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| User Info | The Fraudacity of American Finance in forum [Ticker] | |||
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Genesis Posts: 71435 Incept: 2007-06-26 
KD^2 
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http://market-ticker.denninger.net/archi....
---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 09:04:19
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Weezie Posts: 3601 Incept: 2008-05-19 
Obama's personal message to the American people...
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Thanks Karl. This is one that I am DEFINITELY faxing to all of the Congress. The only thing this is missing is Yaldor's calculations. Although you did reference it in yesterday's ticker, but having it completely documented in today's ticker, along with the other quotes and facts you have, would completely hit your argument out of the park. By the way, you might want to start a digg link (I hate starting those links for items I had no hand in writing), so the rest of us can digg this thing up and hopefully get it more exposure. ---------- ---------------------------- Do not write below this line.
2008-10-17 09:15:46
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Blackswan Posts: 3602 Incept: 2007-11-06
Ponzi Roller Coaster
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Fraudacity sums up American Finance. Does anyone have the Fast Money clip?
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2008-10-17 09:16:22
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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Yes, on my DVR, but I don't have time to work it up yet. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 09:16:45
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Oxfordrick Posts: 2685 Incept: 2007-07-09
san diego
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The purpose of CDS was to enhance the value of super senior tranches by more than its cost, kinda like point-of sale rustproofing on a new car. (Remember that scene in Fargo?) NOBODY expected it to be ever called upon but under Basel II banks could increase their leverage by investing in the very highest rated CDOs. SO IMO it was more of a scheme to arbitrage bank capital rules and IB greed, certainly reckless but infrequently fraudulent. Yes of course CDS should be regarded as insurance and have been regulated appropriately from Day 1 but that's another story.
2008-10-17 09:20:56
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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Quote:The purpose of CDS was to enhance the value of super senior tranches by more than its cost, kinda like point-of sale rustproofing on a new car. (Remember that scene in Fargo?) Uh, if that was true then there wouldn't be $600 billion out against $6 billion of actual VAR in the underlying (according to DTCC) Either someone is lying or the entire game turned into something other than enhancing (or insuring) value. You can't have this one both ways. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 09:23:25
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Jparks Posts: 490 Incept: 2008-04-07
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Nancy Pelosi was on Charlie Rose last night and said several times that this "bailout" was necessary to "create jobs and decrease our dependence on foreign oil." She never stops smiling. Scary. A friend told me yesterday that he heard on the radio that the original bill had been prepared FOUR MONTHS before being presented as an emergency measure. I can find nothing on this. Anybody else heard this?? ---------- "We used to be a country that made ****. Now, we just have our hand in everybody else's pocket." Sobatka, The Wire. Last modified:
2008-10-17 09:32:55 by jparks
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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Yes JParks. The White House Press office said something similar. I wrote about it at the time. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 09:29:13
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Oxfordrick Posts: 2685 Incept: 2007-07-09
san diego
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Certainly these CDS liabilities were traded in a tight little circle with profits booked on both sides according to whatever model was used. These "profits" were bonused out to individual players in due course. I am also surprised by the small net amount but it is certainly possible and if so points out just how much inter IB trading there was. Where it gets really interesting is the possibilitiy of a CDS spiral - ie LEH writes CDS on BSC who writes CDS on AIG who writes CDS on LEH. Try sorting that one out!
2008-10-17 09:32:10
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Etz3l Posts: 9103 Incept: 2007-06-26
Online
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When will the music stop for these criminals? Oct 21st?Quote:The Depository Trust and Clearing Corporation says the risks have been exaggerated in headline scare stories, insisting that the total sum to be paid will be closer to $6bn. It says most positions are "netted out". ---------- Treating the symptoms of financial corruption isn’t the same as removing the causes. Last modified:
2008-10-17 10:25:05 by etz3l
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Halfbrite Posts: 555 Incept: 2008-10-13
Arizona via California
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When seller knows value of product and buyer does not, guess who gets screwed? Customer obtains a mortgage and has no clue how much it costs them - loan originator gets paid thru front door (points and fees from customer) and back door (rebates from lender for screwing customer into a higher rate)-govmt says "this is legal". CDO's, CDS, SIVs, banker knows precise value of product, buyer has no clue (just like a mortgage). Govmt says "all is legal". Banker screws entire world and all Americans investments, pension funds etc. on massive, global scale. Great ticker - you hit it spot on. ---------- "The Second Amendment is in place in case they ignore the others" "Go Galt,and Go Now!"
2008-10-17 10:21:18
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Seriousslacker Posts: 68 Incept: 2008-09-30 
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So the big question is - will they be able to paper over this gigantic fraud and get the credit markets working normally? Since all the major players Central Banks are doing their best to prevent the credit markets from locking, is it possible that they might pull this off without long term interest rates increasing? No matter what, taxpayers are getting screwed, but if the Central Banks can make the problem go away, the amount of questions asked will dissipate much more quickly. I just wish there were more reporters asking tough questions, but that might be viewed as unpatriotic!
2008-10-17 10:51:34
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Jubber Posts: 4242 Incept: 2007-07-05
UK
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Excellent analysis Gen. have e-mailed it to powerluncheurope@cnbc.com as they actually aired one of my e-mails today!, although it was laughed away
---------- "War is God's way of teaching Americans geography." Ambrose Bierce "The Emperor realized that the people were right but could not admit to that. He though it better to continue the procession under the illusion that anyone who couldn't see his clothes was either stupid or incompetent." Hans Christia
2008-10-17 11:02:39
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Fredocal Posts: 65 Incept: 2008-08-14
New York, NY
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Thanks Karl. I have learned so much since I started reading here and learn more every day. I feel like a complete idiot reading these tickers sometimes, but I'm getting there! I keep spamming everyone I know with the tickers and now finally some friends and family are starting to get it. I don't know for sure, but I can sense a change and it is people like you and Mish and the Automatic Earth who deserve a lion's share of the credit. To attempt to wake people up on a massive enough scale to make a difference can be so overwhelming that most people would never start. Thanks to your site and others like it, I've seen lots of people, including myself, who would have never spoken up do so.
2008-10-17 11:24:38
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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Serious, you're kidding right? Paper over it? Why do I do this? Fraud is fraud kids. Jesus. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 11:40:06
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Weezie Posts: 3601 Incept: 2008-05-19
Obama's personal message to the American people...
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Easy, Gen... he only has 3 posts. It takes until at least 50 until they take the red pill.
---------- ---------------------------- Do not write below this line.
2008-10-17 11:44:12
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Snooze Posts: 1652 Incept: 2007-07-09
florida Online
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I just fired this one off to my reps...demanded that since they have chosen to allow the administrative branch to invest my dollars; that they now manage my investments with oversight and scrutiny for any improper use of my investment funds. Nice ticker, Karl ---------- We're on a journey - and we don't know it - back to a nation of communities where your character really matters, and where character rests on whether your deeds comport with truthfulness......KUNSTLER
2008-10-17 11:44:40
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Jnojr Posts: 555 Incept: 2008-09-18
San Diego, CA.
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Quote:When seller knows value of product and buyer does not, guess who gets screwed? Eh? Any buyer of a mortgage who cares to find out what it's "worth" has all of the information. If they can't find it, or don't understand it, they're free to refuse to sign. Why is it that I wasn't "victimized by predatory lending"? I'm not in any special club. Hell, I had one mortgage guy try to slip me an ARM. I said, "No". We will get past the financial aspects of this crisis. What we may not recover from, though, is this idea that everyone can be innoculated against risk. We have tens of millions of people who believe that "life should be fair", and they're voting for people who tell them it can be. Get in over your head? You're a victim! We'll save you! Next will be credit cards... as consumer spending slows, that "crisis" will be "addressed" by the fact that these poor victimized consumers cannot get even more credit from greedy, rapacious credit card companies who (GASP!) actually expect to be repaid! They're draining away hard-earned money from consumers while times are tough, and they must be forced to forgive the unpayable balances they've forced people to accumulate, and they must be forced to lend more so the economy can be jumpstarted! And if they refuse, hell, we'll just take 'em over! They cannot fail, because unlimited amounts of tax (and borrowed / printed) money will be made available to keep the party going. Karl mentions transparency over and over again as a necessary part of any real fix. I believe that transparency is just a part of accountability... people, as individuals, as the representatives of companies, and as politicians, must stand up and say, "I am responsible for my own words and deeds". So long as we do not expect true accountability, nothing else is going to help us... we will keep getting ourselves into deeper and deeper holes, because we're slapping Band Aids over the symptoms of the underlying cause.
2008-10-17 12:04:46
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Halfbrite Posts: 555 Incept: 2008-10-13
Arizona via California
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Jnojr - unless you know what %rate was "par" on the date you closed your home mortgage, you were victimized - you just haven't figured it out yet. The par % rate is known to about 1% of people who obtain a mortgage, but 100% of lenders know exactly where par is when they close the loan. (par is the real value of the mortgage you bought) The slickest "con" is when the mark doesn't know he's been robbed until the perp is long gone (or the proceeds in an offshore account!) - cdo's, cds, siv's! ---------- "The Second Amendment is in place in case they ignore the others" "Go Galt,and Go Now!" Last modified:
2008-10-17 12:27:43 by halfbrite
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Implosion Posts: 3210 Incept: 2008-03-20
99.9% of all crash calls are wrong!
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Maybe this ticker should be sent to the FBI and/or the FTC?
---------- "You better believe in the PPT! If you haven't by now, you will." - Chummin It's a Global Economic Meltdown (Music Video): http://www.youtube.com/watch?v=mzXTxAOQE....
2008-10-17 12:32:17
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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It was already sent to a few Congressfolk. Send it around! ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 12:38:01
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Jnojr Posts: 555 Incept: 2008-09-18
San Diego, CA.
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Quote:Jnojr - unless you know what %rate was "par" on the date you closed your home mortgage, you were victimized - you just haven't figured it out yet. Exactly how have I been "victimized"? I have a mortgage that I can afford, that I willingly consented to. You seem to be making a claim that I may be paying "too much". That sounds an awful lot like a Socialist claim that the lender is making "excessive profits". I don't care what this "par" is. I borrowed a certain amount of money, and agreed to repay it with a fixed interest rate. I can afford to repay the loan at the agreed-upon rate. How much the lender is making off of the deal is meaningless to me. Trying to incite my envy by pointing out how much tehy may or may not be making is nothing more than the seeds of class warfare, and I ain't playing that game. I do not begrudge my lender making a profit. I do not begrudge anyone making a profit. Socialist principles seeping into every facet of our lives is going to doom us far faster than "predatory lenders".
2008-10-17 14:54:59
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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This is simply not true Jnojr. Would you buy stock if there was no published bid and ask? That's what you're saying is "ok". ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-10-17 14:55:54
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Halfbrite Posts: 555 Incept: 2008-10-13
Arizona via California
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Jnofr- Sorry if I offend-this is not about socialism or "lenders profits". The issue is transparency of pricing of products peddled by bankers. When bankers know the real value (par%) and you don't, you're a potential (and likely) "victim of predatory lenders". Were you victimized and for how much? You don't know until you know what par was on your closing date, just as we don't know who has/has not been victimized until we unravel CDS,CDO's, and SIV's with full transparency! Our government is going to unprecedented lengths (700B of them!) to prevent transparency - makes me go hmmmmmm? ---------- "The Second Amendment is in place in case they ignore the others" "Go Galt,and Go Now!"
2008-10-17 15:33:47
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Degaston Posts: 1100 Incept: 2007-07-27
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How about this for a title of a book ;) "The Fraudacity of Hoax" by Broke oh Bummer What a bummer that we're broke. Thanks for the hoax our blessed politicians. Or the book could be called: "Flamed out Our Finances" by Gone Insane http://www.google.com/products?q=%22Auda.... http://www.google.com/products?q=%22Fait.... ---------- 8/20/2009: Strong Buy ratings - PACR, GIGM, UNG, CSR, PBW - 10 percent in the market right now with 90 percent in cash
2008-10-17 16:48:14
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