tag:blogger.com,1999:blog-4102429195693595750.post7002718498458701362..comments2024-03-22T05:15:17.042+02:00Comments on Sudden Debt: Is A Greek Default Inevitable?Hellasioushttp://www.blogger.com/profile/03564511281240682625noreply@blogger.comBlogger65125tag:blogger.com,1999:blog-4102429195693595750.post-57391993649508855632010-05-01T01:17:16.904+03:002010-05-01T01:17:16.904+03:00Lol, Lord Blagger, you don't know how ironic y...Lol, Lord Blagger, you don't know how ironic your last comment was.<br />No comment.<br />By the way... you can't BUY trust.<br />We've "rigged" the system that way. <br />And we know it too.<br />Freud has taught us that, at least...Debrahttps://www.blogger.com/profile/01510189619803992336noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-37574615445335804242010-05-01T00:12:03.055+03:002010-05-01T00:12:03.055+03:00Fractal, not "factuals"
... Though mayb...Fractal, not "factuals"<br /><br />... Though maybe we do need crystals if LB quotes The Prisoner's Dilemma and has no idea what I'm talking about. <br /><br />... Perhaps we all are doomed and should get that compound in the woods and stock up on canned goods after all.<br /><br />Rich, I'll map it again. I do respect your opinion greatly.<br /><br />Be wellThaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-75508749290446557062010-05-01T00:04:23.259+03:002010-05-01T00:04:23.259+03:00@ Thai... Forget Theory. Forget Philosophy...
...@ Thai... Forget Theory. Forget Philosophy...<br /><br /><br />As Lord B stated: "CDS is a zero sum game. When the buyer wins, the seller loses or vice versa."<br /><br />is it really Win / lose. ...thus Zero sum?<br /><br />I'm talk hard cold money/credit... Accounting puts a fork in it. <br /><br />Is it zero-sum. CASH<br /><br />...or is there a little more then meets the eye.<br /><br />MA - RHAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-16592329692734683772010-05-01T00:01:29.284+03:002010-05-01T00:01:29.284+03:00No idea what fractuals have to do with the subject...No idea what fractuals have to do with the subject Debra. What about crystals and homeopathy?<br /><br />The trust issue is relevant as others have mentioned. Money is a means of exchange. If trust goes the cost of doing business goes up. Fancy entering into barter for everything? Not me.<br /><br />However, the Greek issue. What's the cause? It's that the government acting as an intermediary has distorted cause and effect. ie. Run up lots of bills by borrowing and the effect, default, has been put off. If people had the full cost immediatedly, and not on borrowed cash, they would have said no ages ago. <br /><br />Allowing governments to borrow on people's behalf, is unstable.<br /><br />LBLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-91662863171394190532010-04-30T20:38:27.428+03:002010-04-30T20:38:27.428+03:00Rich re: Defies logic
I hear you, honest. I don&#...Rich re: Defies logic<br /><br />I hear you, honest. I don't think any scientist would disagree with you. But it is what it is.<br /><br />I suspect you are making a distinction that you should not though I'm unsure...<br /><br />Let me try another way: what would you be willing to pay to buy trust?<br /><br />Think about itThaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-64901980692076277832010-04-30T20:18:15.021+03:002010-04-30T20:18:15.021+03:00@LB Re: Estate agent willing to make their client ...@LB Re: Estate agent willing to make their client to the mark due to infrequency of transaction. <br /><br />I agree it's zero sum, but Tiago is correct to point out you are forgetting the externality caused by the clients loss of trust on the entire system. Everyone else in society looses a little here as well. Money is not the only "information structure" conservation laws apply.Thaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-32065465957087194662010-04-30T20:00:00.818+03:002010-04-30T20:00:00.818+03:00@ Thai...
I didn't exclude mother earth in my...@ Thai...<br /><br />I didn't exclude mother earth in my brain... I knew for simplicity, that I would be re-fertilizing eventually, but chose to just show the wasted portion of the energy. The fact is, the earth was -1 in it's initial production of the apple. ...and by me not instantly refertilizing, or using my energy to replcace an equal portion of enegy back to mother earth... the earth lost out. I chose to burn it pointlessly running in circles.<br /><br />Reason being... The mother nature portion takes "time" to get the use. I was avoiding that... because "time" is what I say helps keep the chirade of it being "zero-sum, in place. Of course we can kick the cost out infinitely.<br /><br />My starting point is all post production. From this point forward... the apple, (much like FI) is a depreciating asset in face value.<br /><br />I just don't see it.<br />Sorry.<br /><br />I'm open to your thoughts... but it defies my logic. <br /><br />MA-RH<br /><br />@ Lord I can't spin my wheels on this any more. We'll just have to disagree. Which isn't bad. <br /><br />..as for the +1/+1 CDS... Go talk to accounting.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-74086363132244409622010-04-30T18:36:13.863+03:002010-04-30T18:36:13.863+03:00Thai...maybe we agree on this and maybe we don'...Thai...maybe we agree on this and maybe we don't...<br />I could say to YOU, "yes, Thai, we GET your fractal point of view on everything, how EVERYTHING boils down to fractals, etc, etc. and the conservation of energy, yes, of course, in the final analysis...<br />So, I say... let's try to live and let live, OK ?<br />I'll put up with your repetitions, and you put up with mine ?<br />That's what cooperation is about ?<br />Let's try to do a better job of it OVER HERE, OK ?<br />I agree with Lord Blagger in his statement about looking at value.<br />At how value is assigned a monetary equivalence which is dependant on the symbolic numbers system too.<br />And to see how complicated this is, I'm going to tell you a little story.<br />Two years ago I met up with my... American ACCOUNTANT, and we were discussing exchange rate stuff.<br />And she made a comment about how things were... expensive in the U.K., BASED ON THE EXCHANGE SHE WAS GETTING on her U.S. dollars...<br />I say.. that translates into a somewhat misguided notion of the way money works, to base your ideas of WHAT THINGS ARE WORTH in any given society on the exchange rate you are getting for your own currency, and the TRANSLATION of your currency, and your "system" into the system of the country you're in.<br />As I think I've mentioned before.. if my international accountant can show THIS kind of ignorance about the way money works, what makes us think here that we have understood all of its ramifications ?<br />I would not have so much hubris to make that assertion for myself, in any case.Debrahttps://www.blogger.com/profile/01510189619803992336noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-33598059005622149742010-04-30T18:32:20.644+03:002010-04-30T18:32:20.644+03:00It's still a zero sum game.
You lose, estate ...It's still a zero sum game.<br /><br />You lose, estate agent wins.<br /><br />However, if you draw the boundary round yourself, and ignore the estate agent, then you have excluded a participant in the game. <br /><br />The rules of a zero sum game exclude modifying the rules in this way.<br /><br />That doesn't make the analysis wrong.<br /><br />If you look at yourself as the system, the analysis will look like this.<br /><br />1. Cost and effort of me doing all the work.<br /><br />2. Cost of paying someone else, even a crook, to do the work.<br /><br />Which is cheapest?<br /><br />However, in the second case, you aren't discussing the whole game, you are discussing the strategy of one participant in a zero sum game.<br /><br />You might like to read up on the game 'prisoner dilema' It's a standard of game theory.<br /><br />The problem here is that you are a very infrequent player of the game. The estate agent can screw you over, and to him it doesn't matter. You aren't going to be a repeat customer. Prisoner dilema has different outcomes if you are playing an open ended game multiple times or a fixed number of games.<br /><br />LBLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-45898991315766947752010-04-30T18:18:23.436+03:002010-04-30T18:18:23.436+03:00Rich, the energy which entered your sytem that sta...Rich, the energy which entered your sytem that started you +1 was the earth giving you the apple. Every transaction from thereafter had a cost of friction as the energy in the apple changes hands and form.<br /><br />You left mother nature out of your model. But you and I both know she is there. ;-)Thaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-47764668666434365432010-04-30T18:04:03.766+03:002010-04-30T18:04:03.766+03:00Lord B…
Your tenacity is great… I guess we just ...Lord B…<br /><br />Your tenacity is great… I guess we just don’t see eye to eye. I fail to comprehend, even from your exhaustive scenarios, what makes it zero sum?<br /><br />You grow an apple. You sell it to me for an I.O.U. (we’ll call I.O.U. $1Blagger) I eat the apple, you have the $1blagger. (let’s forget whatever cost was associated with you producing that apple)<br /><br />Equal so far?<br /><br />Now let’s take a look at these scenarios. <br />1. After eating that apple, I either repay that $1Blagger IOU, through good or service, -or- you pass that IOU on to someone else for a good or service and I perform that IOU for them. (The energy I perform the good or service is done with the strength that apple gave me.)<br /><br />Are we zero sum?<br /><br />2. After eating that apple, I expend all my energy running in circles. I exhaust the energy supply. I just chose to never pay you back that IOU. (or you passed the $1blagger along to someone else for a good or service and they don’t receive their good or service. …leading to potential cascade, especially if you exchanged it for something that exhausted too.)<br /><br />Are we zero sum?<br /><br />3. After a week, I decide I do not want your apple. I give you back your rotten apple, and tell you I no longer owe you.<br /><br />Are we zero sum?<br /><br />In all 3 scenarios… I was “up” for the useful life of the apple. For the 3 scenarios, you were “enriched”, cheated, or lost opportunity cost (or the value of the apple energy yourself) ….and all of this is minus the cost associated with producing the apple.<br /><br />How, when you get something or nothing are you net “zero sum” for both scenarios. It can’t be both ways.<br /><br />Maturity (repayment) and default are destruction of the I.O.U. Inflation and deflation take care of the value through maturity. Default, consumption, and cost are lost! Inflation and deflation becomes the exponent on “lost” portion of wealth.<br /><br />I’m not saying you’re wrong… I just can’t cognitively accept or get past this concept. You’ll have to forgive me for not understanding your theory.<br /><br />All the best, <br />Miss America – Rich HartmannAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-73092014814766852272010-04-30T16:18:26.836+03:002010-04-30T16:18:26.836+03:00Oops I misspoke
I meant to say: zero-sum is only ...Oops I misspoke<br /><br />I meant to say: zero-sum is only <i><b>the boundary condition of the fractal</b></i>- e.g. there is still plenty of room for trust. ;-)Thaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-78264895926937930282010-04-30T15:33:26.642+03:002010-04-30T15:33:26.642+03:00Oh, and Tiago, it is zero-sum. ;-)
Life is fracta...Oh, and Tiago, it is zero-sum. ;-)<br /><br />Life is fractal and zero-sum is only one building block in that fractal. E.g. there is still plenty of room for trust. ;-)<br /><br />Be well my friendThaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-78491815372417642562010-04-30T15:30:09.229+03:002010-04-30T15:30:09.229+03:00Tiago, amen
There be Greek Socialists amongst the...Tiago, amen<br /><br />There be Greek Socialists amongst their Norwegian brethren. ;-)<br /><br /><br />But since Mr. Spirit level says its all about equality, and lack of equality is a spectrum from top to bottom, should you "create" this equality by cutting off the top? Or cutting off the bottom? Or some permutation of a combination of both? Or leave well enough alone and let the pieces fall where they may?<br /><br />Since you are the socialist, I ask you: are you really prepared to do what is necessary in order to achieve better trust amongst Greeks living with Norwegians? <br /><br />This is not just an academic issue either...<br /><br />Will you let me have a few weeks/months of your or your wife or your parents or your child's life of MY choosing (this is the key: my choosing, not yours) to use as a credit card for one of your neighbors whom you do not trust/respect/approve of?<br /><br />Clearly you already said "yes" to this for neighbors you do approve of? What if you see more and more of what you do not?<br /><br />Cooperation is tough<br /><br />Think about itThaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-66983746285262750432010-04-30T15:13:54.320+03:002010-04-30T15:13:54.320+03:00Ahhhhhh!!!!!
Enough of this Deb!
We get your p...Ahhhhhh!!!!!<br /><br /><br />Enough of this Deb! <br /><br />We get your point, honest. <br /><br />We get that you are trying to tell us about the age old problem of epistemic closure. <br /><br />We get that you are trying to tell us about the problems of inductive reasoning. Note Hell has The Black Swan on his reading list. <br /><br />We get that you are trying to tell us that if we develop a reductionist model which incorporates everything we know as humans, and this model tells us everything in the universe, indeed life, thinking and the universe itself are all zero-sum in the end (which is does), still the model is flawed with the problem that there is always information that is outside our model (because it is outside the the system we know from which we built our model) which could change everything. FWWIW, this is basically Godel's Incompleteness theorem.<br /><br />And we get that if we come up with a model which explains everything, the assumptions necessary to create the model itself cannot be validated by the model (again Godel)<br /><br />We get it, honest.<br /><br />But you don't know what's outside the system any more than the rest of us so we are back to arguing about whether Angels exist because we can't see them.<br /><br />And while I'll concur with you that it is as valid a discussion as any other on some absolute cosmic scale which should give equal time to all the other systems we missed in our own reductionist model of life/the universe/everything, still it is not helpful either.<br /><br />We get it<br /><br />If you message from all this is we need to cooperate?<br /><br />AgreedThaihttps://www.blogger.com/profile/00700253024420397221noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-42106873492957309392010-04-30T15:00:14.386+03:002010-04-30T15:00:14.386+03:00Lord Blagger:
When I sold my house in the Netherl...Lord Blagger:<br /><br />When I sold my house in the Netherlands, I signed a piece of paper, giving full authority to the estate agent. An old chap, that was both greedy and honest (I had entrusted him to help me buy the same property and I knew him to be a stereotypical old Dutch). 5 minutes took me to sign the paper. I also signed for a hefty commission. He sold my house, did everything as discussed. Price: commission and 5 minutes. Never crossed my mind that he might defraud me.<br /><br />Compare this with my partner here in Portugal just trying to rent a place: several times she was told that the conditions were X, just to arrive at the signature date (she never dreamed of giving full power to the estate agent - not enough trust) and see that she was lied (and the contract not signed). Cost: 2 months searching for a home, commission, several days at work lost.<br /><br />Zero-sum game my ass. It is called "Externalities".<br /><br />Corruption and fraud are socially inefficient to the extreme (we live in societies, they do exist).Tiagohttps://www.blogger.com/profile/09130634176057923895noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-54789329987703411112010-04-30T14:43:22.509+03:002010-04-30T14:43:22.509+03:00People have been claiming that the financial syste...People have been claiming that the financial system is not a zero sum game. <br /><br />I've pointed out it is, and why.<br /><br />If you want to change the subject to something else, please do so. I'm prepared to discuss that to<br /><br />However, as it stands, no one has offered up a scenario that shows an non zero sum game when it comes to finance.<br /><br />eg. Fraud isn't a zero sum game. Oh yes it is, the victim loses, the fraudster wins.<br /><br />You're better off admitting defeat on the zero sum game, and moving on to an equally interesting subject, namely what destroys value<br /><br />LBLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-76564514848748991482010-04-30T14:17:18.302+03:002010-04-30T14:17:18.302+03:00Lord Blagger...
You did not respond to MY critic.
...Lord Blagger...<br />You did not respond to MY critic.<br />I said that these issues are zero sum ONLY WITHIN the symbolic system itself.<br />That means that... outside of the symbolic system, they are NOT zero sum.<br />And I maintain, for example that Haiti's earthquake is outside our symbolic systems. <br />Like other things are outside our symbolic systems.<br />And CQFD the RULES that govern our symbolic systems do not necessarily apply outside of them.Debrahttps://www.blogger.com/profile/01510189619803992336noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-78983604811948855292010-04-30T12:13:47.797+03:002010-04-30T12:13:47.797+03:00So the worldwide pool of credit stands at $1,000,0...<i><br />So the worldwide pool of credit stands at $1,000,000. (now in actuality, all that credit is nothing. Fiat! Logically, people think of that fiat dollar in your pocket as an asset. It’s actually not. That dollar is just a Gov’t issue I.O.U. The most basic modern day asset… is actually debt!)</i><br /><br />Still a zero sum game.<br /><br />Who are the participants?<br /><br />Public to government. Government back to publicLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-44872395576568678772010-04-30T12:12:54.382+03:002010-04-30T12:12:54.382+03:00Miss America Rich Hartmann
=============
A long...Miss America Rich Hartmann <br /><br />=============<br /><br />A long post of your's but lets pick the easiest flaw.<br /><br /><i>So now that $1mm pool of credit is just the modern version of price for the real tangible assets. Oil, food, shelter, etc… As those are consumed they need they deplete the $1mm pool.</i><br /><br />Why is the pool depleted?<br /><br />If I buy food, is money destroyed? No. It goes to the seller.<br /><br />ie. You've done what I've said people would do, and omit one of the participants from their analysis. <br /><br />Still a zero sum game. <br /><br />Your comments on 'perceptions of wealth' are a different issue. They related to value, which others have discussed to. <br /><br />Value can be destroyed, but value is a virtual concept. It's unrealised profit and loss in the banking world.<br /><br /><i>In zero sum… there has to be a winner and a loser. When you have bank 1 and bank 2 both on opposite side of a CDS bet, but yet you have both bank 1 and bank 2 holding and pledging that each of their CDS for more credit, you realize that you don’t have +1/-1.</i><br /><br />Yes you do. It's always +-1.<br /><br />However, can you tell me how people pledge CDS contracts? News to me that you can put them up as collateral. <br /><br />Every deal I've known would rely on people paying cash for the premiums?<br /><br />LBLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-76372239680430096462010-04-30T11:46:29.836+03:002010-04-30T11:46:29.836+03:00Money is SUPPOSED TO BE a "measurement" ...Money is SUPPOSED TO BE a "measurement" of value.<br /><br />---------------<br /><br />Not supposed. It is. Even gold as a currency is a measure of value. <br /><br />Money is just a means of facilitating exchanges of value indirectly, to avoid the necessity of battering goods you want directly with the producer.<br /><br />All forms of money, gold included, rely on the producers believing that when they want to realise the value of the money, that other producers will do likewise. <br /><br />So I'm in perfect agreement with you on this point.<br /><br />As for fraud, has it gone on? Yes. See www.lordsoftheblag.net for my alter ego's opinion on it. (You have to get irony to read it!)<br /><br />However, you have to look where the large frauds are taking place. It's not in the banks. The real fraud is with government. <br /><br />For example, the UK government uses off balance sheet accounting to hide its debts. It admits to 800bn of debt, but the real liabilities are around the 4,000 bn mark. It's all off the books<br /><br />Fraud? Yep. Ponzi? Yep.<br /><br />LBLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-38548580415172291652010-04-30T10:27:36.809+03:002010-04-30T10:27:36.809+03:00Two years ago I went into my local post office, an...Two years ago I went into my local post office, and in the course of the verbal dog sniffing that our species does, the woman on the other side of the counter said to me.... "Time is money".<br />.......<br />THAT is the ideology that arose from the perverted effects of the Protestant reform.<br />Because that equation is NOT true, and we are collectively behaving as though it WERE true.<br />Rich, I can see Lord Blagger's points because he is reasoning only WITHIN the symbolic system of money and its nature.<br />From WITHIN this system, I think he is right.<br />The problem is, as I said earlier (or later ?), our world can not be reduced to our symbolic systems.<br />Money is SUPPOSED TO BE a "measurement" of value.<br />A number value assigned to... at this point lots of convoluted products of the symbolic system of money itself.<br />At a certain point, when you continue opening door upon door upon door in your symbolic system, you.. GET LOST.<br />Everybody gets lost, and in my opinion, there are maybe ONE OR TWO people who look like Goethe among those nice men in jackets swearing in on the economic bibles, but..<br />They are geniuses. You can't have a generalized system that only one or two people understand.<br />On the fraud problem...<br />The zero sum philosophy could be equated with what "we" shrinks call castration, which goes somewhere along the line of you can't have your cake and eat it too (but Freud was too smart to fall totally into that monotheistic morality trap...).<br />It is in human nature to NOT BELIEVE that you cannot have your cake and eat it too.<br />So, reducing general human nature to particular fraud is simplistic and misguided.<br />Like reducing Freud's unconscious to Sartre's "mauvaise foi", or bad faith.<br />No way to prove things work this way, I say, Lord Blagger.<br />If i can't prove that money is destroyed, YOU can't prove that people's main motivation is fraud (not that you really tried, anyway...).<br />One of these days I think I am going to have to put y'all to contribution to look at what we call the Ponzi scheme.<br />I think we need to look much harder at it.<br />We're not seeing how... the Ponzi "scheme", from another angle, looks like the multiplication of the loaves and fishes.<br />We can be so thick, though.<br />That's what "mauvaise foi" does to you, though.<br />Makes you thick. <br />Thank you for your comment Peter.<br />I will ask for YOUR contribution particularly on the Ponzi scheme.Debrahttps://www.blogger.com/profile/01510189619803992336noreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-41555149657324744322010-04-29T19:00:03.254+03:002010-04-29T19:00:03.254+03:00In trying to simplify I went to my most hated sour...In trying to simplify I went to my most hated source… Wiki! (Hate it) In hopes there was a clearer def I actually found a simple statement that I hope you find useful:<br />Economics<br />Many economic situations are not zero-sum, since valuable goods and services can be created, destroyed, or badly allocated, and any of these will create a net gain or loss. Assuming the counterparties are acting rationally, any commercial exchange is a non-zero-sum activity, because each party must consider the goods it is receiving as being at least fractionally more valuable than the goods it is delivering. Economic exchanges must benefit both parties enough above the zero-sum such that each party can overcome its transaction costs.<br /><br />Like I said… <br />All the Best,<br />Miss America Rich Hartmann <br /><br />p.s. Deb, no worries here, just having fun. Still value the smile more then the dollar. Regardless of my bondage, my disposition remains good despite the clarity that forces me to wear rose colored glasses. I just hope to share the knowledge of how unfortunately bonded reality and ponzi are. It’s sad it’s cliché.<br /><br />@ Thai… I’m not looking to win. Nobody won. …a few years ago, everybody won. Now we have to pay the price of zero-sum. Now we all lose. How you choose to lose is also relative.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-18863124313763279802010-04-29T18:46:05.432+03:002010-04-29T18:46:05.432+03:00Lord B…
I think what’s being lost (and what I sta...Lord B…<br /><br />I think what’s being lost (and what I stated above somewhere) is that this fixed income, debt and dollars aren’t being valued at a fixed moment. The value is finite base on time. The dollar exists now, the debt is paid tomorrow. That debt issued is infinite. <br /><br />In zero sum… there has to be a winner and a loser. When you have bank 1 and bank 2 both on opposite side of a CDS bet, but yet you have both bank 1 and bank 2 holding and pledging that each of their CDS for more credit, you realize that you don’t have +1/-1.<br /><br />They are both holding, collateralizing, and recycling that credit for more cash in the system. They both hold this as +1 / +1, (Net +2) when in actuality it is Net 0. …and this isn’t FRAUD!!! That’s the way it works. FASB 157A,B,C!!! …and there is nothing stopping this because that’s the “correct” way this is supposed to work. In chess, you don’t say, you can have my bishop, queen, and king, and the victory in exchange for your all your pieces in this same game tomorrow. Chess is fixed in length. <br /><br />Financial voodoo. <br /><br />So the worldwide pool of credit stands at $1,000,000. (now in actuality, all that credit is nothing. Fiat! Logically, people think of that fiat dollar in your pocket as an asset. It’s actually not. That dollar is just a Gov’t issue I.O.U. The most basic modern day asset… is actually debt!)<br /> <br />So now that $1mm pool of credit is just the modern version of price for the real tangible assets. Oil, food, shelter, etc… As those are consumed they need they deplete the $1mm pool. So growth has to outpace or maintain that $1mm pool. Our “assets” can’t depreciate either, or else they need to also be added to this net growth. …but in the modern world, supply and demand pricing, free markets decided that this was no longer good. Instead, securitization of this whole $1mm pool happened. …and fractional reserves of credit were now issued against all assets. No longer is just the deposit of cash/credit fiat… but the ownership of the whole $1mm pool became fiat. <br /><br />…and Bank 1 and Bank 2 have helped make that pool now equal $2mm. Sure the pool is still the same size, but the value we assign it is more. Then the pool became $4mm because the banks decided to further securitize the out of thin air credit/debt that was associated with it. The pool being $1mm or $2mm is all relative. The securitization of the product from thin air in not! The actual size of the pool and the value of it still remains relative, but the fact remains that people perception of wealth remains. <br /><br />If we call the market’s peak that $4mm moment, then when our “perceived wealth” was market to market through depreciation of ABS, (the #! product, through MBS, RMBS, CorpRe, etc..) we take that $4mm pool and bring it down to $3mm. <br /><br />…but the world isn’t realizing that deflation. We’re filling the void with a fiat payment from tomorrow. No one is actually forced to absorb this fiat loss. …but everyone is consuming from that $1mm pool (that’s valued at who knows what now) based on the fact that they still have something like that $4mm. It becomes no longer relative because the market can no long correctly price the true hard asset as they depreciate, …and growth (which isn’t happening) no longer knows how to maintain or outpace the needed existing size of the pool. The pool is still whatever sustainable size it is. It’s collaterization, is relative to it s market price, say current value, $3mm (even with a $1mm created from parallel securitization of the fiat thin air debt mixed in) …but we spend like we have $4mm. That difference is pushed out in time. or printed when needed NOW.<br /><br />In tragic irony, all those dollars created from thin air, stand under the guise of a Gov’t backed I.O.U. …but when in actuality we are carrying around “as an asset” this debt like it is something positive.<br /><br />All the Best,<br />Miss America Rich HartmannAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4102429195693595750.post-53656974152257373192010-04-29T16:14:19.499+03:002010-04-29T16:14:19.499+03:00Ok. Me give you an example.
Buy a share for 1 USD...Ok. Me give you an example.<br /><br />Buy a share for 1 USD. Price goes to 10, then back to 1 again.<br /><br />Has anything been created or destroyed?<br /><br />Has anyone lost any money?<br /><br />LBLord Blaggerhttps://www.blogger.com/profile/06783119146180259097noreply@blogger.com