Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

2007: The Year of Debunked Financial Market Myths

Stock-Markets / Financial Markets Jan 09, 2008 - 01:22 PM GMT

By: Mark_B_Rasmussen


  • Best Financial Markets Analysis Article The “WEALTH AFFECT” is real and you can borrow yourself into perpetual prosperity.
  • You can spend yourself rich.
  • “It is different this time” and not all speculative manias collapse.

  • Real Estate always goes up.
  • The subprime problem is contained.
  • We are at or near a bottom in the Real Estate correction.
  • February 2004, near a generational low for fixed rate mortgages, was a good time to get an Adjustable Rate Mortgage (ARM) as recommended by Mr. Bubble…..3 months before a 17 rate hike campaign began.
  • “A strong dollar is in the country's best interest” Henry Paulson-Secretary of the Treasury.
  • The “2% Core Rate” of inflation is accurate, reliable and credible. Gold + 31.8%, Oil +59%, Gas +54%, Wheat +77%, Soybeans +79%, Barley 56%, Rice +28%, Cotton +20%, Eggs +69%, CRB +16.5%, Goldman Sachs Commodities Index +40.6% for 2007.
  • The U.S. economy is fundamentally strong with good job creation. The (BLS) Bureau of Labor statistics has created hypothetical jobs with a computer model X12ARIMA aka the Birth/Death model (probably the same programmers used by Wall Street for mark to model valuations). For 2007, 89% of total non farm jobs reported were created by the BLS computer model and were therefore, hypothetical or not real. An example of this is, during 12/2007 17,000 financial services jobs were created by this model, while financial institutions were declaring massive losses and layoffs. The same phenomenon happened in Q2 of 2007 when 115,000 construction jobs were created while home builders were declaring massive losses and new home starts were plunging…..perhaps builders were paying people to stay home. The BLS does conduct a “Household Survey” of 60,000 households and for 12-2007 found a loss of 486,000 jobs, yet reported +18,000 new jobs for December. George Orwell would be so proud to know that “The Ministry of Truth” is alive and well in the U.S. Do hypothetical people consume and pay bills? “figures don't lie but liars figure”, “There are three kinds of lies…….lies, damn lies and statistics” Mark Twain.
  • It is possible to turn financial lead into gold through financial alchemy aka innovation and creativity.
  • Subprime securitized (RMBS) Residential Mortgage Backed Securities deserve AAA credit ratings, the same as U.S. Treasuries and ONLY 5 American corporations.
  • The ratings by the bond rating agencies (Moody's, S & P and Fitch) are credible, trustworthy and reliable. The rating agencies would never be influenced by the companies that Pay them to rate the bonds they issue.
  • Shorting gold is a top 10 investment for 2008-Goldman Sachs. $863 today, a new all time record close, the first monthly and annual close over $800. GS wouldn't recommend shorting gold to cover their huge short positions, would they?
  • Goldman Sachs wouldn't short the same RMBS's they made huge fees and commissions on at the same time they sold them….and Henry Paulson knew nothing about such things before becoming the Secretary of the Treasury.
  • Financial innovation, flexibility and risk disbursement is what makes the American financial system so great. Thank you Mr. Bubble.
  • Risk disbursement is almost as good as eliminating risk altogether……the interest rate spreads said so! That is, unless you were a small town in northern Norway, Make a Wish Foundation, countless Local Government Investment Pools (like Florida), money market funds, Asset Backed Commercial Paper, Insurance Companies, Pension Funds and the entire global financial system. We created a financial plague that has infected every corner of the globe with the blessing and encouragement of Mr. Bubble.
  • Mark to Model/Myth (no sales or market inputs) is a very accurate, credible and reliable method to establish the value of $100's of billions of over the counter securities that have No Real Market.
  • Bond insurance companies (Monolines) with less than 1% equity to risk exposure are definitely deserving of AAA ratings (did ACA really get reduced 12 credit levels to junk in a day? And if they don't raise $1.5 billion in capital by 01/16/2007 $69 billion of their insured bonds will also be rated junk) as they and their insured bonds are as risk free as U.S. Treasuries and only 5 U.S. corporations…….in process.
  • SIV's (Special Investment Vehicles) ($100's of billions) are kept off of bank balance sheets and are much different than Enron's SPE's (Special Purpose Entities).
  • 1.5% capitalization rates for commercial property (1/3 of treasury yields) are a very good value……remember Real Estate only goes up…….in process.
  • The Federal Reserve is omnipotent and can fix any financial problem. After 1% in rate cuts, fixed rate mortgages are the same as last year, the LIBOR rate has hardly moved, the dollar has declined dramatically, inflation is up, they cannot force lenders to lend, they cannot force borrowers to borrow and they can't dictate where the oceans of liquidity they create go……in process.
  • Liquidity is the solution for insolvency…….in process.
  • Subprime is the “Only Cockroach” in the financial pantry. Look at the accelerating Alt-A, Prime, HELOC (Home Equity Lines Of Credit), Commercial Mortgage Backed Securities (CMBS), credit cards and auto loans default rates. S & P is expecting a 4 fold increase in corporate defaults over the next year. Private Equity and M&A loans with Covenant lite and PIK (Payment In Kind) provisions ($7.5 Trillion over the past 2 years) were issued with the same stringent standards as subprime……in process.
  • Legislation to prevent foreclosure on U.S. homes is not to prevent many and large losses by lenders……it is really to allow U.S. homeowners to pay considerably more than their home is worth for a long time.
  • Central banks are inflation fighters with 18 of the 20 largest growing money supply over 10% per year.......between 2-10 times real economic growth. Clearly, they never read or heard Milton Friedman “Inflation is always and everywhere a monetary phenomenon”.
  • “Peak Oil Theory” is false and oil is going down to $30 - $40 per barrel. The world owes the U.S. unlimited, discrete, secure and inexpensive oil. We don't need no stinkin oil wells off of the Florida and California coasts or ANWAR. We also don't need no stinkin refineries or nuclear power plants. We can run our national trucking fleet on wind, our cars on photovoltaic panels and our ships and trains on geothermal.
  • Black Swans, Rogue Waves and Fat Tails are fairy tales.
  • You can believe and trust the Government, the Federal Reserve (private banking cartel) and Wall Street spokespeople.
By Mark B. Rasmussen

Mark is a real estate appraiser/broker by profession

Copyright © 2008 Mark B. Rasmussen

Mark B Rasmussen Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in