lohnt sich zu lesen :cool die "Spielchen" sind allerdigs :gomad
17 October 2008
Bear Raids and Economic Warfare on a Global Scale
The lawmakers and regulators may wish to look into the quiet but devastating run on the hedge funds that is occurring right now, that is going to cut that industry in half, and distort the markets until the end of the year.
This will affect key commodities in addition to certain industries, and may temporarily impair some national economies.
The Prime Brokers have a rough idea where the hedge funds, their clients, have their major holdings, and are leading bear raids on them as the funds have to raise liquidity because of redemptions. They are publicly identifying those positions to other players in the industry. A conflict of interest of the first order it appears at first blush. Perhaps not illegal, but certainly destructive and 'feeding the fire.'
These bear raids on key positions generate more panic and losses for the hedge funds, which in turn generates more forced selling and losses.
The irony of course is that the Prime Brokers are also the biggest banks, and are being bankrolled by the US Treasury and the Fed by about 400 billions per day in rolling capital. They appear to be at a loss so to speak with regard to productive investment opportunities. Thus they turn to speculation.
In addition to the hedge funds, many banks with their own small trading desks are being caught in the cross fire.
We do not think of this as a conspiracy but clearly the unintended consequence of poorly thought out but well intentioned actions taken in haste.
The lawmakers and regulators must create a firebeak to stop the cycle of destruction. They could require any bank accepting Federal funds to adhere to some simple guidelines about the potentially predatory use of those funds, especially banks that are more like large hedge funds themselves in their composition.
This cycle of destruction of assets is exactly why the Congress enacted Glass-Steagall in the 1930's. Some of the Washington and Fed whiz kids might wish to go back and revisit the raison d'etre for that legislation.
Some likely measures would be an immediate limit on the expansion of short positions in all commodities, with limits based on market size, and the enforcement of laws against naked short selling on all equities immediately.
There should also be disclosure from all recipients of taxpayer money of all net positions to the SEC on a daily and weekly basis. We would also approve of a ban against short selling over certain limits of the size of a market or the shares outstanding by players over a certain size, and all those receiving Fed subsidies.
But this will probably not happen, which is why we may have a political crisis next year.
To put a very fine point on this so no one can miss it, it is not the hedge funds themselves that we care about, or the 'qualified investors' that put money into them. What concerns us are the unintended consequences, the malinvestment, the market distortions, the polarization of wealth, and the political blowback that come from interfering with markets and other people's business for a protracted period of time, and in a big way. The actions being taking by our banks, our 'national champions,' is ours because we are funding them and regulating them. And in this world, if you break it, you bought it, whether it was intended or not.
This is starting to look like economic warfare from some perspectives. The blowback may not be attractive.
Posted by Jesse at 1:59 PM :verbeug
Krisenbanker gönnen sich 70- Milliarden- Belohnung
Wo kann man pokern, alles verlieren und trotzdem kassieren? In der Bankenwelt. Wie der "Guardian" berichtet, zahlen Wall-Street-Firmen ihren erfolglosen Managern noch einmal 70 Milliarden an Gehältern und Sonderprämien - bevor sie in Washington um Hilfe betteln. mehr... [ Forum ]
17 October 2008
Looking Good Billy Ray
Feeling good, Louis...
Lahde, who bet versus subprimes, quits hedge funds
by Jennifer Ablan
Fri Oct 17, 2008 5:15pm EDT
NEW YORK, Oct 17 (Reuters) - Andrew Lahde, the hedge fund founder who shot to fame with his small fund that soared 870 percent last year on bets against U.S. subprime home loans, has called it quits, thanking "stupid" traders for making him rich. (and the beat goes on - Jesse)
In a biting, but humorous letter to investors posted on the website of Portfolio magazine on Friday, Lahde told investors last month he will no longer manage money because his bank counterparties had become too risky.
Lahde ripped his profession in the letter. He noted another hedge-fund manager who recently closed shop and was quoted in The Wall Street Journal as saying: "What I have learned about the hedge fund business is that I hate it." To which Lahde responded, "I could not agree more with that statement.
"The low-hanging fruit, i.e. idiots whose parents paid for prep school, Yale and then the Harvard MBA, was there for the taking," said Lahde, who according to the website birthdates.com is 37.
"These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy, only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America."
Lahde, whose Lahde Capital's Short Credit Fund returned 886 percent in 2007, said he didn't have a strong opinion about any market other than to comment, "Things will continue to get worse for some time, probably years."
But while he will no longer manage money for high-net worth individuals or institutions, he will continue to manage the wealth he has amassed.
"Some people, who think they have arrived at a reasonable estimate of my net worth, might be surprised that I would call it quits with such a small war chest," he said. "I am content with my rewards. Moreover, I will let others try to amass nine-, 10- or 11-figure net worths. Meanwhile, their lives suck." (Newsflash - lots of people living from paycheck to paycheck have lives that suck too - Jesse)
Last autumn, the Financial Times reported that Lahde had launched a fund to bet against commercial real estate -- which made 42 percent in its first two months.
"I now have time to repair my health, which was destroyed by the stress I layered onto myself over the past two years, as well as my entire life -- where I had to compete for spaces in universities and graduate schools, jobs and assets under management -- with those who had all the advantages (rich parents) that I did not," Lahde said.
(In his letter on the web, Andrew drifts into a heavy fugue state, and recommends a think tank to be funded by George Soros to design a new government, and that our economy could be based on hemp. Don't bogart that dream, Andrew. - Jesse)
Andrew Lahde's Farewell Letter:
Today I write not to gloat. Given the pain that nearly everyone is experiencing, that would be entirely inappropriate. Nor am I writing to make further predictions, as most of my forecasts in previous letters have unfolded or are in the process of unfolding. Instead, I am writing to say goodbye.Posted by Jesse at 11:10 PM :verbeug
Major Market Bottoms over the Last 150 Years
Guest Commentary this weekend comes courtesy of George Slezak, who used to trade the pits for his own book, and brings a well-developed set of experience to almost any market.
My view is a little different from George's on the macro level. However, the point is to listen to other fact based points of view, and take from them what makes sense for you, even if you may disagree on some of the basic assumptions.
Opinions without facts are almost worthless. Everyone gets on a streak now and then, and carve their hits into marble and write their misses on the sand. But opinions mean nothing, because if the normal trader's opinion is probably little better than a 50-50 coin flip, and if he knows a lot and is an insider, he's probably lying. So take the facts and make something you can estimate and follow with confidence, and try to search out people who have a better than average track record in following the markets.
George and I seem to both agree we have not yet made a major bottom. In fact another 8% down from here at least in a panic selloff looks about right. Its not clear where the bottom will come however, because this selling is being driven by a forced liquidation of the funds, who are getting some brutal treatment from the Gang of Nine Banks. We have an open mind to the continuation of the looting until Bush and Paulson leave town.
Let's allow the market to tell us. And in the meanwhile, here is some valuable information from George, who regularly takes the honors in the tallies of the forecasts of letter writers. His site can be visited here at Stock Index Timing.
------ (viele Charts usw.)
Please understand this is the way to works at MAJOR BOTTOMS, not intermediate bottoms. Intermediate bottoms in a trend are different because it is not threatening the major multiyear lows on a new trading low and forcing panic selling from long term positions.
We are now looking for a MAJOR BOTTOM, and since we are retesting I expect us to slide through to lower lows.
Unfortunately, the slide through may look real bad. I expect we will have a week of downtrend days and then a combined 20 billion share day climax, maybe before the end of the month!
Strap yourself in and get ready for the ride of the century! It's gonna look so bad that the dismal forecast above of the next four years of a chop between Dow 6,000 and Dow 10,000 isn't going to look so bad after all.
Did I say 6,000! Yeah, that's 62% back to the 1974 low. I HOPE we hold the 50% back level of the 7,200 year 2002 low. But if that doesn't hold we could go further. We will see if it happens, maybe in the next few weeks.
Posted by Jesse at 1:21 PM :verbeug
18 October 2008
At the Decisive Moment Paulson Served His Friends and Bernanke Failed to Lead
"If derivatives are Weapons of Mass Destruction, then the Credit Default Swaps market is the H Bomb. Credit Default Swaps, if they start unwinding, can develop a chain reaction that will take out a fair chunk of the real economy, in addition to two or three big name corporations... Aren't you glad we have men [Ben Bernanke and Don Kohn] so familiar with the mistakes the Fed made in 1929 to 1932 with regard to Fed Policy? We wish they had at least audited the courses covering the Fed's mistakes from 1921 to 1929. Sure, they are the experts; we're just concerned that they may be preparing to fight the last war."Anna Schwartz
Bernanke Is Fighting the Last War
By BRIAN M. CARNEY
'Everything works much better when wrong decisions are punished and good decisions make you rich."
On Aug. 9, 2007, central banks around the world first intervened to stanch what has become a massive credit crunch.....
.....So even though the Fed has flooded the credit markets with cash, spreads haven't budged because banks don't know who is still solvent and who is not. This uncertainty, says Ms. Schwartz, is "the basic problem in the credit market. Lending freezes up when lenders are uncertain that would-be borrowers have the resources to repay them. So to assume that the whole problem is inadequate liquidity bypasses the real issue."....
In the 1930s, as Ms. Schwartz and Mr. Friedman argued in "A Monetary History," the country and the Federal Reserve were faced with a liquidity crisis in the banking sector. As banks failed, depositors became alarmed that they'd lose their money if their bank, too, failed. So bank runs began, and these became self-reinforcing: "If the borrowers hadn't withdrawn cash, they [the banks] would have been in good shape. But the Fed just sat by and did nothing, so bank after bank failed. And that only motivated depositors to withdraw funds from banks that were not in distress," deepening the crisis and causing still more failures.
But "that's not what's going on in the market now," Ms. Schwartz says. Today, the banks have a problem on the asset side of their ledgers -- "all these exotic securities that the market does not know how to value."
"Why are they 'toxic'?" Ms. Schwartz asks. "They're toxic because you cannot sell them, you don't know what they're worth, your balance sheet is not credible and the whole market freezes up. We don't know whom to lend to because we don't know who is sound. So if you could get rid of them, that would be an improvement." The only way to "get rid of them" is to sell them, which is why Ms. Schwartz thought that Treasury Secretary Hank Paulson's original proposal to buy these assets from the banks was "a step in the right direction."
The problem with that idea was, and is, how to price "toxic" assets that nobody wants. And lurking beneath that problem is another, stickier problem: If they are priced at current market levels, selling them would be a recipe for instant insolvency at many institutions. The fears that are locking up the credit markets would be realized, and a number of banks would probably fail.(And chief among these were Goldman Sachs and Morgan Stanley - Jesse).....
.....It takes real guts to let a large, powerful institution go down. But the alternative -- the current credit freeze -- is worse, Ms. Schwartz argues. (Most economists we've met are underdeveloped in 'real guts' having been trained and conditioned to be bureaucrats playing the political curve and sniping in academic sorority fights - Jesse)
"I think if you have some principles and know what you're doing, the market responds. They see that you have some structure to your actions, that it isn't just ad hoc -- you'll do this today but you'll do something different tomorrow. And the market respects people in supervisory positions who seem to be on top of what's going on. So I think if you're tough about firms that have invested unwisely, the market won't blame you. They'll say, 'Well, yeah, it's your fault. You did this.
Nobody else told you to do it. Why should we be saving you at this point if you're stuck with assets you can't sell and liabilities you can't pay off?'" But when the authorities finally got around to letting Lehman Brothers fail, it had saved so many others already that the markets didn't know how to react. Instead of looking principled, the authorities looked erratic and inconstant. (They should have struck a principle and stuck with it, and laid out the plan for handling the resolution of these large bankruptcies. At the critical moment Bernanke flinched, and Paulson was hopelessly entangled in conflicts of interest because next in line was :bad Goldman Sachs :bad - Jesse)
How did we get into this mess in the first place? As in the 1920s, the current "disturbance" started with a "mania." But manias always have a cause. "If you investigate individually the manias that the market has so dubbed over the years, in every case, it was expansive monetary policy that generated the boom in an asset..........
"This was [his] claim to be worthy of running the Fed," she says. He was "familiar with history. He knew what had been done." But perhaps this is actually Mr. Bernanke's biggest problem. Today's crisis isn't a replay of the problem in the 1930s, but our central bankers have responded by using the tools they should have used then. They are fighting the last war. The result, she argues, has been failure. "I don't see that they've achieved what they should have been trying to achieve. So my verdict on this present Fed leadership is that they have not really done their job."
(We expressed our concern about this last year, but can now draw a more expansive conclusion.
Bernanke has no background in banking or running large companies and organizations, making the tough decisions, sometimes under fire and with inadequate information. The internecine squabbling amongst the academics is surely vicious, but not nearly the same thing and not constructive to the type of character it takes to shape a country's financial system.
At the end of the day Bernanke came to the point of critical decision and simply deferred. He accepted what was being put forward by Hank Paulson who does have that executive drive and experience, but is hopelessly conflicted in his role as Treasury Secretary of :bad Government Sachs. :bad
At the key moment Ben flinched from his role as the independent central banker. In that sense he is no different than Alan Greenspan who repeatedly did what was convenient, politic, easy, ingratiating. - Jesse)
Posted by Jesse at 7:55 PM :verbeug
....wieder lang zu lesen - aber es ist eben schon scary :rolleyes
Paulson Panics as UK, Germany find own solution
F. William Engdahl
Oct 20, 2008
America's de facto Finance Czar, US Treasury Secretary Henry Paulson has reached for the panic button and made a dramatic 180-degree reversal of his financial bailout plan passed only days before. On September 23 in testimony before the US Congress, Paulson, former CEO of the politically influential Wall Street investment firm, Goldman Sachs, declared his adamant opposition to the idea of the US Government taking equity stakes in troubled major banks in order to provide them capital and stabilize the frozen interbank trading market. On October 13, that opposition to 'nationalization' collapsed. What happened to cause that sudden reverse is what interests us here. It shows the utter lack of coherency in the US financial elites over how to deal with their home-grown securitization of risk fiasco.
The Paulson plan was widely criticized among more sober US bankers and economists, including Paulson's predecessor as Treasury Secretary, Paul O'Neill who simply called the concept of using $700 billion taxpayer bailout fund to buy 'toxic debt' from banks, as 'crazy.' All critics agreed the Paulson approach was far the most costly model and far from guaranteed to solve the underlying problem-inadequate bank capitalization following hundreds of billions of dollars in sub-prime and other security losses.
Yet the Secretary adamantly refused to alter his plan, even after Congress rejected it in the first vote. He allowed non-related Democratic items to be glued on to his original TARP plan, a plan that gave the Treasury Secretary virtual dictatorial powers over the US finance and de facto the economy. It was referred to widely as 'the financial equivalent of the US Patriots Act.'
Then, on October 8 the unexpected took place. Gordon Brown, former British finance minister and now Prime Minister, facing a literal meltdown of the British banking system, on advice of senior staff of the Bank of England, swallowed his own opposition to bank nationalization and adopted an emergency nationalization scheme. He announced that the UK Treasury had made € 64 billion available to buy bank preferred shares in eight UK banks designated by the Government as strategic. The nationalization was to be partial but effective and included a €260 billion 'special liquidity scheme' of Treasury cash to inject into the frozen inter-bank market, consisting of UK Treasury bills in exchange for bank less liquid assets as collateral.
The relevance of 1931
The move was a replay of the dramatic decision by the British Government in 1931. At that time, Britain and members of the British Commonwealth 'broke the rules of the game' and unilaterally abandoned the international Gold Standard. In September 1931, after months of debate, the UK abandoned monetary orthodoxy and unilaterally left the Gold Standard it had rejoined in 1925.
Germany had preceded the UK, under far different circumstances, by some weeks in August 1931 by abandoning the Gold Standard.
Germany, under emergency rule without Parliament under Chancellor Brüning, faced a crisis in the wake of the French decision to punish the German-Austrian economic entente. France had precipitated a banking crisis in Austria's largest bank, the Vienna Credit-Anstalt.
The role of J.P. Morgan Bank in New York, the leading private creditor of the German banking system since the end of Hyperinflation in 1923, and the Morgan controlled New York Federal Reserve under Governor George L. Harrison, was instrumental in precipitating the German banking crisis of 1931.
As a condition for its stabilization loan to the Reichsbank, Harrison demanded the Reichsbank cease lending to German commercial banks. Under maximum duress, it did. The banks collapsed.
So long as it remained on the Gold Standard, a requirement of JP Morgan and the New York Federal Reserve, Germany had to prevent capital outflows and impose higher taxes and budget austerity to persuade international creditors of its credit worthiness. As German recession deepened, the government cut the social programs instituted after the war. It was the outbreak of the banking crisis in the summer of 1931 that made the German depression so severe. The collapse of the banks in central Europe had a major social, psychological and political impact. The rest became tragic history.
The United States, guided by Harrison and backed up by the monetary orthodoxy of President Herbert Hoover, held bitterly to the Gold Standard until March 1933 when newly inaugurated President Roosevelt left the Gold Standard. By then, the United States economy was deep in depression.
Paulson's Volte Face
This time around it was again England that led the break with the rules of a US financial game by swiftly nationalizing its top eight banks, starting with the Royal Bank of Scotland (RBS) on October 8, a Wednesday. By that Friday it was clear that Germany was also moving towards a national resolution of its banking problems, problems which originated in the US spread of Asset Backed Securities and Credit Default Swaps, an exotic new area of finance which had grown up in recent years in a totally unregulated area of bank-to-bank practice to a nominal size of some $68 trillion. The French Sarkozy Plan, a €300 to 400 billion 'common bailout fund' modelled loosely on the original Paulson Plan, was dead. German taxpayers would not pay for the excesses of French or Italian banks. It was a sea change in attitude across the EU away from a US-led global financial unity. The American Century faced catastrophe.
That was the point of Paulson's radical shift to what in the parlance of US radical free marketers was a bolt towards the dreaded 'S' word, socialisation of the banking system. According to my best European banking sources, had Paulson not taken radical new action at that point, as one City of London veteran banker expressed it, 'the US banks were in danger of extinction.'
On Monday October 13 in the US Treasury, Paulson convened an emergency meeting with the heads of the nine largest US banks. According to reports from participants, Paulson handed each person a one page document to sign that they would agree to sell their stock shares in part to the US Government in return for an emergency injection of $250 billions. Paulson told them they must all sign before leaving the room. Three hours and reportedly many acrimonious arguments later, all nine had signed in the largest Government intervention into the US banking system since the Great Depression.
According to insider accounts from bankers here I spoke with and in New York, it was precisely the decision by the UK, backed by a similar if not yet so detailed plan from the German authorities which forced Paulson's Volte Face.
After the fact, in a confirmation of how weak the new Federal Reserve Chairman, Ban Bernanke is in face of the domineering personality of Paulson, Bernanke mumbled to the press that he had 'all along' been in favor if the Government buying equity shares to recapitalize the banks. Why he refused to state that publicly before the Paulson Plan won the day is unclear, but it suggests the man Bush chose to succeed Alan Greenspan was chosen for his lability not his ability or his backbone.
San Francisco Federal Reserve President, Janet Yellen remarked as well, long after it had become clear that the US Administration's decision to let Lehman Brothers go bankrupt without Government assistance, had been a horrible miscalculation.
That Lehman Bros. bankruptcy on September 15, was the 'shock heard round the world,' which precipitated a global crisis in banking confidence resulting in the present situation. Whether Paulson and friends calculated the collapse would provide the basis to demand a US-crafted solution to the crisis remains unclear. What is clear, one of the chosen 'winners' in the present US banking reorganization, JP Morgan Chase, played a nasty role in the final push of Lehman Bros. into insolvency the Friday prior to Lehman's Monday declaration of insolvency. JP Morgan Chase had 'mysteriously' withheld a $19 billion transfer that Friday which would have averted the collapse of Lehman Bros. It was an eerie echo of the nasty role played in 1931 by the House of Morgan in relation, then, to the German and European banking crisis.
After 1931 the House of Morgan never again rose to the prominent role it had held. It is looking increasingly likely that the successor to the bank, JP Morgan, despite the pretensions of its head, Jamie Dimon, to invincibility, may be far more modest.
18 October, 2008
F. William Engdahl - http://www.321gold.com/editorials/e...dahl102008.html
.....bestimmt hat nicht Bush Bernanke ausgewählt - sondern die übliche WallstreetMafia - hoffentlich ersticken sie an ihren Machenschaften :bad
Das grosse Zittern geht weiter
Der nächste Zeitpunkt für Nachbeben könnte der kommende Dienstag sein, wenn Sicherungsgeber, die Anleihen der Pleitebank Lehman Brothers mittels Kreditderivate gegen Zahlungsausfall versichert haben, zur Kasse gebeten werden. In einer Art Auktion wurde vor wenigen Tagen die Höhe der Zahlungsverpflichtungen aus diesen Papieren - sogenannten Credit Default Swaps (CDS) - festgestellt.
Der Wert der CDS-Kontrakte auf Lehman-Anleihen wurde in der Auktion auf gesamthaft 365 Milliarden Dollar taxiert. Ungewiss ist, wie hoch die Nettoverpflichtungen ausfallen, da viele Kontrakte gar nicht mit echten Anleihen hinterlegt werden müssen. Die Schätzungen variieren stark. Während der Kreditderivatehändler DTCC mit Zahlungen von sechs Milliarden Euro rechnet, gehen die Analysten von RGE Monitor von einem hohen zwei- oder gar dreistelligen Milliardenbetrag aus. Chef-Bankenanalystin Elisa Parisi-Capone: «Möglicherweise muss am Dienstag jemand viel Geld in die Hand nehmen.»
Damit wird der Spuk nicht vorüber sein. Die CDS-Auktion für die ebenfalls zahlungsunfähig gewordene US-Sparkasse Washington Mutual ist auf den Donnerstag terminiert, und dieser Fall wiegt kaum weniger schwer als Lehman. Bei den isländischen Banken Glitnir, Landsbanki und Kaupthing hat der internationale Derivateverband ISDA ebenfalls den Eintritt eines sogenannten Kreditereignisses festgestellt - das bedeutet, dass die Anleihenversicherungen auf deren Schuldverschreibungen nun ebenfalls ausgezahlt werden müssen. Die Auktion dürfte Anfang November stattfinden.
faygokid Sun Oct-19-08 12:41 PM
Original message More W.Va. voters say machines are switching votes; In six cases, Democratic votes flipped to GOP
Edited on Sun Oct-19-08 01:30 PM by faygokid
Source: The Charleston Gazette
WINFIELD, W.Va. -- Three Putnam County voters say electronic voting machines changed their votes from Democrats to Republicans when they cast early ballots last week.
This is the second West Virginia county where voters have reported this problem. Last week, three voters in Jackson County told The Charleston Gazette their electronic vote for "Barack Obama" kept flipping to "John McCain".
In both counties, Republicans are responsible for overseeing elections. Both county clerks said the problem is isolated.
They also blamed voters for not being more careful. . .
Read more: http://www.sundaygazettemail.com/News/200810180251
The Guys From ‘Government Sachs’
By JULIE CRESWELL and BEN WHITE
Published: October 17, 2008
THIS summer, when the Treasury secretary, Henry M. Paulson Jr., sought help navigating the Wall Street meltdown, he turned to his old firm, Goldman Sachs, snagging a handful of former bankers and other experts in corporate restructurings.
In September, after the government bailed out the American International Group, the faltering insurance giant, for $85 billion, Mr. Paulson helped select a director from Goldman’s own board to lead A.I.G.
And earlier this month, when Mr. Paulson needed someone to oversee the government’s proposed $700 billion bailout fund, he again recruited someone with a Goldman pedigree, giving the post to a 35-year-old former investment banker who, before coming to the Treasury Department, had little background in housing finance.
Indeed, Goldman’s presence in the department and around the federal response to the financial crisis is so ubiquitous that other bankers and competitors have given the star-studded firm a new nickname: Government Sachs.
The power and influence that Goldman wields at the nexus of politics and finance is no accident. Long regarded as the savviest and most admired firm among the ranks — now decimated — of Wall Street investment banks, it has a history and culture of encouraging its partners to take leadership roles in public service.....
.....“There are people at Goldman Sachs making no money :dd:dumm living at hotels, trying to save the financial world,” said Jes Staley, the head of :rolleyes JPMorgan Chase’s asset management division. “To indict Goldman Sachs for the people helping out Washington is wrong.”......
full story: http://www.nytimes.com/2008/10/19/b...=rssnyt&emc=rss
Robert Grossman for The New York Times
Robert Rubin, right, an ex-Goldman co-chairman and a Treasury secretary in the Clinton administration, promoted Timothy F. Geithner at Treasury. Mr. Geithner now leads the New York Fed.
Sun 19 Oct 2008
ING Bailed Out By Dutch
Posted by alyx under all ur bankz , bailout
LOLFed was surprised to learn Dutch just pumped 10 billion euros (appx $13.5 billion dollars at current exchange rates) into ING, whose market value right now is scarcely 1.5x that.
Oh, wait, not Ed O’Neill. The Dutch GOVERNMENT. Not Dutch. OK, we’ve got it now. The Netherlands set aside 20 bn euros for these kinds of investments, and that’s half their scratch on this transaction right here.
Terms (from CNBC):
ING will issue 1 billion of non-voting core tier-1 securities to the Dutch state at a price of 10 euros per security.“Designed not to dilute shareholder capital” plus “position similar to common shareholders” kinda makes it sound like “If AIG doesn’t get their act together, the Dutch government stands to lose a lot of euros on this one.” Sounds like a good deal for ING. A cash cow if you will:
(At least that’s how Babelfish told me it’s said…)
Anyway, when we saw Fortis get carved up last month we all thought ING was doing better than Fortis, but these days “better” is obviously a very subjective term. ING booked srs losses for Q3 and the stock tumbled on Friday.
(And Jason, it’s my turn to say I don’t care who posted first!)
von ---> $cheinbar
Meine Finanzen sind zerüttet, an den Börsen hat's gekracht,
da hab ich aus meinen Aktien den Kindern Drachen gemacht.
Ich zog mit ihnen zu Felde, wo sanft die Lüfte wehn,
dort konnt ich meine Aktien noch einmal steigen sehn.
...wieder mal mit der nötigen Vorsicht geniessen ;)
From the Toronto Resource Investment Conference, Dr. Jim Willie talks to Al Korelin.
Is this guy serious?
-> A gold backed currency by the Europeans, Russians, Chinese and Arabs?
Mon 20 Oct 2008
Bernanke: Save The Consumer
Posted by alyx under bernanke
Further details on SuperBen’s plans:
Bernanke, despite utterly DENYING journalists everywhere the ability to slap a “BERNANKE: US IS IN RECESSION” headline on their coverage of this morning’s speech, was kind enough to admit that the US economy will run “below its longer-run potential” in the next few quarters, and to suggest extensive government intervention:
WASHINGTON — U.S. Federal Reserve Chairman Ben Bernanke on Monday threw his support behind a second round of fiscal stimulus by the government to limit the risk of a “protracted” slowdown in the economy.Other proposals included delivering an electroshock to any banker who denied a consumer’s request for an auto loan, the signing of the “No CDO Left Behind Act” to ensure that no bad asset was left on the books of any of the country’s nine largest banks, and something about how if Janet Yellen lost the bet she made with him about whether or not the US was really in recession she had to bake him a pie. OK, maybe not, but I tuned out for a while there.
Monday, October 20, 2008
A $516 trillion derivatives 'time-bomb'
Not for nothing did US billionaire Warren Buffett call them the real 'weapons of mass destruction'
By Margareta Pagano and Simon Evans
The market is worth more than $516 trillion, roughly 10 times the value of the entire world's output: it's been called the "ticking time-bomb".
It's a market in which the lead protagonists – typically aggressive, highly educated, and now wealthy young men – have flourished in the derivatives boom. But it's a market that is set to come to a crashing halt – the Great Unwind has begun.
Last week the beginning of the end started for many hedge funds with the combination of diving market values and worried investors pulling out their cash for safer climes.
Some of the world's biggest hedge funds – SAC Capital, Lone Pine and Tiger Global – all revealed they were sitting on double-digit losses this year. September's falls wiped out any profits made in the rest of the year. Polygon, once a darling of the London hedge fund circuit, last week said it was capping the basic salaries of its managers to £100,000 each. Not bad for the average punter but some way off the tens of millions plundered by these hotshots during the good times. But few will be shedding any tears.
The complex and opaque derivatives markets in which these hedge funds played has been dubbed the world's biggest black hole because they operate outside of the grasp of governments, tax inspectors and regulators. They operate in a parallel, shadow world to the rest of the banking system. They are private contracts between two companies or institutions which can't be controlled or properly assessed. In themselves derivative contracts are not dangerous, but if one of them should go wrong – the bad 2 per cent as it's been called – then it is the domino effect which could be so enormous and scary......
Posted by Bullionmark at 8:31 PM
oh great…outhouses and plugged toilets
October 20th, 2008
we know who is using the upper and lower outhouses…disgusting!
Mon 20 Oct 2008
Monday Night Links
Posted by alyx under links
From the “ohhhh, so THAT’s how it’s going to go down?” department: GM to acquire Chrysler? [CNBC]
Few things can be as austere as Washington Mutual’s fail. [WallStreetFighter]
Votive early, votive often. [National Review]
The wall of worry in the TED spread, and the Fed’s ever-expanding balance sheet. [GreyFinance]
21 October 2008
The SP 500 May be in a Cascading Waterfall Decline With a Bottom around 444
US equities as represented by the SP 500 are in a cascading waterfall decline that may not reach a genuine bottom until it reaches 640. If the US dollar starts falling with stocks and Treasuries we may see a capital flight that sets up a decline that may not bottom until the SP reaches 444, with high volatility and sharp rallies along the way. The rally from the final bottom will be tentative and slowly expansive with a modest slope.
Posted by Jesse at 1:22 AM :verbeug
Cramer haut wieder mal auf den Putz :rolleyes:hihi
Tue 21 Oct 2008
BREAKING NEWS: Jim Cramer A Blowhard
Posted by Jason under cnbc , jim cramer
We here at LOLFed do not often watch the Jim Cramer Crazytime Hour on the television, because we are of the firm opinion that financial advice and the soundboard from your local radio station’s morning zoo should be mutually exclusive concepts. Also, neither of us have enough liquor in our respective houses to make it through an entire hour of Cramer saying things that will never come true (with the exception of the THEY KNOW NOTHING rant, which was eerily prescient if a tad obvious).
So you’ll forgive us, loyal readers, if we weren’t right on top of Cramer’s calling for the public stoning of AIG employees if they ever came out in public to mingle with the little people, which of course they never do. Lucky for all of us, AIG’s new CEO Edward “G. Gordon” Liddy is a fan of Jim’s comedic stylings, which led him to fire off this letter in response:
Dear Mr. Cramer,Oh, it is on like Donkey Kong. Now, in all fairness, a small unit of AIG (heh heh heh, “small unit”) actually did cause this mess, but I think I get what he is saying.
In summary, if you see an AIG employee out on the street, do not yell at them. If you see Martin Sullivan out on the street, smile inwardly because that is where he belongs. And if you see Jim Cramer out on the street, you should immediately set him and any of his travelling companions on fire,* for the good of humanity.
*LOLFed is not saying you should actually do this, but we’re not saying you should not do this.
Kerkorian's Tracinda raises Ford stake to 6.49%
Last update: 7:31 a.m. EDT June 19, 2008
DOW JONES NEWSWIRES Billionaire investor Kirk Kerkorian reported Thursday that he raised his stake in Ford Motor Co.
to 6.49%, days after the company's chief executive, Alan Mulally, met with members of Kerkorian's Tracinda Corp. to discuss the future of the auto maker.....
.....Tracinda announced earlier this year it had purchased 100 million shares in the Dearborn, Mich., company and then immediately tendered a public offer for another 20 million at $8.50 apiece. That offer expired last week. Slightly less than half of all Ford shares were tendered for Kerkorian's offer.
Ford shares closed Wednesday at $6.22, down 38 cents......
Tracinda to sell up to $300 million in Ford stock
By Steve Gelsi, MarketWatch
Last update: 8:59 a.m. EDT Oct. 21, 2008
NEW YORK (MarketWatch) -- Tracinda Corp., the holding company for billionaire investor Kirk Kerkorian, on Tuesday said it may sell its entire 6% stake in Ford Motor Co., valued at more than $300 million, as it changes its investment focus to the gaming and energy sectors.
Tracinda disclosed it sold 7.3 million shares of Ford
on Oct. 20 at an average price of $2.43 a share for proceeds of about $17.7 million.....
...auch die Grossen fahren happige Verluste ein :rolleyes
Tracinda, In Other News From The Quaint Little Old Men Department
Posted by alyx under Uncategorized
Kirk Kerkorian is like that little kid fascinated with cars who never seemed to grow out of it. He tried to take over Chrysler in 95, ended up with a board seat, sued Daimler unsuccessfully for something akin to trying to force Chrysler shareholders into choking on those little plastic toys those Germans hide inside Kinder eggs, tried to take over GM and force it to merge with Nissan (at least he exited that one with a profit) and, most recently, bought up Ford shares hand over fist for like four times what it is trading at now (immediately thereafter, Ford announced it was giving up on turning profitable in 2009, or, possibly, ever). Apparently he’s been forced to pony up a big chunk of his MGM Mirage stock as collateral for the credit line he used to buy the Ford shares, meaning he is using gambling to back up gambling.
I wanted to put the logo for Tracinda, his investment firm, on a failboat. Does Tracinda even have a logo? All I find when I search for it is Tracinda’s Country Treasures, which, when you consider the whimsicalness of all this investing in American autos, is probably completely apropos:
...bei DU gesehen :)
....ob Paraguay Auslieferungs-Vertrag hat :confused:rolleyes da soll Gerüchten zufolge die Bush family riesige Ländereien gekauft haben :mad
Boom, Doom and Gloom
Insight on who really is to blame for the financial mess, with Marc Faber, The Gloom, Boom & Doom Report editor/publisher
....er sieht USA positiver als den Rest der Welt :rolleyes
Tue 21 Oct 2008
Senile Fed Chairs, Rate Cuts Boiling Over, Hoarding Old Newspapers And Junk CDOs
Posted by alyx under cnbc
Rick Santelli declares Paul Volcker’s support of Obama to be senility: someone needs to “write a book about what great people do as they go into the twilight”. It was a great day to be watching Squawk while I was trying to wake up, they even called Larry Kudlow a weenus. I’ve got to get a DVR.
weenus ---> In search of the wild weenus
By Bruce Watson
Published on September 15, 2006
OF all the strange slang my daughter has brought home from school, none is so weird as ''weenus.''.....
amüsant zu lesen ;) http://www.amherstbulletin.com/story/id/91500132005/
UPDATE 2-Goldman Sachs recommends "sell" on Citigroup
Tue Oct 21, 2008 9:52am EDT
(Reuters) - Goldman Sachs reinstated Citigroup Inc (C.N: Quote, Profile, Research, Stock Buzz) with a "sell" rating and recommended a "paired" trade in which investors sell Citigroup short, betting on a decline, and buy Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz) shares.
Shares of Citigroup, the giant U.S. bank, fell 5 percent to $14.35, while those of Morgan Stanley rose 3 percent to $20.36 in morning trade on the New York Stock Exchange.......Tanona has a six month price target of $11 on Citigroup.....
....seit wann hackt denn eine Krähe der andern die Augen aus :rolleyes:confused oder steckt wieder mal was dahinter :gruebel:mad
Wall Street banks in $70bn staff payout
Pay and bonus deals equivalent to 10% of US government bail-out package
Staff at six banks including Goldman Sachs and Citigroup are in line to pick up the payouts despite being the beneficiaries of a $700bn bail-out from the US government that has already prompted criticism. The government's cash has been poured in on the condition that excessive executive pay would be curbed. Pay plans for bankers have been disclosed in recent corporate statements. Pressure on the US firms to review preparations for annual bonuses increased yesterday when Germany's Deutsche Bank said many of its leading traders would join Josef Ackermann, its chief executive, in waiving millions of euros in annual payouts.Goldman Sachs rewarded themselves. So did the JP Morgan pirate community. The gnomes knew they could skim off 10% and hoped to get away with it. It was NOT headline news in the US media until the Brits broke the story. Thanks to the Guardian, most Americans now know the ruling elites used this damned rescue to reward themselves. This last week, the AIG gang went off to Scotland on a multi-million dollar jaunt to shoot grouse and grouse about the peons interfering with their fun. They drank expensive brews and brooded about the unfairness of life. (....schon wieder :confused:rolleyes:mad die feierten doch eben erst :mad) Why, we are criticizing their efforts to cultivate contacts via these wonderful parties where they fly about the planet in their private jets!
This, too, was in the British news, not American news. US newspapers don't send reporters snooping around Bilderberger gatherings or if ABC sent a reporter to check out who was at the Democratic party's corporate parties held by the super-rich, the reporter is beaten up by the cops. At the Republican party, the media didn't even try to do this. Any reporters reporting on the demonstrations was beaten up or arrested, too. So this guarantees the media won't look at anything, anymore. And they don't look much at all. But the news that AIG got tens of billions from US taxpayers and then went off to have expensive parties has leaked out via the internet. Joe the dumb Plumber doesn't talk about this. He hates worker's socialism, not corporate socialism.
...ob es etwas ähnliches wie Gerechtigkeit gibt :rolleyes die müssten doch alle mit dem Hut in der Hand an einer Strassenecke stehen oder besser - in einem Käfig damit man sie mit faulen Eiern beschmeissen kann :o
....was muss eigentlich noch alles passieren :grrrr
.......Goldman Sachs gnomes are 'leading' us to the slaughter. They have destroyed America. All the choices they have made are wrong. We are in the present mess thanks to them! How can anyone sane praise this utter take-over of our Treasury, the Federal Reserve, Congress and many state houses as a good thing? We are way, way down the wrong road and we are there thanks to them! Goldman Sachs should be investigated and the people who are 'serving' us this stew of destruction, they should be arrested for treason.......
Börse weiss auch nicht wie weiter :gruebel
Posted by fabric
Fed would grant up to $540B to money market funds
AP - 49 minutes ago WASHINGTON - The Federal Reserve announced Tuesday that it will provide up to $540 billion in financing to bolster the money market mutual fund industry, its latest effort to get credit flowing more freely again.
EU- Kommission will Nacktscanner auf Flughäfen erlauben
Das Europäische Parlament ist empört: Die EU-Kommission will die Zulassung von Ganzkörper-Scannern bei Flughafen-Sicherheitskontrollen durchwinken. Die Geräte durchleuchten sogar die Unterwäsche von Passagieren - und sind in Amsterdam, :kotz Zürich und London bereits im Einsatz. mehr... [ Forum ]
Schweiz: 21. Oktober 2008, 17:44
Die Schweiz ignoriert die Forderungen
Ablehnende Reaktion auf die Beschlüsse der OECD-Konferenz
Die Beschlüsse einer Konferenz mit Mitgliedern der OECD ist in der Schweiz auf Ablehnung gestossen. Die 17 OECD-Länder hatten in Paris beschlossen, die Schwarze Liste von sogenannten Steuerparadiesen um einige Länder, darunter die Schweiz, zu erweitern. ...
«Steuerparadiese»: Deutschland droht
Bürgerliche Parteien: Empörte Reaktionen
Deutschland droht - na das wird einige User aber freuen :Prost
A scorecard of the government’s forray into banking
-> Posted by sailman @ 14:13 pm on October 21, 2008
NY Times Financial Commitment graphic
Fed makes new move to help bust credit logjam
By MARTIN CRUTSINGER and JEANNINE AVERSA, AP Economics Writers Martin Crutsinger And Jeannine Aversa, Ap Economics Writers – 2 hrs 3 mins ago
WASHINGTON – The Federal Reserve on Tuesday introduced a new program to finance the purchases of assets from money market mutual funds as the government continued to search for ways to battle a severe credit crisis.
"The short-term debt markets have been under considerable strain in recent weeks as money market mutual funds and other investors have had difficulty selling assets to satisfy redemption requests," the Fed said in an announcement of its new effort.
JPMorgan Chase & Co. (...also in "besten" WallstreetMafia Händen :mad) was chosen to run five special funds that will buy certificates of deposit, bank notes and commercial paper from money market mutual funds. The Fed will lend up to $540 billion to the five funds to support the effort......
full story. http://news.yahoo.com/s/ap/20081021...ancial_meltdown
October 21, 2008, 15:53 Gas exporters plan OPEC-style alliance
Russia, Iran and Qatar have discussed plans to form a powerful OPEC-style group for exporting gas. The news comes after a meeting between Gazprom chairman, Alexey Miller, Qatar Energy Minister Abdullah Ben Hamad Al-Attiya, and Iranian Oil Minister Gholam Hossein Nozari. "Great decisions have been taken at this meeting," said Nozari. "The sides agreed at the Tuesday consultations on the earliest formation of this organisation and on drafting its charter.
"The negotiators underlined that this document is to be submitted at a coming meeting of the foreign ministers of member states of a forum of gas exporting countries."
Talks about the creation of the group will send shivers down the spines of the United States and the European Union, which rely heavily on imports.
The founding fathers of any such group would be Russia, Iran, Qatar, Venezuela and Algeria. If realised, the alliance would control more than half of the world's known gas reserves and give the countries powerful leverage.
21 October 2008
How High Will the Dollar Go?
Let's call this one "Your Host Exhibits His Falliblity" and general inability to see the future. Its a good reminder to all of us, of how little we really 'know.'
This is an email sent in response to a question "How high will the Dollar rally? Give us a best guess."
Who can know these things with any certainty? As guesses go this is probably as good as any.
Tell me if the European banks are stabilizing and are no longer starving for dollars, and that there is a meaningful decline in the TED and LIBOR$ and the top in the dollar will be easier to project.
Its hard to say because I don't have the latest data on the Banks balances in europe from BIS.
Posted by Jesse at 2:39 PM
...kein Wunder steigt der $ - wird ja für all die bailouts gebraucht :dumm
Good ole FED and its huge $ footprint
(Hten) Oct 16, 09:55 (RTTNews) - Thursday, Jean-Pierre Roth, the Chairman of the Governing Board of the Swiss National Bank, said the US$54 billion loan extended to UBS will not affect :rolleyes:mad the central bank’s monetary policy in any way. The reason he cited was that the entire operation is funded by US dollars….The SNB will obtain US dollar through a Dollar-Swiss-Franc swap with the US Federal Reserve…..
...da ich ein absoluter Fan bin ;)
Apple CEO: What’s Adobe’s Market Cap, Again?
Posted at 6:07 PM PT on October 21, 2008
With $25 billion in cash and short-term securities stored away on its balance sheet, Apple (AAPL) is in a uniquely comfortable position from which to weather the econaclypse. And perhaps a uniquely opportunistic one, as well. According to CEO Steve Jobs, anyway. To wit: Jobs’s comments Tuesday about Apple’s cash reserves what it might do with them.
We have almost $25 billion safely in the bank and zero debt. This provides us tremendous stability and the ability to invest our way through this downturn. This is what we did during the last downturn–we increased R&D investments and created some of our best new products and businesses, like the Apple retail stores, for one. This downturn may also present some extraordinary opportunities for companies that have the cash to take advantage of them, like Apple does.”What was that again?
“This downturn may also present some extraordinary opportunities for companies that have the cash to take advantage of them, like Apple does.”
Sanford Bernstein analyst Toni Sacconaghi noted that remark as well and followed up on it during the Q&A. “Steve, you mentioned a couple of times that you thought there were extraordinary opportunities for companies with cash,” he said. “I think you could hire almost every engineer in Silicon Valley on a lifetime employment contract and not really dent that significant cash horde that you have. When you made that statement, are you suggesting that there are significant opportunities for Apple outside of Apple, specifically in terms of acquiring companies?”
Jobs’s reply: “I just meant exactly what I said, which is I think there’s going to be some significant opportunities.”
Could this mean that Apple is considering an acquisition–a major acquisition? It’s hard to say, but the fact that Jobs dropped such a hint at all is certainly interesting. Perhaps it’s time for that long-rumored merger with Adobe (ADBE).
Incidentally, Adobe’s market cap is $14.65 billion. …
.....und ich hoffe, dass Steve Jobs noch lange dem Apple erhalten bleibt - obwohl er ein extremer Exzentriker sein soll und gar nicht immer fair zu seinen Mitstreitern :rolleyes
October 21st, 2008 After a long weekend in Connecticut enjoying the Fall foliage, I took the train to Grand Central Station. Had lunch with a friend, then went to Wall Street to see if I could take a look behind the curtain or at least catch a glimpse of Paulson, but no such luck. At least I was able to demonstrate good form for other visitors and locals alike on how to ride a bull, either by grabbing the horns while seated or showing off and riding standing up. Yahoo! Unfortunately most people opted to just stand by and look in wonder, or even worse, they crawled around to the back end! There were even guys kissing the unmentionables… What’s up with that?! Is there anyone here who doesn’t yet know how to ride a bull?
Incidentally, the stock exchange has been closed to the public since 9-11. Now they’re installing fancy rotating blockades in the streets around the exchange, to thwart would-be truck bombers.
Staying with Russian friends out near Coney Island tonight, then heading to England tomorrow.
Posted in Metals Links | Comments Off
you won’t be needing these anymore !
October 21st, 2008
Posted in Metals Links
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