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Latest Comments80 Comments
Markets Upbeat After Obama Victory
Market down almost 500 yesterday.... WHAT ARE YOU SMOKIN??
Time to up the meds and/or turn the computer back over to mommy.
ROFLMAO
7 Steps To Restore Functioning Markets
Apparently you don't know what ballast is and so you mis the metaphor =ok
I already told you what I thought of the article = "a loada crap" so I see no reason to repeat myself.
You responded by calling me emotional and irrational.= way to go!!!
I see no reason for continuing a dialogue with you.
PS when you write something and make assertions and claims, then when people do not like your assertions and do not agree with your claims, you should be prepared to accept their criticism as valid criticism and honest feedback on what they thought of what you wrote.
If not, then suggest you don't write.
I stand by my opinions
7 Steps To Restore Functioning Markets
You'd be bettter to say "who needs a sailboat with no ballast in the keel?" "Who needs a balance sheet with longstanding assets that change value quarterly at the whim of a regulator"
Mark to market is plain stupid, As are the idiotice bromides and hackenyed excuses its supporters put forth.
MARK TO MARKET DOES NOT WORK. IT is the root casue of this financial disaster.
MArk my words, mark to market will disappear, it will go out like a light witihn 6 months. Like a cheap hooker who disappears immediately and quietly without a word of praise of blame.
The EU Commisssion is already to dump it, the Treasury has already made wimpers thru SEC about "modifyig" mark to market so it can be ignored during times of troubling markets.
A really dumb idea put forth by really ignoant politicians and theoreticians and D/A academics.
Dump the whole idea, and watch markets begin an inexorable return to normal.
Right now the balance sheet and Equity and return on Equity don't mean squat, BECAUSE no one knows what the value of the underlying asets will be next quarter.
Finally mark to market sets up a self distructing feedback loop in BOTH directions. IF/AS asset values go up -in good markets- the result is phony profit inflation and more borrowing than is otherwise justified.
In bad markets as asset values are collapsing, MtoM accelerates and exacerbates the collapse making a bad situation worse.
You can't argue with the reality of what has happened.
7 Steps To Restore Functioning Markets
SARBOX and mark to market is the root cause, the EU commission and many economists in this country agree with me. This travesty has destroyed balance sheets not only of banks, but every enterprise.
The balance sheet is like the ballast in the hull of a ship. It provides the essential stability by which the ship can sail thru stormy weather. Mark to market has removed all the ballast from the balance sheet, creating unstable financials and hence making all borrowers - and lenders -suspect as to creditworthiness. What does a rational person do when faced with increased uncertainty? He hunkers down, hoards cash, tightens up loan requirements.
That'sa fact Jack, you don't know diddly. IMO
My comment is not emotional, it is analytical, and certainly rational.
and you don't have a clue.
7 Steps To Restore Functioning Markets
Mark to Market took the ballast out of the bottom of the ship. As a result balance sheets are no longer reliable, hence borrowers and lenders are no longer secure in the stability of their financials. AND SO everyone hunkers down and hoards cash - just in case.
I thought this article was basically a loada crap.
Stocks for the Long Run?
"I think we have entered into a particularly difficult moment for equities. They have made us no money as an asset class for a decade. They have become, on a daily basis, simply impossible to game. The notion of "buy and hold" has been decimated by the action as buying and holding even the most blue of "blue-chips" has become a total loser's game."
A decade has 3650 sets of data points. And so within a decade there are 3650 sets of start/end point combinations. That means to choose only one such set out of 3650 possible combinations means there merely a .03% chance. (probability) of your global decade long investment conclusion regarding buy and hold.
You should avoid making such meaningless statements -as should Kramer - as they negatively affect your credibility.
Instead I suggest you run a series of comparisons. Run the data on ALL 3650 such start/stop data points and then see how many of these resulted in Gains/No movement/Losses. This will provide a basis for a reasonable statistical assertion as to the expected outcome of a "buy and hold" investment strategy.
IMO, from someone who wentto school before the educational system was "dumbed down" and destroyed by the NEA.
CNBC's Gasparino Problem
Meantime, if you think the Market is not having a negative reaction to the possibility that a racist/commie/socialis... (BHO WHO) with no record of accomplishment or expertise who is willing to throw his grandmother under the bus to promote his own career might get elected and expand U.S. government beyond the pale , then IMO you are out in space somewhere.
Barack Hussein Obama operates from the communist basic premise
"From each according to his means, to each according to his needs"
Also in case Charlie Gasparino happens to read this,
The cause of this financial meltdown are the U.S. Politicians.
Reference especially Fannie/Freddie forcing bad loans to noncredit worthy individuals. AND
1)Fair Value account = "mark to market" => Sarbanes Oaxley
Destroyed the accounting system, made balance sheets unstable, and caused Book Value to become meaningless
2)Elimination of Glass Steagall Act = eliminating separation of invesment and commercial banks
3)ELimination of uptick rule on short sales
4)Allowing 5% margin on commodities trading Leading to oil,gas price rises thru speculators. $50k equity controls over $1MILLION in futures contracts.
The politicians caused this financial panic. Fix the points above, bring back trust and stability to the financial system and you will bring back normalcy.
MO
Solar Gets What They Want, But Stocks Still Suffer
Once the dust clears on the misnamed "bailout bill" and word gets out
on the renewal of the solar tax incentives then solar will rise again.
Subject of course to what happens to the irratic and illiquid and fearful financial industry - with no small thanks to "MArk to Market" and Sarbanes/Oaxley and the politicians who created this mess by foisting "Mark to Market" upon us along with the requirement for social engineering in lending thru forcing -under penalty of criminal prosecution - social engineering and requiring all lenders make loans to unqualified borrowers, especially minorities, in the name of "Social justice.
With special notice of disdain and dishonor on the major proponents bubba bill clinton, janet reno, paul sarbanes, oaxley,barney frank,al schumer, Chris Dodd, joe biden, hillary clinton, and of course frank raines of fannue mae and his major crony buddy Barak Hussein Obama, a supporter of the radical odmestic terrorist group ACORN and major recipient of politcal donations from Fannie Mae and his buddy frank raines..
The politicians caused this fiasco, not Wall Street. A Pox on both your houses.
IMO
Mark-to-Market vs. Mark-to-History
Time to dump Sarbanes/Oaxley once and forever.
However I disagree with your solution of setting up a new indexed artifical standard.
IMO the best solution is the proven solution = go back to the future and reinstate the time tested and proven balance sheet rules for valuing assets.
cost OR Market as determined by the company with "write downs" and "write offs". Allowed by rule at management discression with accompnaying footnoted justification. AND required upon disposition of the specific asset.
What's wrong with what works? the value of underlying capital assets is the "ballast" in the balance sheet, which -just as the ballast in te bottom of a sailboat - allows the boat to float and keeps the boat stable and keeps the boat from capsizing.
Thanks for nothing to all politicians who caused this problem thru their stupid attempts to force FANNIE MAE and FREDDIE MAC and all banks to make bad mortgage loans to minorities and others in the name of "social engineering" And specially to the DIMLIB democrats who over the years led this effort = Bubba bill. clinton, Barney Frank,Al schumer, Paul Sarbanes, Oaxley, Chris Dodd, Joe Biden, and of course Barak Hussein Obama.
A pox on both your houses.
Mark to Market Accounting: Kill It Before It Eats Us Alive
Au Contraire.
It cannot be done without government $$$ AND seller funded insurance to guarantee against default the questionable securities to buyers.
ALSO the idea of a $700 Billion cost to the taxpayer is false, a gross mischaracteriztion foisted upon the ignorant by those who know better.
The actual headline should read.
"Taxpayers may be hard assets at 20- 30 cents on the dollar from strapped investors and speculators AND THEN RESELL those assets with insurance attached back to other institutional investors for 60 to 80 cents on the dollar"
This is not a bail out, it is an opportunity for the government to use the strength of its balance sheet to provide liquidity, purchase performing and nonperforming assets for pennies on the dollar, then thru a seller and buyer financed govt insurance fund, Resell those self same assets back to other institutional investors. The margin on this deal and the size of the deal can potentially generate enough profit to wipe out the current account governement deficit.
PS The Alternative was demonstrated during the "little depression" of 1929 when due to a lack of liquidity the banks failed, credit dried up,jobs disappeared, tax reveunes evaporated and bread lines ensued.
The alternative to the Paulson plan and my suggestions above is a financial panic followed by a GREAT DEPRESSION.
IMO
Mark to Market Accounting: Kill It Before It Eats Us Alive
Congress created this problem thru Sarbanes Oaxley and the "mark to market nonsense.
Solution is as follows
1)Eliminate the "mark to market" nonsense immediately and forever
2)Reinstate the uptick rule
3)Reinstate Glass Steagall Act separating comm/investment banks
4)Raise margin to 50% on ALL commodities futures trading oil/gas
5)throw money into the system -Money is the best deodorant
6)Provide guarantees and establish an insurance fund
This D/A mark to market nonsense and Congressional reaction against "Wall Street" can be described metaphoirically as follows
I am captain of an aircraft carrier (The financial system)
the ship cmes into port for minor repairs
The idiots in Congress decree all ballast shall be removed from the ship (Mark to Market is equivalent to removing the stabilizers from the balance sheet = Sarbanes Oaxley ACT)
The captain returns and says WTF have you done? you screwed up the balance of my ship, it will become top heavy, unstable, and capsize without the ballast in the bottom of the hull (Balance sheet)
The Congress insists the captain takes the ship out without ballast
The captain does as told, begins aircraft carrier operations AND
the aircraft carrier is now unstable and capsizes.
The Congress blames the Captain for incompetence,
Pass the emergency measure, and eliminate Mark to market along with the above and this problem will disappear. Its "root cause" is that it is an accounting problem.
IMO
Nortel's Strange M&A Poker Game
Too much BOW and not enough WOW
Dead money IMO
SEC Retires 'Moron du Jour' Title
Yes. Adam Smith with Glass Steagall, full margin requirements and the uptick rule with no SARBOX. But not at the mmiediate moment as we are almost at the point of a financial panic.
No "not on social good". The tax system is already too confiscatory with the top 3% of most productive tax payers (top income group) paying over 50% of personal income taxes, and the botttom 50% paying essentially nothing in personal income taxes. How much more do you want from the "hated rich"?
Social Security is a ponzi scheme in which the schemers have discovered they can steal from it at will and with impunity. So either stop them from stealing from it in the future and/or privatize it. Currently you put the money in, the politician/crooks just take it out, spend it and leave you holding a worthless IOU . IF this were a private Trust fund, the trustees would all be in jail.
"Socialism for the Rich" is an oxymoron, a dimlib label to confuse the bread and circuses crowd. There is no such thing as it is their money in the first place, they earned it.
Since 1945 the politicians have managed this country into bankruptcy.
Consider this proof:
1940's FDR = Americans may not own gold
1962 JFK gets U.S. into Vietnam war by changing a few U.S. observers into many U.S. armed advisors. (PS we won in Vietnam0 just ask the Soviets, if you can find them)
1968 LBJ = Its ok to steal from Social Security to fund Vietnam war
1971 Nixon = $35 dollars = 1 once of gold, but the dollar is no longer pegged to a gold standard. Its "free" from the burden of gold reserves.
2008 ALL = Approx $900 dollars required to buy 1 once of gold
SO NOW THE DOLLAR IS WORTH ABOUT 3 CENTS COMPARED TO ITS 1971 WORTH.
That is why $30,000 houses are now "worth" $1million and why a "nickle bag" now costs over $100.
Remember "trickle down" beats "pissed away" any day
Peace and Love,
SEC Retires 'Moron du Jour' Title
I am glad they put it to the shorts - because Iwas long many options positions last week = all Sept exp.
But here are -IMO - the overriding salient macro points of this whole financial crisis.
1)Its very real
2)Its global
3)The potential precipice is very high - its a long way down.
4)Our politicians are stupid and ignorant -for the most part
5)Paulson and Bernanke are probably the 2 most knowledgeable, connected, and experienced individuals we could possibly have in their positions.
SO!!! To all I say there is good news and bad news.
First the Good news: do not be afraid,
don't worry be happy. - Mon!
Now the bad news with thanks to Martha and the Vandellas
No need to be fearful because there's "No where to run to baby, no where to hide" we are far past that.
Have a nice week.
SEC Retires 'Moron du Jour' Title
A few politicians (Congressmen) hanging around would stop the remainder from continuuing to steal $$$ from the SS trust fund, make every one feel better, and completely eliminate the pending bankruptcy of SS.
This country is on the road to potential financial collapse. We were put there by FDR and the New Deal and now Hard decisions are required to fix big problems. We used to hang horse thieves in this country - and guess what - horse thievery is way down.
Also kudos to the guy who added = "Get rid of Sarbanes/Oxley.? That piece of garbage legislation has significantly increased the cost of doing business, while adding not one iota of utility to the corporate oversight process.
Constitutional Centrist is a political philosophy that has been around for some years. Its an outgrowth of Libertarianism.
So, as I suspected, you do not know the operative definition of Facism. Get a political text, learn and then maybe we can discourse on the differences. After all if you don't know the "eigenvalues"... of either side of the equation, how can you possibly understand or add to a discussion characterizing the significant differences between the 2 states?
As a suggestion: Focus on differentiating the concepts of Rule of Law vs Rule of Man.
PS Allowing some preferences for qualified applicants = kids from Alumni and rich donors IS NOT AFFIRMATIVE ACTION . It is ENLIGHTENED SELF INTEREST. Normally called a quid pro quo.
Have a nice day.