This is what is destroying our country

mr lovah said:

oh please. if it wasn't for central banking practices, we'd have zero inflation

fucking moron

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Gotta love how when they run out of arguments, they resort to insulting people.

That's a pretty compelling argument you got there... or not.

rollitup said:

I've read your posts, Son. It really doesn't matter where on the "political spectrum" my views are, because your views are way "out there."

What's really pathetic is that you actually think you are paying attention!

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Wow, a response, I must have hit a major nerve.

heckler73 said:

While your latter conclusion is amenable to mine, the part in bold is questionable. Banks aren't going to give loans in the absence of the SIVs they had prior. So to assume "they" refused to give loans is mistaken. Their playing field changed, so they reverted to the prudential model (i.e. emphasis on risk assessment).

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Who said the banks refused to give out loans?
I should have clarified that people aren't asking for loans because of debt saturation. If no one is asking for a loan, the bank cannot issue them.

SIV? You know that an SIV is just a banking business model concept right? Purchasing long term debt and selling short term debt and arbitraging the difference in rates. Except without all the leverage that banks can use. Banks don't use SIV's, Commercial banking concerns with shadow components might, but Banks (hometown) by themselves can ratchet the profits up higher due to leverage than the best managed SIV can. Shadow Banks do not make loans to the plebs either. So SIV's don't have much to do with general price inflation. Equities perhaps, although I would counter that the HFT scammers are to blame for some also.

You cannot have inflation without the masses having a share of the riches. Since the top 10% of the nation owns 95% of all the stocks and bonds, most people have not participated in the Equities inflation.

NoDrama said:

Who said the banks refused to give out loans?

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uhhh...you? Slip of the "fat-finger", perhaps?

I should have clarified that people aren't asking for loans because of debt saturation. If no one is asking for a loan, the bank cannot issue them.

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Agreed...

SIV? You know that an SIV is just a banking business model concept right? Purchasing long term debt and selling short term debt and arbitraging the difference in rates. Except without all the leverage that banks can use. Banks don't use SIV's, Commercial banking concerns with shadow components might, but Banks (hometown) by themselves can ratchet the profits up higher due to leverage than the best managed SIV can. Shadow Banks do not make loans to the plebs either. So SIV's don't have much to do with general price inflation. Equities perhaps, although I would counter that the HFT scammers are to blame for some also.

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That is what I was talking about; the commercial "shadows". Magnetar, etc.
Without the SIVs issuing "paper" by which the loans could be funneled into CDOs, MBSs, etc. the banks couldn't unload --or capitalize on--the risk. And I seem to recall smaller banks were getting involved with some of the mortgage brokering, too. It was not exclusive to the "big boys".
I witnessed aftershocks from this shit first-hand, as I saw my car loan get shuffled off from HSBC to BNS, because HSBC got caught up in the derivatives game. That's part of the madness of private debt and endogenous money. Coupled with financial engineering this stuff can get explosive, never mind volatile (cf. Janet Tavakoli).

I also thought we were talking about equity inflation, specifically. I'm not saying equities affect general inflation directly, but there is an implied influence underlying the need for profits at the executive and shareholder levels, which will weave its way down the consumer chain to find sustenance.

You cannot have inflation without the masses having a share of the riches. Since the top 10% of the nation owns 95% of all the stocks and bonds, most people have not participated in the Equities inflation.

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Agreed.