MonkeyBusinessBlog

Speculators, Credit Derivatives, and Government

2010-03-11T10:46:43-05:00

The shamelessness of government really knows no bounds. The people of Greece spent money they don't have to send their leader to see the leader of the United States the other day. The leader of the US has been known to, how do we say this politely, do and say some "unconventional" things during his short time in office. From what it sounds like, the Greek guy wanted the American guy to stop his speculators from betting against Greece in the financial markets. Because, I gather, things would be all good in Greece if it just wasn't for those evil speculators (there's that word again). Even the "different kind" of American leader had to tell the guy to politely "beat it". I wonder if it came up that maybe one of those evil speculators was one Goldman Sachs. You know the company that helped Greece "hide the salami" (technical term) a few years back to prevent them from looking like the Third World economy that they were?

So you have the European Union calling for the end of credit derivatives. Or at least the end of "naked" speculation using credit derivatives. I guess this works to get the voters on their side. I'd love to talk to these leaders behind closed doors. Speculation is what makes the world go round. Are there evil speculators on the Chicago Board of Trade? You know the place where ANYONE can set up a trading company with the proper funding? The place where like 90 PERCENT of the companies go BUST in their 1st year of trading. Yep. So sometimes speculators lose and some even go bust. Haven't seen the Bankrupt Speculator Charity being talked about and nor should it be talked about. You take risk with your capital and you lose? Sorry Charlie. If you hit it big, god bless.

I think its high time these countries, municipalities, governments, etc. stop complaining and pointing fingers and CUT a lot of their own costs. The communist TV news channels will no doubt have all the coverage of the Greek unions protesting and rioting in the streets, ANGRY at the budget cuts that are coming. I would start by making an announcement that anyody who attends these riots is fired.

Quick Update and Clarification

2010-03-10T11:42:31-05:00

The markets are up. So is our ticker SSO which is a 2x bet on the S&P 500 going up for true action junkies like myself. See? I told you sometimes that its sometimes better to join em than beat em. We'll see how this plays out, of course watch it closely, and update you as we go.

Just to clarify. Please let us know if you are interested in investing in the Monkey Business McMansion at bensalzproductions@yahoo.com . The e-mail address in the previous post was incorrect. And yes for those who are concerned, we do keep track of you if you write in and we will respond. Most likely tomorrow. We will also state when the e-mail goes out on this website, so you will still have a chance to respond if you don't get a follow up e-mail. Please just be patient.

Now I'm going to the Waffle House for lunch or maybe Bob's Big Boy. Or even Shoney's.

It Was a Long Day

2010-03-10T08:29:38-05:00

Well I looked up and down, over and out, and around and around, for real estate in Southwest Florida yesterday. Saw all types of stuff. From little walk up efficiency apartments, to luxury high rises on the beach, to pristine golf communities, to vacant lots of land. Wanna know what they all had in common? Foreclosures. I asked my realtor Kent H., if he saw any improvement in the real estate world, and he said that things were definitely moving at lower prices (I could also tell he was very busy, with his cell phone ringing every 5 minutes while he was with me, unless that was a trick). However, he said that the foreclosures keep coming. You replace a bunch of foreclosures with sales and the foreclosures keep coming. Another tip he gave was that if you are a buyer and you see the word "short sale", don't waste your time. Short sales are filled with red tape from the banks and you'll be spinning your wheels for 6-8 months at least, before you even get a chance to get anything done. Now, "Bank owned" is a whole different ball of wax. That's usually stuff the bank wants to get rid of, and quickly. That's what we looked at.

So I'm not going to go into specifics of yesterday's properties here on this blog, but I will be sending a nice specific e-mail, probably tomorrow, to those of you who have expressed interest in partnering up to purchase the Monkey Business McMansion. For those of you who are foaming at the mouth to get involved, you can still e-mail us at www.bensalzproductions@yahoo.com. But hurry. We may be acting quickly on this.

I finished up my evening at the Seminole Casino in lovely Immakolee, Florida. A bit of advice for getting there? Make sure you have gas and a dependable car. I didn't break down or run out of gas but if I did, I guarantee I wouldve been eaten by 1) bugs, 2) alligators, or 3) swamp things. There is NOTHING but swamp once you leave civilization until you get to the casino. How did I do? I lost $40. Not including the $20 in free play they gave me for signing up for their players club. Or the $3.50 voucher some little old lady mustve left behind, that I found in one of the machines. Which caused me to walk around the casino looking at ALL of the slot machines to see if anyone else did the same. Hey, these are tough times. You gotta find any kind of money making opportunities. It was a nice little place too. A little bit crowded as well for a Tuesday night. However, despite not winning, I did not resort to shaking anyone down in the parking lot. I figured that was bad karma for the ride home and I would've most certainly been attacked by the "Creature from the Florida Lagoon".

I'm going to look at a few more properties and then be back in New York tonight. Remember to hit us with e-mails at www.bensalzproductions@yahoo.com if you have further interest in our little project. Enjoy the day.

This Is The Business of Small Men

2010-03-09T23:14:02-05:00

A quick post on the fabulous business of "High Finance". I'm sitting here around 9pm eastern time and my little hedge fund has to unwind a little Australian Dollar interest rate swap. Unwind means that I have the trade on with with one of the f**king thieves that make markets in this crap and I want to end it. It's pretty simple...just a series of future cash flows that have to be discounted back to "present value". No rocket science if you are in this business....and even if your not, I could probably teach most of you how to do it in an hour or two.

Anyway, I have this little interest rate swap that I put into my model, which is the same as everybody else's model. I know I have to pay these bastards and I figure that they are going to charge me the full bid/offer. What am I gonna do right? It's not like we are BlackRock. So I run it and it shows that I have to pay 6,300 Aussie Dollars. Then the following "Bloomberg" instant messaging sequence takes place.

Me: "What say you young man?"

Trader in Sydney: "7,900"

Me: "7,900? What rate are you using?"

Trader: "5.70"

Me: "Yeah, me too and I see 6,300"

Trader: "Agreed."

Me: "Agreed? What happened to 7,900? Where did that come from?"

Trader: "Oh, hah hah....I'll send a ticket."

And this is how it goes. This is what hundreds of people get up and do every day. They spend their days looking to pick off somebody who either isn't paying attention, or isn't very bright....or in our case, small guys without a ton of leverage. This is what finance either has become or always has been, a bunch of guys running around trying to find a sucker. It starts with petty bullsh*t like this mope's 1,300 Australian Dollars that he was trying to clip me for (and he was already making about 2,000 for doing....nothing) and eventually you graduate to putting municipalities into financing and "hedging" instruments that they don't understand (or they do and they're getting paid off not to notice) and clipping them for hundreds of millions. It's learned behavior.

Ahh, I feel better now. What's really funny is, that little prick might actually read this blog!

Its All Discipline These Days

2010-03-08T12:01:46-05:00

Ok so I covered the SPY at 114.21 and the QQQQ at 46.56. Kapow. Right in the kisser. And the wallet. Those who understand charts are now saying "Well Richie, you shouldnt just be market neutral if the charts have crossed on the way up signaling a BUY. You should be betting that the market is going HIGHER!" And you know what......I just did.

Yep. The market wants to go up in my face? Good. I'll go along for the ride. And it forced me to think back about some gambling moments. Particularly with one of the old time gamblers, "The Salmone". One night we're all playing craps betting against the shooter (About 90% of crap players bet "with" the shooter despite it being slightly better odds to bet against the shooter. Go figure.). The shooter gets hot and blasts us a few times. The Salmone screams, "streaky shooter! Get with him!" So we all switched to going with the shooter and made a killing. Hopefully, we'll see that in this instance.

I just bought the ticker SSO (which is a 2X bet on the S&P 500 to go higher), due to the charts saying to do so. Bought it at 39.88. Staying with the gambling theme, "I'm all in." Good luck players.

Stay tuned tomorrow for some updates on the Monkey Business McMansion as I stand in 74 degree weather in Naples, Florida at high noon. Bright and sunny too.

Irony Abounds In Our Day, Already

2010-03-08T08:43:46-05:00

Well we got to wake up to this little bit of news in an article from our friends at Bloomberg News entitled, "On The Edge Banks Facing Writedowns After FDIC Loan Auctions"; um, commercial lending is going to give banks more pain. By reading this blog, this comes as no surprise. However, what might surprise people is the extent at which most banks have been playing "hide the salami" (technical term), over the last few years with regard to their commercial mortgage portfolio. You see, when the FDIC auctions off these loans from a troubled bank, EVERYONE who owns a piece of that loan must mark it on their books at the price at which the loans sell. So when you read that last sentence, you say, "well of course they should. That's what they are worth in the marketplace at this moment. Seems fair." Well it does seem fair except the banks, with their teams of lawyers are fighting this tooth and nail to NOT have to do this. I wonder why? Cause they (and we taxpayers) are gonna take it right in the pooper (another technical term) again. We here at Monkey Business, have been calling for this kind of transparency for a long time, and KNEW this day would come. Now its time to pay the piper.

126 banks failed last year and in gambling terms, I have the "OVER" on that amount of failures in 2010. Take a look wherever you are, and see if there's some businesses shuttered in your area. Lots of em right? With strong histories even and a long tenure in business. Not good. But let's talk about healthcare. I didn't watch that "Hollywood Hoedown" last night but it sounds like even the communists in Hollywood were quiet in terms of their praise of the "used to be Jesus on earth" running our country these days. Interesting times.

Now that all being said, the stock market has roared right in our collective mushes (still, yet another technical term). The stock tickers SPY and QQQQ are up around 5% since we shorted them awhile back and we are throwing in the towel today. Yep buy the SPY and QQQQ stocks back and cover your short positions. Yes, even despite, all the bad news we continue to see. Don't worry we'll get more cracks at this. We just want to continue to show our discipline, not get emotional (well, not get TOO emotional, I'm screaming a bit right now as I write this), and get carried out in a bodybag. Live to fight another day. Good luck to the FDIC in their auctions of bad bank loans. After all, who do you think pays MORE for this mess when the auctions don't go well? Go ahead look in the mirror.

Happy Payroll Friday!! All Better Now.

2010-03-05T18:35:34-05:00

Have a great weekend.

I'm Gone Fishin

2010-03-05T14:25:46-05:00

First off, the media events went swimmingly yesterday. Hope you tuned in to the radio show. The dinner show was also top notch. Details to follow of course at a later date.

So the economic numbers weren't "so bad" this morning. As my man John Crudele from the NY Post says, "Who really cares what the numbers are that come out of Washington these days? They can practically make anything up." So the unemployment rate stayed the same. La dee frikkin' da. But you know what? The stock markets are going up, up, up. And our short positions in SPY (the S&P 500) and QQQQ (the Nasdaq) are getting beat up. The charts haven't said to cover the positions yet, but it looks like on Monday we will. Bummer. Of course we'll keep you abreast of what we are doing.

As you may know, I am traveling until next Wednesday evening on a couple of business matters. One of which of course is the "Monkey Business McMansion fact finding tour". I will be reporting my findings diligently here on this blog. So stay tuned. Please have a wonderful and happy weekend, and just think, your 401k holdings are doing a bit better! So, please do your best to prop up your local economy!