Archive - 2010 - Blog entry

The financial crisis compressed 30 years of change into two, taking us from libertarian Ayn Rand to pay czar Ken Feinberg in one giant leap. The “white collarization” of organized crime has been a secular trend since the sixties. AIG getting 100 cents on the dollar was the greatest scam in history. Maybe a pathological need to be in front of the spotlight? No luck with the infamous black book.

The UK National Association of Pension Funds has called for an overhaul of accounting rules that govern the disclosure of company retirement liabilities, arguing that these are intellectually flawed and partly to blame for the widespread closure of schemes. The move is hugely significant, not only for the UK but around the globe. The UK led the big revolution in pension fund accounting over the past 10 years to value assets and liabilities of a scheme at a snapshot of current market values.

The immensely popular investment idea, namely to short U.S. Treasuries, may be the largest sucker bet in many, many years. Instead, buying longer duration government bonds (U.S, European or Japanese) before the final stage of an epic 30 year bull market could prove to be one of the smartest trades of the last decade.

82% of the American public wants tougher regulation of Wall Street.

Most top independent financial experts say that we need to break up the big banks and otherwise rein in the financial giants in order to save the economy.

But Summers, Geithner, Bernanke and Congress like things just the way they are.

Of course they do ... they're bought and paid for:

Two years ago when I warned that Munis were getting primed for default in quite a few states (analysis linked below), my admonitions were pooh-poohed. Muni's practically never default, said the ivory tower (muni salesmen) professionals. Don't look now, but bankruptcy warnings are now standard fare in the Detroit prospectus, that doesn't even come with a set of financial statements attached. They are probably paying more than Greece,,, with more to come.

Whatever happened to Goldman's do gooder campaign?

Picture China right behind Greece as the target of the market vigilantes.

Evidence seems to be mounting that we are headed towards some sort of implosion in the paper Gold market, and perhaps the currency/bond markets in general. Got physical Gold?

Investing in Russia is a double edged sword. Shareholder rights are virtually unknown. Cross the government, and they’ll through you in jail. But the land of Lenin and Red Square has the cash to finance a serious growth spurt. GDP is flipping from a -7.9% rate in 2009 to an expected 3.2% this year. Russians have no credit card debt, no home mortgages, and terrible housing, but the resource wealth to buy what they need. Just watch out for the knock on the door in the middle of the night.(RSX)

David Loglisci, who was Hevesi's chief investment officer at New York's state pension fund, has agreed to dish to investigators for Attorney General Andrew Cuomo on a culture of corruption that existed in the office.

What do the January unemployment numbers mean? How about February?

GATA must be gulping hard as Goldman, GETCO, Citadel, MS, UBS & DRW announce the purchase of minority stakes in NYSE Liffe U.S., which administers 100 oz. gold futures, 5,000 oz. silver futures, options on gold and silver futures, and mini-sized 33.2 oz. gold and 1,000 oz. silver futures. The long-suspected ringleader of silver futures short-sided shenanigans, JPM, was conspicuously absent from today's NYSE press release. David Simon himself (The Wire) couldn't write a seedier script of flagrant fraud and regulatory remiss.

1st Q for the SSTF is like all of last year. Bad news.

My favorite party boy economist, Nouriel Roubini, just came out with his analysis for the second half and he notes that we may be heading toward a double-dip recession. Too much negative news, he frets. I have been saying this for some time.