Real predictions!! dow will fall to 2300!!! proof also available.

Bruxfain "Where do you get that derivatives are acting as a foundation for the world economy?"


The Dow is down 150 points right out of the gate today, up 400 yesterday, largest point gain ever last Monday and the 2nd largest drop last Tuesday.....

The amount of volatility over the past few weeks implies that the market is completely reaction based and devoid of a foundation. As long as the Dow had the successes it did over the past 5 years people didn't bother to see what "said" success was built on. The moment the markets stumbled slightly and shifted off there "growth every quarter" momentum, people looked around and realized they have no clue (Buffet included) how big this derivatives mess had gotten.

Without a solid understanding of the foundation you built your house on, how can you expect to make any "real" growth, let alone repairs when the house begins to fall apart.

Peace

Originally posted by GoalPoster
fillet of ignot . . .

OKay, thanks. My coffee is all over the place now.

That was great! Better than Afrin for clearing the sinuses

Nope, can't eat gold and if TSHTF in a really bad way, it will be like GD1 where they just came around and confiscated your gold anyway.

Paper gold is only paper, you'll never see the real stuff.

Lead, on the other hand, is a very valuable metal, can be used in protection and increasing your food supply

This is all very true. Personally, I wouldn't buy gold. I am buying non perishable food and medical supplies. IMO if I have all my eggs in a row, then I won't need gold for trading because I will have everything I need.

Originally posted by bruxfain
As an answer to your 1st question...An "off balance sheet item" is an asset or liability that is owned by a corporation but not included on the balance sheet? If this is not correct and is something else they should really change the name, as it only causes confusion.

As an answer to your 2nd question... This is implied in the article entitled "$516 Trillion ‘Time Bomb’ Set To Destroy World Economy" by Sorcha Faal.

If a $516 Trillion derivatives market collapse CAN lead to the destruction of the global economy, it is implied that the global economy is subject to or sitting atop or somehow related to the derivatives market, which is set to explode. This ain't kindergarten, my man. Is this logical?

The person I responded to brought up the $516 Trillion derivatives market and all together we can come to the understanding concerning the assertion and its supporters that many publically traded US corporations are Party to derivatives transactions that originated in a shadowy parallel banking world and these transactions don't appear on the balance sheets of the above mentioned corporations, but do contribute to their overall health and value, thus the health and value of the world economy;

PS

I don't think the whole world economy is subject to these derivatives, but I estimate only 1/3.

Ok, I don't hold Sorcha Faal worthy of reading, hence the misunderstanding. But to express that anything is founded on derivatives is just backwards. They are foundation of nothing. Foundation is where real value exists (physical economy). Derivatives bubble is just gambling. The fact that two people make a bet doesn't mean the economy has the staked amount more money or value in it. On the other hand this also means that the physical economy does not set any kind of limit to how large losses you can incur in gambling. And when you lose, the economy of the losing party suffers (duh!). The economy of the winning party suffers too in case it has accounted for its favorable position in advance (marking to market) which the other party is unable to honor i.e. defaults on her liabilities.

As for the off balance sheet items, yes it is what the name implies. But the fact that it is not on the balance sheet doesn't mean it is impossible to value or that it is off the financial statements. Off balance sheet items are (should be) stated in attachments or fine print. If they're not, it's an accounting fraud. And accurate accounting of derivatives can in certain cases be virtually impossible, hence the impossibility of accurate financial statements (and hence the exclusion from accurate balance sheets). So it is not the fact that some items are off balance sheet per se, but what those items actually are (derivatives) that creates the opaque financial statements which may hide monstrous liabilities.

So off balance sheet items are nothing fraudulent (maybe a little...) or mystical. It is the "sophistication" of these structured derivatives that is the root of the problem not accounting practices. I also don't understand the notion of "shadowy parallel banking world"...

I guess that people don't seem to realize that just 6 weeks ago, a 400 point move in the DJIA would be sending alarms up everywhere. Huge moves are a BAD thing. In the last 6 weeks though, we have seen so many of them, we are already getting numb (or getting out of the market if we have any sense)

Derivatives are another bubble that is waiting to pop. they have increased 5 times in $$ over the last 5 years. Again, this is a BAD thing.

$516 Trillion in Derivatives is a BIG BLACK HOLE in the world of finance. There isn't enough GDP in 5 earths to fill that hole.

If anyone is thinking that derivatives is the "foundation" or "Backbone" of an economy, you are living in the same fantasy world that Hank & Ben are in.

reply to post by KaginD


Kagin, according to your oft-quoted buddy Maslow, gold is long down the list of things you need to live..

I think that cigarettes and alcohol will be much easier to trade than gold. Trading gold requires some sort of loose infrastructure, because it doesn't really have any intrinsic value (discounting Monoatomic Gold).

Peace




[edit on 21-10-2008 by TheRealDonPedros]

reply to post by redhatty


"$516 Trillion in Derivatives is a BIG BLACK HOLE in the world of finance. There isn't enough GDP in 5 earths to fill that hole."

EXACTLY


The volatility you are illustrating is due to the fact that the market is devoid (BIG BLACK HOLE) of a foundation. Did you not notice that every point jump (down or up) was preceded by some bit of mainstream news. The market reacted because people reacted. The increased amplitude of the fluctuations
is due to the increased confusion brought on by a lack of security in the foundations of the economy.

You said it yourself, its a "BIG BLACK HOLE"..Regardless of where you are in relation to a black hole is irrelevant, IT WILL SUCK YOU IN.

Peace

reply to post by CTrider


Like I said earlier, another poster refered to a $516 Trillion WMD waiting to take out the world economy; otherwise known as the global derivatives market. I assumed he was refering to the Sorcha Faal article. For me its not about believing what is written there but more for trying to understand violent minds.

The article goes on to describe this market as...

"complex and opaque ... the world's biggest black hole because they operate outside of the grasp of governments, tax inspectors and regulators. They operate in a parallel, shadow world to the rest of the banking system. They are private contracts between two companies or institutions which can't be controlled or properly assessed. In themselves derivative contracts are not dangerous, but if one of them should go wrong – the bad 2 per cent as it's been called – then it is the domino effect which could be so enormous and scary.

I considered it reasonable that both the video at the beginning of this thread and the Sorcha Faal article are indirectly related.

I also suggested that because of the age of the Sorcha Faal article it is reasonable to assume that the market has already priced itself accordingly at least the best that it can.

When I talked about the deranged minds of the financial market participants I am refering to the base emotions they expressed between September 19 and October 10; shoot first ask questions later mentality.

Very likely if some new event occurs and all the people who want to collapse the American economy lead a sales drive on Wall Street in the coming weeks, it will most likely be an irrational knee jerk reaction just like the one we saw last month that causes it to decline, but nothing REAL.

So you can keep looking for holes in my understanding of the sitaution, but I still think it is a balanced and conservative; not a baseless suggestion of either strength or weakness as the author of the video does.

Its funny, the author continually refers to the greater part of Americans as "consumer slaves", I ridicule him and there is an uproar.

IMO: "You're not a consumer slave until you realize you're a consumer slave".

It's definitely polarizing and adds a bit of heat to the arguments. Regardless, star for your last post bruxfain. You definitely defend your conservative stance well.


Peace

Originally posted by TheRealDonPedros
IMO: "You're not a consumer slave until you realize you're a consumer slave".

That's a damn fine point Don Pedro...It's akin to my definition of consciousness: What is consciousness anyway? "The awareness of being aware of your action(s)".

Once we have the cognizance that we are in fact consumer slaves is the defining moment that we truly are.

Starred for that one.


AB1

Originally posted by bruxfain
I considered it reasonable that both the video at the beginning of this thread and the Sorcha Faal article are indirectly related.

Very Indirectly related. But unless you have been a Sorcha Faal "reader" for a long time, it would be hard to know that. Even the thickest tinfoil sites have banned Sorcha writings LOL

I also suggested that because of the age of the Sorcha Faal article it is reasonable to assume that the market has already priced itself accordingly at least the best that it can.

Not by a long shot, there are wave theory and projections used by economists (at least honest ones) that show that we are not done yet. Things are not stabilized, as the fluctuations in the markets clearly show.

Very likely if some new event occurs and all the people who want to collapse the American economy lead a sales drive on Wall Street in the coming weeks, it will most likely be an irrational knee jerk reaction just like the one we saw last month that causes it to decline, but nothing REAL.

Last month??? Okay, now i know you have just recently began to notice the markets. If you look at a 1 year chart of the S&P, NASDAQ or DJIA you will clearly see that we have been in a steady decline for over a year now. It is a slow crash, but it is still a crash.

The only irrational knee jerks that are occurring are when Bush, Hank or Ben put their mugs on TV to make an announcement regarding the economic crisis, then we have jumps and falls that are PURELY emotional reactions.

For the rest of it though, it is a reality that books are cooked, the country (US) is bankrupt, yet the Fed keeps making $$ out of thin air. The drops in the market are reflective of the LIES and FRAUD that has been perpetrated on the public by rich fat cats.

The person in the video is an economist, one with enough foresight to look at what is happening and make an educated guess (called prediction). He is not the only one who has made similar predictions. It's just that the ones who really are paying attention, and worried about their $$ as well as ours aren't on TV getting paid to share their knowledge.

Edit to fix quote tag
Edit to replace missing sentence
[edit on 10/21/08 by redhatty]

[edit on 10/21/08 by redhatty]

Im so glad for taking everything off (my funds) 2 weeks ago.
I lost 53% of my savings.

Thanks ZG addendum.

I think this guy is right on target...what he is saying is EXACTLY what I have been predicting for a long time. He is right on target about what consumers have done. Hocked the house and spent like there was no tomorrow.. Back years ago when the credit card companies convinced congress to remove the deductibility of credit card interest and created the "Home Equity Lines of Credit" I knew we would be in trouble. The one thing he does not mention that I believe is the taproot of the U.S. financial problem is the massive trade deficit. Our accumulated trade deficit since 1972 when we tipped over into a negative annual trade balance...is now sitting in the 30-40 TRILLION dollar range. No individual, no family, no city, no county, no state, and NO NATION can go year after year spending more than it takes in and not go bankrupt. The bottom line in my opinion is the U.S. is now bankrupt and the outcome of the election will it appears now, cause the U.S. to experience the most massive currency crash in the history of the world. This time its gonna be "Brother can you spare a "C-note".

reply to post by alphabetaone


A bit aside from the point, you should check out Bertrand Russell's barber paradox. It's a mathematical description of what you're talking about Alphabetaone.

Originally posted by KaginD

If you watched the first video that was put on youtube in March, he predicted where the Dow and the S&P would be by September. He was right. Thats 6 months prior to September. So, if he accurately predicted what would happen in September in March, then how is the thread misleading

Please watch the video before you comment on it.

He predicted the Dow would be at 7,000 to 8,000 in September. It never reached those lows in September. It hovered around 10k - 11k all throughout September. Therefore he WAS NOT right.

Watch CNBC, you'll learn more than watching this guy.

Look at the 30 companies in the DOW. There's no way they go down to 2300. Don't forget that companies can be dropped and added to the DOW as well. If one underperforms - it's outta there and replaced with something that does perform.

Interesting listen. However several issues cause me to not buy into the totality of what he is saying.

First he said he has reviewed "All" the data.

All of it.

Every last bit of it.

All.

Think about it.

Thats a pretty tall order.

Given the fluid nature of the world situation I have serious doubts this person has his fingers in every last bit of data flowing around the globe and is privy to the nature of future actions taken by humanity. Now add the ability to accurately predict the outcomes of said datastream? well I find it interesting to think that he must be an escapee from a secret world order think tank come to warn us all. (My magic 8 ball said "Outlook not so good" about the think tank thingy)

I mean he must be an economic genius, right?

Maybe he should turn his burning intellect to solving the worlds economic issues in some real way instead of feeding the fear responce of our primal selves.

/e bow

[edit on 21-10-2008 by Helmkat]

Interesting post. At least I feel comfort in knowing we can eat the rich!

WOW! This guy in the videos is mirroring what George Ure of the Web Bot Project has been saying for over a year now. According to the Web Bot Project, the economy will continue to spiral down hill until at least February of next year. George himself has said that the Dow will get as low as 5400 or possibly worse. Let me explain how I view our current ecomonic condition.

This is what our economy looks like:



The cards at the base holding all the others up:





Up until the 70's, we were an industrial and agricultural based nation. We actually produced 'stuff'. Since then, we have been moving towards a service based society. The production of tangible products has almost all been shipped overseas. We now import far more than we export. So far this year alone, we have sent over $569 TRILLION more overseas than what we have brought in. Source. It is absolutely impossible to sustain this kind of deficit. We as Americans have been spending more than we make every year thanks to the availability of credit. If you keep spending more than you have, it is inevitable that this house of cards will fall.

Both George Ure and the gentleman in the videos are absolutely right. This is only the tip of the ice berg, and we ain't seen nothing yet!

For those interested, you can read George Ure's daily update page at UrbanSurvival.com. You can also find archives of past predictions by him and the Web Bot Project on the same page.

dude this guy isn't making predictions, i said two years ago that our economy is going to start collapsing in 2008 and now it is happening. if you want an accurate "prediction" here is one for you, the economy of the united states WILL fully colapse by 2011.

the federal reserve was created in 1913

Devaluation of the $ / Age of the Federal Reserve

95%/ 94 Years (2007)
100% / 98 Years (2011)

By 2011 the dollar will literally be worth nothing

reply to post by KaginD


It was constructive. Well, it was at least amusing.

I actually get a little kick out of those so completely blind to what is happening that they can laugh with that kind of deluded assurance.

I am not a financial expert. However, I have a fair understanding of maths, economics, and human psychology. And by any angle it is viewed from, little mess is far from over.

It doesnt take a genius to see that lower consumer confidence and buying power are going to impact manufacturing and industry. And that this impact is going to be felt again by financial markets that have made risky loans to some of these companies.

Below is a very good, but pretty dense article called "The butterfly effect" that goes over in detail some of the dominoes that are lined up to tumble.

www.safehaven.com...

There is only so much bailing out anyone can do when a cannonball hits your boat.

I almost wish I was the guy laughing at everyone else for worrying over this. He at least wont see the train that hits him. Most of us that see us coming are still going to get hit anyway.

Perhaps ignorance IS bliss.