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Guest Post: Inevitable Catastrophe - The Fruits Of Moral Hazard On A Global Scale

Tyler Durden's picture




 

Submitted by Charles Hugh Smith from Of Two Minds

Inevitable Catastrophe: The Fruits Of Moral Hazard On A Global Scale

Insulate participants from risk with policies like the Bernanke Put and you guarantee destruction of both the market and institutional legitimacy.

Identify the common characteristic of these three statements:

1. The Federal Reserve will never let the stock market decline, i.e. the "Bernanke put"

2. The Chinese government will never let property prices decline

3. The European Central Bank will never let Greece default

The answer of course is moral hazard: a person who is insulated from risk will have an insatiable appetite for risky bets because any gains will be theirs to keep but any losses will be covered by the central bank or government. The global financial authorities’ success in propping up assets (stocks in the U.S., real estate in China, banks in Europe, etc.) over the past three years has strengthened this asymmetric disregard for systemic risk into a dangerously quasi-religious faith that central banks and governments have essentially unlimited power to keep asset prices aloft via printing money, manipulation of markets and financialization of their economies.

What happens if markets crumble despite massive, sustained central bank and government intervention? The institutions that created moral hazard will be revealed as false gods, and that faith will be destroyed.

This loss of faith in the transparent functioning of markets will trigger what I call the delegitimization of both the markets and the institutions which have essentially promised a permanent upward bias in assets.

We can see the global scale of this central bank-cnetral State induced moral hazard in the tight correlation of all markets: the stock exchanges rise and fall in near-perfect unison, oil and gold rise and fall in parallel with equities, and so on.

As I have noted before, beneath the surface there is really only one trade in the entire global marketplace: all assets on one side and the U.S. dollar on the other. Correlation is not causation, of course, but it is more than peculiar that every decline in global equities is matched by a concurrent rise in the dollar.

Transparent, independent markets do not move in lockstep. The campaign to prop up all asset classes with implicit guarantees of intervention has completely insulated institutions and punters who believe that the Bernanke Put and the Chinese government's equivalent prop under real estate is not just policy but a guarantee of god-like power.

Thus the gains from gargantuan speculative bets are yours to keep, and any losses will be made good by the central bank or government. This is the ideal recipe for misallocation of capital and speculative derangement on an unprecedented scale.

Moral hazard is the ultimate perverse incentive: it rewards all that is unproductive and risky and punishes long-term investment and prudent risk assessment.

A second feature of the global central bank's moral hazard is the necessity to punish any punters who dare to bet against the banks' manipulations. Thus Fed Chairman Bernanke could opine that oil would decline and presto-magico, a "surprise" release of oil by central authorities occurs the next day.

This second feature of central bank manipulation leaves a market devoid of short sellers and thus of any buyers as markets crumble.

Once trust is lost, it cannot be won back. Once participants' faith in the markets and in the god-like power of central bank intervention is crushed, the markets will lose participation on a grand scale. The authorities' favorite game, goosing asset prices to create an illusion of recovery and rising wealth, will be revealed as a global fraud.

Announcements of future interventions will be scornfully dismissed and thus they will have lost their power to prop up the markets.

All of this flows from the very nature of moral hazard: insulate participants from risk and give them unlimited leverage and "free money" to play with, and what you eventually end up with is catastrophe. There is no other possible end state.

 

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Fri, 06/24/2011 - 17:31 | 1399831 Josh Randall
Josh Randall's picture

$hit on a Shingle: it's whats for Dinner

Sat, 06/25/2011 - 08:06 | 1400812 ethnik
ethnik's picture

last move of players like Bernake or EB's to collect value of paper money from regular people, to take your savings. They are pretty aware of this. thats why they manipulate precious metals till its still possible.

Fri, 06/24/2011 - 17:36 | 1399835 apberusdisvet
apberusdisvet's picture

The new market mantra:

go long pitchforks and nooses

go short breathing politicians and banksters

Fri, 06/24/2011 - 21:56 | 1400354 Spirit Of Truth
Spirit Of Truth's picture

Yep.

Dance with the devil of statism and ultimately you are inviting the devil to take charge:

http://thespiritoftruth.blogspot.com/2008/10/greenspan-i-have-found-flaw.html

Sometimes the most important role of government is in enforcing the FREEDOM TO FAIL. Not doing so invites collective suicide IMHO. We're going down The Road to Serfdom...

Fri, 06/24/2011 - 23:54 | 1400551 jeff montanye
jeff montanye's picture

and the irony is that in the fall of '08 there was enough capital between the shareholders and the bondholders in the financial sector to support a profound reorganization without spending taxpayer money and while avoiding moral hazard.  

Sat, 06/25/2011 - 05:17 | 1400759 Reptil
Reptil's picture

Bingo. A missed opportunity of gigantic proportions.

Sat, 06/25/2011 - 10:46 | 1400927 Flakmeister
Flakmeister's picture

Instead we got a financial coup d'etat in TARP....

Haircuts are for little people....

Fri, 06/24/2011 - 17:34 | 1399839 doomandbloom
doomandbloom's picture

buy the dip?

Fri, 06/24/2011 - 17:43 | 1399850 snowball777
snowball777's picture

Buy the diiiiiiaaaaaiiiaiaiighghghg!!!!

Fri, 06/24/2011 - 17:52 | 1399877 Hurdy Gurdy Man
Hurdy Gurdy Man's picture

hahahahaha

 

Fri, 06/24/2011 - 17:39 | 1399840 snowball777
snowball777's picture

Because, because, because, because, because...because of the wonderful things he does.

- Chick from Kansas and Friends

 

Fri, 06/24/2011 - 18:58 | 1400023 breezer1
breezer1's picture

easy for you to say...

Fri, 06/24/2011 - 17:42 | 1399848 Thorlyx
Thorlyx's picture

well said

Fri, 06/24/2011 - 17:44 | 1399859 There is No Spoon
There is No Spoon's picture

Bernanke jumped the shark with his decision to do press conferences. He voluntarily pulled back the curtain on himself, revealing that the Wizard of Oz is powerless and it's all a mirage. He's revealed himself to be a one trick pony. Since qe2 didn't work, he's been rendered useless and will surprise everyone by stepping down by the end of the year.

Fri, 06/24/2011 - 17:46 | 1399876 topcallingtroll
topcallingtroll's picture

Qe2 did work, if by work you mean that we avoided a great depression.....so far.

It has been almost free money, because bond vigilantes are nowhere to be found.

Fri, 06/24/2011 - 18:14 | 1399936 baby_BLYTHE
baby_BLYTHE's picture

housing prices haven't seen declines like these since the 1930s

Fri, 06/24/2011 - 18:16 | 1399952 CompassionateFascist
CompassionateFascist's picture

Real unemployment is now about the same as it was during the worst of the "great" depression. QE2 did nothing but further enrich banksters and other speculators...and ensure that the Great-er depression will be terminal for the entire System.

Fri, 06/24/2011 - 18:46 | 1400005 DoChenRollingBearing
DoChenRollingBearing's picture

top,

I suspect that QE2 worked only in the sense that by kicking the can further down the road will only make the reckoning even worse than if we had taken our medicine in 2008 - 2009.

I also suspect that almost free money will lead to very bad results.

Re bond vigilantes, I guess they all became bond buyers...

Fri, 06/24/2011 - 19:05 | 1400044 Hedgetard55
Hedgetard55's picture

He did make the end result that much worse.

 

There is no "free money". Everyone who owns dollars and cash equivalents got nicked for the money through debasement and the theft of potential interest income.

Fri, 06/24/2011 - 19:28 | 1400094 Mark Noonan
Mark Noonan's picture

Precisely - and that is why no matter how kooky everyone tries to make it out to be, we must get back to gold currency.

Fri, 06/24/2011 - 19:06 | 1400046 Founders Keeper
Founders Keeper's picture

+1

 

Fri, 06/24/2011 - 22:56 | 1400444 mayhem_korner
mayhem_korner's picture

Qe2 did work, if by work you mean that we avoided a great depression

Er...huh?  Avoid or defer and exacerbate?

Qe2 turned the M-80 we were holding into Tsar Bomba...

http://www.youtube.com/watch?v=WwlNPhn64TA

Fri, 06/24/2011 - 17:44 | 1399860 topcallingtroll
topcallingtroll's picture

Lets see how monday goes. If i dont think ive caught a temporary inflection point time to get out of the stock market again.

If you cant beat moral hazard then join the party, but i might be getting back in too soon.

Fri, 06/24/2011 - 18:52 | 1400010 DoChenRollingBearing
DoChenRollingBearing's picture

While I will not get into the stock market (other than more selling), I see nothing in your remarks that merits junks.

Fri, 06/24/2011 - 21:48 | 1400333 TimmyM
TimmyM's picture

Too bad for you TCT. Once everyone has embraced your confusing of liquidity with price continuity, the market will crash on an uptick.

Fri, 06/24/2011 - 17:41 | 1399861 viator
viator's picture

Dear Ben,

We just heard on Bloomberg TV that prices at the pump have fallen 21 days in a row.

We know that while prices were going up every day, you got a lot of crap from people about inflation, and how you weren't doing enough. So we just wanted to say: Thank you!

Now sure, we don't drive -- we live in New York after all -- but that doesn't mean we can't sympathize with those people out there who do drive, and for whom gas prices were taking a bigger and bigger bite out of their paycheck.

So again, big thanks.

Sincerely,

Joe Weisenthal

http://www.businessinsider.com/dear-ben-bernanke-a-huge-thanks-for-attacking-inflation-and-bringing-gas-prices-down-2011-6#ixzz1QESmr0wx
Fri, 06/24/2011 - 18:07 | 1399915 Kayman
Kayman's picture

We just heard on Bloomberg TV that.... the federal debt is "just a number".

What a relief. I can tell my children and grandchildren that they have nothing to sweat about.

I feel so much better now.

Fri, 06/24/2011 - 18:53 | 1400001 Cruel Aid
Cruel Aid's picture

I've heard that 'debt doesn't matter' bullshit being spewed.

It doesn't matter till it does! And then it is too late.

Also, this is the buy the dip pause in the market. On cue.

Fri, 06/24/2011 - 19:49 | 1400136 Hacked Economy
Hacked Economy's picture

But it doesn't matter...as long as you encourage more debt from consumers below you, and inflate the credit side of the ledger books, which in turn inflates the economy.  Yay!

Unless there's a recession, and unemployment, and lower tax revenues, and a debt-fueled spending binge, and...

</sarcasm>

EDIT:  Looks like a junk troll made his/her rounds on this thread.  Look at how many people in a row got a single junk.  Jerk.

Fri, 06/24/2011 - 17:45 | 1399862 Robslob
Robslob's picture

I had a thought...

We will all have the last laugh...when we die.

Fri, 06/24/2011 - 17:41 | 1399863 Deepskyy
Deepskyy's picture

Once again, Charles lays out the ugliness around us in concise and simple terms.  Now if we can just get J6P to stop being concerned about Kim Kardashian's ass and start paying attention to the thieves all around them, we might get this ship righted.

 

 

I won't hold my breath.

Fri, 06/24/2011 - 17:46 | 1399872 km4
km4's picture

The U.S. is too big to fail, right? MarketWatch http://bit.ly/k2lMZA


We are not Greece, many argue, but our country is clearly on an unsustainable path of deficits and increasing national debt and we must take steps to curb government spending and reduce debt levels.

The U.S. is too big to fail, right? But who would (could) bail the U.S. out?

Brian Edmonds is head of interest rates trading at Cantor Fitzgerald. He has worked in bond trading for several financial firms over his nearly 25-year career. Edmonds also formerly served as chairman of the Bond Market Association’s Primary Dealer Committee.

Fri, 06/24/2011 - 17:46 | 1399874 Piranhanoia
Piranhanoia's picture

These monarchs must have really nice places to bug out when/if their larceny is again considered a crime rather than a resume.

Fri, 06/24/2011 - 17:53 | 1399879 HileTroy
HileTroy's picture

Wow! That makes perfect sense all currency made of paper just gets printed and life goes on!!

 One small problem even though the world is filled with sheeple there are a few wolves left over from "Productive Industries" that have had there asses handed to them by dudes looking at six computer screens and playing games with the "Wall Street Economy"

Long bullets short Bankers Politician/Lawyers

When the Sheeple cant get there free cheese us wolves will point them in the right directions to stampede.

 

What am i missing ???? There is a shit stome of baddness heading for the human race, I see it in the eyes of men less capable on the MSM every night. Natural selection me thinks will make a big come back.

What a intresting time to be alive.

 

reposted from another thread cuz I think I'm such a clever pus.

 

LOL

Fri, 06/24/2011 - 18:27 | 1399966 css1971
css1971's picture

Y'know if you get them real mad, and you manage to rip their eyes away from the TV or Facebook? Put them out of a job, out of a home.

 

You know what they'll do?

 

They'll vote.

Fri, 06/24/2011 - 17:53 | 1399889 RiverRoad
RiverRoad's picture

Lies, lies, and damned lies.....

Fri, 06/24/2011 - 17:57 | 1399890 sitenine
sitenine's picture

4. The US will never be allowed to loose its AAA rating.

Fri, 06/24/2011 - 18:02 | 1399905 Thomas
Thomas's picture

Not necessarily. Remember the banking cartel is global, so the US will indeed lose its AAA credit rating when this borderless (and despicable) group decide it should.

Fri, 06/24/2011 - 18:09 | 1399922 sitenine
sitenine's picture

Fair enough statement, but do recall that Hong Kong considers Treasuries junk, and Germany's Feri recently downgraded US debt. S&P shills? Right, we know who owns them ;)

Fri, 06/24/2011 - 17:56 | 1399894 sasebo
sasebo's picture

CHS, astute observation, as usual.

As usual we don't have to do anything, just sit back & watch the assholes go under. Give them plenty of rope.

Fri, 06/24/2011 - 18:54 | 1400021 DoChenRollingBearing
DoChenRollingBearing's picture

Sitting back and watching will feel a whole lot better if you are prepared.  Popcorn and gold, great companions as we watch them go under.

Fri, 06/24/2011 - 17:57 | 1399901 10kby2k
10kby2k's picture

 

Why do you think its called a depression?  It sucks and is depressing. Here it comes and there is no stopping it.

Fri, 06/24/2011 - 18:01 | 1399903 NidStyles
NidStyles's picture

It's more of an Ethical Hazard. As no matter what it's detrimental to everyone, where as a moral hazard would be beneficial to someone at the expense of other's. Devaluing the monetary gain's and putting the entire system on tilt is detrimental to everyone.

Fri, 06/24/2011 - 18:04 | 1399909 VyseLegendaire
VyseLegendaire's picture

Good concise summary here.

Fri, 06/24/2011 - 18:04 | 1399920 midnight
midnight's picture

ZH, an hardcore bull speculators blog/forum, whining about moral hazard. Wow!

Fri, 06/24/2011 - 18:11 | 1399925 Atomizer
Atomizer's picture

Considering Bernanke has openly admitted uncertainty on his policies, the time is approaching quickly. Cutting out the middleman shall become the handwriting on wall. Some will push for a new replacement. The real problem is in broad daylight.

Fri, 06/24/2011 - 18:16 | 1399933 Itsalie
Itsalie's picture

moral hazard breeds lower and lower risk premia, widespread correlation of all assets and soon, (like now) all participants are locked up in a death embrace. Investors, pension funds, mutual/hedge/money-market/SWF/japanese Mssrs watanabes/bankstas, the whole lot - some providing liquidity, others providing leverage, yet others gambling pensioners' (401) and taxpayers' money. Oh, and those who believe the Bernank is somehow rendering patriotic service by printing money to wage war against the CCP or trying to destory euro, fat chance! They are all trapped in the titanic, sailing towards the invisible iceberg waiting to lurk. Its too late, there's no bailing out now.

Fri, 06/24/2011 - 21:25 | 1400282 RockyRacoon
RockyRacoon's picture

Moral hazard has been a problem before there was a phrase to describe it.

Go back to the guarantee of bank deposits, the FDIC.   Why should folks who have money in a bad bank have deposits guaranteed?   Folks would be keeping an eye on the goings-on in their banks if they were not lulled into a sense of security that the government would cover losses.   Fraud can be prosecuted if it happens, but cutting off the losses prevents discovery of wrong doing.  Look how the concept has morphed into the present banking system for proof.

If one is libertarian enough and fully for limited government, it must go the full monty and include all aspects of governmental meddling.

Fri, 06/24/2011 - 18:21 | 1399934 Fancy Bear
Fancy Bear's picture

Look at the weekly of the dow. We're about to leave the channel in place since March 09.

And about "TPTB". They're an illusion. There are people with epic power but don't delude yourself into thinking that they are omnipotent puppetmasters. Sure, they can often leverage things in their favor. But that's about it. Instead, what we're seeing is that greed and a corruptable system have created the emergent property of the appearance of a multigenerational plot to consolidate money and power and to reduce the global population aka TPTB.

To be clear: this situation is absolutely out the control of individuals and small groups.

If you need a good example of modern emergent phenomena, look up the TED talk "what technology wants."

The current global debt crisis is the result of "what crony-capitalism wants."

Fri, 06/24/2011 - 19:13 | 1400066 zaknick
zaknick's picture

Well said, except it isn't a corruptible system but a thoroughly corrupt one since, at least, 1913.

It's gonna be one heck of a ride to see Amerika awakened from its morally corrupt "Roman Empire II" narcissism.

Yeehaaaw, bitches!

Fri, 06/24/2011 - 19:20 | 1400073 zaknick
zaknick's picture

Well said, except it isn't a corruptible system but a thoroughly corrupt one since, at least, 1913.

It's gonna be one heck of a ride to see Amerika awakened from its morally corrupt "Roman Empire II" narcissism.

Yeehaaaw, bitches!

Fri, 06/24/2011 - 19:19 | 1400077 slewie the pi-rat
slewie the pi-rat's picture

TPTB = PPT & above.

Sat, 06/25/2011 - 07:57 | 1400809 Fancy Bear
Fancy Bear's picture

PPT?

Fri, 06/24/2011 - 18:15 | 1399941 Seasmoke
Seasmoke's picture

once moral hazard leaves the box, it is impossible to put back in.......i like to think i was once a moral person, but now i am much smarter

Fri, 06/24/2011 - 18:17 | 1399946 allenaki
allenaki's picture

The Greek Aganaktismenoi (indignados) issued the following:

"The Greek People are surrounding the parliament in Constitutional Square from Tuesday morning (28 June) until Wednesday evening (29 June).
These are the 2 days when the final voting and the discussion of the new austerity plan take place inside the parliament.

The Greek Aganaktismenoi are appealling to ALL POLICE AND SECURITY FORCES, ESPECIALLY TO THE LOWER RANKED OFFICERS - MAN AND WOMEN -
AND CALL THEM TO NOT USE THEIR WEAPONS, TEAR GASSES AND OTHER EQUIPMENT AGAINST THE PEOPLE, NOT TO EXECUTE THE ORDERS OF A GOVERNMENT WHICH DOES NOT RESPECT THE CONSTITUTION AND SELLS GREECE TO THE BANKSTERS.

The Greek Aganaktismenoi demand an OPEN voting process and the names of the parlamentarians" which shall vote "YES" TO THE AUSTERITY PLAN 2 shall be announced LOUD during the voting, so that the Greek People know who the TRAITORS are."

From all over the country BUSSES are organized to transport the people.

The Aganaktismenoi of SALONIKI have ORGANIZED BUSSES to travel to Athens and JOIN Aganaktismenoi in Syntagma Square.

Fri, 06/24/2011 - 18:17 | 1399947 T-roll
T-roll's picture

Great article Charles.  When the stock market crashes again, I wonder if Americans will be like the Japanese and stay the hell away from the stock market for a couple of decades?  Or will we go about blowing another Fed induced bubble?

Fri, 06/24/2011 - 18:51 | 1400017 Cruel Aid
Cruel Aid's picture

It might be the only way to get these friggin houses off the books.

Crash the market.

Fri, 06/24/2011 - 18:22 | 1399962 vegas
vegas's picture

Lesson #1 you learn the first day on a trading floor: Never bet against the end of the world because it can only happen once. Last time i checked, whether clearing through an exchange or OTC third party large [TBTF] bank [spot forex], when you buy a currency at 1.40000 and sell it at 1.40010, you ctill make a pip just like you did 20 years ago.

 

Shit happens and prices move. Hey, it'c called a market for a reason. Or maybe I should hope for stock and currency markets like 2005; when volatility was shit and you were lucky to get a 60 pip range in the Euro over the course of the entire day.

 

Fuck the collective good and all those who are paralyzed into inaction because somehow, someway, the world as we know it is ending. Hey, bring it on!!

 

Markets were here before I was born, markets are here now, and long after I am gone markets will be traded then also.

 

My job is simple: I trade and make money off of others because it is easy. Especially when market participants get one-sided and think the world is ending. Moral hazard? Please, give me a fuckin' break here.

Fri, 06/24/2011 - 19:23 | 1400085 Noah Vail
Noah Vail's picture

Got one comin'  for you right between the eyes.

That's after we take a week to peel your skin from your bones.

The parasites must be exterminated and they will be.

Sat, 06/25/2011 - 10:31 | 1400921 Absinthe Minded
Absinthe Minded's picture

+.223

I heard on the radio this morning how mutual fund managers are pissed off because younger people are not piling into risk like they should at their age. It makes it harder for them to get proper gains to help them attain the funds necessary for retirement. Translation: We can't scam them out of as much money if they keep it in low risk funds. Fool me once shame on you, fool me twice... Just because you may use a little KY it's still a porkin' your givin'

Fri, 06/24/2011 - 21:37 | 1400305 RockyRacoon
RockyRacoon's picture

Thank you for a near perfect exposition of the problem.

With people like you, who needs bankers?

Fri, 06/24/2011 - 18:26 | 1399964 vegas
vegas's picture

Lesson #1 you learn the first day on a trading floor: Never bet against the end of the world because it can only happen once. Last time i checked, whether clearing through an exchange or OTC third party large [TBTF] bank [spot forex], when you buy a currency at 1.40000 and sell it at 1.40010, you ctill make a pip just like you did 20 years ago.


Shit happens and prices move. Hey, it'c called a market for a reason. Or maybe I should hope for stock and currency markets like 2005; when volatility was shit and you were lucky to get a 60 pip range in the Euro over the course of the entire day.


Fuck the collective good and all those who are paralyzed into inaction because somehow, someway, the world as we know it is ending. Hey, bring it on!!


Markets were here before I was born, markets are here now, and long after I am gone markets will be traded then also.


My job is simple: I trade and make money off of others because it is easy. Especially when market participants get one-sided and think the world is ending. Moral hazard? Please, give me a fuckin' break here.

Fri, 06/24/2011 - 18:46 | 1400006 Everybodys All ...
Everybodys All American's picture

Wish I had your naivete.

Fri, 06/24/2011 - 19:19 | 1400071 jm
jm's picture

Naive this is not.  It's one of the most honest posts I've seen.

 

Fri, 06/24/2011 - 21:41 | 1400323 RockyRacoon
RockyRacoon's picture

It might be honest, but so is a admission of murder.   That doesn't make it admirable.

...I trade and make money off of other.

Implying that ethics might be an issue here.

Fri, 06/24/2011 - 22:23 | 1400399 jm
jm's picture

In the market, nobody looks out for you and yours but you.  Doing a good job of it means finding opportunity and not being paralyzed to act decisively, as unsavory as some of it may seem to delicate sensibilities.  This isn't an easy business, not everyone is cut out for it.   

If Ben offers a QE ramp on risk, do you take it or not?  People on ZH bitch a storm about "manipulated" stocks, but took VERY correlated risk in buying silver. Was it wrong to short it when silver got the Sacramento sweater?

Everyone will look like a genius for a time, and they'll look like dummies in their turn.  There are different ways than picking up pennies, but I agree wholeheartedly with the post. 

Fri, 06/24/2011 - 23:38 | 1400522 RockyRacoon
RockyRacoon's picture

Trading on the vagaries of the Fed is feeding off carrion, the putrid dead carcass of the free market.

Fri, 06/24/2011 - 23:50 | 1400542 jm
jm's picture

Pardon my bluntness, but this doesn't mean much beyond morbid prose.

The market is the market, manipulated or not.  If you can make money trading, good for you.  If it violates your sensibilities, stay out... or, as is the case of most, let others do the the dirty work for you.

Why are people so hostile to the idea of people pursuing their self-interest?

Sat, 06/25/2011 - 00:34 | 1400596 RockyRacoon
RockyRacoon's picture

Why are people so hostile to the idea of people pursuing their self-interest?

Not I!  It is the vehicles provided for doing that that are the burr under my saddle.

The offerings are complex and designed to fleece the unaware and those not steeped in the alchemy of "trading".   There is a term of art called "attractive nuisance" which applies.   If given a legal method to rape and pillage, men will make the most of it.   The Wall Street machinations create an atmosphere of privilege and entitlement which is most unbecoming.

Sat, 06/25/2011 - 09:56 | 1400886 Chump
Chump's picture

If you're clueless and inexperienced yet involved in complex trades, in any market, you deserve to get fleeced.  Especially this market.

Fri, 06/24/2011 - 18:41 | 1399988 buzzsaw99
buzzsaw99's picture

Moral hazard, is that like using loan loss reserves to pay out bonuses because you know the fed always has your back?

Fri, 06/24/2011 - 18:43 | 1399999 Everybodys All ...
Everybodys All American's picture

All the more reason to not raise the debt celing. If and when the debt ceiling is raised the meglomaniac Bernanke goes once again full f-ing crazy again creating more and more debt. Unfortunately, this has become the only way to reign in this mad man in my opinion.

Fri, 06/24/2011 - 19:10 | 1400056 gwar5
gwar5's picture

Central planners will never starve as long as there's a younger generation to eat.

Fri, 06/24/2011 - 20:36 | 1400197 Use of Weapons
Use of Weapons's picture

Hint: Fish just ran out [52% of all stocks overfished / +19% depleted / +8% extinct]. U.N. / IPSO research.. not that this wasn't on the cards for the last 10+ years (remember Danson? Yep. He was right).

2.6 billion people rely on the oceans as their primary protein source. Not to mention what happens when you fuck 70% of the globe's ecosystem [hint: Ph'ngluiae R'lyeh mglw'naph Cthulhu wah'naghj fhtagnaph].

 

Smart money... well. We'll let you know @ the IPO (and really - you can't eat Ipads or Groupons, which is why we laugh at you. Eating... almost mandatory, even for the size 0's; then we've got you).

 

http://www.youtube.com/watch?v=IIODY3d_aXE

 

 

p.s.

 

You can stop the /troll software on this account nauw, please. I've paid my dues, and disclosed my angle - now stop it with the irritating /trollware [and don't force me to link to the sources, we all know the way it is done: 503's, random slowdowns, insertion of meta-reference links. Don't teach your grandmother how to blow eggs. Kthx.] ~ do some basic accounting, x-reference the email with donations. Hmmph.

Sat, 06/25/2011 - 07:49 | 1400802 css1971
css1971's picture

We have plenty of food.

http://en.wikipedia.org/wiki/Soylent_Green

 

Sat, 06/25/2011 - 06:45 | 1400779 michigan independant
michigan independant's picture

There work is almost complete. Bring the States to ruin for the Bancor. People should understand there road to Serfdom. 

http://www.imf.org/external/np/pp/eng/2010/022210.pdf

You think the Senate can defend the Republic? They cannot even balance a checkbook. They were dimissed in the 80's to local affairs only.

 http://www.youtube.com/watch?v=mXUpKmYwnEE&feature=related

Sat, 06/25/2011 - 08:30 | 1400827 eddiebe
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Sun, 06/26/2011 - 20:56 | 1404145 officeone
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