

Posted by tim at March 29, 2009 12:51 PM

Just FYI, here's a little math equation for you

1,000,000,000,000 / 350,000,000 ~ 2857.1429

Posted by tim at March 29, 2009 01:11 PM

The "people in control" if you can stand to call them people, are convinced that your share of that trillion rightfully belongs to them. I guess the question is whether we let them be right.

Posted by tim at March 29, 2009 01:20 PM

"..imaginary bubble wealth that only existed as magnetic patterns on hard drives."

I have a McMansion full of lead-laden, Chinese-made bling-bling that proves you wrong sir.

Posted by Bernie at March 29, 2009 02:03 PM

22 trillion in money documents out there, 6 trillion more one dollar bills only drops YOU 18%--20%. 6 trillion minus from the 10 TRILLION BUSH/CHENEY DEBT leaves ONLY 4 trillion to TAX OR BORROW.

Posted by Mike Meyer at March 29, 2009 02:58 PM

BUT my guess is bringing down the National Debt is the last thing it'll get spent on. WE are apparently ONLY interested in enriching bankers.

Posted by Mike Meyer at March 29, 2009 03:05 PM

A few years ago the tubes were crackling with ridicule for the shallow silliness of religious belief. Still are some but not so crackly now.
The idea that there could be something "there" just because people believed there was was beneath contempt, except the political strength of all those believers was getting intimidating and plus they elected Bush.
But that's all money is. Faith. Belief. Even gold heavy as it is needs faith to be of constant value. Otherwise it's only all about "what'll ya give me, whatcha want fer it?" And banks can't run like that on the day to day.
So pull the plug on the belief system, get enough of the mass to lose faith in the constancy of the currency - and watch the whole financial economy swirl on down the drain.
There are other economies. F'rinstance there are economies based on things people actually need, as opposed to based on neutral symbolic tokens with potential application toward possible transactional gratification.
Money's fun, and easy, but it has enabled a horde of parasites to assume dominant positions over succeeding generations ever since it appeared, and it got more dominant with each year of use.
Madoff did what he did without ever lifting anything bigger than a cardboard box and that probably not so often. Mostly he did it here, online, in the lightspace, with bits 'n' stuff, and live in person face to face by talking nice words - and creating faith.
He didn't steal nothin real. None of the people he ripped off are missing anything real. They're missing the belief by others, in this case banks creditors stores etc, that they have and control imaginary symbolic tokens Madoff helped them accrue.
As Schwarz pointed out above it's imaginary, bubble wealth, which makes it faith-based, which makes it no more substantial than religious belief.
So either they're both horseshit, money and religion, or maybe we should examine religion for some traces of whatever magic pixie dust made money so vital and important and real that the whole world's talkin about disaster when nothing solid, nothing tangible, nothing edible has really changed at all.

Posted by roy belmont at March 29, 2009 03:34 PM

I think commenters have touched on the two features of a Ponzi scheme: imaginary; and redistributive.

Imaginary because the iterated leveraging creates the illusion of wealth creation. Bubbles, magnetic patterns, whatever you want to call it.

That, in turn, makes redistribution possible: the vastly smaller amount of real wealth gets redistributed into the hands of the Ponzi schemers. The magnetic bubbly patterns are necessary for the redistribution to be stealthy.

If you shoplift a lollipop you go to jail. If you steal billions you get a bailout.

If you murder one person you get the death penalty. If you murder 100,000, you get the medal of freedom.

And the beauty is that when you point out such truisms, people call you shrill.

Posted by Bernard Chazelle at March 29, 2009 04:56 PM

"Shall we tell you of those who lose most in respect of their deeds?-
Those whose efforts have been wasted in this life, while they thought that they were acquiring good by their works?"

Posted by tim at March 29, 2009 04:59 PM

He didn't steal nothin real. None of the people he ripped off are missing anything real. They're missing the belief by others, in this case banks creditors stores etc, that they have and control imaginary symbolic tokens Madoff helped them accrue.
As Schwarz pointed out above it's imaginary, bubble wealth, which makes it faith-based, which makes it no more substantial than religious belief.

Many of the people had at some point transferred real wealth into fake wealth because fake wealth was more transferrable, and would have had the option to transfer it back into real wealth at some date if Madoff hadn't wiped it out.

Posted by Cryptic ned at March 29, 2009 05:35 PM

Well, I think it's a little more complicated. A bunch of dollar bills is imaginary wealth, but the pieces of paper banks hold now are even more imaginary.

So, the bankers had been shifting worthless pieces of paper around - and getting commissions, stock options, and bonuses made of real dollar bills.

That would've been OK too, but it appears that all those real dollar bills bankers paid to themselves belonged to bond holders, who are very important people indeed. If banks go bust, the bond holders will lose their money and that's against the rules. Bond holders mustn't lose, or they'll get very upset. So, we will have to cheap in now and 'restore the confidence'.

Posted by abb1 at March 29, 2009 05:35 PM

"chip in" that is

Posted by abb1 at March 29, 2009 05:36 PM
So either they're both horseshit, money and religion, or maybe we should examine religion for some traces of whatever magic pixie dust made money so vital and important and real that the whole world's talkin about disaster when nothing solid, nothing tangible, nothing edible has really changed at all

Roy, there's a substantial difference.

With faith based valuations/money we have a belief in our fellow citizens and their abilitis, social responsibilities, laws, etc; it's not theistic at all. Social structures are easy enough to see, and to regulate for the greater good as long as we have clearly defined definitions of what we're trying to do.

The icky part is that that you need to depersonalize the calculations to make the outcome predictable, and that's not the domain of the touchy-feely that think human life should not be evaluated on those levels. But if you can't quantify something, control of it gets away from you.

Egads, but the quality of consciousness makes us infinitely valuable in the view of some. And isn't that type of valuation a bubble in itself that interferes.

Posted by Angryman at March 31, 2009 11:54 AM
Just FYI, here's a little math equation for you

1,000,000,000,000 / 350,000,000 ~ 2857.1429

I'm not getting your point. Were you expecting a free ride into the future?

Posted by Angryman@24:10 at March 31, 2009 11:56 AM

NOW, the newsreaders on cable news shows are spouting off about the "return" of real estate. Housing sales are up! WAHOO! Foreclosed houses selling for pennies on the dollar, while the owners live out at tent-goddamned-city!
Personally, I am 62 years old. Didn't own a credit card until I was over 50. I still don't buy NOTHIN' unless I have the cash for it. I use the credit card or a debit card now and then only if there is money in my credit union or box under the bed to cover it. Seems simple to me.
Of course, my home is paid for, though it is only worth about 1/3 of what it was last year. I never really believed it was really worth the kind of money this sort of thing was going for a few years back anyway. If YOU are looking for a nice home at the beach, mine is for sale. http://beachhomeforsale.blogspot.com

Posted by Mr. Natural at April 1, 2009 11:27 PM