Rantings on Markets, Economics and Business Strategy

Here It Comes

noreply@blogger.com (TimingLogic) — Thu, 12 Nov 2009 13:53:00 +0000

We have been writing for four years that rising nationalism is coming. And since this crisis started we have posted many rising tensions as they develop. Russia has already slapped enormous tariffs on many foreign goods and China isn't far behind. China already has one of the most closed anti-competitive markets in modern history in this racket elitists and ideologues call "free trade". The term Free Trade is a perfect example of Hitler's propaganda technique termed the Big Lie. (A tactic also used extensively in George Orwell's mind-controlled society, Oceania in his novel 1984.) In other words, if you repeat a completely preposterous lie enough, the general population will come to accept it as true. At least until they are jolted into reality. Any other Big Lies you can think of in today's Orwellian world? They are countless. Almost all are propagated by media, the financial engine, politicians and mass marketers.

Accommodative monetary policy and quantitative easing are nothing more than pretty words for nationalistic monetary policy - a race to the bottom of the barrel being undertaken in some form by every major economy on earth. Who will win that race to make its economy more competitive in this world of "free trade"? In neoliberal economics embraced across the world today, destroying one's currency is a primary requirement to attract unregulated global capital - a dynamic we have been critical of on here. Hence our many remarks about a race to the bottom of the barrel. Everyone is attempting to devalue their currency in a strategy embraced by the mentally-challenged economics community, financial mobsters, central bankers and political stooges benefiting from multi-national business "contributions". Contributions which specifically assist in setting policies friendly to "free trade".

China is in a substantially unique position in that it has benefited more than any country in modern history from an influx of foreign capital, foreign investment and foreign know-how. This is easily seen in the fact that somewhere north of 80-85% of exports out of China are from foreign multi-national firms, something we have highlighted often over the last four years.

Dominant technology and manufacturing firms from Japan, Taiwan, America, Europe and other countries have plowed substantial knowledge into China allowing for a metamorphosis of knowledge that would have taken fifty to one hundred years to develop itself. Instead this transfer of knowledge has taken place in a little more than a decade. National sovereignty, intellectual property rights and national wealth are irrelevant in this neoliberal economic charade. Instead the world has become a playground for banksters and multi-national firms using national wealth to speculate across the globe regardless of the consequences, benefits or costs.

China's policies are turning nationalistic just as we said they would. And they have far and away the most to lose by doing so. Foreign investment and technology transfer could suffer substantially leading to the depth and length of any substantial downturn. China must have continued access to foreign know-how or lose any momentum gained by heretofore foreign investment. China's comparatively stagnant domestic economy, weak research infrastructure and other substantial dynamics require continued outside investment for any level of sustainability. The U.S., as an example, still dominates global scientific research spending one out of every three dollars. Add in Europe and Japan and the remainder of scientific research around the world is a rounding error. In fact, much of China's research is actually intellectual property of foreign multi-national businesses with facilities in the country.

As China's economy collapses, a knee-jerk reaction from communist leaders would be to devalue their currency as is the policy accepted by the status quo of every economy on earth. But, now with fickle international investors having much to lose in China, such a move would have the effect of destroying returns on capital. A death knell for future investment. So, a much more palatable approach to is to accomplish the same objective without appearing to harm foreign investors. Foreign investors are substantially more important in today's economic landscape than national sovereignty, whether trade is free or fair or otherwise, etc. That "palatable" approach would obviously be to subsidize exports and increase regulation of imports in lieu of overtly devaluing the yuan. This is something we have obviously highlighted before but is very relevant to this post.

China has no alternative other than to do something to stem the collapse of its economy and corresponding massive loss of jobs while attempting to retain future foreign investment.

The actions of Chinese officials are becoming more overt. As an example, a recent trade filing showed that import tariffs were raised on nylon for no other reason than they are hurting domestic nylon suppliers. Much of China's economy has always been predicated on this type of protection but now the press is finally picking up on it. Future actions will almost assuredly be even more flagrant as it pertains to today's economic ideology.

This brings us back to a point we have made on here before. The yammering ideologues citing Smoot-Hawley tariffs as a cause of the Great Depression are completely ridiculous. Just as today, global trade collapsed at the start of the Great Depression. Tariffs were a response to the race to the bottom of the barrel we have highlighted above. A strategy employed by all nations at the start of the Great Depression. Just as today. And many countries were more vigilant than others in their race to the bottom of the barrel because they had accumulated such substantial debts from World War I. In order to repay these international debts, they had to do anything possible to keep their economies humming. Even if that meant selling goods below cost. Sound familiar? Smoot-Hawley as a cause of the Great Depression is one of the biggest Big Lies of our time. A Big Lie perpetuated by ideologues and special interests and mouthed by idiots doing their will. It is completely ridiculous. Global demand had already evaporated and there was massive excess supply just as today - a dynamic we have written of for four years. So, embracing the same neoliberal economics as we see today, will the outcome be different? Is the recession over? Or are we witnessing more Big Lies?

Not only is China going to experience a depression but I have complete confidence the communist government will make exactly the wrong trade and economic decisions which will lead to maximum economic pain. And most likely semi-permanent to permanent flight of foreign capital and investment.

You won't read any of this elsewhere. That's a good thing. Because the entire economics community, political leadership and Wall Street mobsters have succumbed to the Big Lie. A dynamic created by incredible hubris and ego. The truth is almost never is it seems.

This past week China takes another step in creating their own destiny by putting an even tighter yoke on an already very closed market.

Party hard! And buckle up.

Goldman Sachs' Letter To The Editor

noreply@blogger.com (TimingLogic) — Wed, 11 Nov 2009 18:55:00 +0000

More of God's work. Link here.

Toyota Bags Formula One

noreply@blogger.com (TimingLogic) — Wed, 11 Nov 2009 13:50:00 +0000

Formula One has the potential to implode over the coming year with only three major manufacturers still committed to the sport. Toyota, BMW and Honda are out. Ferrari is threatening to leave. Renault is going to decide its future by the end of the year. Formula One's program costs are absolutely outrageous. Some have put estimated costs of funding a two car team at upwards of $300-400 million a year. The corresponding quantifiable benefits are dubious.

Quite some time ago we remarked that leisure and entertainment businesses were likely to see a seminal shift in coming years. I have had this discussion with friends and they have generally looked at me in disbelief when I have remarked compensation numbers in the leisure and entertainment industries could drop by 90% in extreme cases - a point we have made on here before.

People are simply well too naive about reality. Hollywood entertainers, professional athletes and others involved in the leisure business making $15, 20, 30 or more million a year are living through their own bubble that is simply not sustainable. People have become so accustomed to this dynamic over the past few decades that they don't stop to think about the unsustainable economics. I would classify this in the same vein of the advertising bubble we have written extensively about. ie, People are simply well too naive as to sustainable economics.

Another example I am dubious about is the completion of Disney's newly announced plans for a new Shanghai theme park. Between future social volatility and China's coming economic strife, it's highly probable Disney will eventually cancel these plans. Since leaders at Disney are well unaware of these future dynamics, plans will continue until some marked event awakens them to reality. For a small stipend, I would gladly share a presentation of my work with Disney's board of directors. Actually, a nice barter would be unlimited lifetime access to the wonderful Disney properties. Obviously including airfare. Haha.

Many industries beyond Formula One are on the precipice as I write this. Another example includes the terrible financial shape of the NHL. Its financial problems are deep and systemic. And what is their answer? Taxpayer funding. Often threatening to leave cities without financial assistance. Ahem. Where might these firms relocate to with every major municipality in financial trouble?

Remember, were the Federal Reserve not backstopping the economy with trillions of dollars of taxpayer money, a phenomenon which cannot continue forever, entertainment firms and sports franchises would already be in bankruptcy reorganizing. First on the list of any reorganizations in the entertainment and leisure industry would be the adjustment of salaries and compensation commitments of people making bubble earnings.

The party is over. The unwinding begins. And that means some of the world's wealthiest people are likely to experience the same fate as many of the world's most underprivileged. That is, bankruptcy. A dynamic we have hammered on repeatedly. That is, many of the people who most benefited from current economic ideology would eventually succumb to it.

Senator Bernie Sanders Introduces Legislation To Break Up The Wall Street Mobster Monopoly

noreply@blogger.com (TimingLogic) — Tue, 10 Nov 2009 13:53:00 +0000

An unintended consequence of this legislation would be to break up of the Washington monopoly along with it. Let's explain this dynamic.

I have talked about this for nearly a year now but it remains unreported. Wall Street banks are likely not being broken up because they serve the state. They are a massive repository for new issuances of government debt. Wars, stimulus programs, funding massive foreign interventions and other policies which are related more to power and control need to be financed. With global trade collapsing and foreign entities unable to finance the U.S. deficit at its record levels, Washington needs to find domestic purchasers of its debt. The fact that Bernie mentions these mega banks are now substantially larger than before this crisis started creates an even larger repository for the Federal government to self-fund its own deficits without foreign purchasers. This is another dynamic also not clearly understood. The growing asset base of these banks also allows them to mint massive profits buy plowing enormous sums of money into a completely risk-free (conceptually) purchase of Treasuries. Get money at zero percent and invest it at 3.5% all day long. This dynamic allows these firms to continue to fund their Frankenstein financial market inventions as well.

Yet all of these dynamics and more are destroying the American economy. As we have said numerous times, it is Washington killing our economy. It is the President, the Congress, the Treasury, the Federal Reserve and anyone else who supports current policies. This surely is not malicious of intent, but is an unintended consequence of propping up these massive firms. In a world of finite capital, the U.S. government is crowding out the individual, the small business and even the large business for this country's resources. And because these firms are now effectively government-supported on every level, they too are crowding out capital which would otherwise support the operation of community banks and regional banks. What does that mean? We the People will continue to scavenge for capital and subsequently become poorer at the expense of the state. Bankruptcies will continue unabated. Unemployment will continue to rise. Small businesses will continue to fail. The economy will not recover.

Many people believe we are on the path of Japan and cite numerous meaningless comparatives including decades of low growth with low interest rates. That is absolutely incorrect. We are on the path to collapse without a change in economic policy. Japan's economy, unlike the U.S., was still a net producer of capital throughout their decades of comparable policies. And the global economy went without any substantial slowdown during their malaise thus providing a healthy outlet for their goods and services. So they could fund their government intervention. Today, comparatively, globalization is dead regardless of the rhetoric.

The U.S. has a reprieve of some length beyond what an initial crisis would have developed by allowing these mega banks to continue to grow in girth but a repeat of Japan is completely impossible in the U.S. without a massive economic transformation we have been stating for years must take place. It will take place whether elitists want it or not. It's only a matter of when and if it is adopted by necessity through collapse or through proactive policy. Only time will tell.

There are many solutions to our crisis . Solutions that mandate constructive government involvement. But current policy isn't one of them. Why would we expect it to be? As we have written Schumpeter told us ages ago that the only way to recover from economic crisis is to rid ourselves of the prior generation's foolish leadership and their faulty thinking which led to the collapse in the first place. And, indeed this collapse lies completely in the hands of elitists in government and business who have forsaken society's trust. They have forsaken We the People for morally bankrupt reasons. Were society enlightened to this fact, we would not consider any possible solutions involving a perpetuation of the status quo. But, in fact, all we are doing is perpetuating the status quo. Why? Because the status quo owns the microphone and the wealth taken from society in this great fraud. Wealth needed to control the microphone. Sound familiar?

A major change is headed Washington's way. What Schumpeter said is manifesting itself into today's political reality - Incumbents, regardless of party, are marked for removal as we saw in the elections last week. That's not a surprise on here. It is something we have been expecting for years as we have written of our self-correcting society. It's time for Washington to decide. Politicians are either part of the problem or part of the solution. It's time to stand to account and convince the voters of their merit as our public servants. Merit afforded by action. By true leadership. Not by rhetoric. Not as our overlords promising a new America while dictating the economically unpopular and morally bankrupt status quo. Or just as bad, accomplishing nothing.

Link here.

Goldman Sachs CEO - He is, he says, just a banker "doing God’s work" - Since When Is God's Work Tyranny And Tax?

noreply@blogger.com (TimingLogic) — Tue, 10 Nov 2009 10:32:00 +0000

We are truly living through Orwellian times. All remarks in this article made in support of Goldman Sachs are dubious at best and generally very, very, very misleading. Didn't make bad bets? Didn't need a bailout? Were hedged? You have got to be kidding me. This is ex post facto hubris and lies. An attempt to reframe public opinion based on propaganda and bulloney. To rationalize legalized theft.

And the remarks in the article by the NYT's journalist Andrew Sorkin are incredibly ignorant and representative of the systemic failures of American journalism. Sorkin remarks that people want to see the Wall Street banks fail again. Get real. People want a society with a rule of law. And that means people are held accountable for corruption, destruction of our economy and to receive compensation based on merit. That would be virtuous merit not mafioso merit. Especially when the taxpayers are backstopping Goldman Sachs and Wall Street to the tune of 12+ trillion dollars while American citizens' lives are literally collapsing. People want banks and financial institutions which serve society, not prey on society. Goldman Sachs would simply not exist today were it not for American taxpayers. And for this firm to be paying its employees record compensation when they are still being supported by trillions of dollars of our money is part of the most heinous crime ever perpetrated on the American people. Period.

I want to repeat something we have said countless times. A point that apparently is missed by a very large majority of the populous including Goldman's CEO. Goldman Sachs is a consumer of capital. It creates no capital for society or the economy. Its businesses - investment banking, mergers & acquisitions and trading & trading services to financial firms - create no new capital. This isn't an opinion. It is a fact that anyone who understands the concept of capital clearly comprehend. Frankly, I could write a financial text book on how all of the businesses Goldman participates in literally destroyed the American economy over the last few decades. Literally. To a depth that would astonish the vast majority of people including, apparently, the CEO of Goldman Sachs, who apparently supports a very destructive economic model for no other reason than it has served him well.

Goldman Sachs and Wall Street banks consume society's wealth. They are a tax. And while Wall Street serves what has become a marginal purpose of marrying investors with creators of capital while collecting a tax for doing so, as we have highlighted numerous times over the last few years, Wall Street as an institution is an extremely inefficient undemocratic dinosaur. One that employs methods of monopoly rather than the democratic marriage of investors and creators of capital. One that benefits the very few for no reason of merit but instead simply of monopoly. They are no different than the hoodlums who have gained control of the world's oil resources or cocaine resources and use power and corruption to control these resources. And, I am not exaggerating in that statement. As we have remarked before, a much more efficient model is a distributed capital market which more democratically allocates capital at the point of demand. And often without the intermediary taxes Wall Street levies upon society.

In other words, Goldman's CEO would likely be shining shoes as a career were his company not part of a monopolistic Wall Street gatekeeper created and endorsed by Washington politicians. The system has become systemically fraudulent and truly serves no meaningful purpose.

Wall Street's profit bubble is indicative of the extent of tyranny and tax it is imposing on society. Somehow I have a hard time marrying tyranny and tax with "doing God's work". More "free market" neoliberal bullshit. Maybe Goldman's CEO could enlighten us with his remarks in a forum where informed citizens are able to provide a counterweight to his bully pulpit statements of feigning reality.

Yet our distress comes from no failure of substance. We are stricken by no plague of locusts. Compared with the perils which our forefathers conquered because they believed and were not afraid, we have still much to be thankful for. Nature still offers her bounty and human efforts have multiplied it. Plenty is at our doorstep, but a generous use of it languishes in the very sight of the supply. Primarily this is because the rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence, have admitted their failure, and abdicated. Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men.

True they have tried, but their efforts have been cast in the pattern of an outworn tradition. Faced by failure of credit they have proposed only the lending of more money. Stripped of the lure of profit by which to induce our people to follow their false leadership, they have resorted to exhortations, pleading tearfully for restored confidence. They know only the rules of a generation of self-seekers. They have no vision, and when there is no vision the people perish.

The money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of the restoration lies in the extent to which we apply social values more noble than mere monetary profit.

Happiness lies not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort. The joy and moral stimulation of work no longer must be forgotten in the mad chase of evanescent profits. These dark days will be worth all they cost us if they teach us that our true destiny is not to be ministered unto but to minister to ourselves and to our fellow men.

Recognition of the falsity of material wealth as the standard of success goes hand in hand with the abandonment of the false belief that public office and high political position are to be valued only by the standards of pride of place and personal profit; and there must be an end to a conduct in banking and in business which too often has given to a sacred trust the likeness of callous and selfish wrongdoing. Small wonder that confidence languishes, for it thrives only on honesty, on honor, on the sacredness of obligations, on faithful protection, on unselfish performance; without them it cannot live.

Restoration calls, however, not for changes in ethics alone. This Nation asks for action, and action now.

Wall Street's con game continues. Karma is a bitch.

Latent Volatility Continues To Build In The Euro Zone

noreply@blogger.com (TimingLogic) — Mon, 09 Nov 2009 16:55:00 +0000

We have been bearish on the Euro for a long time. Our bullishness on the dollar while the world was partying hard and the dollar was plowing lower was predicated on many coming dynamics. Most of which are clearly still not understood by the keepers of the status quo. ie, Global bureaucrats. That we have entered the eye of the storm and volatility has temporarily receded has not changed a single major theme we have talked about on here over the last four years. As I have written before, I believe coming crisis is headed for a Euro area near you.

That Trichet and other unelected Euro zone bureaucrats set economic and social policy for the sovereign people of Europe, is a great tyranny that has been thrust upon the people of Europe. A tyranny that the sovereign of Europe will only clearly understand as this crisis metastasizes. The seeds of volatility have not been vanquished. In fact, they are still germinating. A worst case scenario is that the Euro as a currency medium is completely repudiated. We shall see how far volatility takes this crisis but as I have said before, I would not at all be surprised for this dynamic to develop.

Health Care Reform Or Prison? What's The Diffference?

noreply@blogger.com (TimingLogic) — Mon, 09 Nov 2009 10:33:00 +0000

Few would like to see health care reform more than me. Is this reform?

Apparently anyone not participating in national health care will get their health care for free ......... in prison. It seems to fall deaf upon the idiots in Washington that the reason many Americans don't have health care is because they cannot afford it. Might we more accurately interpret this as sending people to prison for being poor?

But then how is this different than banksters ripping off poor taxpayers for hundreds of billions of dollars after tanking our economy? Aren't underprivileged people in this scenario already in prison?

Oh, I'm sorry. A Goldman Sachs executive enlightens us on this topic ......... “The injunction of Jesus to love others as ourselves is an endorsement of self-interest,” Goldman Sachs' Griffiths said Oct. 20, his voice echoing around the gold-mosaic walls of St. Paul’s Cathedral, whose 365-feet-high dome towers over the City, London’s financial district. “We have to tolerate the inequality as a way to achieving greater prosperity and opportunity for all.”

I guess that means poor bastards are poor for a reason. Because it's necessary for the greater good as defined in our Constitution. Thomas Jefferson and George Washington would be proud. I guess King George would be the most proud.

Hayek would be proud. The road to serfdom is well underway.

Don't Have Money To Pay Your Mortgage? No Problem. Fannie Mae Will Let You Lease Your Foreclosed House Back With The Money You Don't Have.

noreply@blogger.com (TimingLogic) — Mon, 09 Nov 2009 10:24:00 +0000

Another brilliant idea from the government. I have a better idea. They should have provided relief to homeowners from day one rather than bailing out the Wall Street banking mobsters who are stuffing their pockets with taxpayer bailouts while kicking homeowners to the curb.

At least Al Capone fed the poor.

Link here.

Goldman Sachs Has One Losing Trading Day In The Third Quarter - Markets Are Rigged Courtesy Of Washington Politicians

noreply@blogger.com (TimingLogic) — Fri, 06 Nov 2009 13:58:00 +0000

"Sometimes the law defends plunder and participates in it. Thus the beneficiaries are spared the shame and danger that their acts would otherwise involve. But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them and gives it to the other persons to whom it doesn't belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime." -- Frederic Bastiat

Now, I'm going to tell you right now, it doesn't get any better than this. 98.4% winning trades? Anyone that has built trading systems, traded professionally or understands probabilities will tell you this type of win-loss ratio is impossible unless the market is rigged. A good trading system will have 60-70% winning trades over the long term. No transparent, open market with millions of participants - all with equal access to information - can ever produce the kinds of returns Goldman is making.

This is clearly not sustainable. Either transparency and legitimate competition for capital will be restored, Goldman will trade the liquidity out of counterparty participants thus causing markets or returns or both to implode, markets will blow up, other market participants will adopt the same strategies or some unforeseen dynamic will develop. That means the perceived brilliance of Goldman Sachs will again come crashing down. Because it never was brilliant. It was the fact that they had asymmetric access to information.

We have talked about this before but I want to lay this out in street terms a lay person will understand because it is important average Americans get this scam.

Wall Street's brilliance in financial markets is all a feint. A deception. It's part of the con. This is no different that a street con artist setting up a victim for the take. These financial firms create an aura of brilliance by hiring mathematicians, physicists and hard-charging MBAs. So, the mystic builds that they are brilliant masters of finance and that science has now been harnessed to create a new industry. To create new profits. A Brave New World. The age of quantitative finance. Our society will now trade our way to prosperity. This is utter bullshit. We are in fact trading ourselves into collapse.

The really dirty secret is that none of the cited sources of brilliance are primary drivers of profit or success. They are thrown out to feign the public. To justify paying Wall Street executives hundreds of billions of dollars to steal from society. And the public knows no better because these firms use a lot of fancy jargon to describe what they do. Wall Street doesn't want anyone to know what they are doing and baffling people with bullshit is part of the art of the con. It's not science that drives profits. It's not hiring Harvard MBAs. It's not hiring physicists who can't spell economics, complex systems or risk management.

What drives profits is making sure you set the rules to the game. Rules you can manipulate. And that means Wall Street lobbyists bribing, albeit legally (loosely termed "legal" as Bastiat told us in the above quote), our politicians to set the rules are really the secret brilliance behind Frankenstein finance and Wall Street's unsustainable profits. If you had billions of dollars to throw at Washington, you too could be brilliant.

It is nothing more than corruption that drives Wall Street's profits.

The art of the con game.

JP Morgan Ends SEC Alabama Probe

noreply@blogger.com (TimingLogic) — Fri, 06 Nov 2009 13:53:00 +0000

A disturbing look at the fraud involved in the Jefferson County fiasco. Apparently there will be no substantial criminal probe. Banksters just say they are sorry and all is well.

Unemployment Much Worse Than The Carnival Barkers Expected

noreply@blogger.com (TimingLogic) — Fri, 06 Nov 2009 13:38:00 +0000

We blew through 10% unemployment with unemployment and underemployment now near 20%. What a surprise. These carnival barkers predicting net job creation this month are the same ones who told us we had entered Pax Globalia before the crash. This economic model is dead. Globalization is dead. Frankenstein finance is dead. It's time for transformative leadership. Leadership which embraces economic populism aka democratic economics, sustainability and national sovereignty.

Link here.

Christopher Dodd Tries To Save His Job With Bank Reform Proposal

noreply@blogger.com (TimingLogic) — Fri, 06 Nov 2009 13:01:00 +0000

I am very dubious as to the sincerity of Senator Dodd given his involvement in the collapse of our financial system. Dodd enjoyed the fruits of deregulation, a predatory banking system and is what I would term an institutionalized legislator. A "lifer". I'd like him and his Republican counterpart Richard Shelby to start collecting their retirement pay in 2010. I don't know if Shelby is up for re-election but Dodd is. And uber bear Peter Schiff is apparently going to run against him. Nothing would make me happier than to see Schiff win. Not because I endorse Schiff's views on economics, because I clearly don't. But because Schiff would be new blood in a stagnant and corrupt Congress.

Only a politician could dream up a new regulatory agency to do what the existing regulatory agencies did for nearly a century. That is, until Dodd, Shelby and others led the charge to destroy these regulations. I believe Dodd's bill has zero chance of passing the Congress and being signed into law. And I believe Dodd knows this. As a supporter of the Wall Street cabal, I view this effort as an attempt to save his political hide by appealing to the populist rage in America. In other words, I believe Dodd is prepping for his 2010 re-election campaign.

Senator Dodd, all you need to do is restore the financial regulations which led to the greatest prosperity in America's history. Financial regulations you helped to dismantle during your years of institutionalization. We don't need a new government bureaucracy. We need new legislators who will do the will of their bosses. That would be us.

Link here.

Jesus Decides Goldman Sachs Employees Should Receive H1N1 Flu Shots Before High Risk Pregnant Women, Children And Elderly

noreply@blogger.com (TimingLogic) — Thu, 05 Nov 2009 16:17:00 +0000

I couldn't resist. It's good to be the king.

Profit "Not Satanic" Barclays Says, After Goldman Invokes Jesus

noreply@blogger.com (TimingLogic) — Thu, 05 Nov 2009 14:15:00 +0000

“The injunction of Jesus to love others as ourselves is an endorsement of self-interest,” Goldman Sachs' Griffiths said Oct. 20, his voice echoing around the gold-mosaic walls of St. Paul’s Cathedral, whose 365-feet-high dome towers over the City, London’s financial district. “We have to tolerate the inequality as a way to achieving greater prosperity and opportunity for all.”

The Death of Usury or The Disgrace of Usurers from 1594 England

We won't be talking about religion on this blog but the insanity and rationalization of banksters knows no bounds. I don't know about you but I grew up in an environment that embraced spirituality as a virtue. Not that I have always upheld those ideals. But, then I believe most of us aspire to be better than we are. I never could imagine anyone in my family ever uttering the twisted words above. Ever. That's a pretty narcissistic and self-serving interpretation of Jesus Christ as a rationalization for morally bankrupt behavior. I thought Jesus Christ spoke of selflessness, compassion and kindness. Especially for those in society who were unable to defend themselves. Or those we disagreed with. Not condescending selflessness or kindness either. But as someone who was another equal. Democratic selflessness.

This Bloomberg story has to literally be one of the most bizarre I have ever read. Even more bizarre is that Wall Street mobsters are heading to churches to rationalize their behavior. Actually, if the men quoted in this article knew anything about many religions, they would realize that profits are not Satanic but usury is.

Do we need a refresher course in Canon Law? Usury was once punishable by ex-communication.

Ezekiel 18:13 He lends at usury and takes excessive interest. Will such a man live? He will not! Because he has done all these detestable things, he will surely be put to death and his blood will be on his own head.

Sharia (Muslim) Law forbids the acceptance of interest for lending.

The United States used to cap interest rates at 6% and anything beyond that was usury.

In early England the punishment for usury was forfeiture of property.

A public banking system would not be concerned with profits or screwing our fellow citizens out of their often meager earnings. But would be concerned with the democratic development of humanity, the creation of jobs and attempting to enable citizens with the opportunity for a life of self-determination. It would serve the common good and serve democracy. It would serve society democratically. It would not serve those who are most willing to exploit society without conscience. Or those who will do anything to rewrite our laws to steal our money.

Bank Of England ........ Doomed?

noreply@blogger.com (TimingLogic) — Thu, 05 Nov 2009 13:46:00 +0000

Gold bugs will look at this Bloomberg story as supporting evidence of why gold must go higher because it supports their confirmation bias. It's part of the mass hysteria in much of the financial community that central bankers are planning to hyper-inflate their way to prosperity.

The reality behind this story is substantially different. In other words, Bloomberg is often guilty of the mass hysteria or inaccurate reporting we see elsewhere. The actual rate of easing in the U.K. is slowing substantially. And the Bank of England appears to be winding down its attempts at printing money if you actually read their statements instead of media hype.

The U.K. economy has not responded well to central bank actions so far. Remember our post some weeks ago remarking the U.K. is in serious trouble and the potential for the pound to go kaput? Stick this in the back of your mind for a future post.

"The Handcuffs Are Off. The States Can Pursue Justice (Against The Banksters) Now."

noreply@blogger.com (TimingLogic) — Wed, 04 Nov 2009 13:55:00 +0000

I have made no secret on here regarding my position on State's Rights. I believe in Jeffersonian ideals and that State's Rights advocates clearly understood the potential for all of Washington to become a cabal. Yes State's Rights have been abused in the past by racists and politicians attempting to force their personal will on civil liberties but under these circumstances we have the check of the Federal government on the actions of state corruption. The system creates a cycle of virtuosity in my estimation. Is it perfect? Well, there is no such thing as perfect.

We see many ideologues attempting to marginalize any recent discussions of State's Rights as right wing extremists or racists or tea baggers or other equally ludicrous remarks. These are tactics timelessly used by power in an attempt to control dissent. No. State's Rights is a sign of resistance to Washington corruption and power grabs beyond their Constitutional authority.

How can we expect a Federal government that has created the rules allowing predatory banking to actually fix the problem? Politicians are drunk with power and billions of dollars of legal bribes from these institutions. It's the same reason we haven't seen a public commission to look into concerns of wrongdoing. The list of ills associated with this dynamic is endless.

Yet, here comes the states. State lawmakers and attorney generals aren't on the take to the tune of billions of dollars from the banksters. What incentive does a state lawmaker have to protect Washington corruption when it is destroying state economies? States have historically been the primary protectors of consumers anyway. It's a natural that we should have state's attorney generals pursuing legal action against the crooked banksters. And it's a constructive reminder of why we have State's Rights.

Goldman Sachs Takes On A New Role - Taking People's Homes

noreply@blogger.com (TimingLogic) — Tue, 03 Nov 2009 21:19:00 +0000

Link here.

"This (Goldman Sachs's Actions) Is Fraud And Should Be Prosecuted"

noreply@blogger.com (TimingLogic) — Tue, 03 Nov 2009 14:08:00 +0000

Link here.

Wall Street Bailouts Are Killing The Banking System And The Economy

noreply@blogger.com (TimingLogic) — Mon, 02 Nov 2009 15:32:00 +0000

Let's get something out of the way first since Wall Street supposedly earned substantial profits a few weeks ago.

Wall Street did not earn a single penny of profit. Nor have they paid back the American people. That is a lie. Let's look at the facts. The banks and the economy are being backstopped by over $12 trillion in government money. Frankly, it's really a lot more than that if you really factor in all of the government involvement. Additionally, Wall Street firms are still holding horrendous amounts of mispriced assets and are effectively insolvent.

Were the United States taxpayer to withdraw trillions of dollars of support for the economy and Wall Street, Wall Street would again collapse. It would collapse that very day. As long as trillions of dollars of American citizen's money are needed to backstop Wall Street, these pseudo-profits being used to pay massive bonuses remain nothing more than outright theft. Every single dollar in operating profit reported in this environment should be used to rebuild banks financial balance sheets and repair the damage these crooks have done to the American economy. Instead the government is allowing these firms to steal even more money from the citizens of this country. There are no financial profits. Only mobsters who screwed Americans on the way up and are now screwing them on the way down while millions of innocent Americans rot. Stopping the financial system from complete collapse is one thing but then letting the subsequent behavior to continue is corrupt. And these financial firms telling us they need to pay these mobster racketeering salaries to hire more people to continue to criminally gamble with our money is a perfect example of another use of Hitler's propaganda technique known as the Big Lie.

Our system of government and democracy must, as a baseline, first serve the common good. Or at least do no harm to the common good. Any policy that then serves this baseline can then be expanded to serve individualism and personal achievement. In other words, Wall Street must either do no harm or serve the common good first. The system today is misrepresented by thieves who ideologically cite greed as good without any limits placed on the morality of that statement or of government policy. Government policy on a wide swath of issues is harming economic opportunity and the common good. Policy supported by both parties. And banking is one such issue.

We have been remarking since this crisis started that the Federal government/Federal Reserve is killing the underlying economy and the banking system in their efforts to save these mega financial firms. Part of this dynamic is support for policies which enrich these mega banks at the expense of banks attempting to serve the underlying economy - a role mega banks and Wall Street clearly are not filling. Many, if not most smaller banks and community banks remain in serious crisis while Wall Street uses its taxpayer booty to lever up the same risky schemes they have been utilizing for years to illegitimately drain capital out of the economy and out of legitimate community and regional banks. This dynamic is picking up momentum as mega bank's use of trillions of dollars in taxpayer monies gives them an incredibly unfair advantage in the market. An advantage that legitimate regional and local banks simply cannot compete against. Almost a self-fulfilling prophecy of harming heretofore healthy banks by being able to offer taxpayer subsidized services at below the cost of health banks or the market. A nearly exact sentence we wrote about almost a year ago on here. This is structurally damaging the banking system even more than the shock caused by the initial crisis. A dynamic we have highlighted for almost a year and one that remains a serious, serious problem of maintaining these government-backed zombie banks.

In other words, Wall Street and Washington in their corrupt dance are unwittingly creating our own future. An unpleasant future. And both are financial benefiting handsomely by doing so. By both paying lobbyists and politicians tremendous taxpayer backed monies to keep reform from taking hold and by Wall Street mobsters extorting hundreds of billions of dollars in bonuses for perpetuating this dynamic.

This crisis is far from over. As an example, we have been unique in our consistent remarks that we believe Goldman Sachs has a very substantial probability of facing future crises and possibly even failure at some point due to the unsustainability of its business model. Goldman is dealing with the same dynamics which led us to remark that Merrill Lynch's business model was not sustainable.

If we look at community banks and regional banks - which serve the underlying economy - we see that most rallied less than two months off of the March lows versus the eight month rally seen by the general stock market. In fact, the regional banking index shown below had half of its rally in the first week off of March's bottom where it gained approximately 4.5 of its total 9 point rally. Many community banks are still scraping near the bottom of their March lows. The fact that the regional banking index hasn't made a single point of progress in six months and community banks are in similar or worse situations tells us a stark reality. That firms (and by inference American citizens) not on the government dole remain in serious trouble. That even hot money realizes these firms aren't worthy of a trade. For it is only being on the government dole that guarantees firms will be able to show pseudo-profits.

Given the business of regional and local banks reflect fundamentals comparative to Wall Street's taxpayer-funded unsustainable casino-methods of making money, we get a better look into economic reality by looking at local and regional banking results. Results remain muted at best and continue to deteriorate at worst.

Wall Street is contributing to this crisis by trading the economy into collapse and buying government debt to rebuild their balance sheet rather than investing in the economy. Wall Street's greed at all cost is generating short term trading profits which are in fact contributing to deteriorating fundamentals.

In an effort to re-ignite the status quo instead of instituting the economic and financial reforms needed, the government and the Federal Reserve are both unwittingly killing the economy and our banking system. A major reason why government should simply set very sound rules for commerce in the economy, enforce them diligently and stay out of the way. Fiddling and fidgeting with new rules, regulations and special favors encouraged by monied interests simply adds to the malaise and ultimate destruction of economic opportunity.

The government remains the primary hindrance to economic reform.

S&P Regional Banking Index (3 wave rally count complete?)

Friday's Pricing Action Rejected The S&P's Rising Wedge Trendline

noreply@blogger.com (TimingLogic) — Sun, 01 Nov 2009 14:10:00 +0000

Thursday's rally was cheered because of the GDP data. Really, that was irrelevant. We were more oversold than at any time since the March low this year with a lot of heaving dumping of stock the last week. Thursday's rally was technical in nature and driven by the futures market as opposed to a substantial number of buyers in the cash market.

I pulled this early Friday so the chart doesn't reflect the entire day's pricing action. (We finished below Thursday's low.) This is a magnified chart of the bearish rising wedge on the S&P we put up a few weeks ago. Wednesday's pricing took out the rising wedge's trendline created off of the March and July lows. Thursday's rally pushed back up against the trendline. In other words, what has been support on the downside has now become resistance on the upside. At least for now. Friday's pricing action rejected an attempt to regain the trendline. Again, this type of action is a sign traders are driving this market. What's new?

Washington Piggery Continues As The Lobbyist Bubble Grows - Change You Can Believe In

noreply@blogger.com (TimingLogic) — Sat, 31 Oct 2009 19:37:00 +0000

Link here.

Steve Rattner On The Auto Bailouts

noreply@blogger.com (TimingLogic) — Sat, 31 Oct 2009 13:42:00 +0000

I'm not going to spend a lot of time on this post because Steve Rattner's remarks are much more worthwhile. We have written extensively about the auto industry on here over the years. Most of our remarks have turned out to be spot on. As an engineer, as someone who has extensive experience in business process, in benchmarking, in management consulting, I have a firm understanding of the auto business and what ails them. Some of that ailment is a result of poor government policy, some because of a combative nature of the UAW and some because of failed economic ideology. But the vast majority of the failures of the American auto industry are because of horrible, insular management. In fact, horrible management led to the combative nature of the UAW. As we have remarked before, unions are simply market responses to hegemonic authority and concentration of power. It's the same dynamic response to tyranny that led to the concept of democracy.

By the way, Edmonds came out this week and said the government's Cash for Clunkers program likely cost $24,000 per vehicle. We used a lower figure in our napkin analysis based on the feedback of a Ford executive but regardless, the outcome is the same. Taxpayers were paying GM to build cars. For free. A general truth is that if government officials knew how to run a business and do so successfully, they would be running a business. I think this data point helps substantiate this fact. It's also why the home buyers tax credit is going to turn out to be a major flop.

Anyway, some interesting feedback from Rattner below.

Inside the GM/Chrysler Rescues

Why we had to get rid of GM's CEO

The auto bailout: How we did it

Galleon Paid Hundreds Of Millions Annually For Information

noreply@blogger.com (TimingLogic) — Sat, 31 Oct 2009 12:31:00 +0000

Well, this Galleon probe has turned into a doozy. Supposedly the firm spent $250 million - often much more - annually, obtaining information that would give it and edge. Information not available to the general public. This is reminiscent of the time leading up to the collapse in the Great Depression where manipulators of stock pools and bucket shops scammed investors. Wall Street's fraud is endless and just about the only constant fixture in American history. Its power and corruption needs to be busted up. Forever. As we have highlighted before, a distributed electronic capital model would serve democracy substantially more efficiently. And take the innovation and creation away from capital gatekeepers on Wall Street and put it into the hands of those who deserve it - the creators of capital.

This mess highlights how important transparency is. As we have remarked many times on here, companies like Goldman Sachs, Citi and others were not successful because they were brilliant, they were successful because they rigged the game.

When anyone pays government officials millions of dollars to nearly guarantee the outcome by rigging rules to manipulate markets, be it Wall Street or defense contractors or insurance companies, you are going to make money. And loads of it. At the same time, you are taking away competition and economic vibrancy. Why? Because you are in the market before the general public and even competitors realize the rules to the game. Or you are forcing competitors out. As the other participants catch on to the rules and seek to participate, you can always be at least one step ahead and leave your competitors holding the bag. I view this as the dynamic that was in play which took down Merrill Lynch, Bear Stearns and Lehman. Goldman was the leader in the game of many exotic debt instruments which took down Wall Street. Other firms were trying to follow the leaders. By the time these firms were heavily into the game, some of the other firms were already on the opposite side of many trades. It wasn't brilliance which put them on the opposite side of the game. It was because this is a rigged scam.

We need complete transparency into markets and Washington. Our economy will eventually heal itself when this dynamic is dealt with.

Key China Box Index Drops First Time Since June

noreply@blogger.com (TimingLogic) — Fri, 30 Oct 2009 16:18:00 +0000

Link here.

Why Do We Need A Central Bank?

noreply@blogger.com (TimingLogic) — Fri, 30 Oct 2009 15:26:00 +0000

Well, the main reason we needed a central bank is to fund wars. It's no coincidence the Europeans created both the central bank and perfected repressive colonialism and empire. They go together like peanut butter and chocolate. Coincidentally the Federal Reserve's creation happened just as World War I broke out. Or maybe not so coincidentally since the winds of war were in the air at the time of the Federal Reserve's creation.

The United States profited handsomely by extending credit to European countries during WWI so they could pound each other into oblivion. None to ironically, there were substantial problems with mass desertions in WWI. It's easier to sell a war when you are able to make your enemy out to be evil or if they actually are evil such as Hitler was. WWI had relatives and neighbors killing each other for no good reason other than some fat ass sitting on a throne told people it was necessary. Not generally a motivating factor to encourage voluntary assignment to die. War is an old man's game where young men die. I have a better idea. Let's let those who start wars lead us into battle. The majority of conflict would be eradicated given most old men are better at killing other people's children than facing death themselves.

The U.S. extension of credit to Europe had multiple beneficial effects. One, American businesses profited by selling the Europeans armaments and supplies. This made American businessmen rich and provided American jobs. Two, by the Europeans blowing each other to smithereens, that left economic domination exclusively to the United States as the economy of these countries was left in shambles. And thirdly, we could manipulate the Europeans because they were indebted to us at the end of the war. All of this had an effect of continuing our economic and political domination. And, of course, allowing the U.S. to rise to become the global military superpower. I'm sure none of this ever crossed the mind of any political leaders. Rather war is always a matter of good vanquishing evil.

Of course, look what Wall Street will do for a few billion dollars. Imagine what impact on the human psyche a few trillion dollars has. In today's world it is unsustainable military spending that is bankrupting the U.S.

..........War is the common harvest of all those who participate in the division and expenditure of public money, in all countries. It is the art of conquering at home; the object of it is an increase of revenue; and as revenue cannot be increased without taxes, a pretense must be made for expenditure. In reviewing the history of the English Government, its wars and its taxes, a bystander, not blinded by prejudice nor warped by interest, would declare that taxes were not raised to carry on wars, but that wars were raised to carry on taxes..........

.............Every war terminates with an addition of taxes, and consequently with an addition of revenue; and in any event of war, in the manner they are now commenced and concluded, the power and interest of Governments are increased. War, therefore, from its productiveness, as it easily furnishes the pretense of necessity for taxes and appointments to places and offices, becomes a principal part of the system of old Governments; and to establish any mode to abolish war, however advantageous it might be to Nations, would be to take from such Government the most lucrative of its branches................

As many great minds have noted, war is the health of the state. War on drugs, War on terror, War on crime, War on poverty ...... Curiously, where is the war on the tyranny of wars? On the suffering of innocent people? And where is the war on unemployment in the U.S.? It seems the military contractors and banksters won that war long ago. Apparently the unemployed in the U.S. is the enemy combatant in that war.

Anyway, this was just a mini rant leading into an interesting article at public broadcasting. I would argue that many of the points made in this article are really begging the question of why do we need private banking? Localized public banking would serve the community, local development and employment. And it would not only be capitalistic but unlike private banking, it would be democratic. And because it would be public, its operation would be completely controlled by a democratic society. Isn't it time we marry all of capitalism with democratic principals? Oh the horror of such a concept. It would mean elitists would be held accountable to democratic ideals instead of their often feudalistic tyranny imposed on society by many sociopathic CEOs and Wall Streeters.

As a final note, as I've said before, I'm not so much against a central bank as I am against the source of government spending and our national banking system being private. It should be public. If private financial institutions want to compete with a public banking system, that's fine by me. That happens in countless countries throughout the world.