And then Chris Cox, the incompetent head of the SEC, threw the SEC under the bus (while taking no blame himself, being the piece of sh*t he is)

"I am gravely concerned by the apparent multiple failures over at least a decade to thoroughly investigate these allegations or at any point to seek formal authority to pursue them"

- SEC head Christopher Cox, one of the most destructive human beings of all time, speaking on his incompetent organization's almost surreal abdication of duty in investigating the $50 billion Madoff Ponzi Scheme, December 16, 2008

"The U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars"

I will keep printing this quote until it finally clicks with all of you.

I'm just trying to help.

"U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.

"By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services"

-Ben Bernanke, talking about the helicopters, November 2002

MOABO

IF YOU HAVEN'T GOTTEN OUT OF US DOLLARS, DO IT AS QUICK AS YOU CAN.

THIS IS NOT A DRILL.

IT'S TIME TO TAKE RISKS AGAIN.

THIS IS A WATERSHED MOMENT.

THIS IS THE REAL DEAL.

MOABO.

MOABO.

THE HELICOPTERS HAVE ARRIVED.

When Bernanke announces his news today, remember what he said on November 21, 2002. It hath been foretold.

[UPDATE] - BERNANKE GOES ALL IN. MORAL HAZARD BE DAMNED. AND GET READY FOR THE NEXT BUBBLE.

FLASH: Fed Cuts Target for Key Rate to Record Low, Pledges to Use All Available Tools

Remarks by Governor Ben S. Bernanke
Before the National Economists Club, Washington, D.C.
November 21, 2002 Deflation: Making Sure "It" Doesn't Happen Here

Curing Deflation

Let me start with some general observations about monetary policy at the zero bound, sweeping under the rug for the moment some technical and operational issues.

As I have mentioned, some observers have concluded that when the central bank's policy rate falls to zero--its practical minimum--monetary policy loses its ability to further stimulate aggregate demand and the economy. At a broad conceptual level, and in my view in practice as well, this conclusion is clearly mistaken. Indeed, under a fiat (that is, paper) money system, a government (in practice, the central bank in cooperation with other agencies) should always be able to generate increased nominal spending and inflation, even when the short-term nominal interest rate is at zero.

The conclusion that deflation is always reversible under a fiat money system follows from basic economic reasoning. A little parable may prove useful: Today an ounce of gold sells for $300, more or less. Now suppose that a modern alchemist solves his subject's oldest problem by finding a way to produce unlimited amounts of new gold at essentially no cost. Moreover, his invention is widely publicized and scientifically verified, and he announces his intention to begin massive production of gold within days. What would happen to the price of gold? Presumably, the potentially unlimited supply of cheap gold would cause the market price of gold to plummet. Indeed, if the market for gold is to any degree efficient, the price of gold would collapse immediately after the announcement of the invention, before the alchemist had produced and marketed a single ounce of yellow metal.

What has this got to do with monetary policy? Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.

Celebrate, good times, come on?

Time to put on the gold lame and join the Bernanke asset bubble party?

Time to write songs about The Great Reflation and Dollar Destruction?

Time to get the party back on, with spiked punchbowls for everyone?

How are the restaurants doing by you?

In my local village, empty.

Indian places - empty
Thai places - empty
Italian places - empty
French places - empty
Lebanese places - empty

The only exception? Burger King. McDonald's. Pizza Hut. They're heaving.

People still gotta eat. They just trade down to crap.

Want to get in on the Muntadhar al-Zaidi "throw your shoes at Bush" action? Here's how...

Since you can't pelt him in person, if you're so inclined, fling some shoes at Bush here. Hopefully some good smelly old dirty ones:

George W. Bush Presidential Library
c/o SMU
6425 Boaz Lane
Dallas TX 75205

Maybe add a nice personal note.

It's the least you can do.

And a side note. I believe you witnessed the end of the Iraq war on Sunday, as the first shoe was in the air. This one moment finally united all Iraqis - Sunni, Shiite and Kurd.

Get out America. Time to go home. It's their country now.

Soot and Ashes Serious Question of the Day

Will anyone ever trust American bankers, politicians, ratings agencies, reporters, auditors or regulators again?

Will you?

Anyone seen my shoes?

Is all trust in the US Securities and Exchange Commission, and it's completely incompetent head Chris Cox, now gone?

It's one thing to be able to conduct a $50 billion Ponzi Scheme in America. I mean, that's pretty rich.

But it's another thing for the SEC to let it go on. And on. And on. And on.

After ENRON, you'd have thought the SEC would have learned. But instead, they just got worse.

America is run by monkeys, trust is now gone, and our reputation is worth sh*t. No investment should be trusted in this environment. Especially investments in America. When it comes to finance, we are now a third world country at best.

Thank you Chris Cox.

Monkey.

Someone throw some shoes at this guy, OK?

Madoff ‘Tragedy’ Said to Have Escaped Scrutiny by SEC

Dec. 15 (Bloomberg) -- U.S. regulators never inspected Bernard Madoff’s investment advisory business, alleged to be a Ponzi scheme that cost investors $50 billion, after he subjected it to oversight two years ago, people familiar with the case said.

The Securities and Exchange Commission hadn’t examined Madoff’s books since he registered the unit with the agency in September 2006, two people said, declining to be identified because the reviews aren’t public. The SEC tries to inspect advisers at least every five years and to scrutinize newly registered firms in their first year, former agency officials and securities lawyers said.

Madoff, 70, who had advised the SEC how to regulate markets and donated regularly to politicians, was arrested Dec. 11 and charged with operating what he told his sons was a long-running Ponzi scheme in the New York-based firm’s business advising rich people, hedge funds and institutions. His ability to avoid detection may fuel debate about the SEC’s effectiveness and the adequacy of its resources for policing money managers.

“Given what the SEC claims is the magnitude of the fraud, this is something you would hope an inspection would have uncovered,” said Mercer Bullard, a University of Mississippi law professor and former mutual-fund attorney at the SEC. “It’s hard to imagine a fraud of this alleged size not being accompanied by significant and pervasive compliance problems.”

"This is a goodbye kiss from the Iraqi people, dog. This is from the widows, the orphans and those who were killed in Iraq"

[UPDATE] - For the record, Muntazer al-Zaidi, the Iraqi shoe-thrower, is now on my list of personal heroes. His bravery and selflessness should be celebrated around the world, especially in the United States.

It took an Iraqi, through an act of defiant and peaceful protest, to show America how to stand up to a corrupt and incompetent leader.

I hope this is the first in a long and unending series of footwear aimed at George W. Bush. A Traitor To His Nation. The Worst President Ever.

_____________

Looks like someone's in for a little waterboarding tonight...

And for some background, for those of you unfamiliar with this gesture of utter contempt:

In the Arab world, shoe flinging is a gesture of extreme disrespect. A notable occurrence of this gesture happened in Baghdad, Iraq in 2003. When U.S. forces pulled down a giant statue of Saddam Hussein during the 2003 invasion of Iraq, many Iraqi detractors of Hussein threw their shoes at the fallen statue.

This may be an ancient gesture from the Middle East; Psalms 60:8, speaking of some of the traditional enemies of Judah, says that "Moab is my washpot; over Edom will I cast out my shoe...." (KJV)

The shoe represents the lowest part of the body (the foot) and displaying or throwing a shoe at someone or something in Arab cultures denotes that the person or thing is "beneath them." Showing the bottom of one's feet or shoes (for example, putting one's feet up on a table or desk) in Arab cultures is considered an extreme insult. Examples include Iraqi citizens smacking torn-down posters of Saddam Hussein with their shoes, and the depiction of President of the United States George H. W. Bush on a tile mosaic of the floor of the Al-Rashid Hotel's lobby, forcing all visitors entering the hotel to walk on Bush's face to enter the hotel.

During President George W. Bush's surprise visit to Iraq in December 2008, an Iraqi man threw shoes at him during a press conference with Iraqi Prime Minister Nouri Kamel al-Maliki.[1]

History will be brutal. No matter how much he tries to spin it as he slithers out of office.

Not only will history will be brutal, but I hope Bush is hounded until the day he dies for the destruction he brought to America and to the world.

He should be shouted down anytime he tries to speak. He should be vigorously protested whenever he comes out of his cave. He and Cheney both.

History will not be kind. And neither should the American people.

Paybacks are a bitch.

"I can tell you who is not a homeowner. It is not someone who paid zero down and ridiculously low payments for two years; that my friend, is a renter"

If that quote doesn't about sum it up, I don't know what does.

HOMEOWNERS WITH MORTGAGES DO NOT OWN ANYTHING.

GOT IT MSM?

GOT IT POLITICIANS?

And people who put zero or little down are not losing 'their' homes. They're being asked to leave the bank's home. So that they can go rent something, like they should have been the whole time. You know, before they became housing gamblers.

In August 2006 I sent this letter to Senator Chris Dodd, who ended up being on the take from Angelo Mozilo, asking for a Senate REIC investigation...

And of course, he did nothing. Hell, I didn't even get a response.

And now, in part because of Chris Dodd, the world's financial system has imploded.

He could have listened.

He could have done something.

He could have stopped the fraud, the corruption and the gambling.

And he didn't.

Because he was on the take. He is corrupt, he is a pig, he should be investigated, and he should be arrested, along with Mozilo and the rest of his 'friends'.

But of course, that won't happen. Because your leaders are on the take, and the REIC is too powerful.

And now the world pays the price.

An open letter to Congress to call hearings on the corruption within the Real Estate Industrial Complex - please send to your Congressman

Dear Sir;

I am calling on you to initiate hearings in regards to the corruption prevalent within the Real Estate Industrial Complex. Many of these fraudulent and corrupt practices have led to the housing bubble, and now housing collapse. Initial points of investigation should include:

* Corrupt appraisers being paid off or promised future business in return for "making the numbers work"

* Mortgage brokers kicking back realtors when recommending their services

* Developers who gave money to bogus charities, who gave the money to new homebuyers to in order to purchase homes from those very developers

* Realtors steering clients to homes and developers where they were being paid bonus commissions or kickbacks, and not disclosing this to the buyer

* Rampant mortgage fraud, underwritten by firms who knew the applicant was unqualified, knowing that the loan was to be held by an unsuspecting third party or commoditized

* Deception practiced by the National Association of Realtors, promoting homeownership when they knew prices were declining and unsold inventory was skyrocketing

* Insider stock sale transactions by Bob Toll and others, dumping their shares at the peak while cheerleading their stock and prospects to the public, knowing the market was deteriorating, cancellations skyrocketing and their stock price and business model soon to decline

* Fannie Mae and Freddie Mac cooking the books and running out of control, imperiling the US financial system

* Congressmen taking outright bribes and campaign funding from the Real Estate Industrial Complex to "look the other way"

* The impact of misguided tax policy (cap gains tax exclusion for home sales) and policy ("ownership society" encouraging people who could not afford houses to buy at the peak) on the housing bubble

* The actions of the Fed and ultra-loose Fed policy in creating the bubble, including Greenspan's recommendation in front of Congress for people to get into ARM loans right before he began raising interest rates.

The population will be in full panic mode soon as the Housing Ponzi Scheme collapses. It is your duty to protect the American people from this ever happening again, by cleaning up the Real Estate Industrial Complex as you helped to with the corrupt Analyst / Investment Banking relationships, and corporate systemic fraud and deception during the dot-com bubble and bust.

Thank you

Do you understand yet that the United States will likely have a budget deficit of $2 trillion NEXT YEAR. And that the year after that might be more?

Let that sink in.

A couple hundred years, we did pretty OK.

And then....

WHAM!!

POW!!

KABLOOY!!

TILT!!

At the same time a $1 trillion plus stimulus is being discussed, a gaping hole in government receipts is going to open up as businesses and individuals make less money and pay less taxes. Significantly less. Added to the $500 billion plus structural deficits we were running anyway.

Thank you George Bush. Thank you Ted Stevens. Thank you Harry Reid. Thank you Nancy Pelosi.

You fu*ked us all.

And anyone buying up US debt in this environment might be the biggest fool of all.

Soot and Ashes Quote of the Year Nominee

"Short, f*cking, everything!"

HP'er Tyrone, offering in three words what would become the best investment advice of the year, January 28, 2008

Well, even after everything falls apart, we'll still have the internet to keep us entertained. Right?

I mean, they can't turn off the internet, can they?

On December 31, 2007, I asked HP'ers for their 2008 predictions. Here were some gems...

Nimesh Patel said...

My prediction for 2008 is that the real estate market will recover and our stock market will go through another bull run after it hits a low of 12000. America is the wealthiest country in the whole world. Despite the recent subprime mortgage fallout, foreigners will continue to trust us.

born to lose said...

2008 - 2010 will be the toughest times since the seventies.

Three_Mile_Island said...

Fed rate 1%
Gold new highs
Oil new highs

decaffeinated said...

- At least one major US bank that is not Countrywide will teeter on the brink of insolvency, forcing a Congressional bailout. I'm thinking WaMu, but the rot at Citi seems pervasive as well.

- WaMu's stock price will flirt with $5/share.

- Gold will top out at $975/oz, silver at $18/oz.

- The Dems will take the presidency and retain both houses of Congress. Republicans will piss themselves.

TM said...

My prediction for 2008 is that house prices will continue their slide, home loan, auto loan and credit card defaults will continue to rise, and 401k funds will continue to be raided.

Most importantly, I think the credit crunch will worsen, and will prompt a full-scale bailout of banks by the government.

Andrew from Russia said...

A Black Swan Year, and perhaps the first glimpse of post-consumerist economy.

keith said...

If Bloomberg doesn't run, Obama is the next President

On housing, US median price falls 10% in 2008

On stocks, no idea on the averages, but watch for builders, banks, lenders and investment houses to fail and merge. CFC, IMB and WM are first up

Anonymous said...

I predict we have an economic collapse of gigantic proportions. Men, women and children will all be homeless and there will be no food. People will have riots over food. Gold will go up to $10,000,000 per ounce and keep going up. Keith and all of the other HP'ers will be happy hiding in their mama's basement eating crackers and canned foods while the rest of America suffers.

Thanks for playing. You're no longer needed. Goodbye.

United States Senator Jim DeMint: "We're going to have riots." Ruh-Roh.

“We’re going to have riots. There are already people rioting because they’re losing their jobs when everybody else is being bailed out. The fairness of it becomes more and more evident as we go along.

"The auto companies may be hurting, but there are very few companies that aren’t hurting and they’re going to hurt. We don’t have enough money to bail everyone out.

“If you look at where we’re going, we’re not on a sustainable course as a country”

- Sen. Jim DeMint, R-S.C., accidentally telling the truth, December 11, 2008