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Indianapolis Indiana Under the Hedge Fund Gun

Hedge funds and equity funds have been seizing large parts of the real estate bubble. Cereberus Fund bought GMAC, the real estate arm of General Motors. Now the Carlyle Group has financial grabbed the Indianapolis based transmission company of General Motors, known as Allison Transmissions.

June 28, 2007 (LPAC)--Carlyle Group, -- the private equity group closely linked to British BAE Systems, which is in the middle of the "scandal of the century" and multiple U.S. and foreign investigations,-- has announced a takeover of a division of General Motors. Both BAE Systems and the Swedish Bofors Defence Group which BAE bought from Carlyle, are accused of bribing government officials on a large scale all over the world, to get big defense contracts, and building up slush funds for political use, through these contracts.

On the same day Carlyle announced the planned takeover of GM's Allison Transmissions division for $5.6 billion, Carlyle had to cut back a scheduled IPO of a bond investment fund, because of increasing liquidity problems on the speculative junk-bond markets on which Carlyle plays. Many financial analysts are now fearfully forecasting the failure of some large private-equity "leveraged takeover," bringing on a general junk-market collapse--and Carlyle's GM takeover could well be the one to fall apart.

Carlyle Group in 2005 sold BAE Systems a large chunk of its U.S.-based military contracting corporate group, until then known as United Defense Industries. It also sold Bofors to BAE that year. BAE is now trying to add to that, Armor Holdings, the firm which makes armor for U.S. Armed Forces' Humvees.

For the U.S. auto industry, the takeover, if it goes through, will mean seven more technologically productive and well-tooled plants, and 4,000 employees--all in the Indianapolis, Indiana area--going under the control of speculative private-equity funds and hedge funds, along with Chrysler Corp., GMAC, Delphi Corp., and scores of smaller firms. Allison Transmission also has 1,500 distributors and dealers in 80 countries.

Carlyle has a junior partner in the planned takeover, the Canada-based private-equity group Onex Corp.

Freeze hits Mortgage Backed Securities (MBS)

Traders in the crisis-hit mortgage-backed securities
(MBS) market have begun reporting a freeze-up, a near halt in all generation
of the securities known as collateralized debt obligations (CDOs), a week
after the two collapse of two big Bear Stearns hedge funds trading in CDOs. So, the attempt to isolate the collapse in real estate prices has failed, so it seems.

This can start to have a big effect on the MBS market as well. With
paper creation in this $2.6 trillion market having sunk to a couple of
billion dollars last week, the vice-chairman of Loomis Sayles in Boston
warned, "If investors start dumping them, oh, boy, watch out for some
massive credit widening," using market slang for a sharp interest in
interest rates, a credit crunch in the market. Interest rate premiums
on CDOs jumped 1.5% last week.

The specter of this disintegration of markets based on mortgage
securities threatening the whole financial system, raised its head in a
Congressional hearing June 26. Rep. Carolyn Maloney (D-NY), waving that morning's
{Wall Street Journal}, asked SEC Chairman Christopher Cox if he agreed that
CDOs and related securities are risky, dangerous to the financial system,
opaque in value, and should be regulated? With journalists and aides suddenly
taking furious notes, Cox said he lacked the authority because these
securities are not registered under the 1933 Securities and Exchange
Act; but that if Congress changed that, "Absolutely," they should be
regulated due to that risk. And he announced that the SEC has opened an
investigation of the Bear Stearns hedge funds and 12 other cases that relate
generally to sub-prime.

You give Cash a bad name

I guess I'm shot in the heart, baby you're to blame. You give cash a bad name. As the financial system and the real estate bubble crash more and more.

1998 was a turning point in the economy, with the Russian bond collapse and the collapse and bailout of the LTCM hedge fund. It was also the beginning of inflation in oil prices and commodities. Look at the wave of inflation and collpase since 1998- the year of VP Gore's move to bomb Iraq and the Sudan.
In fact, the dollar can be said to have already collapsed on the order of 50-percent or more. Of course, this is an old stroy. The house that my father bought for $25,000 in 1960 is now on the market for $600,000 and more. That is an inflation, or a devaluation of the dollar by 20 times!!! However, the American public has been in a big sleep on this because food prices have been cheap, the cheap import of clothing and other household goods and low raw materials prices.
With the "wall of money" policy of Federal Reserve Chairman Alan Greenspan, to keep the collapses of September 1998 under control, the money has been more and more slushing around, looking for a place to "invest". One of those places has been the real estate market. As in the collapse of Bear Stearn's hedge funds, this is coming from the collapse of sub-prime CDOs, collateral debt obligation (financial instruments).. And this is just the beginning of the disaster, unless we reorganize the bankrupt financial system like Franklin Roosevelt did in the the 1930s and 40s.

Real Estate Bubble since 1998

The real estate bubble, with its associated REITs and other investment vehicles, like the CDOs, are taking a fall now, but when did the bubble start? 1998 was a turning point in the economy, with the Russian bond collapse and the collapse and bailout of the [LINK=http://hedge-fund-investing.com/?gclid=CLSRoZuw_IwCFSMKGgod8iY7EA]LTCM hedge fund[/LINK]. It was also the beginning of inflation in oil prices and commodities. Look at the wave of inflation and collpase since 1998- the year of VP Gore's move to bomb Iraq and the Sudan.
In fact, the dollar can be said to have already collapsed on the order of 50-percent or more. Of course, this is an old stroy. The house that my father bought for $25,000 in 1960 is now on the market for $600,000 and more. That is an inflation, or a devaluation of the dollar by 20 times!!! However, the American public has been in a big sleep on this because food prices have been cheap, the cheap import of clothing and other household goods and low raw materials prices.
With the "wall of money" policy of Federal Reserve Chairman Alan Greenspan, to keep the collapses of September 1998 under control, the money has been more and more slushing around, looking for a place to "invest". One of those places has been the real estate market. As in the collapse of Bear Stearn's hedge funds, this is coming from the collapse of sub-prime CDOs, c[LINK=http://www.reuters.com/article/bondsNews/idUSN3045916020070501]ollateral debt obligation (financial instruments).[/LINK]. And this is just the beginning of the disaster, unless we reorganize the bankrupt financial system like Franklin Roosevelt did in the the 1930s and 40s.

Home Sales Collapse and Bear Stearns

The home sales slump will hit other financial instruments, as we see in the Bear Stearns Hedge Fund collapse. Home sales (existing homes) are lowest in four years.

June 25--U.S. Sales of existing homes fell in May to the lowest level in four years, while the median home price dropped for a record 10th consecutive month. The National Association of
Realtors reported June 25 that sales of existing single-family homes and condominiums dropped by 0.3% to 5.99 million units in May, the slowest pace of sales since June 2003.

The median price of a home sold last month dropped to $223,700, down 2.1% from a year ago. This marked the 10th straight price decline compared with a year ago, the longest
stretch of weakness on record. The sales declines were heaviest in the South, where sales dropped by 3.4%, and the West, where sales were down by 0.8%.

The inventory of unsold homes rose by 5% to 4.43 million units in May, a level that would take 8.9 months to clear out at the May sales pace. That is the highest inventory level since
the last deep slump in housing in 1992.

Note, the crash is slowest hitting New York City and other metropolitan areas on the Northeast coast.

Real Estate Collapse--- From the Bronx on Down: Bear with me, Sinking by the (bear) Stearns

Real Estate Collapse--- From the Bronx on Down: Bear with me, Sinking by the (bear) Stearns

Bear with me, Sinking by the (bear) Stearns

We have a huge amount of inflation in the economy. With all the bailouts, now of the Bear Stearns hedge fund, this goes on. This is directly linked to the down turn in the real estate market and the sub-prime CDOs (Collateral Debt Obligations). Raw materials are going up, but not as "the market" but as a historically controlled and FORCED PROCESS. The way commodities have gone up is ridiculous.

Over the last few years everything from nickel to copper to gold and silver and of course black gold- oil has gone up. Why should people pay $60 a barrel for oil that cost $5 a barrel to produce in Saudi Arabia?

Next we have the issue of food production. With ADM, Cargill and the other grain cartels getting in on the act, the price of food is finally going up, do to the bio-fuels scam. This is after regular food has been cheapened by lack of price production, driving millions of farmers out of business.

Should the oh-so righteous greenie environmentalist be proud of themselves? They get huge government subsidies for their pet projects-- not for feeding or helping people-- but for literally destroying the food of hundreds of millions. Just so a few fat cats will continue to have gasoline and or diesel, even under conditions being created of virtual or actual world war!

Real Estate, Subprime CDOs and Bear Stearns

The real estate market is about to hit the hedge funds with their collapse. The connection is the Bear Stearn's little hedge fund, and the $3 billion bail out of it. Why the desperation? Because, the CDOs are about to hit the market. That, plus the housing market collapse is going to be another black hole for the financial system. You can see why they need a Nazi dictatorship and endless war and genocide. That's how to keep in "business". Right now, they seem to be caught with their pants down. Then there is the BAE (British Aerospace) affair...

Peter Schiff, president of the Connecticut-based Euro Pacific Capital, warned about a potential "catastrophe" in the CDO (collatoralized debt obligations) markets, due to the Bear Stearns hedge funds collapse. "As long as these CDO bonds stay off the market, as they universally have, asset managers have the luxury of 'marking them to market,'"
Schiff wrote in a research note, reported by Dow Jones. "Not surprisingly, using this method the vast majority of these bonds are valued at par or greater." But if the Bear Stearns bonds were auctioned in the open market, their real values would be exposed. "This would force other hedge funds to similarly mark down the value of their holdings. Is it any wonder that Wall street is pulling out the stops to avoid such a catastrophe?," Schiff wrote. Worse than the impact of hedge fund losses, would be the impact of an open market auction of subprime CDOs. "Their true weakness will finally reveal the abyss into which the housing
market is about to plummet," Schiff wrote.

Carbon Trading More Fun than Real Estate

If the real estate market and the foreclosures are getting you down, how about getting into the Carbon Exchange? Like carbon kisses in the wind, some people like to make money on nothing, as in $24 billion. That's what this Carbon Dioxide racket is about, just breathe and you are polluting! They would make money off the rain, but mother nature might need permission to take a leak! Of course Al Gore’s British controllers are making a killing already.

The City of London intends to reinforce its role as the world’s carbon-trading capital, a favorite policy of Chancellor of the Exchequer Gordon Brown, who takes over from Prime Minister Tony Blair on June 27. A report from International Financial Services shows that the City of London is taking an ever-bigger share of this rapidly expanding market, as banks and brokers become more heavily involved, the {Daily Telegraph, June 19th} reported today. Already last year—even before hedge fund operator Al Gore weighed in with a worldwide propaganda campaign to push the “global warming” hoax,” London’s ICE (electronic energy) Futures market accounted for more than 80% of trading tied to the European Union’s Emissions Trading Scheme (ETS). Europe’s ETS is the biggest “emissions-swapping” swindle of its kind in the world. Total ETS volume tripled in volume and value terms to $24.4 billion, and is predicted to grow another 50% in 2007.

Remember, humans emit CO2, so the above may want to kill the reader and several other billion people for this crime. And then there are those evil rice fields belching methane. If only 3 billion people could stop eating, it would help the carbon count. Oh what a beautiful climate we have now!!!! We can't let it ever change, even if billions must die, but if it's by 2020, people have time to plan and write their will. That's not Nazi! It's just the will of Mother Nature, as interpreted by the acolytes of Margaret Mead and Bertrand Russell.

West is Maybe not the Best - in Real Estate

Housing Industry Continues To Tank

Bad news continued to plague the housing industry in recent days. The Commerce Department’s Census Bureau reported today that in May, U.S. housing starts fell for the first time in four months—down 2.1% from April’s figures, and down 24% from figures of May 2006. The largest drop is in the Western region, which is about 40% below its May 2006 level.

On the subject of foreclosures, a third firm which tracks foreclosures (Foreclosures.com) released their data for May, reporting the highest rate so far. Several stages in the sequence of the foreclosure process are monitored, and notably, although actual final sheriff’s sales of properties are up 42% from a year earlier, the pre-foreclosure stages have gone up 96%, which presages future disaster as those transactions move to the final stage.

All of this is having a predictable effect on home builders. Their trade association, the National Association of Home Builders—which in late 2006 happily agreed in a conference-call with other industry groups that a recovery would begin by the second half of 2007 -- yesterday announced the results of its latest survey (with Wells Fargo) of “builder confidence.” The survey showed a drop in confidence in June, hitting its lowest level since February 1991. “Builders continue to report serious impacts of tighter lending standards on current home sales as well as cancellations, and they continue to trim prices and offer a variety of nonprice incentives to work down sizeable inventory positions,” NAHB quoted its President, Brian Catalde. NAHB’s chief economist said they don’t expect any recovery in their sector ‘til 2008. [GRC]

War Could Blow the Real Estate market up

Yes war could make things down in Florida a lot worse. After all, you need a lot of gasoline to get down there. And the bells are tolling for the builders Toll Brothers. Maybe Cheney will be forced out first:

Is Cheney Blocking Rice's Testimony on Yellowcake Hoax?

June 19, 2007 (LPAC)--Despite having been served with a subpoena, Secretary of State Condi Rice is still refusing to testify in front of the House Oversight and Government Reform Committee about the Niger yellowcake hoax and how the infamous "16 words" got into the President's 2003 State of the Union Address. Rice was President Bush's National Security Advisor at the time, and frequently trumpeted Vice President Dick Cheney's propaganda line that Saddam Hussein was on the verge of obtaining nuclear weapons.

Rice's appearance before the committee has been scheduled a number of times, including for today, with the White House stalling, and even using the excuse of Rice's trip to Moscow, to postpone her appearance. Observers believe that it is Dick Cheney who is insisting that the White House refuse to permit Rice to testify. The next step would be for the full House of Representatives to vote to find Rice in contempt of Congress.

Committee chairman Rep. Henry Waxman disclosed last week that committee investigators are continuing to interview witnesses and examine documents relative to the Iraq/Niger claim. In recent weeks, the committee has taken depositions or conducted interviews of former CIA Director George Tenet, Tenet's deputy John McLaughlin, and former CIA anti-proliferation official Alan Foley; plus retired Army Col. Larry Wilkerson (Colin Powell's former chief of staff); and the former head of State Department intelligence, Carl Ford.

The Hill reports that committee member Rep. Carolyn Maloney (D-NY) also wants to talk to Rocco Martino, the shadowy Italian businessman who allegedly passed the forged Niger documents to an Italian journalist.

Seaside Real estate is back in, Al Gore is Out

The good news is that seaside real estate is back in. Al Gore is out of style, and his theory of manmade global warming exposed as a total fraud. so, hit the beach boys and dont worry about the floods of mmgw.


Reid Bryson is citing man-made global warming as a cult, has some mighty fine credentials. But, he is also citing the evidence that educated school children used to know. Like they called it Greenland cause it was green, and the Norse raised grapes in Newfoundland. Of course, if they want to brainwash Americans into being a bunch of Nazi nutcases, that's another story. On being asked about the Al Gore movie, an Inconvenient Truth, he said "don't make me throw up".

Man-Caused-Global-Warming Is Not Science, "Almost a Religion," Says Father of Scientific Climatology


June 18 (LPAC)--The man known as the father of scientific climatology, considers global warming a bunch of hooey. Reid Bryson, a University of Wisconsin-Madison professor emeritus, says, "There is no credible evidence that it [the Earth's warming] is due to mankind and carbon dioxide. We've been coming out of a Little Ice Age for 300 years. We have not been making very much carbon dioxide for 300 years. It's been warming up for a long time," Bryson said. The Little Ice Age was driven by volcanic activity. That settled down, so it is getting warmer, he said.

In a interview published in the June 18 Capital Times of Madison, Bryson said that humans are polluting the air and adding carbon dioxide to the atmosphere, but the effect is tiny.

"It's like there is an elephant charging in, and you worry about the fact that there is a fly sitting on its head. It's just a total misplacement of emphasis," he said. "It really isn't science because there's no really good scientific evidence."

The so-called consensus in the scientific community that global warming is man-caused proves absolutely nothing, Bryson said. "Consensus doesn't prove anything, in science or anywhere else, except in democracy, maybe."

Bryson, 87, was the founding chairman of the department of meteorology at UW-Madison and of the Institute for Environmental Studies, now known as the Gaylord Nelson Institute for Environmental Studies. He retired in 1985, but has gone into the office almost every day since, without pay.

Why are thousands of scientists promoting global warming? "There is a lot of money to be made in this," Bryson said. "If you want to be an eminent scientist you have to have a lot of grad students and a lot of grants. You can't get grants unless you say, `Oh, global warming, yes, yes, carbon dioxide.'" Speaking out against global warming is like being a heretic, Bryson noted.

"There is very little truth to what is being said, and an awful lot of religion. It's almost a religion, where you have to believe in anthropogenic global warming or else you are nuts."

Bryson didn't see Al Gore's "An Inconvenient Truth." "Don't make me throw up," he said. "It is not science. It is not true."

Rentals are Looking Good, for Vacations

Rental of apartments, etc. is looking a lot better than buying anything these days. Why commit huge financial resources when the market keeps falling and there is no bottom. On the other hand, real estate is still, well real.

And a beautiful vacation in Maui is damn right real. I was impressed with the idea of renting a 3 bedroom vacation home in Lahaina Baby Beach Hale, except I don't know what a hale is. Anyway, that is alot of space for "only" $500 a day, but does the maid come with it or extra? Anyway, that is only one block from the beach.

If you are a total cheapskate like me, there is the one bedroom cottage 3 blocks from the beach, and who cares, cause once you get to the beach, man, you stay there all day, right? In Maui, in the state of Hawaii, you will be on vacation.

Real Estate Bubble Down, New Carbon Bubble

Even with the real estate bubble going down more and more, there is an attempt to create a new bubble around the carbon swindle. You have to buy the right to burn coal, etc. and create carbon dioxide. This is supposed to ease global warming, which is a total fraud, at least as a man-made phenomenon. In fact, over the last 10 years, the actual phenomenon of global warming has gone into a global cooling phase. That may help your real estate in Florida, though hurt it in Newfoundland (its too cold)!

An abbreviated and edited German version of the BBC film was finally shown for the first time in public on German TV to a broad audience. The private, widely seen RTL-TV station stressed explicitly, that for reasons of relevancy, the program was being aired after the just concluded G-8 summit in Heiligendamm, which had put the climate hype into the center.

The program ran most of the main elements of the BBC film, followed by a discussion between former Green environmental minister Trittin, a "leading" German meteorologist, an 'environmental economist' from the German Institute of Economics (DIW), a known Bavarian cabaretist, a leading journalist from Stern magazine, a futurologist and a Dutch climate scientist in the audience. What was completely left out of the German version however, was the whole question of genocide in the Third world as a result of the dictate to reduce CO2 emissions – and thus the moral and civilizational dimension, which is at stake. However, otherwise the whole program was quite straight forward and created a useful psychological shock in an otherwise completely brainwashed discussion in Germany.

The moderators started off by saying, that the show was put on the air "for reasons of relevancy," due to the just concluded G-8 summit, where again the fight against global warming was declared to be a priority. But, if this is just one big swindle, what then? From there, the show went through the different questions: Is this just one big swindle, what is causing global warming then, why are politicians lying to us, who is profiting from it, etc, showing most of original BBC-film clips. The discussion in the TV studio with guests, was opened by a statement from the futurologist, who exclaimed how much he liked the fact, that with this evening, "a discussion finally has been opened", and how dangerous it was to dogmatize such a discussion, playing on people's fears. Former environmental minister Trittin freaked out in the beginning, when asked what he thinks about the film's documentation. He "answered" by saying, that there were also reports in the internet, which claimed that the Americans themselves organized 9/11! After some unscientific remarks by the other two proponents of global warming, cabaretist Lisa Fitz surprisingly stated, that first and foremost, she has now had it with hysteria, reminding people of previous 'catastrophe scenarios,', lumping everything into one bag: AIDS, dying of the forests, dead birds. One would have to ask always who is profiting from these scares, referring to those "big profits," which Rumsfeld and his company made with the sale of Tamiflu. At that point, it would have been more than appropriate, to mention the Green hedge funds, Al Gore and his German friends.

The 'environmental economist' of the DIW exposed herself, speaking about what the effect would be, if "the population develops" as before, without elaborating further. She also explained, how scientific 'scenarios' are developed, which then lead to political decisions. The Dutch scientist Labohm was asked about global warming and stated plainly, that there has been a global cooling of temperatures, not a warming, in the last ten years. On this, the official meteorologist completely exposed himself, when confronted by Labohm, that he was basing himself entirely on "German warming data". Labohm ridiculed him: "You as a meteorologist must know, that this is completely irrevelant, it's the global climate, which matters!" This was a point scored, which even the most ignorant viewer could understand, who still might have been confused up to that point.

In the end, there was a vague discussion about how it does not hurt to save energy, since coal and oil will come to an end. While it was pointed out, that the 'alternative energies' are also not liked by everybody (for example, those disturbing windmills), nuclear energy was kept out of the equation completely – with frequent remarks throughout the show, that "as the film documented", it was really the nuclear industry behind the scare… This seems to be prepared as a fall-back option for the public debate. However, the moderator closed by saying that he relies on human ingenuity, which always has found solutions to previous problems. This is true – through a global Eurasian development perspective, and the massive use of nuclear energy. It is again the BüSo, which is already creating the public environment for that with an initial run of 100.000 pamphlets on the Eurasian development perspective, counterposing it to the Malthusian nature of the CO2 swindle.

Improve Real Estate with Great Projects

Is Russia a target of the GWOT? Tired of following Al Gore and the lust after polar bears set. How about following a series of conferences that have taken place in Russia recently. They are even about a new U.S.-Russia Alliance. This doesn't mean the war danger has gone away, if anything it has been heightened.

One conference in May was to celebrate the 80th birthday of the famous Russian econmist Prof. Mikhavich Menshikov. A few weeks later, in early June was the Russian conference on the Bering Straits tunnel project, to connect a railroad project through Siberia and Alaska to Moscow and Washington DC. A key speaker at the conference was former Gov. Walter Hickel of Alaska. Lyndon LaRouche the political gadfly had a paper read too, and showed up in Moscow a week later.

More to come on a series of articles in the Russian press on the historic US-Russia friendship, and the target of this relationship, the perfidious British!!!

BAE Systems Scandal will hit Real Estate Grab in the Middle East

In a way, the endless war drive in the Middle East is a giant real estate grab. And of course a lot of money and bribery is involved.
There is a big scandal about $2 billion or so in bribes to Prince Bandar of Saudi Arabia. Prince Bandar is a leading collaborator of Cheney in the White House and the war. Then there is the wolf in sheep's clothing, Lord Woolf.

In fact Prince Bandar is notorious for pushing an Iran war, and a Sunni-Shiite war. But I think there is a lot more than money involved in this corruption in Great Britain, and involving the Blair Government, and the incoming PM as well.

June 11, 2007 (LPAC)-- In the firestorm around its multi-billion dollar covert slush-funds, the giant British arms company BAE Systems has chosen Lord Woolf, former chief justice of England and Wales, to head the company's review of its own practices, according to British Broadcasting Corporation.

Lord Woolf is currently in the tiny oil-rich emirate of Qatar, which borders Saudi Arabia on the Persian Gulf. Lord Woolf retired from his British post in October, 2005. A few months later Qatar announced it was appointing him President of the Tribunal over the newly created Qatar Financial Center, a projected paradise for global speculators, explicitly modeled on the City of London.

In the same (May 22, 2006) announcement, Qatar designated British attorney William Blair -- older brother of Prime Minister Tony Blair -- as chairman of the Financial Center's Appeals Body, making Woolf and Blair the Center's highest legal authorities. William Blair is a top international banking representative.

Woolf and Blair flew to Qatar last month to set their operations in motion.

Meanwhile back in London, the same Woolf-Blair Qatar entity is sponsoring a strategy session on the long-term relationships between the emerging money centers in the Persian Gulf and the City of London financial center. Baroness Symons will co-chair this June 28 meeting, hosted by the Middle East Association, of which she is Vice President. The meeting was arranged jointly by the City of London and the Gulf Cooperation Council, created in 1981 by Saudi Arabia.

Baroness Symons is a leading figure in the UK-US-Saudi financial and arms relationships behind the BAE scandal. She was Minster for Defense Procurement from 1999 to 2003, and has since served as Tony Blair's special envoy to Saudi Arabia and to the Middle East. Her husband, former Blair aide Phil Bassett, helped run the falsification of intelligence that led to the Iraq war.

Baroness Symons herself has organized the Blair regime's management of the slander campaign against Lyndon LaRouche in the case of Jeremiah Duggan.

Executive Intelligence Review is updating its 1997 investigation of Armor Holdings, the U.S. defense contractor that was acquired this year by BAE Systems for $4.1 billion.

the Carry Trade and the Real Estate Bubble

The carry trade has entered into the real estate bubble. Individuals are getting loans in other currencies than their home country, and hoping that their own currency does not collapse in value.

Reports are that:

Millions of people throughout the world, especially in Eastern Europe, are using the carry-trade, usually the preserve of big-time gamblers, to take out home mortgages. In the carry-trade, an investor borrows money from one country, where the borrowing cost is low, and invests it in another country, where investments yield a high rate of return (see yen carry trade). Now, households are insanely engaging in this risky practice, taking out a home mortgage in a foreign currency at low interest rates, sometimes half the rate of interest charged in their home country.

The May 29 Wall Street Journal reported the case of Tamas Bencze, of Budapest, Hungary, who took out a foreign-currency mortgage loan at 5.75%, whereas if he took out that same mortgage loan in Hungary, the interest rate on the loan would be 14%. However, if the Hungarian currency, the florint, were to sharply depreciate, then Bencze's mortgage would become suddenly unpayable.

The mortgage carry-trade is the latest craze. In Poland, one-third of all mortgages are contracted in foreign currencies. In Hungary, half of all the mortgage loans are foreign currency-denominated, according to the country's central bank. The Swedish bank SEB reports that 70% of its lending in Latvia, is in foreign currency, rather than the local currency, the lats.

The mortgage and regular carry-trade have created an immense danger. In countries throughout Eastern Europe-- Poland, Hungary, Latvia-- the foreign currency debt coming due now exceeds the reserves of those countries' central banks. Were foreign investors to pull out funds from those countries-- which prop those currencies up-- the currencies would crash. This would intensify ungovernability in Europe.

The U.S. has also jumped aboard the mortgage carry-trade bandwagon. According to the Journal, an individual bought a 7-bedroom house in Kissimmee, Florida, by borrowing the equivalent of $240,000 in yen from Britain's Lloyds Bank. Some giant banks are making such loans with the same fervor that they had made with subprime mortgages. This added element of insanity will make the housing market explosion a once-in-a millennium event.

Real Estate Crash

There is a whole lot of real estate crash going on.
And it won't go away by trying to pretend that everything is OK. Commercial real estate will crash along with sub-prime mortgages. We need an FDR style reorganization. Mortgages, and Mortgage Backed Securities will be history. Repeat after me.

There is a whole lot of real estate crash going on.
And it won't go away by trying to pretend that everything is OK. Commercial real estate will crash along with sub-prime mortgages. We need an FDR style reorganization. Mortgages, and Mortgage Backed Securities will be history. Repeat after me.

There is a whole lot of real estate crash going on.
And it won't go away by trying to pretend that everything is OK. Commercial real estate will crash along with sub-prime mortgages. We need an FDR style reorganization. Mortgages, and Mortgage Backed Securities will be history. Repeat after me.

There is a whole lot of real estate crash going on.
And it won't go away by trying to pretend that everything is OK. Commercial real estate will crash along with sub-prime mortgages. We need an FDR style reorganization. Mortgages, and Mortgage Backed Securities will be history. Repeat after me.

I think you get the message, Blackstone, UBS, and Blackrock and Citigroup?

Commercial Real Estate Bubble, what is next?

There is a lot of gossip around. Even though the home buying and selling market is down totally, a huge amount of hyperinflationary funny money is going into the commercial real estate market. As a proof reader you see the mega-deals (like I do) coming through the law firms every night.

This shows how the system needs a bankruptcy reorganization. Huge amount of money is issued, and then the money has to go someplace. If one bubble collapses, Blackrock, Blackstone, Bears and Stearns, UBS, Citigroup etc, must create another one. And they do, and they do, and they do.