DB, stated: "Yes, Bob. Obviously in your view, economics are irrelevant."

This statement is either a misinterpretation of what I said or a creative forgery.

Only an idiot can state that a state of economy is irrelevant. It is well known that the "industrial revolution" in England was responsible for the rise of the British Empire. It is the American economic & industrial might were responsible for America becoming a superpower.

I tried to convey that the present China economic model is a state capitalism. Consequently, it is a very different "animal" than communism or free-market capitalism or Keynesian 'economics'. It has its own performance matrix, rules, behavior, pluses and minuses, etc.

There are no such things as a miracle drug that can treat/cure all diseases. My point was/is that each patient requires an individual approach. IMHO, and I am not an expert in the Keynesian approach (it is not economics), but I think the Keynesian approach has been utterly perverted by people who do not understand it and are totally incompetent in its implementation.

To assume that John Maynard Keynes advocated bailing out 'too-big-too-fail' corporations and municipalities and, at the same time, rewarding their incompetent and criminal management is outright lunacy.

Finally, in the last 30+ years, China has made a giant step forward for its people. Therefore, Chinese leaders deserve lots of credits. As for making mistakes along the way, well, only one who does nothing does not make mistakes.

Extremism in any shape and form is bad. Flexibility is good.

Two examples: China vs. USSR
The late USSR leaders were extremely dogmatic and very poorly educated and at the same time they were lacking any vision and flexibility. The result is well known.

During the same time, the Chinese leadership was capable of intelligently analyzing the reality and implementing a gigantic transformation of their society from the Mao communism to the present state capitalism. Chinese leaders were flexible and ready to adapt.

Does it mean that China has no problems and their future cloudless? No. But Chinese leaders have shown flexibility in addressing and solving their problems. Presently, China is at a very important juncture in its development. For too long, China was 'under radar' and didn't have serious geopolitical enemies. Now, situation has changed. Now, both the West and Russia see China as someone to be suppressed and cornered. This is not any different from the West quite successful campaign to destroy both Germany (WW I & II) and Russia/Soviet Union/Russia (WW I & II and the 'Cold War').

Consequently, the West will do everything in their power to destroy China. The next 3-5 years will be the most critical for China and its future: either it will become a world military superpower or it will be heading for a collapse and destruction. To 'stay low and quiet' is not an option for China anymore. Stalin did understand this geopolitical dynamics very well but his heirs did not!

In my view, discussions about China empty cities and inflation are intellectually challenging but irrelevant.

Reply from The Daily Bell

In my view, discussions about China empty cities and inflation are intellectually challenging but irrelevant.

Yes, Bob. Obviously in your view, economics are irrelevant. Thanks for sharing.

Pure and simple, Buffett finds security in the banks, be it G/S, BofA or Wells Fargo. The Fed will not let those institutions go down the tube.

RE: Buffet. He is crazy like a fox. See BUFFETT'S BANK OF AMERICA DEAL
Click to view link

Buffett is a follower of Graham and Dodd's value investment theory. He's applied this theory in building Berkshire-Hathaway.

A problem arose for Buffett when Greenspan, as new Fed Chairman, in October 1987 monetized losses in the equity markets. This unprecedented, singular action by Greenspan was later approved and institutionalized by executive order of Ronald Reagan establishing the Working Group on Markets, aka as the Plunge Protection Team (PPT). The PPT was to go into action in a dire emergency. Instead, presently the PPT intervenes in the equity markets on a weekly, if not daily basis.

This sort of interference in the equity markets stands Graham and Dodd's equity investment theory on its head. What is Buffett to do... ??? Is he to cling to Graham and Dodd's theory which he used to build Berkshire-Hathaway or is he to sign up to Bernancke's Quantitative Easing to keep the dollar value of Berkshire-Hathaway shares up.

I think we got the answer with Warren's recent pronouncements and actions.

WSJ: "Greece, especially as many of the government's assets are already earmarked for privatization"

Bear in mind, governments, in their opinion, prime assets are "THEIR CITIZENS" (as in property).

It is not only inanimate property, but, the people and their progeny to the nth generation who have and are still being sold out.

a'int gonna fly. Never has, never will. The self-decreed irresponsible will soon be finding out that it is "just THEIR opinion".

But some islands can serve as collaterals and be developped touristically by the Finns. Like this they could escape their sun-less winter and remain on Finnish territory.

Yeah it's a bit hard to carry off the Acropolis in the dead of night :)

Finland should beware. If they don't play the game, they may send the marines. Furthermore, any non cash collateral to a Greek loan would not increase the safety of the loan. Rule number one about collateral; the lender must have control over it. If the collateral is in Greece, you forget about control.

I hope Buffet fully realizes the potential liabilities from the mortgage foreclosure problems. Some of the loses could be 100% as the inability to foreclose is now an realistic issue. With a 5 year statue of limitations window, some properties in foreclosure may end being free and clear to the owners and a total loss to the lender/investor. The courts are issuing quite titles on these properties.

It all smells nowadays.

If your the little guy the only true investment (you actually get something other than piece of paper) we have a chance with is gold and silver - something they can't make. You have to be very lucky with the equities when you're in the same game with the 'Buffets'and the Fund managers.

Think about it, they all do business on one little street, they're all wired together, they went to the same colleges, they eat lunch together, they hang out with each other, they vacation together, etc... ..they own the counterfeiting machine... ... .THEY MANLIPULATE THIS DAMN MARKET. If it turns ugly they'll come looking for your valuables - be smart don't store your valuables in a safe deposit box - IN A The Crooks BANK!!!!!!

Hell, even Mother Nature trying to send them a message, first with an earthquake and now she's sending them a hurricane!!! If only we can be so lucky.

P.S. -- Read up on the Deep Capture site to see how a 'blowout' works.

Re: Buffet -- Either he is crazy like a fox and knows there is a bailout coming, or he is gullible and is being set up to be taught a Big Lesson by the naked short crowd. Or he is quietly behind one of the naked shorters, figuring to collect on the insurers who will be bailed out when they can't pay their CDS's off (a la AIG, the bailout of which paid off huge for those who bet on the demise of the toxic crap they themselves were peddling).

Re: Greece -- well, they could just not borrow any more. That is what will eventually happen anyway. Why is it an underlying meme that all these countries (including the U.S.) must perpetually borrow, always more than last time? Or that it can or should go on forever?

The interesting thing to watch out for is what happens when they cannot borrow any more. Even selling off their seed corn will only last an instant, and if they do this by offering collateral, the potential for serious violence escalates dramatically because the people will probably not stand for it when it is time to seize the assets.

People worldwide are about to learn a very basic lesson about the fundamental underpinnings of civilization. Dishonesty and plunder as the foundation for government and money are going to bring old-testament consequences upon them (us). Because in the end, the only proposed solution to any problem is always to strip you of your possessions and the output of your work. And now their bookwork says you owe more than your entire life's output, and their philosophy says you need to be told what to do every waking moment. Let's see what happens when the mask is stripped away and they come to collect. One thing you can count on, the innocent will be hurt the worst.