Subject:	More Reasons Why mcbankshill Is An Idiot
Date:	1999/06/14
Author:	fedinfo <fedinfo@halifax.com>
	Posting History

The bank shill has proposed that if cash is not available, then that is NO problem. We can just use credit cards and checks....   http://www.FreeRepublic.com/forum/a376451f03941.htm Topic: Business/Economy   Y2K Early - Chaos Possible In 90 Days       Panic surrounding the Y2K problem could make the situation worse by far than the actual malady.   This is written by one of the more conservative people on the y2k Homestead list. He builds computers for large business and gets them all set up and rolling. If you think Y2K effects are going to be nil - think again, the fireworks could easily begin shortly - keep your powder dry...     Think you have 6 months to prepare for the upcoming big Year 2000 rollover? Think again. Its more like ninety days.   The word on the street is that no one will show up at the last quarterly debt auction of 99 or the first one of 2000. The big investors (buyers of short-term debt) say they are going to stay out of the auctions and see how the Y2K rollover affects things. (Remember these are very fiscally conservative people) Short-term debt is auctioned off every three months by the likes of the credit card companies and other financial institutions. This is what keeps them running.   Ever wonder why the interest rates on plastic are so darned high? Its because the credit card folks rent their short-term debt to big investors. These investors are promised a big return on their three- month investment. This is where the credit card folks get the money to pay the merchants who accept the card in payment for goods and services.   Credit cards are a *very* big part of our modern economy, if no one buys their debt they just cant operate. Merchants wont get paid so most will likely stop accepting plastic, almost over night.   This alone will put many companies out of business. Car rental agencies accept *only* plastic. You cant rent a car today even with a wheelbarrow full of cash. How many ISPs like AOL are almost exclusively paid by automatic charges to their customers plastic? [Meaning that within the last quarter of this year, many Internet users could possibly find it very difficult to locate an ISP still in business - except for the phone companies that have been angling to control the business.]   Think there wont be bank runs by October? When we cant use our plastic, wont we assume that our checkbook isnt far behind? Cash will be king! (What little there is of it, that is) The lucky ones will get 10% of their cash out before the banks doors are slammed closed in their faces. Once the government imposes cash withdrawal limits, which it will, our confidence in government, banking, insurance, and nearly all other institutions will disappear faster than our cash. By Halloween the cities will be aflame.     =============   The bottom line is simply that if cash is not readily available, who would then trust a bank to HONOR a check. No one is going to turn over their merchandise for a check if it CAN NOT be redeemed for cash. Same with crdit cards. No merchant will turn over his products for potentially unredeemable credit cards.     mcisaac is an idiot.   I doubt that cities will be in 'flames' by Halloween. And I can not say how the panic will be worked out...if it comes sooner rather than later.   Looking at the panic...... The spin from the different entities has been effective in mollifying the public concerns so far. How long will that last? I dunno. But, ultimately the spin will not prevail. The longer it goes before the panic begins....the worse it will be.   -- Paul Milne If you live within five miles of a 7-11, you're toast. Sent via Deja.com http://www.deja.com/ Share what you know. Learn what you don't.

-- a (a@a.a), June 14, 1999

Answers

My parents weren't planning on being here until December (set in cement). I sent this to my mother and she mailed back saying they'll keep Dad's August appointment with the Mayo clinic and be down after that! Never can tell what will move some people off the fence! Predicting the "herd" is far more difficult than predicting the consequences suffered by the lack of completed remediation, in my opinion anyway!

-- Will continue (farming@home.com), June 14, 1999.

This FR article was discussed today at:

http://www.greenspun.com/bboard/q-and-a-fetch-msg.tcl?msg_id=000x0R

Just thought I'd help, still don't know how to link.

-- newlurker (bcobur@yahoo.com), June 14, 1999.

Milne has got it wrong,

in the USA at least,

I'm a Brit living also in the US and tend to look at things from a "perspective"... :)

I have NO DOUBT WHATSOEVER there will be NO PANIC, the population is too docile and stupid... worldwide... why the hell would they panic about y2k, or even a banking crisis, they don't think, that is the way TPTB want it, the spin meisters are doing a superb job, anyone thinking on my level at this moment in time is less than a small percentage of a point!,,, Milne is good, up to a point, but is ultimately blinkered,,,

No panic, TSHTF, mass panic, death,

Objective achieved.

a, and paul m, if you are reading this, work it out for yourselves, you only get so many chances :)

btw a keep the posts coming :)

-- Andy (2000EOD@prodigy.net), June 14, 1999.

Yea -a-, don't take such long breaks, ok? I especially like Milne's "I'm gonna bust a nut" posts! Since I have none...I'm forced to rely on you guys!!!

-- Will continue (Farming@home.com), June 15, 1999.

Hey,

my knee's hurting...!

-- Andy (2000EOD@prodigy.net), June 15, 1999.

Fuzzy set theory allows a range. I'll go with the 90 days, plus or minus 20.

I've seen Americans panic during riots, etc. Not everyone will panic initially, but once it starts, it'll snowball.

-- Mad Monk (madmonk@hawaiian.net), June 15, 1999.

There was a guy on "Point Of View" (can hear it at Broadcast.com) on Monday discussing economics. Actually, although he was very low key, many of his basic premises are the same. EXCEPT that he urged people to act very calmly and rationally --- hedge with 10 to 15% Gold/Silver coins, borrow against 401K, so forth.

All very good IF people would really act that way. THE POINT: I don't know when it will happen either, as Andy said people are very "slow".

But when it does, no reason, rational thought, or good advice is going to stop the panic. When people can't get their money, for whatever reason, ... Milne will be proved right. Of course by then, none of us will really care, we'll be to busy dealing with "the panic".

-- Jon Johnson (narnia4@usa.net), June 15, 1999.

I agree with Andy. I think folks are too "stupid" (hopefully ill- informed is more accurate, but I wonder) to act.

The "masses" are told what to think on TV, and they obey. I don't think they will be told to panic.

All hail Emporer Clinton, future ruler of solar system!

-- Anonymous99 (Anonymous99@Anonymous99.xxx), June 15, 1999.

Well, thank you very much. I PREDICT - there will be NO PANIC IN 90 DAYS.

I shall keep a link to this thread - and in exactly 90 days from June 14, I shall post the link. We will see who is right.

I just love it when Milne sticks his neck out with a date - he hasn't been right yet - but keeps on trucking.

-- Paul Davis (davisp1953@yahoo.com), June 15, 1999.

"This is where the credit card folks get the money to pay the merchants who accept the card in payment for goods and services."

Not true. Each merchant pays 1-3% of each sale to the credit card company. That's why small businesses often don't accept credit cards. Their profit margin is too thin.

-- Chuck (robertsc@accn.org), June 15, 1999.

uh, Chuck, check your math. If a merchant accepts a charge for $100, he will receive $97 from the credit card company (3% service charge in this example). The $97 comes from the investors described in the original post.

-- Dave (dwood@southwind.net), June 15, 1999.

Good point, Chuck. I'd *love* it if VISA and Mastercard paid *me* for the privilege of doing business with them!

[By the way, some really small businesses pay up to 5% to the credit card companies until they can demonstrate a decent track record (no chargebacks etc.).]

From the Free Republic article that a quoted Paul Milne quoting:

"The word on the street is that no one will show up at the last quarterly debt auction of 99 or the first one of 2000. The big investors (buyers of short-term debt) say they are going to stay out of the auctions and see how the Y2K rollover affects things. "

Did I miss the memo? Who said what, where and when?

-- Johnny Canuck (nospam@eh.com), June 15, 1999.

Paul,

Can I take it from your comment that if a panic were to start in 90 days, you wouldn't be blaming Paul Milne?

Johnny and all,

Also see this Westergaard 2000 article from March:

http://www.y2ktimebomb.com/II/TK/tk9912.htm

"Consumer Confidence and the Flight to Quality"

-- Linkmeister (link@librarian.edu), June 15, 1999.

a smalltime local merchant "might" honor a check if it is drawn on the same local bank he banks at. His problem then becomes his suppliers, will THEY honor his check for more merchandise?

in any case, the loss of credit cards is a HUGE "credit crunch" especially in the consumer arena. It would wipe out consumer spending.

If everybody hedged 10% of their 401k's with metals, gold would be at $2500/oz. Maybe $25,000. Only 1% of people would actually be able to buy in any case. Everybody cant do it only some.

-- otay (spanky@lilrsacles.com), June 15, 1999.

To the GIANT ASS Paul Davis:

Read the post again, you moron. I did not predict ANYTHING at all. You really are a flaming moron. I posted an article that discussed a "POSSIBLE" panic. Then i followed it up by saying that I DOUBTED cities would be in flames by then. Davis, you are such an ass, grapsing at any and every straw. Better luck next time, moron.

-- Paul Milne (fedinfo@halifax.com), June 15, 1999.

Paul, Could/would the fed intervene and buy the debt to keep things afloat a while longer? When do FannieMae and FreddieMac sell mortgage backed securities? Kinda wondering how much longer I can expect to have a job.

-- Dave (dwood@southwind.net), June 15, 1999.

a: You need to be a wee bit more careful in naming your threads. I too assumed that Paul M. was stating "chaos in 90 days" until I actually read it.

Also, are you planning to post Gary North's latest Reality Check newsletter for those of us who don't get it? Thanks.

-- King of Spain (madrid@aol.com), June 15, 1999.