The world financial crisis II

Hyundai shortens workweek

Perhaps a universal 4 day work week would help solve the current production /consumption /environmental/ crisis.

I am beginning to wonder if the entire global financial community is rotten to the core. Wall street has taught 'em well. Maybe staying completely away from the stock market is the best advice one can give anyone. I don't care what the bullshit artists (the financial pundits) say, this stock market freefall is going to impact on everyone's pension benefits.  Is ALCOA going bankrupct? What about IBM?

http://business.theglobeandmail.com/servlet/story/RTGAM.20090107.wsatyam0107/BNStory/Business/home 

India rocked by financial scandal at large computer company

Just absurd.

 http://www.theglobeandmail.com/servlet/story/RTGAM.20090106.wrequities07/BNStory/Business/

Is it a breakout, or fake out?
A bear market mauling cut the TSX in half in 2008. Quietly, stocks are climbing again on positive momentum, rising more than 20 per cent. Is it a breakout? Or just another fake out?

http://investdb.theglobeandmail.com/invest/investSQL/gx.show_chart?pl_comp_id=&pl_errmsg=&iaction=Chart&pl_primary_listing=TSX-I&iaction=Chart&pl_additional_listing=0&pl_period=INTRA&pl_chart_type=+&pl_sh_movement=0&pl_long_movement=0 [6]

How many more of these deaths will we see?

http://www.smh.com.au/news/world/business-leaders-drastic-way-out-of-crisis/2009/01/07/1231004078888.html

Another buying opportunity eh Heywood!

http://investdb.theglobeandmail.com/invest/investSQL/gx.index_today?pi_symbol=TSX-I&pi_action=

If you do still insist on investing in the stock market here is as close as possible to a full-proof way to make money.

Every time the stock market goes up for at least the next five years, consider it a great selling opportunity, and sell like crazy. Even short sell as much as you can, and you will come out a winner. If you go in the direct opposite direction from what all the press and financial pundits recommend, you are almost guaranteed to become rich.   

 By-the-way the TSX is down more than 300 points today so far.

http://investdb.theglobeandmail.com/invest/investSQL/gx.index_today?pi_symbol=TSX-I&pi_action=

What does Duncan Cameron mean by "limited liability"? Surely these capitalists could be held liable all this while for losses and damages incurred by their own bad decision making?

Corporations were invented in the first place basically to allow owners who make stupid, unethical, or otherwise bad decisions to get away without have to pay the prioce for their nonsense, or they allow the owners to avoid paying their fair share of income taxes.

 That's what corporations do, they limit the liability of the owners. They are a scam, always have been, always will be.

just try and have a discussion with a big supporter of capitalism about whether or not corporations should actually exist, and listen to the bullshit that will be shoveled in your direction.

Pretty self-explanatory -

http://clusterstock.alleyinsider.com/2009/1/porn-producers-ask-for-a-5-billion-bailout

Now everyone has their hand out...among other things.

     There wiill be another stock market shock when all of the fourth quarter data comes in.

There are just way too many crooks out there waiting to steal your money.

Anyone who has any investments connected to the stock market, which means most of us (think Canada Pension Plan, whatever) is hooped.  At least you can control you own personal investments, and give yourself a chance by avoiding the stock market for the rest of your life.

It's getting real ugly out there folks - you ain't seen anything like this before.

What was it that gave it away that perhaps we should not be putting our retirement income into the stock market? Whoever came came up with this brilliant strategy should be drawn and quartered as many million of people in North America are going to have their pension dreams destroyed in the not too distant future.

http://www.businessweek.com/bwdaily/dnflash/content/jan2009/db2009017_858862.htm?chan=top+news_top+news+index+-+temp_news+%2B+analysis

This should be good - these financial gurus are suggestioning we will have a recovery with many more millions out of work. Idiots.

http://www.businessweek.com/investor/content/jan2009/pi2009017_894787.htm?chan=top+news_top+news+index+-+temp_news+%2B+analysis [16]

The Bank of England cut the benchmark interest rate to the lowest since the central bank was founded [18] in 1694 as policy makers tried to prevent the credit squeeze from deepening Britain’s recession.

http://www.bloomberg.com/apps/news?pid=20601087&sid=avTXAfm9.vhM&refer=h... [19]

 Obama made his speech this am, laying out his plan to address the crisis and calling for action.   I expect that in the coming days and weeks there will be much commentary and disscussion about it in pundit world, news world and all over the intertubes. 

 Here's a link to the Kos blog that has links to the video and text of the whole thing, though I expect it will be all over the place in a few hours it's just easier to link to it all here.

 Obama's Economic Speech 

 I did watch it live but beyond just being amazed at hearing a guy who can actually speak and seem like he has half a brain I haven't got into thinking about the details or what it means.

  I did like the connection and vision he had around alternative energy infrastructure and connecting ecological issues with economic ones. That at least, was refreshing to hear from someone in his position. 

 I may get back to it later but I have to go shop for a new bathtub.  

It ought to be no surprise that the demise of the paradigm on which he has staked his entire political and economic outlook should leave Stephen Harper bewildered. Surely a very good reason for Canadians to put him out to pasture.

http://rabble.ca/blogs/bloggers/james-laxer/stephen-harper-stock-market-tipster-par-excellence

  hahaha

Radical cheap: $1,000 homes

"There are just way too many crooks out there waiting to steal your money. "

The real crooks hold shop in the 'Federal' Reserve and their banking mogul pals. The money was essentially valueless to begin with, way before the present crisis hit the fan. What was it, something like a real value of 17 cents to one dollar?

The real problem is fiat currency.

Another buying opportunity

http://investdb.theglobeandmail.com/invest/investSQL/gx.show_chart?pl_comp_id=&pl_errmsg=&iaction=Chart&pl_primary_listing=TSX-I&iaction=Chart&pl_additional_listing=0&pl_period=INTRA&pl_chart_type=+&pl_sh_movement=0&pl_long_movement=0

I'm not quite sure what was great about it.

Keep what hard earned money you have in cash, and before too lomg you will be buying cars and houses for 1/2 the price they once were.

http://business.timesonline.co.uk/tol/business/economics/article5484682.ece

Galbraith said saavy investors of the 1920's and 30's thought similarly - that there were bargains to be had. As the stock shares of relatively viable and successful companies were halved and reduced to a fraction of that, bigger fish swallowed smaller fish whole. And then by the next 24 months, those share values declined even further. Things became a lot worse before they were better. Political conservatives still say it wasnt New Deal socialism which raised the US economy from the depths but world war. The thing of it was, money was spent and lots of it, both public and private in North America. Hitler's Nazis followed Keynes to a large degree with borrowing heavily and spending liberally on infrastructure and military. And those stick in the mud advocates of laissez-faire capitalism in North America were quickly ignored in favour of the fight against fascism. Military recruiters in the US and Canada said they'd never seen so many emaciated young men unfit for combat by the late 1930's. Keynesian-militarism was born aka upside-down socialism for the rich.

We're hooped.

Harper has already given away the store by all the defence contracts he has handed out since he became prime minister. We have no money left now to create manageable deficits.

These bailouts are more silliness. Why is some poorly-managed sector bailed out by the rest of us?  Why are they more special than the rest of us?

And some people think Vancouver or Calgary or Toronto are immune to the laws of supply and demand. On what basis? These overpriced housing markets are going to crash and burn because people cannot purchase them at their current prices and live within their means.  

And just wait until BCers realize how much they have been had financially by these freaks who brought us the 2010 Olympics. 

We have been living a dream, on borrowed time. It is now time for us all to pay the piper. 

Ah, gee, what a surprise.  
  
Albertans with 'no equity left' going bankrupt: trustee

 http://www.cbc.ca/canada/calgary/story/2009/01/09/cgy-alberta-debt-bankruptcy.html

A month ago our federal government in collusion with the press were in denial about a recession.

All you had to do was walk down some streets in any city and see the boarded up construction sites to realize we were in deep do-do economically. 

It's just like the weather - if you want to know what the weather is doing you don't need someone to tell you - just look out the window.

It seems we have taken leave of our common senses.

Note that corporations are a product of the state, not capitalism.  I'd argue that the free market is actually undermined by limited liability protection. Here's a good article on the subject:

http://www.lewrockwell.com/rozeff/rozeff28.html

Oh great, it could be a world of legal wrangling according to rightwing librarians and insurance companies. Isnt the most privatized and most insured health care in the US already the most expensive in the world and producing the lousiest national health statistics in a comparison of richest countries?

A good example of how corporations protect their owners from their own stupid decisions is this company Millennium Development Corporation that is the developer for the Olympic Village. Who are these people and why are they allowed to keep their identity secret? Why do we not know who they are? Is it because they are connected to Premier Campbell or Prime Minister Harper? Apparently Millennium is owned by the Armeco Group. These people have at least two other major projects going on in BC, one in West Vancouver, and one in Nanaimo. Why doesn't Gregor Robertson grab these other properties if he can and hold them untill Millennium delivers financially what it said it was going to do for Vancouver? 

This Olympic financial nitemare that is about to be unleased on the poor citizens of Vancouver and BC will be our 2010 legacy. Thanks a lot.

Before this is over the Sullivan/Ladner/Christy Clark NPA will be so discredited that they will change the name of this municipal party in Vancouver. 

Is any of this reaching financial planners and fund managers who work within the system, handling our pensions?

follow-up.  Sorry. The previous post was poorly phrased.  I meant to suggest that people with pension fund managers and the like, forward these discussions to them.  I  routinely send Pam Martens and Michael Hudson pieces from counterpunch.org to mine and they claim they're reading them --whether they can afford to absorb any of it without giving up altogether is another matter.

And thanks for the very enlightening points being made in this thread.

I'm expecting a nice rally around the time Obama is finally sworn in.  Long term, you can't go wrong with alt energy stocks especially solar!

 CSIQ is my pick!

Yea, that's quite the rally all right. 

Canadian Solar only droped about $50. in the past year. It might have dropped more but it basically couldn't, as it's stock was close to being worthless. 

The stock normally hovered in $28 - $35 dollar range. When Q2 results were expected to be better than ever, that stock climbed up to $50 for a brief period of time before sinking back to it's normal level.  They had also announced some major contracts around that time too which helped boost it.

It's quite low right now (as pretty much any stock is) BUT it has a very good balance sheet.  Plenty of cash in the bank (CASH not credit), lots of equity, contracts signed for the coming year and a supply of silicon is secured too.

The current price is still SO undervalued!

I'll put my money on Buffett's million dollar bet any day of the week.

These mutual fund fees remind me of the absorbidant fees charged by the cell phone companies.

http://money.cnn.com/2008/06/04/news/newsmakers/buffett_bet.fortune/index.htm

Wow, another great buying opportunity, the TSX is only down around 300 points today, and how many more thousand people are going to lose their jobs this week!

Global systemic crisis – New tipping-point in March 2009: 'When the world becomes aware that this crisis is worse than the 1930s crisis'

I remember from my grade 10 latin classes 'pecu' was the word for money. Perhaps that's relevent if we are becoming a service economy.

Unlike the US Federal Reserve bank, Canada's central bank is already nationalised. It's not used to carry public debt though like it was from 1938 to mid 1970's. It could be used for better purposes. We could stop borrowing from foreign lenders at high interest rates and finance infrastructure and vital social spending spending at near zero interest. And raise bank reserve requirements similar to Keynesian money  management in India and China. Bay Street greed and special interests prevent the two big business parties from pursuing most popular economic and political agendas though. As Linda McQuaig said, the political impotence is self-imposed in Ottawa. It's not real impotence as they would have us believe.

I meant nationalising failing private banks.  To the best of my knowledge none of the major Canadian banks (CIBC, TD, etc.) came nearly as close as the American ones to failing, so this might never have been as much of an issue in Canada.  But it was the private banks I was talking about, not the central ones.

The TSX is down close to 350 points this morning so far. Must be another buying opportunity or more realistically, it probably isn't.

How does Soros make his money? By shorting the financial system I believe. When a system thrieves on BS, shorting the market is probably the best thing to do, don't you think?

I'm scooping ouy NASDAQ:AREO, they have a really interesting product that sold like hot-cakes over the xmas season.

I just heard a rumour that the international funding for the twinning of the Port Mann Bridge has fallen through, however I would be very surprised if Campbell would admit to it or stop the project before May 13, 2209. That will teach them to go non-union.

Canadians have already bailed out Canada's increasingly deregulated banks in the recent past big time. They've gambled away billions in oil and gas ventures in the 1980s and 90s and lost large with Canary Wharf in London. They wanted to be too big to fail, too, like their US counterparts. But pressure from the NDP and other groups helped stave off big bank mergers in Canada.  But youre right, this high risk mortgage fiasco only crept into Canada by a little, and the Harpers only put up about $200 billion to guarantee Canadian mortgages for US insurers creeping into Canada. herr Harper didnt brag it up to very many about that one though. 

But it's a good thing our own neoliberalized/hypnotized stooges were hesitant to privatize CMHC as was done with Fanny Mae and Freddie Mac in the U.S., for sure.

And thank goodness they've backed away from deregulation of power gen and distribution here in Ontario, Canada's largest economy. That was a big neoliberalized flop for us as well as California and several more US states, and Britain, too. Some of those ENRON crooks went into banking and finance on Wall Street after 2002 and were looking to spread wings into Ontario's power market at turn of the decade. Howard Hampton rode the two old line party leaders pretty hard when the ideology failed as he warned them it would. God help them in Alberta and BC if they stay the course with power deregulation. They'll be having to take out 2nd mortgages to pay their light bills.

The party is definitely over when building projects in Dubai are in trouble.

Nakheel, the state-owned developer of Dubai's palm-tree shaped islands, said on Wednesday it would halt work on a kilometre (3,281-feet) tall tower for a year in the Gulf's trade and tourism hub.

The planned skyscraper, part of the 140 billion dirham ($38 billion) Nakheel Harbour & Tower project announced in October, would be the world's tallest tower once completed. The project includes 40 high-rises.

http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSLE18816220090114

If I understand correctly, the Port Mann Bridge expansion was a P3 - a Private/Public partnership. WTF are we doing borrowing money abroad to finance our Canadian infrastructure projects? Are our decision-makers nuts? Probably not. Bot off, more likely. How much longer are Canadians citizens going to accept geting hosed by our very own right wing governments?  

Nortel files for bankruptcy

One-time jewel in the crown of corporate Canada falls from grace. Nortel was lots of very talented people led by incompetent CEO's and CFO's for too long, and struggling within an overall economic system that just doesnt work. Capitalism is a monumental failure.

Not to mention a bad habit of cooking the books!

Deflation in progress in the US:

This morning the BLS reported that Consumer prices in December fell ( - 1.0 %) on a non - seasonally adjusted basis.  Inflation for the entire year 2008 was +0.1%!  (meaning I have officially won my bet wtih Bonddad).  In the last 5 months, prices have fallen ( -  4.4 %), or at an annual rate of ( - 11.0%)!
    Yesterday, the Producer Price Index showed the first annual decline since 1950. In the last 5 months of the year, producer prices fell (-8.2%), the biggest collapse since the Great Depression.  The day before that, import prices fell the most in its 26 year history.
    This is the worst deflation since the Great Depression.  To make matters worse, in addition to losing nearly 2 milliion jobs in the last 4 months, we may be on the cusp of a wage-price deflationary spiral as there are increasing reports of companies imposing wage cuts on their workers.

http://www.dailykos.com/storyonly/2009/1/16/81223/5999/707/684745 [54]

This is very much not a good thing. Once deflation starts, it's hard to get out. In addition to the usual reasons in a recession why firms and individuals might choose to not spend their money, deflation adds the excellent reason that if you wait, the price of something will be lower.

On the other hand, there could be too much inflation:

Zimbabwe is introducing a Z$100 trillion note, currently worth about US$30 (£20), state media reports.

Other notes in trillion-dollar denominations of 10, 20 and 50 are also being released to help Zimbabweans cope with hyperinflation.

http://news.bbc.co.uk/2/hi/africa/7832601.stm

I'm not sure that this actually helps anyone besides delaying the day wheelbarrows are required to go shopping, but there it is.

Actually deflation is the best possible outcome for the Vancouver housing market bubble. Looks like at one developer has dropped the price of some condos by 40%. Once one does it, all the rest will follow. This market has a big long drop coming - as if working people can afford to live in this city any more..

Enough BS from politicians, RE boards, economic gurus, and financial pundits, all of whom have a vested interest in projecting inflated housing values. Finally some basic common sense.  
  
Housing market 'rebound' unlikely, say local bloggers

http://www.thetyee.ca/Blogs/TheHook/Olympics2010/2009/01/15/market-levels-unlikely-rebound-bloggers/

Nonetheless, the folks over at Housing Analysis [58] and condohype [59], two widely read local real estate blogs, seem to think there’s little chance market levels will “rebound” to 2007 levels anytime soon.

“What people are apparently still not getting is that a 'return to normal' does not mean returning to 2007,” reads a recent post [60] on Housing Analysis. “It was 2003-2007 that is the anomaly; not 2008-09.”

According to the blogger, the rampant speculation that’s driven up real-estate prices for the last few years is gone for the time being – and unlikely to return anytime soon. The upshot is that $1000 per square foot pricing, the reported break-even point for the Olympic Village, is a fairly improbable scenario.

"Maybe speculators will return to the market and blow a new bubble. Could happen, but I doubt it will happen in the next few years," writes the blogger.

A recent post [61] on condohype echoes similar opinions:

“I’m increasingly worried about the expectation of a 'bounce back' in the Vancouver real estate market…many people who are supposedly well informed aren’t getting the memo about the real estate decline.”

The Global Financial Crisis: The Great Depression of the 21st Century  Chossudovsky's Jan 14th lecture in Montreal (video)

- capitalism not operating by supply and demand anymore for many years - Today, speculation rules markets. GDP is meaningless.

- physical/real economies in trouble for over ten years

- there was a Canadian bailout to the banks. Harper mentioned a few billion leading up to the election, but two weeks after that, it was $75 billion to Canada's deregulated banks (pro rata cut&paste of US $700B bailout)

- US $700 billion dollar TARP/socialism for bankers and financial capitalists is actually several trillion dollars more than that

-US TARP/socialism for the rich actually more transparent than Harper's socialism for deregulated banksters here in Canada

*bottom line is that we can expect more neoliberal austerity - more privatizations of health care and public services and assets - more slashing of transfers to provinces to pay for this round of non-transparent programs of socialism for Canada's big time banksters  

He mentioned the name of one Quebec entity that is likely to be pawned off, but I couldnt understand what he was saying, sounded something like "EE-raw Quebec"

It's quite long and discusses neoliberal economic history back to the 80s and 90s. This is financial capitalists maneuvering to take over physical economy means of production and assets from recent physical economy owners- more concentration of wealth (and power) in the few hands of those who have it.

If you own property in Vancouver either sell it right away, or plan to hold onto it for 10 to 15 years, as Vancouver is going to experience an unprecented housing debacle, the likes of which have rarely been seen in our lifetimes.

http://futronomics.blogspot.com/

Olympic Sized Depression Hitting Vancouver [64]  

Western Canada had a lot going for it during the recent credit boom. Not only were debt spigots open wide like nearly everywhere else in the world, pushing up asset prices along with them. But the provinces of BC, Alberta and Saskatchewan all had their own commodity booms at the same time, further fueling the demand for housing. In BC the mining (and to lesser extend forestry) industries underpinned a robust economy. In Alberta, the rising price of oil made previously uneconomical tar sands projects profitable. And in Saskatchewan, skyrocketing fertilizer, grain and uranium prices created their own boom in major cities.

More so than anywhere else, the boom story in Western Canada felt legitimate. So even if the rest of the world were to undergo a contraction of sorts, this region would be supported by it's "strong fundamentals." This relative feeling of safety provided the boom mentality even more fuel than elsewhere. Unemployment got as low as 3-4% in some areas, redefining what most economists thought was "full employment."

But Vancouver had yet one more factor providing wind at it's back. They had "won" the right to co-host the 2010 Winter Olympics with Whistler (a nearby ski resort town). The resulting inflow of foreign investment was going to put the city "on the map" in terms of major cosmopolitan international cities. Tokyo, London, New York, Milan, Vancouver. Yes. It was ordained. The International Olympic Committee had declared it so. The provincial government even began an advertising campaign with the slogan "The Best Place On Earth." Old license plates bearing "Beautiful British Columbia" are now exchangeable for new ones with the olympic logo and the new slogan - for a fee of course. All of this is symbolic of a peak atmosphere of social mood. People were made to feel extremely lucky just to be part of such a place. As such, property values needed to reflect this newfound prestige. And of course, "there is only so much land."

Or so went the story.

Unfortunately, Vancouver residents have been shocked to learn over the last few months that gravity does indeed apply to them also. Sure as the sun rises, boom has turned to bust. And perhaps nowhere in the world has it manifested so spectacularly as in Vancouver. Where social mood was highest; it has furthest to fall. Here are the recent happenings:

BC Legislature to be Recalled for Special Session [65]

The B.C. Legislature will be recalled for a special session to deal with Vancouver's request for permission to borrow more than $450-million to complete the troubled Olympic Village project.



Without legislative action, the city would have to hold a referendum to approve the borrowing - an option Mayor Gregor Robertson said would cause costly delays in dealing with the situation.



"They need a tool right now that they don't have without a legislative amendment," the Premier [Campbell] said.



"We will bring that in as soon as it's drafted. We'll bring it in. We'll take it to the House, and hopefully it will pass as quickly as possible."



Mr. Campbell said he hopes members will get beyond "traditional politics" in order to deal with the matter.

Vancouver's Credit Placed On Watch Due to Olympic Village Project [66]

An independent credit rating agency has placed Vancouver on a credit watch and may even downgrade the city's AA+ rating as a result of potential debt coming from the beleaguered Olympic Athletes Village project.



Standard & Poor's on Tuesday issued a bulletin about the city's finances, saying the impact on the city's debt could be significant if it borrows money to fund the remaining construction of the village.



"We believe that there's going to be an event in the next three months that will have a negative impact on the city's credit profile," Stephen Ogilvie, an analyst with the agency, told CBC News.

Nortel Woes Could Hurt Olympic Sponsorship [67]

Nortel Networks was already financially flailing when it signed on as sponsor of the 2006 Winter Olympics in Torino, Italy.



It was laying off workers in 2007 when it became a major sponsor for the 2010 Games in Vancouver and struggling to stay afloat when its deal with the 2012 Summer Olympics in London was announced last July.



Now that the company has filed for bankruptcy protection from its creditors, Nortel's sponsorships at the next two Olympics could be in jeopardy.

Only through incredible incompetence or incredible arrogance could a struggling company think it is a good idea to spend millions on sponsoring a circus every few years.

The olympics in Vancouver-Whistler are turning out to be an unmitigated disaster. All of the planning going into the preparations assumed that economic expansion was a given. There was no contingency for a worldwide business slowdown. Surely, the economists they had hired assured them that no such thing had any statistical probability of occurring, and therefore wasn't worth planning for. This arrogance was prevalent regardless of numerous olympic experiences gone awry over the decades (the Montreal 1976 summer games had debts only repaid 30 years later, in 2006).

I'm guessing the attendance figures the olympic committee have assumed will also turn out to be wildly optimistic and revenue for the games and small businesses alike will turn out to be far lower than expected.

I'll give my readers two guesses as to who will be paying for this financial disaster, but you'll likely only need one.

Elsewhere, the global credit unwind and commodity collapse have real estate prices reeling in Vancouver. Vancouver is the former home of the TSX-Venture Exchange. It is the largest collection of junior mining exploration and development companies. Most of those companies are still based in Vancouver. During the commodity boom, these companies absolutely exploded in value. Very few of them actually made any money. But the prospect of finding a huge resource deposit was enough to give many of those companies significant value. Now, with commodity prices 70% lower and credit markets basically closed, many of these companies are gravitating toward zero. Cash in the bank is disappearing fast and without financing, they are essentially holding companies for mining permits that have little hope of ever being used. The wealth lost in the collapse of these shares has been exceptional, especially when you consider much of it is contained to one city.

[68]

During the boom, company executives, investor relations representatives, even secretaries were paid modest salaries plus stock options. The tremendous wealth effect this had was a contributor to Vancouver's housing boom. Now it too has all but disappeared.

In only 8 months, home prices have fallen 19%. And the massive amount of speculative supply that was bought in anticipation of flipping it post-olympics is awaiting the market for the spring. This has all the ingredients for a spectacular crash of epic proportions. Already, wise property developers are trying to front-run the market.

On Sale: $350M of Real Estate in Lower Mainland [69]

A Vancouver real estate developer is making an unprecedented move to offer a liquidation sale of $350 million worth of its condominiums throughout the Lower Mainland.



The marketing strategy by Onni Group of Companies is aimed at selling off hundreds of condos in its inventory.



About 375 unsold condominiums in cities such as Richmond and New Westminster will be offered at 20 to 40 per cent off, a real estate insider told CBC News.

Only time will tell whether those discounts will be sufficient to draw enough buyers. Judging by the absolute collapse in social mood, I don't know where the buyers are going to come from. Nearly everyone who could come close to affording a condo (and many who couldn't, to be sure) already bought one in the fright campaign of run-away prices. "If you don't buy now, you'll never be able to afford one," was common advice.

[70]

Prices of nearly everything got so out of control, that there is no telling where the bottom is on this market. The chart above traces out some very clean Elliott Wave patterns, which would suggest prices are heading all the way back to their "Wave 4" trough of '98. That would be a 50% decline from the peak - surely even more for condos in super-speculative areas (the Olympic Village, for example). How will the forthcoming property tax hikes affect prices? Will the inevitable post-games service cuts by the city make Vancouver an undesirable place to live in the future?

We are once again confronted by a region that thought, "It's different here." It wasn't. It never is. Speculative booms precede busts, just as inhaling precedes exhaling.

Too bad the video doesn't work it sounds interesting.

I think Soros didn't do so well last year...

The video was running a-okay last night, 500Apples. Perhaps it'll be working by Monday, and you can tell us which Quebec company or asset he thinks will be sold off in the next while. Not that it matters a whole lot to me though. I dont know what's wrong with the video link. This link is from September, but it covers a lot of the high points mentioned in the Montreal speech.

Is she related to Harper, a real estate broker, or a banker?

http://www.timesonline.co.uk/tol/money/property_and_mortgages/article5537245.ece 

Her optimistic predictions come on the eve of a grim forecast from the heavyweight Ernst & Young Item Club, warning that 2009 will see the biggest peacetime downturn in the economy since 1931. It predicts a 16% fall in house prices this year and a further 6% drop in 2010. “ The housing market remains in dire straits, starved of mortgage finance,” said Professor Peter Spencer, Item's economic adviser. “Although bargain hunters are active, there seems little reason to buy until house prices stop falling. We do not see that happening until the end of 2010.”

The Treasury will tomorrow announce

The California government is about to run out of money for, well, everything - but in particular, to pay disability benefits.

California's fiscal future lurched yet another step toward oblivion on Friday as state Controller John Chiang announced he could no longer make payments for services to disabled and blind people who need the money to pay for rent and food.

Chiang said payments would most likely have to be stopped by Feb. 1.

http://www.msnbc.msn.com/id/28709883/

There's money in California just not money for the less privileged. Why isn't the governor taking a cut in pay as things are so bad. Disgusting.

------------------------------

Maybe there are too many cars on the road as it is. Why do we need more?

http://www.cbc.ca/cp/business/090115/b0115117A.html

Car sales drop ups urgency for budget fix to car leasing 

That's amazing how the blind and disabled in California rated so low on their list of vital program spending. They have social programs for everyone but the po' in America.

Is it because a majoriy of the po dont vote for Arnold?

Shane Bohnen lets his wife deal with the lender. He was reluctant to speak for this story. He figures no one will have any sympathy for a family living in a $1 million house.

Well, it isn't a $1 million house anymore.

And he's right. I have trouble feeling sympathy for people who so obviously overextended themselves financially with no consideration that something might go wrong. In aggregate, however, it's a big problem. 

The wave of subprime delinquencies appears to have crested. But in October, for the first time, the number of prime mortgages in delinquency exceeded the subprime loans in danger of default, according to The Post's analysis.

This trend shows up most acutely in California and other high-growth regions, such as Arizona, Nevada, Florida and pockets of the Washington region, most notably in Prince William and Prince George [80]'s counties.

 http://www.washingtonpost.com/wp-dyn/content/article/2009/01/16/AR2009011604724.html?hpid=topnews&sid=ST2009011700501&s_pos=

A second UK bank bailout, and if that doesn't work - and the market seems presently convinced that it won't, with bank shares tanking -  it seems that many of the major banks will end up nationalized.

http://news.bbc.co.uk/2/hi/business/7837557.stm

Niall Ferguson has the answer that will save the world from financial meltdown and general situation in 1930's America loosed world wide. I think what he's suggesting is similar to what American Lyndon Larouche suggests for an FDR-like solution. And that is to just wipe out all the gambling debts and bad iou's floating around the world and enslaving whole nations. Put the whole thing through bankruptcy? Ferguson says it's God's will? Oh the banksters and neo Roman senators wont appreciate that very much at all.

The Age of Obligation

Ur was an ancient lost city and rediscovered in modern day Iraq, or whatever they call it now since the phony war on terror began.

Having watched the Chossudovsky posted by Fidel, which is now working again, http://www.globalresearch.ressourcequebec.com/Lecture/January_14-2009.ht... , I can recommend it as being well worth watching.

The first two minutes are some mumbling in (spanish?) and then an introduction.

Some of his points:

- War in the middle east related to the financial crisis
- oil companies, wall street, military-industrial complex, the biotech conglomerates, the media conglomerates are the pillars he identifies as the alliance of interests behind the current mess.
He also disparages his own profession of economics.
- He says market manipulation is done largely through the derivative trade, and that the manipulation renders economic theories of spontaneous change (i.e. business cycle) impossible. He says swings are due to speculative games and not economic fundamentals.
- He says though the real economic has been in a crisis for a number of years, says real economy and financial economy are in a symbiotic relationship.
- He mocked the use of GDP as the emperor of economic statistics, quote: "The real economy is absolutely shattered".
- Says we're dealing with a massive transfer of wealth resulting from speculative trades. "The large financial institutions appropriate wealth through the use of these instruments".
- He says we're moving to a new phase where there will be cannibalizing of large corporations as well, building on the previous cannibalizations of small and medium businesses.
- Bailouts are a cause of the crisis, not a cure.
- He believes the depression started in the 1990s and perhaps even in the 1980s.

His talk goes slightly more esoteric after the 30 minute mark, a lot of interesting history and analysis.

He mocked the Canadian approach, he says we are in a copy and paste mentality (lol), when it comes to Canadian and American financial regulations.

He says he's estimated the Afghan drug trade is worth between 150 and 200 billion a year !!!

Gee, another pipeline for the mad bombers to attack.  This would put a lot of people to work though, and better than shipping by tanker - bring it on.    Canada offers financial backing for Mackenzie pipeline

http://www.financialpost.com/most_popular/story.html?id=1194757

"...I was told by [my] chief economic advisors that the situation we were facing could be worse than the Great Depression"

(from Dubya's last press conference.)

Tom Engelhardt comments on the denial of this information throughout the last months of Bush's administration.

I love the sound of that...Dubya's LAST  press conference.

If you want to survive financially get out of any North American stocks for the rest of your lives. And make sure your pension plan investors hear that mesaage as well. Yes there will probably be a little rally when Obama's stimulus kicks in, and then stocks will sink like a stone.

If you want to survive financially get out of any North American stocks for the rest of your lives. And make sure your pension plan investors hear that message as well. Yes there will probably be a little rally when Obama's stimulus kicks in, and then North American stocks will probably sink like a stone, never to recover in our lifetimes. go East, young Lady, go East (East as in China, that is). 

I'm just overwhelmed by all these buying opportunities. Today (Tuesday) was another one. But it seems that every day there is one of these wonderful purchasing opportunities, it is followed by an even better one the following day.

• 8,504.930
• -336.550
• -3.81%
• Vol: 271,032,156
• Last Trade: Jan 20, 2009 17:05:00 EST 

http://investdb.theglobeandmail.com/invest/investSQL/gx.index_today?pi_symbol=TSX-I&pi_action=

I'm just shocked - what a surprise!

http://www.theglobeandmail.com/servlet/story/RTGAM.20090121.wreconomy21/BNStory/crashandrecovery/home [91] [91]

Citing the intensifying financial crisis that is “spilling over into real economic activity” around the world, the central bank drastically slashed its growth expectations for Canada this year, forecasting a contraction of 1.2 per cent, compared with an earlier forecast of a modest 0.6 per cent expansion.

The country's income is contracting, house prices are falling, wealth is crumbling and exports are on a sharp decline, the bank noted. It cut its target for the overnight lending rate by half a percentage point to 1 per cent – lower than in 1958, when the most-watched policy rate was 1.12 per cent.

You can say that again, North Report. It's quite a drop.

Does Obama really mean to get down to business with the banksters?

Senator Ringuette calls for investigation of credit, debit card systems

The NDP has hammered away at the Harpers for fairness on credit card interest rates,  and excessive bankster service charges and usury in general since 2006.

According to this author a depression occurs by when we reach 25% unemployment.

In the USA now the unemployment rate is at 16-17% and rising. 

Another Great Depression

http://www.kitco.com/ind/Turk/turk_jan152009.html [95]

Last week the US government announced that the unemployment rate rose this past December to 7.2% from 6.8% the month before.  The US economy lost 2.6 million jobs in 2008, of which 1.9 million were lost in the past four months.  Of these, 524,000 were lost in December alone.

Importantly, there are clear indications that employment will drop further. Companies have been cutting back on hours worked, which reached a record low in December of 33.3 hours per week. This measure is a leading indicator because companies first cut back on hours worked before they cut jobs. Also, layoffs are growing. The Wall Street Journal reports: “The new year has brought no letup on layoffs, as employers have already announced more than 30,000 cuts.”

The monthly unemployment report is prepared by the Bureau of Labor Statistics <http://www.bls.gov/news.release/empsit.nr0.htm [96]>. It reveals that the number of unemployed has climbed over the past year by 3.6 million to 11.1 million, but the real numbers are much worse when looking through the government sugar-coating in these reports. As The Wall Street Journal explains it: “While the official unemployment rate is 7.2%, a different figure that includes discouraged workers who have dropped out of the labor force and those working part-time because they can't find full-time work hit 13.5% in December. That was nearly a full percentage point higher than in the previous month and up from 8.7% at the end of 2007.” 

While a 13.5% unemployment rate is shocking, the truth is even worse because the WSJ is still relying upon government reports. To get the unadorned picture, we need to turn to private economists, and I reply upon the work of John Williams of Shadow Government Statistics <http://www.shadowstats.com/ [97]>, who presents in his latest report the true picture of the dire unemployment situation: “During the Clinton Administration, ‘discouraged workers’ those had given up looking for a job because there were no jobs to be had were redefined so as to be counted only if they had been ‘discouraged’ for less than a year. This time qualification defined away the bulk of the discouraged workers. Adding them back into the total unemployed, actual unemployment, as estimated by the SGS-Alternate Unemployment Measure, rose to 17.5% in December from 16.6% in November.”

Unemployment is the key measure that signals whether or not a depression has begun, and by the SGS measures we are rapidly approaching the 25% unemployment rate usually mentioned as the most important signpost marking the depths of the Great Depression. That high rate of unemployment cut a wide-swath of misery through the American population.

Given the current 17.5% rate of unemployment, it would appear that I am not far off the mark to suggest that we have entered another Great Depression, and I am not alone in my thinking. Others who are more attuned to the economic situation see it the same way as I do.

For example, the following quote is from an OpEd piece by Nobel Laureate Paul Krugman that was published in The New York Times on January 5th: “The fact is that recent economic numbers have been terrifying, not just in the United States but around the world. Manufacturing, in particular, is plunging everywhere. Banks aren’t lending; businesses and consumers aren’t spending. Let’s not mince words: This looks an awful lot like the beginning of a second Great Depression.”

Another buying opportunity.

http://investdb.theglobeandmail.com/invest/investSQL/gx.index_today?pi_symbol=TSX-I&pi_action [99]=

Down over 250 basis points so far today and the day's not half over yet.

Housing Starts, Permits in U.S. Slump to Record Low  

http://www.bloomberg.com/apps/news?pid=20601087&sid=aDKiShZMG5Q0&refer=home [100]

Housing starts [101] fell 16 percent last month to an annual rate of 550,000 that was less than forecast and the lowest since the government started compiling statistics in 1959, the Commerce Department said today in Washington. Building permits [102], an indicator of future projects, were also at a record low.  

I cannot think of a more popular policy than shooting the bankers and nationalising the banks. It might even win Mr Brown an election. Come to think of it, it could also be the way to get us out of this mess.

http://www.ft.com/cms/s/0/a35c925c-e65f-11dd-8e4f-0000779fd2ac.html

Well, there you have it - from the Financial Times.