Illiquid Assets

[k0k0r4e]

type in "ski crashes" in the youtube search and click the video with stars in the title to be shocked!

[robrown1]

Raise capital and negotiate secondary trading of equity and debt at UnifiedMarkets.

[magi55]

USA must probably collaps and bankrupt west economy so that west civilisation then will work for a very low salary to be able to compeate with asia workers with same salaries.

But it will be some very bad years and people will have to meet asian living standards.

Possible????

Peace

Magi

[Dewdaahman]

hear,hear..

[andyfromsimi]

I'm starting to think that with all this printing of U.S. Federal Reserve Notes that the lowly penny will soon be worth more value than a paper U.S. note.

I'm saving my pennies! Nickels, too.

[buzzz1213]

So true, the US paper $=.04 cents. keep saving your pennies!!

[TejanoChimbo]

► This guy's a joke

[Happen2008]

The joke is you my friend. Listen to what he says. He is one of the best journalists around.

[TejanoChimbo]

► Who is he?

[jedbeetle]

this is a biased explanation. the bit at 6:40 is not bad, but this is still extremely biased. not "facts" as he says. check out the "This American Life" archive, february 27, for a more honest, straightforward explanation.

[HOLLNAIER]

Hey I 'Got it' in 8:43! Thanks for that guy! Now it makes sense...

[stay2uned]

Excellent!

Your succinct explanation makes the mess we're in much more understandable, even obvious, to the ordinary guy who hasn't yet connected the dots.

Ergo, the old adage: "The criminals are in charge!"

Thank you!

[PetTheHorses]

Karl, would you have an interest in commenting on Putin's speech at the Davos World Economic Forum? His speech seems to show much more reverence for free markets than the laughable Obama Administration.

[MDUMANOVIC]

Nicely said

[doctorofghetto]

I knew there was something wrong with the stock market. Having the middle person invovle(like government or Bernard Madoff $50 billion scheme) will discourse the fixed, alotted price between the buyer and seller. It is like having a "broker" on ebay between the buyer and seller and taking most or all actual assets, then provide fake assets.

[jimjaas]

So true.

[michaelispan]

Oh ! Thank You KD.

I had thought a illiqued asset was a couple of cases of #10 cans of Powered Whole Eggs ;)

[CPAsheldon]

Too much uncertainty frightens buyers away. No one is giving potential buyers confidence that putting their investment at risk wil be rewarded. I was talking to a client about this very thing today and why he didn't want to put more at risk in the stock market.

[VisionQuest2012]

Congratulations Karl on your recent award. Your an asset to the common man. Keep exposing the truth and educating the masses.

[MetroDNews]

LOL @ calling congress. Twiddling your thumbs would be a better time waster...at least you'd burn a few more calories.

[bocanot]

I have spoken to a few people in this industry and Mr. Denninger has this just about nailed. The problem is the price. Would you sell your house to someone for 10 cents on the dollar cuz without gov't setting the rules, that's what the vultures are offering and that's what they are going to get.

[scottgreg05]

Karl as always THANK YOU!

[mcgrawtim123]

Thank you for that concise and easy to understand essay about how govt. continues to roil the markets with its indecision, meddling, and lack of stability.

[samuel200182]

Blankfein and Soros are finding ways to regulate the derivative market, the central clearance houses are emerging and what worries me is the commercial conflict between british investors and chinalco over rio tinto.

[kdenninger]

No they're not. They're CLAIMING it, but they're not going to do it. for the existing contracts.

If they do then the writers are proved to be unable to meet margin requirements and it all goes boom at once.

[lorax2013]

Great video as always. Maybe one day people will realize we don't have free market capitalism and govt. manipulation is the cause of most of our economic problems.

[sapins68]

no manufacturing in america built by china

[averageworkinggal]

Wrong.

It has alot to do with investor confidence and panic - Lehman's BK caused losses which triggered an investor panic (e.g., money market panic on 091609) and froze the credit markets because investors could not tell who was and wasn't solvent.

There is so much information out there on the financial meltdown that those that make the wrong take are easily spotted.

You may have a plausible argument on Indecision the markets caused by indecision by Geithner.

[kdenninger]

How do you know who's solvent and who's not?

Simple - stop distorting the market - remove the ability of people to hide valuation models and at the same time stop promising or suggesting you'll intentionally overpay!

Market "illiqudity" is simply a disagreement on price. Nothing more or less. If you STOP saying you will support non-market based prices and force everyone to mark at the market then the buyers and sellers WILL find a price they can trade at.

[ckekinit]

the Amero and the North American Union is now on Marketwatchdotcom....Main Stream News. Wonder if this is Conspiracy Garbage that will be pulled?

[ghosty426]

Who says they want the Market or the economy to get better? Think Rothschild, Rockefeller and Eyes Wide Shut.

[Fig1024]

The message presented in video definitely makes sense. People need to know rules of the game are not gonna change else they don't play to their full potential. I haven't seen this point of view presented in any mainstream media. Maybe Ron Paul could get the word out if someone asked him? :-)

[kdenninger]

Be aware that those hwo run conspiracy garbage on my videos in the comment area will be summary blocked. Set up your own Youtube videos for that if you want to do it. You're not hijacking my efforts; I'm tired of it and have no time for that crap.

[kidbilly1970]

Ticker-guy, can you tell me when GM is going to announce their 4th quarter earnings? They are three weeks late announcing this. Are they hiding something?

[TruestShadow]

Karl for president.

[myrmexaw20]

Oligarchy is a form of government where political power effectively rests with a small elite segment of society distinguished by royalty, wealth, family, military powers or occult spiritual hegemony. Such states are often controlled by politically powerful families whose children are heavily conditioned and mentored to be heirs of the power of the oligarchy.

[robwe359]

Maybe the government had a part in this, but I am not convinced that the free markets in general cannot create illiquid assets all by itself. Take the partner market as a fresh example. There are a lot of women wanting a better man than they can get, and a lot of men wanting a better woman than they can get. Why? Because media creates a somewhat distorted image of what is possible. I am pretty sure that similar phenomenons can occour in economics as well.

[thierrytu]

In Karl's defense, he has been sounding the alarm bell and putting himself on the line, on youtube for all to see, ever since the first warning signs, which is over a year ago. No need to take out your rage against him -- he's one of the few from the investment club who has woken up.

Keep up your good work Karl ;)

[TyredUvBS]

"this was all done on purpose"

it's a shame more people don't realize this. we are getting methodically screwed in a manufactured, measured, and calculated manner and the sad thing is that it is all condoned by congress the majority of whom don't have the capacity to understand or the compassion to to anything about it

[bubonick23]

Do you put on a suit just to record youtube videos? I bet you're a lawyer huh?

[AmericanFabricator]

do you honestly believe it was not knowingly intentional?

Karl, sir, you need to wake up! You are waaaaay behind on the curve.

[Signzit]

"do you honestly believe it was not knowingly intentional?

Karl, sir, you need to wake up! You are waaaaay behind on the curve."

~

that's what i've been saying... It's like he just fell off the truck. What a trusting soul he is, so pure of heart and mind.

[haggsbo]

Excellent video guy!

[pwtumd]

Carl, I tried to access the ticker forum but it seems to have crashed....can you post on youtube tonight again...have a bad feeling about how close the markets are to the technical bottoms.

[pwtumd]

never mind my last post...just slow

[blackrubberbag]

Hey, what gives?

This fire is STILL raging, despite all of our efforts to extinguish it with gasoline.

The government only pretends to fail.

This meltdown is the excuse for generational theft and the biggest power grab in the history of this once great nation.

We've been bamboozled.

[destinedforobscurity]

Accurate indicment of the two party "crony capitalism" we are currently tolerating.

[badonkadonk34]

another great vid. Thanks

[ChaiVat]

Geez, your sound quality on this video sucks. Volume is super low....the message is always stellar though, so NO disrespect sir...

[beltane3]

Thank you. Keep it up. I concur 110%.

[southalgent]

well said, sir!

[MasterChiefJohn]

If I run for office, I would call you to be my economic adviser. Good stuff.

[CardsDefense]

Awesome

[siddhaam]

Half-true is true enough for the private interests that control the American economy through the Fed.

The 'good ol' invisible hand' is no benign uncle Sam.

You have it back-to-front: Wall St. grants itself its powers through its control of Capitol hill.

Wall St. controls all stages of social and political life in the US. It controls education, the universities; medicine and media; banking and commerce; and so on.

America needs government by "We the people", not corporations.

[siddhaam]

The market is the culprit...not government.

The US government has been compromised, bought and usurped by Wall St. and the market for years.

Just look at Paulson; comes in from Wall St. and before he leaves doles out billions to his Wall St. buddies. I wonder where he will work next?

This is not government.

Also, the Fed is not government. It is independent of government and privately controlled (owned).

America inc is run by a financial elite; not by a government.

WAKE UP.

[PersianPaladin]

Well said siddhaam.

[dconjar]

The idea of the Fed being a private company is only half true, and the financial elite has no power beyond the good ol' invisible hand without Capitol Hill granting Wall Street that power. This is all fraud, corruption, and incompetence radiating from Congress.

[badonkadonk34]

Siddaam - the market is the economic decisions of 6 billion people - every minute of every day. The market is not some boogey man. Money is a medium of exchange - it is a proxy for the services of one specialist versus another. Step back and take in the big picture - you will see the market for what it is. Then you will see how Govt (including the Fed in creating this banking cartel) retards the market in an attempt to manipulate it. They can't. It won't work. Prepare for the worst.

[siddhaam]

Badonkadonk34: The market is controlled by bogey men; and the 6Bn humans are constrained, corralled, conditioned, waged etc. Their decisions are those allowed them by the bogeymen in their part of the global system.

The myth of the market is the bogeymens cover story. They want you to believe it.

I strongly urge you to suspend your belief for a while; look carefully at the information available. It does not support your belief.

The bogeymens cover story is about to change fundamentally.

[badonkadonk34]

Good - so you agree with me. The market is retarded by those who wish to direct it - principally the govt. Siddhaam, pols are manipulated by business and special interests. Remember, Capitalism is pro-market, socialism is pro-business. The market seeks normalcy because it is human. The market seeks to return to human capital (not money). A 26 year old banker making $1.5MM is not normal - so the market will rip him from his Porsche and cast him to the curb. The story will change. Good lk.

[siddhaam]

No Badonkadonk34 I do not agree.

Wall St. (the market) has usurped Washington - why else is there socialism for Wall St. (bail-outs) and free enterprise for ordinary folk (job loss & foreclosure). When business usurps gov it is called fascism - that is clearly the case in America;

The market is the gov in America. It is pro-capital (money), not pro-business (people). It has destroyed US industry.

The market has usurped all govs, nations and peoples. It is running the planet into the ground.

[badonkadonk34]

No - you do agree. Wall St. has usurped Washington. So has the NRA, the pharma companies, the green lobby, etc. The bigger and powerful govt becomes, the more special interests will seek to influence it. Men and women are weak - that is why we have law (which is being shit on). Your faith in a very small group of people is stunning. The mkt is not the govt. Govt sets the price of money, govt promotes debt slavery through fannie and freddie. You have to look deeper Siddhaam. gd luck

[siddhaam]

The Fed controls and issues the money supply - not the gov. The Fed is not the gov; nor is it under gov control.

And it is the banks that promote and make their profits from debt slavery.

You are not seeing this clearly.

One of your founding fathers did see it clearly; he foresaw the danger of the banks to gov and nation...Jefferson - more dangerous than standing armies, he said.

A very small group own and control the American money supply system.

What is stunning is they get away with it.

[badonkadonk34]

Siddhaam - I see clearly. You are very confused. Please research further. Congress could abolish the Fed next week if it pleased. We are done debating. Please look deeper - the simplest answer is almost never the right one. Good Luck.

[siddhaam]

"Congress could abolish the Fed next week if it pleased".

What an astonishingly naive statement!

If you really believe that you are confused indeed.

Anyway I hope you will fare well in the times ahead.

All the best.

[bocanot]

Have to agree with Siddhaam. Its the other way around. The Fed can press a couple of buttons and congress is out.

[siddhaam]

I saw an interview with Greenspan recently during which he made it clear that the Fed is independent of the US administration and the Congress.

Recently at a congressional hearing the Fed representatives refused to answer questions as to where bailout monies had gone.

Also watch how Bernanke sniggers at Ron Paul. He knows it doesnt matter what Paul says; Bernanke only turns up to give the impression the fed is accountable - but really it isn't.

What a charade.

[therealcaptobvious]

Keynesians is governmental intervention. Free Market Economics avoids government interferrance and Keynes complained that it was too slow. The more government interferes, the worse things get. Save capitalism.

watch?v=hZm0YgCQruw

[episteme420]

down with capitalism. structure must prevail over chaos.

[therealcaptobvious]

"structure" screwed it all up. The people can enact enough structure because the people actually care about their own welfare. Politicians don't and you can't just blindly expect them to.

Politicians are too narcissistic and greedy when they interfere with the markets for the "greater good". Mao was a poverty pimp.

[episteme420]

Mao was communist. Communism fails in every instance.

Representatives are there to represent the will of the people so if the people want narcissism and nepotism in their policy then they elect someone accordingly.

wisdom is the primary quality of good leaders and the current situation in the US speaks volumes for the kind of leaders the people have elected. True Capitalism was demonstrated in the years leading up to civil war, in the years leading up to Black Tuesday (and after), and now.

[therealcaptobvious]

episteme420,

Mao was a poverty pimp that killed MILLIONS of his own people. The people elected their own murderer with better intentions. It's human nature to become power hungry and greedy in politics, history proves that so many times. Which is why less government is often better. Allow free markets to work and allow people to protect their welfare. You might want to do a fact check on the fraud that led up to Black Tuesday. Modernize the 2nd amendment and give power to the people.

[PersianPaladin]

Wall-Street makes its own rules; because it owns the government.

[PersianPaladin]

The problem is that Wall-Street OWNS the government, and creates artificial bubbles of speculation, credit in the economy based entirely on debt and illegal private cartel that makes people pay them interest off a government loan from the federal reserve.

The problem goes far deeper than this video shows; and lies in the fractional reserve system of banking, the gambling that goes on with money and stock and currency, and the very fact that usury and interest rates simply exist.

[siddhaam]

Excellent points.

[mobiltec]

I know very little about the market and all the wall street junk that has been going on. I know very little about world economics actually. Other than what I have learned here on YT. BUT...... One thing I have known from the beginning. And it is because I know a lie when I see one. I knew right from the beginning that this IS a manufactured crisis.

[Trapster99]

Thank you for your insights. You are one of the few out there who really tell it like it is. Yes, the rules must be set, fixed and stuck to. Americans are now at risk at losing half of of the remainder of what ever they have left.

Let me go out on a limb and say that I think this is a contrived crisis to create the economic destruction we are seeing....and it is being done for a sinister reason.

[Kelvin701Lakeland]

what did Alex Johnes say last night?

[4evrMT]

You should send your video to every congressman and B/O. Sure, they don't care that there are a few people with brains who see through the ruse, but you should do it anyway. Your voice should be heard my more than just the "peasants." Send it to the news channels. We should get millions to sign a petition of outrage. Okay, I am out of ideas and wish I could move away. My retirement dreams and dream home are probably shot to hell. We are ruled by morons.

[MisterTissueBox]

Wow, I think I get it now.

[Bassmarko]

Great video! thanks for the heads up. This was a subject I did not know much about. now like you i will be watching for the government to do something and step back. Cheers!

[davincij15]

The average person should buy food, guns, gold and silver and not bother calling the kings and queens to ask them to stop fucking you.

Wake up! The emperors have no clothing and they do not give a shit what you say, they will walk around naked and tell you it's the right thing to do until you start to believe it.

Wake up! The only person capable of saving the system is YOU!

[CredoVeritas]

Government isn't taking illiquid assets to relieve anybody. It's a tool drive the populace into dependence and servitude.

The rulers will rule. The servants will serve. Welcome to the wonderful New World! (Order)

They don't need real money, they don't need your approval, all they need is a gavel, steel, and your dependence for everything you have; Your home, your food, your protection, your education. ALL will all be granted through the grace of government.

Your Liberty is being bought.

[robhdg]

great video karl but this is preaching to the choir. the masses have no idea how the market works.

[imtang0708]

Thanks Karl! I've wondered weather or not some shit head BASTARDS manufactured this mess!

[cosmosgato]

Clear and logical.

[PontVedra]

I've seen where the Fed has been paying the banks interest on their reserves which leads some to speculate why the banks are not lending, banks happy. This is an interesting point from Karl. Thanks.

[maximizeutility]

Kudos. This analysis is valid and well presented.

[kapaka12]

why aren't people like karl, peter schiff, or jim rogers ruling the country? Why is it always incompetent crocks?

[Powdermonkey99]

That was very good - Now, thats thinking outside the box - WOW thanks

[jonah70757]

Another great logical common sense presentation. Unfortunately Government lacks both logic and common sense or an understanding of the markets. And to top things off they arrogantly think they know better than the market. The powers that be are using these facts to put Americans in debt for the next three generations as they milk this country dry.

[PulsarFusion]

This is good thanks you for putting this up. My guess is that it's all about government control of the free market. It seems a bit hap hazzard about how they're trying to do that but it all boils down to nationalization of the economy. Government's nose is so much into everyone's business that you'd have to set your ass on fire to smoke a ciggarette.

[BespokeGroupUK]

Now we just need kdenninger to speculate as to why this was managed and orchestrated

[WHEREtheFUNK]

...but Obama is supposed to change everything and make it all better. I want my free shiit now.

[ohio1998]

Ha, sorry, but your white. You'll have to wait until you become an ignorant arrogant minority. No, I'm not racist. I just call it the way it is.

[WHEREtheFUNK]

HAHA...you have hit the nail on the head, bro. Is it me or is Karl seeming a little pissed this morning. He's not makin any money in the market these days...

[immanent]

You say something racist and then say you're not, just calling it the way it is?

I'm glad most free market proponents aren't as ignorant as you are. Being a minority has nothing to do with anything.

Congrats on the most idiotic thing I've heard in 2009.

[ohio1998]

Blow me.

[immanent]

Blow yourself, intellectual sloth.

[ohio1998]

Good one, now go out and get a job. I'm tired of having to work for your welfare checks.

[immanent]

I'm a licensed attorney specializing in patent prosecution, and I'll never need a welfare check, that much is certain. Want to try again, or maybe throw around more racist pejoratives and inferences?

[eurogoldexchange]

Forgetting about leverage and CDSs. It is the hieght of irresponsibility to blame someone else for your own actions. In this case the banks have squandered the money of the depositers. They should not have done it. There is another name for 'discount' , it is called LOSS

[noisyfoot]

Your message is dead on...

This is precisely why entrepreneurship in this country is stifled as well. You can't run a business when the government is spewing so much fear and uncertainty.

Keep the videos coming...

[Hopefl1]

Are you proud that you voted for Obama?

[ohio1998]

Monkey see, monkey do.

[NicosMind]

Whats the name of the government agency that the treasury created?

[dirkthedaring71]

Another great video. Keep it up

[officialusa]

*****

as always... Karl is right on the money.

[NicosMind]

We need to make this vid viral guys, Hit the share button and send it to all your contacts. Leave the last part of the URL, this bit " watch?v=Ano6xlk12-g " All over videos. If the Peter Shiff vid can get a million hits this one can too

[bunkermunk]

Karl, I would really like to see more of you on youtube. You are like the North Star helping me navigate my modest wealth to safe harbor.

[Atoyota]

I read your blog on this subject the other day, thanks for putting this up...

[danoking69]

Truth, Share, Expose, Care!

[olseabee]

How else to indebt a soclety but with counterfeited money that disappears

The "greatest generation" profits by the debts of their children and immigrants they give their childrens country to and call it "competition"

I guess competition means fighting for money that does not exist until you are forced to borrow more

competition my ass

[5starrater1]

really well said.

[StandUp555]

Thx for the good report.

But what you did NOT answer, and I hoped you would have answered at the end ...

... is :

1. Is the Government realy so stupid ?

or

2. Are Geither/Bernanke really so stupid ?

and, if neither 1 nor 2 are NOT true, then

3. Is this a manufactured credit squeeze ?

Thoughts please ?

[kdenninger]

Yes they really are that stupid.

Have you listened to Congress lately?

[dconjar]

Karl, thanks for getting the word out about why the markets really are frozen. I hear so many stupid ideas to help "unfreeze the credit markets" that it almost makes me spontaneously combust.

Question: If we do have a currency crisis that causes much of Europe and Asia to implode and renders our swap lines valueless, what happens with regard to inflation vs. deflation?

I'm assuming that it would be largely deflationary, but your radio show yesterday seemed to suggest otherwise.

[sapins68]

thats why i support protectionism this consumer slave and cheap labor concept of free trade is just nonsense

[sisforshayla]

that makes sense, thanks.

[medulalumosa]

Karl, what good would contacting Congress do? Did it help at all during the first bailout/stimulus? Congress and our government in general does not serve the people. They serve the power elite, corporations and in this case, the banks. They are by and large bought and paid. They have make the rope and the noose, why the hell should I beg them to not try it on? Instead of Christmas ornaments we'll have banker and politician ornaments for the holidays.

[magichandpuppet]

Very well put!

But, it makes me wonder if someone would actually benefit from all of this mess, eh? If so, who would benefit from this who could have possibly been powerful enough to cause influence the government to cause it?

[spikesmth]

I like your points, however it's interesting you blame the government for intervening at the same time that you criticize them for intervening. I think markets have a certain amount of instability built in (possibly by gov action) and I think the gov should have rules to mitigate these fluctuations (to a point). But your best point is the gov needs to be consistent and avoid rule-changes as much as possible. What a monster we've built! Keep the vids coming!

[boots920]

Subversion

"Common Purpose"

The government is causing the crisis great...they're really starting to piss me off.

[delicflower]

If this affects the European Markets we are all screwed. Get your seeds, water and gold ready. If you don't have any, get some! If the end doesn't come, at least you know you can prepare for the worst, if the worst happens at least you'll be prepared. Best of luck to all of you,and 5***** and faved. great job!!!

[lightleague]

Long time no see, KD. Thanks for reappearing.