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Re: [amibroker] Re: Helicopter Ben :-)



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Well said Patrick. Will see how long this over-leveraged system will work using same old tricks over and over.
Issues remain and grow.

Best regards,
Tomasz Janeczko
amibroker.com
----- Original Message ----- 
From: "vlanschot" <vlanschot@xxxxxxxxx>
To: <amibroker@xxxxxxxxxxxxxxx>
Sent: Wednesday, January 23, 2008 10:18 AM
Subject: [amibroker] Re: Helicopter Ben :-)


> Tomasz,
> 
> Philosophically I agree with you 100%. The moral hazard issue has 
> been (i.e. Greenspan-put), and continues to be (i.e. Bernanke's 
> helicopter) a long-term threat. I have a lot of sympathy with Ayn 
> Rand, and all that.
> 
> But there are also the constitutional issues. The Fed has 2 
> responsibilities, namely price stability and protecting growth 
> (i.e. "full" employment). In other words, if the Board concludes that 
> the probability of a recession has increased significantly (like 
> yourself probably if you're bearish), they have to act. It is their 
> duty, regardless whether they take their cue from (lagging) macro 
> economic data, their (failing) models, (overreacting) markets, or tea 
> leaves.
> 
> Re his image flying in his helicopter, remember that his speech in 
> 2002 (when we were all worrying about deflation) was very important 
> for confidence, and according to some the first trigger for the 
> subsequent recovery. I'm not defending the man, nor his predecessor. 
> I'm just stating the roles they need to play.
> 
> You could be worse off. We have a Governor (of the BOE) who couldn't 
> prevent a bank run (e.g. Northern Rock), and simply ignores recession 
> signs. Add to that a former Chancellor (Brown) whose public finance 
> policies are falling apart, consumers who are even more overleveraged 
> than their US counterparts, housing prices which are stratospheric, 
> and you have a recipe for disaster. But then again you could be 
> blessed by having Trichet . . .
> 
> Finally, the growing influence of capital markets on the real economy 
> (i.e. the tail wagging the dog), now increasingly at a global scale, 
> is the crucial issue here. Capital markets, and the products that are 
> designed (e.g. securitisation or the "shadow banking system" [ever 
> wondered why CB-policies seem to have less of an effect?]) and traded 
> are all driven by this paradigm called "modern finance". It is this 
> theory (which, like most, I've been brought up with) which causes the 
> longer-term structural problems that remain. But that's a different 
> discussion.
> 
> PS
> 
> 
> --- In amibroker@xxxxxxxxxxxxxxx, "Tomasz Janeczko" <groups@xxx> 
> wrote:
>>
>> Hello,
>> 
>> You may have some valid points here but
>> 10% for me at least is not really anything worth panicing
>> plus making people belive that central bank will always step in and
>> bail out the market in case of any 5% down move 
>> makes people just more reckless in their decisions and this in turn
>> may create new (old?) problems in long term.
>> 
>> Best regards,
>> Tomasz Janeczko
>> amibroker.com
>> ----- Original Message ----- 
>> From: "Yuki Taga" <yukitaga@xxx>
>> To: "Tomasz Janeczko" <amibroker@xxxxxxxxxxxxxxx>
>> Sent: Wednesday, January 23, 2008 2:00 AM
>> Subject: Re: [amibroker] Helicopter Ben :-)
>> 
>> 
>> > Hi Tomasz,
>> > 
>> > Yes, when world equity markets drop ~10 percent in 2 days in 
> concert,
>> > you are talking 10s, maybe 100s of trillions of dollars.  Yes, a 
> lot
>> > of that is just 1s and 0s stored on computers, but if you don't 
> agree
>> > that its presence, or its sudden disappearance, influences human
>> > behavior to a tremendous extent, then I don't know what I could
>> > possibly say to convince you otherwise.  The markets certainly
>> > believe that all those 1s and 0s that have recently disappeared 
> from
>> > major money center banks have some real consequences.
>> > 
>> > You know I'm hardly going to argue against the cyclical nature of
>> > markets. I have long made a nice living off of them.  But sudden,
>> > violent contractions in wealth have real consequences.  The Fed 
> knows
>> > there is little they can ultimately do about the market's course, 
> but
>> > they are going to try and turn a waterfall into at least a 
> cascade,
>> > or a rapids.  That's probably a good idea, too.
>> > 
>> > At times like yesterday, anything that gets people thinking, even 
> a
>> > little bit, instead of reacting in blind panic, is probably a good
>> > idea. Markets are acting like a deep and long recession is already
>> > baked into the cake.  Maybe, but not necessarily.  Tossing a 
> monkey
>> > wrench into the wheels of the panic bus in order to maybe slow it
>> > down a little is probably not a bad idea.
>> > 
>> > Also, as I'm sure you know, but as your words seem to obfuscate,
>> > lowering interest rates is not exactly the same thing as printing
>> > money.
>> > 
>> > And I think it is competition, not recessions, that do the real 
> heavy
>> > lifting of improving efficiency.
>> > 
>> > Yuki
>> > 
>> > Wednesday, January 23, 2008, 8:42:07 AM, you wrote:
>> > 
>> > TJ> Hello,
>> > 
>> > TJ> Trillions of dollars ? Or rather "paper profit" (the numbers 
> stored in computers)?
>> > TJ> The entire nature is cyclical. Autumn and winter comes after 
> summer, what's wrong with that?
>> > 
>> > TJ> Recession follows the period of growth. And it forces 
> companies to seek
>> > TJ> more efficiency and makes them more competitive. That's 
> healthy for the economy.
>> > TJ> Fed printing money does not make you wealthier, you will just 
> see more zeros in numbers
>> > TJ> on your computer screen but this means nothing. What's the 
> difference if someone
>> > TJ> is losing wealth by market fall or by money devaluation? Only 
> the one who has the printer
>> > TJ> benefits from that.
>> > 
>> > TJ> Best regards,
>> > TJ> Tomasz Janeczko
>> > TJ> amibroker.com
>> > TJ> ----- Original Message ----- 
>> > TJ> From: "Yuki Taga" <yukitaga@xxx>
>> > TJ> To: "Dennis Brown" <amibroker@xxxxxxxxxxxxxxx>
>> > TJ> Sent: Tuesday, January 22, 2008 11:34 PM
>> > TJ> Subject: Re: [amibroker] Helicopter Ben :-)
>> > 
>> > 
>> >>> Hi Dennis,
>> >>> 
>> >>> Think about what you said compared to the reality of the 
> situation.
>> >>> Nearly unregulated free-market capitalism (as in CDOs, SIVs, et 
> al)
>> >>> just about brought down the house.
>> >>> 
>> >>> It's a funny cognitive dissonance.  Ultra-right religious
>> >>> conservatives (not saying you are one), who are often also pure
>> >>> laissez faire market people (ditto), accept the negatives of 
> human
>> >>> nature as inevitable when it comes to moral issues.  But 
> somehow,
>> >>> this same negative human nature is presumed, one would 
> apparently
>> >>> suppose, to just vanish once human beings step forth into the 
> holy
>> >>> cathedral of completely unregulated capitalism.  "Let the 
> markets run
>> >>> themselves completely," they say.  But every time they get 
> their way,
>> >>> they or the markets just about run the truck into a ditch.
>> >>> 
>> >>> There.  If you start a thread with serious potential for 
> *conflict*,
>> >>> Dennis, load the wagons!  ^_-
>> >>> 
>> >>> Yuki
>> >>> 
>> >>> P.S.  Given the non-zero sum nature of equity markets, and their
>> >>> size, it's probably not a bad idea to do something in an 
> attempt to
>> >>> stop potentially trillions upon trillions of dollars from simply
>> >>> being panicked out of existence.  Money is simply uncreated, to 
> use a
>> >>> rather ugly phrase, for the most part. That was allowed to 
> happen in
>> >>> the early 1930s, with pretty sad consequences.
>> >>> 
>> >>> Wednesday, January 23, 2008, 12:38:32 AM, you wrote:
>> >>> 
>> >>> DB> Hello Tomasz,
>> >>> 
>> >>> DB> There are many of us in this country (USA) that want to see 
> the  
>> >>> DB> markets take care of themselves.  Unfortunately not enough 
> are aware
>> >>> DB> of the issues involved and there is only one person running 
> for  
>> >>> DB> President that has that goal --Ron Paul.
>> >>> 
>> >>> DB> It may take a complete financial disaster before everyone 
> wakes up  
>> >>> DB> and realizes that centralized control does not work well.  
> No small  
>> >>> DB> committee can understand all the factors involved in an 
> economy. If
>> >>> DB> they could, then it follows that a small number of people 
> (or an  
>> >>> DB> individual) could know enough to make a quick fortune in 
> fundamental
>> >>> DB> investing.  And we know how hard that is to achieve!
>> >>> 
>> >>> DB> Best regards,
>> >>> DB> Dennis
>> >>> 
>> >>> DB> On Jan 22, 2008, at 10:23 AM, Tomasz Janeczko wrote:
>> >>> 
>> >>>>> Hello,
>> >>>>>
>> >>>>> So helicopter Ben is in full panic mode now :-)
>> >>>>>
>> >>>>> It is pretty amazing and funny to see how this "free economy" 
> is  
>> >>>>> hand-operated :-)
>> >>>>>
>> >>>>> Best regards,
>> >>>>> Tomasz Janeczko
>> >>>>> amibroker.com
>> >>>>>
>> >>>>>
>> >>>>>
>> >>>>> Please note that this group is for discussion between users 
> only.
>> >>>>>
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> to
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>> >>> 
>> >>> 
>> >>> 
>> >>> 
>> >>> Please note that this group is for discussion between users 
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>> > 
>> > 
>> > 
>> > Please note that this group is for discussion between users only.
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>> > 
>> >
>>
> 
> 
> 
> 
> Please note that this group is for discussion between users only.
> 
> To get support from AmiBroker please send an e-mail directly to 
> SUPPORT {at} amibroker.com
> 
> For NEW RELEASE ANNOUNCEMENTS and other news always check DEVLOG:
> http://www.amibroker.com/devlog/
> 
> For other support material please check also:
> http://www.amibroker.com/support.html
> 
> Yahoo! Groups Links
> 
> 
> 


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