Open thread to talk about what historians may come to see as one of the most important days in the history of financial markets.
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A quick glance at my crystal ball reveals more money for the most appalling failures of our financial system with little or no oversight. It will work. It will create more bad behavior by the financial elite and they will accelerate the pace at which they will plunder America. They will continue until America is as broke as Zimbabwe with people starving or until they are stopped. How can they be stopped? The history of the French revolution or the Russian October revolution are good guidelines. However, the aftermath of either did not bring about an improvment of the situation.
I believe America is done. We will be able to maintain a nuclear armed military, we will stay an important world player, just like Russia, China, Germany or Japan. Our best days are behind us never to return. In 4 year we will put the Republicans back in office in hope for change, 4 years later we will put another assortment of corrupt politicians in office to save the day. What "we" fail to realize is that THEY have no interest saving US. None of them. THEY are interested in the well being of their financial contributors. The corrupt and incompetent Supreme court upheld this symbiotic relationship when challenged. So it really is up to US the people to throw all those bums out of DC. I mean every last one of them (some noteable exceptions like Ron Paul or Bunning). The current game will continue until Wall Street is burning.
Sorry for sounding kind of angry this morning. If you're not outrage you're not paying attention.
Market rally for sure. Dow to 15000 by mid year. Everyone had better get in before it's too late.
Finally Congress is spending the right amount to bring us out of this slow economy.
The Plan will be as follows:
1. To preserve American manufacturing and service industries from total destruction by countries with low wages and little to no labor standards, the United States will institute a 30% rule for all industries. This rule will bar any country from having a market share greater 30% share for any particular good or service when there is a domestic source for that good or service.
2. To prevent new American manufacturing and service industries from being strangled in their cradles by foreign competitors from countries with low wages and little to no labor standards, any new American industry will be given a 10 year protected nurturing period. During this period, the government will give new industries tax credits, tax breaks, and, if need be, subsidies, to allow these industries to survive and then thrive.
3. To prevent further looting of state and local treasuries by public sector unions, there will be a self-executing federal constitutional amendment that bars any state, or state subdivision, from permitting healthy and able-bodied employees to collect “old-age” retirement pensions in their mid-forties to mid-fifties. If cops and firefighters want to retire from their professions in their mid-forties, then they should be forced to do light duty or other employment until they reach old age. Most of these retirees collect “old age” pensions in full and still work in other fields. Sorry. Can’t afford it.
4. Mandate that all state and state subdivision contracts with public sector employees shall be subject to voter approval. Moreover, all negotiations shall be made public, including all proposals made by both sides.
5. To restore confidence in the financial system, ten billion dollars will be set aside to hire prosecutors to investigate fraud in the real estate, mortgage and investment industries. Another five billion will be set aside to build new prisons for the anticipated convicts.
I want a bumper sticker and a lawn sign that says:
"If you're not outraged, you're not paying attention."
I'll make it myself.
ANNOUNCEMENT:
Pork BBQ will be served at 11:00 EST
I don't care if it works or not as long as I can get my money out of the dreaded stock markets. I have lost all my life savings in that black hole. I just want to get as much out as I can before the reality dawns on the Sheeple...
I was stupid in trusting the stock markets in the first place. I wish I had known then what I know now. Things are gonna get worse...
But I hope my money will be long out of the stock market so that I can buy some real assets with it...
So come on Geithner... give the banks another bailout... give the economy another stimulus... and give me time to get my money out...
Just remember the 2 rules, the 1X3 rule and the 1X10 rule......
The 1X3 rule is: SPEND, SPEND, SPEND.
The 1X10 rule is: Spend 10 times what you originally said it would cost.
If anyone was wondering where the next greater fool was coming from, NYS wants to hand its lottery endowment over to Wall Street:
http://bloomberg.com/... refer=home
The Masters of the Universe are projecting a 7.8% return. That means those portfolio investments would have to earn over 10% to cover their fees - Madoff level fantasy.
The funds currently invest in treasuries which have little administration/mgt fees and whose returns determine what the winners are paid if they take the long-term payout option (i.e., no downside risk for the state.)
In essence, the lotter chief is saying that we can get 5% more return for if we raise our downside risk to 100%.. And thats if everything goes well, which it won't. The PBGF did exactly what they are proposing and promptly lost enormous amounts of principal.
This is precisely the mindset that Roubini and Taleb were talking about that must be broken: equities always go up, we can make money by placing well-timed bets (as opposed to evaluating a company's ability to earn money), there are no limits and (finally)
trust us, we know what we're doing with your money.
he got what he wanted. no banking execs are fired. trillions will be wasted on worthless assets as opposed to buying the banks outright for a fraction and crushing the share/bond-holders (hey if there wasn't risk, then it would be called "winning" not "investing") and then liquidating everything TO CLEAR THE MARKET.
prepare for martial law. buy your bolt-action rifle and handgun now before you're not allowed to.
ha ha, it is a continuation of bushco policies.
What a surprise.
DEC 2008
as mish points out, BO is about to give the banks 250-500 billion in this first round (with more to come) while all the major banks added together have a market cap of ~150 billion.
Did you tools here obama stuble last night.He said we needed to get money to people who need it the most, the banks.then he quickly corrected himself to say consumers.Who is this guy looking out for?
"Will it work?"
Answer: Of course not!
You'll see...
Today will be announced the second in what will be a long sequence of bailouts.
Eventually all the easy money will reignite debt-fueled spending and lend a boost to our consumerist economy.
Just as the fragile economy begins to pick up, massive inflation will set in as all that extra currency begins to compete for the same raw materials and energy resources.
Our government will be faced with the issue of whether to quickly kick interest rates into the high teens and twenties to rescue the dollar and plunge the economy back into severe recession, or to permit the economy to pick up steam and in the process though the dollar under the bus.
For some reason I think we will see option number 2.
http://www.cnn.com/2009/US/02/10/immigrants.economy/index.html
Immigrants are leaving because the economy sucks.... never thought i would see that.
1. Another colossal failure
2. No
3. Got gold?
What can they propose?
Nothing will have a large impact unless they give everyone a free house.
Or no taxes for 2009.
A Multi-Trillion package is the only thing that will really shock the system.
But what we'll probably hear is the usual tired proposals we've heard about already.
Oooops it's starting, sounds like Dodd is talking bailouts for housing gamblers,
yup tired old ineffective ideas......
Oooohh...Davy Jones!!
The Dow hit -201 the exact same time that Dodd said Geitner's name. That's weird.
YUP, nebulous, dull, tired ideas, thowing money everywhere.
DOW crashes during and after speach.
-305
The one trillion that Geithner proposes to dump into the banks is not enough to work.
The derivitaves market is somewhere around 500 trillion and about 200 trillion have already been seen as toxic.
The only way out, and I believe this is what they are setting us up for, is a destruction of the currency now in circulation and the creation of a new credit system.
Sort of a Bretton Woods 3.
The criminals don't like it... it must be good!
I am very impressed with Obama. I am NOT impressed with Mr. Geithner. He is out of his league.
DP
Was that the fab four or the feces four.
Pat Morrison, LA Times, On banking officials:
I want blood. I’m a vegetarian, but I’d make an exception for a smoking plate of C.E.O. en brochette.”
New "plan" announced = market tanks. Now's the time to go in for the kill Keith...
The two most broadcast words in history are “call now!”
As in "call now" to spend spend spend. Just though ya might want to know.
no
hmmm, my bet is that this plan is dead on arrival. it will morph into something different in a couple of weeks.
Gietner Spoke. No big deal. Markets tanking, they do not have a plan.
It will not work! It doesn't address the heart of the problem, foreclosures and the ARM resets that we are about to get hit with, which are much larger than 2008.
The 800 Trillion Dollar Derivative market will continue to de-leverage. The Titanic is sinking!
http://treasury.gov/press/releases/tg18.htm -
"As house prices fall, demand for housing will increase, and conditions will ultimately find a new balance. " - what a terrible thing to happen, isnt it ?! :)
Is idol on tonight.I wonder what paula will be wearing?
Accountability NOW!
Wall Street corruption must be PROSECUTED!
as mish points out, BO is about to give the banks 250-500 billion in this first round (with more to come) while all the major banks added together have a market cap of ~150 billion.
February 10, 2009 2:47 PM
Obamma is a disgusting crooked thief. He does however lie very well. He will finish the job of butchering the sheeple orrrrrr just finish the job of selling them and all future generations into slavery to his globalist baker masters.
Signed
The Anti Bukko/Wanker
Captain Conservative
Anonymous said...
I am very impressed with Obama. I am NOT impressed with Mr. Geithner. He is out of his league.
--------------------------------
I had hoped that it would be enough for BO to pick the smartest guys in the room. I had really hoped that he would stick Volker back in to force the bad medicine down.
I guess that surrounding yourselves with "the smartest guys in the room" looks good and perhaps instills a little confidence, but, at the end of the day, he still has to figure out which of these smart guys really has a workable solution.
BO is out of his league also. He picked a dishonest tax cheat, in bed with the bankers, to provide the answers and of course we are getting no answers, just more of the same slop.
Great to be in gold today and shorting the ETF's.
Insanity:
Doing the same thing over and over again, expecting different results each time.
His tie is stuck in the guitar.
It will not work - and they have no idea what to do - because it means having to cut their own salaries and benefits, and that's the last thing they'll ever want
to consider, but it's now in the process of hitting them harder now.
Unfortunately, the federal, state and local governments have run out of tricks (i.e. squeezing the tax-payer), and they will now be forced to make further job cuts within the public service sectors - there's no way around it.
We waited too long to reign in these pigs, and now the trough is empty - no more tax-payer dollars - so it's long over do that these people start taking it in the shorts as well.
Geithner is obviously a crook, so getting anything good out of him is not even possible.
OH YEEEEAAAAH!!!
That's some Obamarama Style Hype and Charade I Can Believe In!!!
Geithner Says Bank-Rescue Plans May Reach $2 Trillion
This mutha is WORSE than BUSH!!!
Come on just admit it you Kool-Aid Drinking fools. This is the biggest swindle since Paulson's $800 billion TARP!!!
Drop your pride, Keith. Admit that you've been conned along with the rest of the Kool-Aid Obama worshipping cult.
Bwahahahahahahahaha!!!
Oh, man, we are SOOOO f*cked!!
-Gonzo
BO is out of his league also. He picked a dishonest tax cheat, in bed with the bankers, to provide the answers and of course we are getting no answers, just more of the same slop.
You have it the wrong way around. The bankers and Geithner picked Obama. Do a little research and you'll find that Obama's mother, Ann Dunham, worked for Geithner's father during her time with the Ford Foundation.
Let's make this clear:
Obama is the banker's tool. He works for them. Not for you!
-Gonzo
The National Debt should be widely recognized as a method of accounting for stolen public funds...
So, is today THE day that all hope was lost?
Eventually we'll have that day. It may be today, but I don't think so. I think it won't come until after the riots and the fires, until sickening losses, until an unreal joblessness number is printed.
I'd like that day, THE day, to be today. Hell, they're throwing TRILLIONS at this thing now. But it still feels like things have to get really sick and nasty and scary before they can improve
thoughts?
do these stooges (geithner, BO, bernanke) know how to fix the economy and don't want to do it because it would be painful for their rich supporters or do they not know how to correct the problem?
I find either very disturbing.
Keith, I totally agree that things will need to get a whole lot worse (which they will and especialy now after this) before people take to the streets. We are not an organized society so as a result we can take a lot of shit before getting pissed off as an over all collection of people.
Don't get me wrong because places like the OC will have some riots and some other potential pockets exist as well, but in general we will sit back and watch those that are and say what dopes we think they are being. In reality we will then be the dopes, but it will have then been too late and all of the damage will have been done.
A shame really...
A bunch of high-school kids are now running the show.
A long-winded speech--no substance! by the time Geithner reached the beef, he was exhausted and I was about to puke.
Why couldn't they give him a brief, clear script, typed on a piece of paper from which he could read, instead of that stupid prompter?
This was supposedly aimed at restoring confidence in the system. How can you achieve that with a plan so convoluted and so f*cking business-as-usual?
DOOMED!!
I'd like that day, THE day, to be today. Hell, they're throwing TRILLIONS at this thing now. But it still feels like things have to get really sick and nasty and scary before they can improve
thoughts?
------------------------------------
I agree, the only way this thing will be fixed is when it comes completely and totally apart. right now the foxes are still in charge of the hen house.
BO is looking totally out of his league. Have you watched any video of him taking his stimulus package "grass roots"? He is trying to sell this as a break from the failed policies of the past 8 years. WTF? it is the same stinking pile of sh*t.
BO is still invoking the fear of bush, which won't work much longer.
DEC 2008
hmmmm, lets see:
strike one: geithner bailout plan
strike two: 900 billion stimulus package
strike three: ??? escalation of Afghanistan???
Gonzo said...
You have it the wrong way around. The bankers and Geithner picked Obama. Do a little research and you'll find that Obama's mother, Ann Dunham, worked for Geithner's father during her time with the Ford Foundation.
Okay. How does that alter the situation that we are in today? Is knowing that information going to change something? Is it going to get the milk and honey flowing again?
Just wondering.....
Strike 1 – Having the public elect these same morons (Frank, Dodd, Biden, Kennedy, et al) back into office over and over again.
Strike 2 - Allowing for a democratically controlled House and now with (3) traitors a democratically controlled Senate to go along with a new democrat as President.
Strike 3 – These morons backed by the newbie voting for passage of the biggest waste of our children’s children money in the history of the country.
I wish I could call a time out and go to the mound for 20 seconds. It may do no good, but boy would I feel a whole lot better afterwards!!!
Yup, just as I suspected...trillions and trillions more being thrown at the problem. More govt. borrowing, more swindling by the banks, more consumers getting free money...MORE, MORE, MORE, MORE, MORE!
BO is truly a kool-aid drinking moron. The Repubs opened the door to massive bailouts with the TARP and now the Dems have simply topped them by a few trillion more with the Stimulus and Treasury plan.
They are going whole hog on socializing this country; they are hell bent on it.
More and more Americans are wising up to this scheme. I think it's only a matter of time before we rise up and tell them to stick it. And when that happens, there's going to be hell to pay.
Someone made a good post that since Americans are decentralized in our way of life (unlike europe where the eurotards rely on strong central orgs to guide them and do their bidding), it takes time for the masses to come around. I think though that the time is approaching when we are going to stick it to the govt. and banksters.
name the movie?
"That's it man, game over man, game over! What the f*ck are we gonna do now? What are we gonna do?"
"Oh, man, we are SOOOO f*cked!!"
Is this a direct quote from Linda Thomsen of the SEC on the day Madoff confessed to his Ponzi scheme?
Why are you building that ark, Noah? It can't rain forever!
Someone made a good post that since Americans are decentralized in our way of life (unlike europe where the eurotards rely on strong central orgs to guide them and do their bidding), it takes time for the masses to come around. I think though that the time is approaching when we are going to stick it to the govt. and banksters.
Maybe New Hampshire is leading the way:
New Hampshire Fires First Shot Of Civil War - Resolution Immediately Voids Several Federal Laws, Threatens Counterstrike Against Federal “Breach Of Peace”
The New Hampshire state legislature took an unbelievably bold step Monday by introducing a resolution to declare certain actions by the federal government to completely totally void and warning that certain future acts will be viewed as a “breach of peace” with the states themselves that risks “nullifying the Constitution.”
-Gonzo
So Keith how's that Obama shilling from last year going for ya?
You thought Bush's spending was out of control? OBAMBI has spent more in 2 weeks than Bush did in 8 years.
Is the movie you refer to boiler room?
Okay. How does that alter the situation that we are in today? Is knowing that information going to change something? Is it going to get the milk and honey flowing again?
Just wondering.....
Know thy enemy.
Just now-on CNBC attributed to Geithner:
"Treasury to pump new capital into institutions through as yet un- announced funding mechanism."
ha ha ha.
We can probably make it off the Titanic if we just don't panic.
We need the CEO/Board of Directors approach. They don't sit around and ask "Will it work?". It's more like "It better work or some heads are going to roll!"
God please let me get to the point where I can turn off the TV. "Blah blah blah blah." They are trying to stall things enough that everything will come back and be OK - all the worthless paper will have value again. And in the meantime nobody has to know - nobody can look at it. I think this still amounts to avoiding a run on the banks.
They all seem to be in over their heads though.
I aggravates me that CNBC always interrupts when a questioner is making sense and I think I could learn something.
Anon 7:40
name the movie?
"That's it man, game over man, game over! What the f*ck are we gonna do now? What are we gonna do?"
Aliens 2 - Bill Paxton losing it....
come across what to some may seem like a free house and held off for a little more quality.....fool.
"This is very complicated to get it right," Geithner said.
it is complicated because you are trying to do everything possible to keep from doing what is correct and right.
the banks should have to bring all the off balance sheet stuff back on. if they are insolvent, then the fdic takes them over, kicks out the management and board, funds the bank, wipes out shareholders, and opens it back up again if it can move forward as a viable business.
Big banks are broken up so that we don't have any of this "to big to fail" crap.
But NOoooooo, Mr. Geithner wants to do the "difficult" plan. things that have never been tried before.... that they aren't sure will work....
The solution is simple. it is a lot of work and a lot of pain but there is no escaping that. the sooner we do the right thing the faster will we will get onto the road to recovery.
"Okay. How does that alter the situation that we are in today? Is knowing that information going to change something? Is it going to get the milk and honey flowing again?"
I think the point is regret. Don't make the same mistake again. All that I ask is if, just *if*, the unthinkable occurs and Obama makes us look back at Bushco with the same sort of innocence lost that we now see in Clinton, that you get out and vote for a THIRD FUCKING PARTY. It's not the evil Republicans, it's not the stupid Democrats, it's the system that lets certain people correctly guess, time and time again, who will control the country.
Anon 10:16 writes "The solution is simple. it is a lot of work and a lot of pain but there is no escaping that. the sooner we do the right thing the faster will we will get onto the road to recovery."
"Americans can always be counted on to do the right thing...after they have exhausted all other possibilities." -Churchill
"Americans can always be counted on to do the right thing...after they have exhausted all other possibilities." -Churchill
ain't that the truth.
do these stooges (geithner, BO, bernanke) know how to fix the economy and don't want to do it because it would be painful for their rich supporters or do they not know how to correct the problem?
I find either very disturbing.
Today's stock market decline is simply investor's and the bank's way of telling Geithner they didn't get what they wanted. Just like with every stupid stimulus bill and economic recovery plan for the last year, investors will put a gun to the head of the stock market until Geithner responds correctly.
Investors again hold the economy hostage.
Geithner's "plan" (what plan?) wasn't working before he hit the podium.
"Big name banking stocks were among the heaviest losers on Wall Street on Tuesday after Tim Geithner’s much-awaited financial sector rescue proposals failed to instil investors in the stricken sector with confidence.
The S&P 500 fell by 2.1 per cent in 10 minutes just before the Treasury secretary set out how the Obama administration would use the remaining financial sector bail-out fund.
The sell-off worsened as Mr Geithner spoke and continued throughout the day. Senate approval of the economic stimulus bill failed to halt the widespread decline, which wiped out much of the previous week’s strong gains.
“There was a very long drum roll leading up to this,” said Stephen Wood, senior portfolio strategist at Russell Investments. “It didn’t happen.”
Financials led the retreat, hurt by persistent fears of outright nationalisation of key institutions in which equity holders would be wiped out. The sector lost 10.9 per cent overall."
Read the whole enchilada here:
http://www.ft.com/cms/s/0/1a2106a6-f773-11dd-81f7-000077b07658.html
Check it out. He knows something about CDS's. That's our Tim.
By Joanne Morrison
Reuters
Sunday, June 15, 2008
WASHINGTON -- The New York Federal Reserve's closed-door rule making with top players in the massive $60 trillion credit default swaps market came under legal fire on Sunday, as a fair finance activist filed a complaint questioning why it was done in the dark.
"The Federal Reserve seems to think it can engage in rule making in secret only with the industry," said Matthew Lee, executive director of the New York-based non-profit group Inner City Press/Community on the Move.
Lee filed the administrative complaint on Sunday with both the New York Fed and the Federal Reserve Board in Washington. In the complaint, he demanded that the central bankers explain why the meetings this month were private and requested copies of all communications and details about the New York Fed-sponsored talks.
Officials at the Federal Reserve could not immediately be reached for comment.
The meetings were held with more than a dozen companies led by investment bank Goldman Sachs Group Inc. The companies -- which account for the bulk of business in the $60 trillion market -- met to help set new rules for credit default swaps trading, including the establishment of a clearinghouse.
Credit default swaps are privately negotiated transactions used by companies to hedge against default risks. Over the past decade, the market has grown exponentially, from about $1 trillion to $60 trillion.
Lee, referring to the Fed-led rescue of investment bank Bear Stearns by JPMorgan Chase & Co, said, "It was one thing to bail out Bear Stearns without any comments from the public. Now the Fed is trying to bail out or benefit 17 of the largest financial institutions behind closed doors."
Citing the federal Administrative Procedures Act, he said it was illegal to have conducted the meetings.
"We aim to stop it," said Lee, a fair finance and housing activist whose group has been instrumental in shaping how the Federal Reserve approves bank mergers for more than a decade.
Also present at the meetings were representatives from derivatives and securities industry trade groups who were directed to make no public statements or disclosures about the talks, according to information obtained by Reuters.
"This closed-down, top-heavy process is unacceptable and, Inner City Press hereby timely contends, is contrary to law," Lee wrote in the complaint.
The complaint comes a week after NEW YORK FEDERAL RESERVE PRESIDENT TIM GEITHNER announced the initiatives being developed with the companies, including the central bank's endorsement of the use of a clearinghouse for trading the instruments. The companies that attended the meeting own a centralized clearinghouse called Clearing Corp.
Among those present at the private meetings with the New York Fed were: Goldman Sachs, Merrill Lynch & Co. Inc., Morgan Stanley, the Royal Bank of Scotland Group PLC, Societe Generale, UBS AG and Wachovia Corp, Bank of America Corp, JPMorgan Chase & Co., and Citigroup, according to the New York Fed.
Also attending were representatives from the buy-side firms and hedge funds AllianceBernstein, BlueMountain Capital Management LLC, and Citadel Investment Group LLC
This bailout is a disaster. Letting banks fail and Real Estate collapse is the right approach. Who cares if the banks fail??? We cannot afford to cover all 60 Trillions of potential losses, we simply cannot.... Plus, if home values drop and become affordable then maybe Americans will start paying 10 or 15% of their income towards housing and the rest would be residual income that can be used for "stimulating" the economy.
Another way of looking at the benefit of low home values is that they would put less stress on wage inflation (maybe even deflation) which would render manufacturing in the US less costly, more appealing, and generate more US mfg jobs... We can at last be competitive as apposed to diverting half of our salaries to some fictitious bubble...
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