[Sixstrings]

Lengthy piece on Zerohedge, copy and pasted the highlights:

$this->bbcode_second_pass_quote('', 'T')he recent intervention by the BOJ has quickly become the most contentious decision in global economic circles, with many wondering now that the world economy is off on a course of radical currency devaluation, who will be next, and how far will this game continue? If Albert Edwards, whose latest piece rhetorically asks (and answers) "what do devaluation, high unemployment, inequality and food prices spell? C-H-A-O-S" is correct, this could be the beginning of a rapid descent in which central banks around the world are all forced to use the nuclear option: ceaseless FX devaluation, but one coupled with an endless increase in the money supply a process which can only have one outcome - that predicted recently by Eric Sprott when he said that "we are now paying for the funeral of Keynesian theory."

However, the biggest threat is that this most recent invocation of the nuclear option is coming at a time when the world is least prepared to handle it - social imbalances are at unprecedented levels, and if, as many predict, the price of key food products is about to surge (courtesy precisely of these failed central bank policies) to a point where the great unwashed end up on the wrong side of hungry, from there, to armed conflict, the line is very, very thin.

(snip)

Looking at history, the one most prominent example of coordinated devaluation was during the Great Depression, which was accompanied by the confiscation of gold. Arguably, back then it kinda, sorta worked in principle (for other reasons) if not in theory, with the argument being that devaluation can prevent deflation.

(snip)

So for all those who have been wondering if Mike Krieger, and recently Nic Lenoir's anger at visualizing precisely the scenario where the Fed's ongoing disastrous policies result in social and/or global war are overblown, the answer is no. We are getting to the point where absent a dramatic intervention in the Fed's all or nothing gamble on preserving Keynesianism will almost certainly result in armed conflict.
http://www.zerohedge.com/article/albert-edwards-terminal-competitive-devaluation-nuclear-option-and-how-feds-policies-may-sta

[Pops]

I've been mumbling about the next place regular joe is going to get burned (bonds) because he's skeered of stocks, well the volume of trading is down enough that Wall Street banks may have to start laying people off.

J6p is probably only a small portion of total volume but I'd guess he gets dinged every time he calls and yells "Buy!" into the phone. Computers are the largest traders I'm sure and they are finally getting at least a little scrutiny. Anyhow it appears between regulators and the flash crash in May that no one can explain, and some little bit of a realization the fix is in, those poor banks are having trouble making payroll.

So if our old resource extracting and manufacturing economy made the great leap forward to the FIRE economy, but then someone peed on the fire all we have left is a FiFi economy (Finance & Insurance) but now we get the F knocked out of us - and all we'll have is Insurance and lawyers to keep the economy afloat...

Ahhhh, now I understand the Insurance Reform Bill....

.
ZeroHedge

[Sixstrings]

$this->bbcode_second_pass_quote('Pops', 'I')'ve been mumbling about the next place regular joe is going to get burned (bonds) because he's skeered of stocks, well the volume of trading is down enough that Wall Street banks may have to start laying people off.

[Tyler_JC]

The trouble with buying government bonds (or long-dated corporate bonds) is that the price of the bond depends upon market interest rates.

If we see a whiff of inflation or if the dollar falls too rapidly, the Fed is going to raise interest rates back to something approaching normal levels. That means that the yield on government bonds is going to rise back to normal levels...meaning the price will collapse.

If a 30-year bond is currently yielding 3.8% and interest rates increase to, say, 6% (hardly outside of historical norms), the price of your bond would have to fall by almost 1/3. That's a huge loss for a "safe" investment.

Yes, you will get your monthly interest payments and you will get your principle back. But your purchasing power will be devastated if inflation comes back or the dollar falls. Does anyone expect interest rates to continue falling, inflation to remain vanquished or the dollar to strengthen over the next 10 or 30 years?

Treasuries might sound safe now, but they'll kill you in the long run.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('', 'A')s the FT reports, September trading volumes are already 8% below August's, which in turn was the lowest in 3 years! Of course, the Fed is fully confident that if the DJIA ends September at 11,000, investor confidence in stocks will return. We have one word for that - LOL.

[Vogelzang]

You might be interested in this. If it doesn't show up set it to one star.
http://messages.finance.yahoo.com/Stock ... f=10&frt=1

http://messages.finance.yahoo.com/Busin ... id=1529160

[Tanada]

The Unemployment I can believe is is term limits for politicians, I say 2 terms for any elective office and 10 years for any appointed office with no reappointment.

[deMolay]

US unemployment breaks 10% and the unadjusted Unemployment rate hits 18% plus. http://www.gallup.com/poll/143426/Gallu ... ember.aspx

[Sixstrings]

Thanks for posting, but not exactly new. Just mainstream media catching up with peakoil.com news from six months ago.

[Serial_Worrier]

Real unemployment closer to 18%. Reaching revolution-levels? Probably not as long as people aren't starving or dying at the front. Think Russia circa 1917.

[Tyler_JC]

$this->bbcode_second_pass_quote('', 'U')-1 Persons unemployed 15 weeks or longer, as a percent of the civilian labor force

U-2 Job losers and persons who completed temporary jobs, as a percent of the civilian labor force

U-3 Total unemployed, as a percent of the civilian labor force (official unemployment rate)

U-4 Total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers

U-5 Total unemployed, plus discouraged workers, plus all other persons marginally attached to the labor force, as a percent of the civilian labor force plus all persons marginally attached to the labor force

U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force

NOTE: Persons marginally attached to the labor force are those who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the past 12 months. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not currently looking for work. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule.

[Sixstrings]

$this->bbcode_second_pass_quote('Tyler_JC', 'H')ow does the Gallup poll define "unemployment"?

[Tyler_JC]

The BLS, the people who come up with the U-3 unemployment rate that makes the news every night, calls 60,000 households per month and asks them if they are employed. These people are:

1. All persons who did any work for pay or profit during the survey reference week.
2. All persons who did at least 15 hours of unpaid work in a family-owned enterprise operated by someone in their household.
3. All persons who were temporarily absent from their regular jobs, whether they were paid or not.

It gets very wonky, but you need to have a very specific definition of employment in order to compare one data-set to another. It also gets tricky to compare data across long period of time.

You also have to seasonally adjust the data. There are some jobs that only exist in the summer time and some people who only join the labor force during the summer to work these jobs. Think of a 17 year old high school student who works a summer job selling ice cream at the beach.

The actual number is probably not very important for people in the real world. The point is that there are an awful lot of Americans out of work and it's going to take an excruciatingly long time to put them back to work. Many of them are going to suffer massive pay cuts. Some may never work again. It's scary out there.

On the plus side, I just got offered a part time job selling an overpriced, unnecessary electronic classroom accessory. If you're living in the Boston area, I can hook you up.

[Ludi]

$this->bbcode_second_pass_quote('Tyler_JC', '
')1. All persons who did any work for pay or profit during the survey reference week.

[roccman]

http://www.cbsnews.com/video/watch/?id=6987699n&tag=contentMain;contentAux


And so it continues...

[eXpat]

Around 23 % according to the shadow stats people
http://www.shadowstats.com/alternate_data/unemployment-charts

[Outcast_Searcher]

This certainly looks really nasty, especially the folks who were well paid professionals and now have to take a sub-$10.00 / hour at Target to get anything.

The thing I just don't get though, is the apparent incredible lack of saving. The story was focusing on people in their 40's, 50's and 60's. It just astounds me how people in their mid-50's (and especially 60's) seem to have so little in savings that in a few months they're just financially screwed, even with unemployment.

Considering the tiny size of most non-govt. pensions, I have to wonder how these people planned on retiring, or IF they really planned at all.

I understand how someone who is, say, under 35 can be in trouble quickly in this situation, especially with student loans.

I wonder how many years folks have to see this stuff going on before they wake up to reality and live far enough below their means to do some SERIOUS saving.

[jdmartin]

I saw the piece. Decently done.

On an individualistic perspective, I agree - I see people that were making 200k and think "What in the hell were they thinking?".

On the other hand, it's all the people like them that allow people like me to be frugal non-spenders and still live a decent life. If we all saved and didn't spend, the economy would come down like a ton of bricks. As I've always said, all that waste in the system is someone's job, and thus ultimately my job. So I personally prefer that other people spend away.

[Serial_Worrier]

I can't understand how you get to 50-60 and have so little savings for a professional. It's one thing if you're working class, you're always living paycheck to paycheck. But these people were living VERY high on the hog and never thought to save for a rainy day. Well reality check, motherfrakkers.