The data starkly show a comatose Wall Street being resuscitated with whatever financial might the Federal Reserve could pump into its tangled web of funding vehicles. It also points to how the Fed was dispersing sums which dwarfed the U.S. Treasury’s $700 billion TARP (Troubled Asset Relief Program) bailout program...
It was only a matter of time: back in March, following revelations of the Lehman Repo 105 scam, we speculated that the days of Ernst & Young are numbered. Back then we said "we are confident that (again, with the assumption that we live in some
semblance of a sane/ration world), E&Y's Financial Services Office
and quite possibly the entire firm. Integrity is the number one
currency for an auditor, and just like Anderson, E&Y's just went out
in a puff of green-colored smoke." Today we learn that Andrew Cuomo is about to make E&Y's life a whole lot more difficult. Per the WSJ "State Attorney General Andrew Cuomo is close to filing the case, which
would mark the first time a major accounting firm was targeted for its
role in the financial crisis." Too bad - E&Y was surely hoping that just like everything else in this corrupt country, out of sight would mean out of mind, and soon everyone would forget about the firm's involvement in the biggest bankruptcy in history. Better luck next time...
It has been a literal power struggle for the past few months between Dynegy, Inc. (DNY) and its investors. The climax came on Wed. Dec. 15 when Dynegy said it accepted a buyout offer of $665 million, excluding debt, from Carl Icahn.
Paul Farrell lights it up in his latest market commentary, which puts even some of the more hard-core realists out there to shame: "Wall Street is a loser. Stocks are Wall Street’s ultimate sucker bet.
And it’ll sucker you again. You’ll lose, worse than in the last decade.
Wake up before Wall Street banks trigger the next meltdown, igniting
mass bankruptcy." Um, wow. And seeing how we have been saying that only absolutely immaculate top tickers should be in this market, we agree wholeheartedly with Farrel.
Honest distributor of leaked data or a clever PsyOps front, one can not deny that whatever it is, Wikileaks does share some unique information with the world (as to how it is interpreted is a different story). Yet for the most part, the bulk of the organization's recent exposures have focused on the US military and away from the private sector, and thus away from that which is really important in today's world: money (of a paper representation thereof). Which is we read with interest in the latest Julian Assange interview with Forbes' Andy Greenberg that next on the docket of Wikileaks disclosure is not some facebooky look into the gossip world of international espionage or the foreign service, but something far more tangible and relevant: "A Big US Bank."
Now that RINO is the stuff of Chinese fraud folklore, many turn their attention to those who allowed this abortion to happen in the first place: namely the company's accountant, Frazer Frost, LLP ("FF"). We have tried to get some more information on the recently incepted accounting company, unfortunately, when we click on the website's link requiring more information on the "auditor" we get the following "under construction" blank page. The little we could glean, from RINO's 10-K, is the following information: "Moore, Stephens Wurth Frazer and Torbet, LLP (“MSWFT”), located at 135 South State College Blvd., Suite 300, Brea, CA 92821 was approved by our audit committee and board of directors to be our new independent accountant. Effective on January 1, 2010, certain partners of MSWFT and Frost, PLLC (“Frost”) formed Frazer Frost, LLP, which became the Company’s new independent accounting firm.)" Following the abysmal lack of audit controls at RINO, we will leave it to the Federal authorities to determine whether FF is just another Arthur Anderson in the making. However, in our attempt to protect readers from what could be a Chinese-focused Enron fallout, we present the 26 public tickers all audited by FF. It is no surprise that among the company's clients is a preponderance of Chinese companies (many of which have used the recent Chinese IPO bubble to list on various American exchanges). While we caution readers to do their own due diligence, it is probably safe to assume that a short basked of the following 26 names will generate outsized alpha over the next few months: a very rare outcome in a market determined exclusively by levered beta strategies.
A flurry of buyouts, headline-y good macro news (just don't read the "not so" fine print), and the Fed promising to print enough dollars to make everyone a millionaire as Bernanke mimics the First Citiwide Change Bank "volume" strategy caused investors to celebrate in the morning by doing the Dougie.
Krugman Dementia Alert: Former Enron Consultant Says Jim Rogers "Has Been Absolutely Wrong About Everything"Submitted by Tyler Durden on 11/06/2010 15:50 -0400
While we approach the topic of Paul Krugman with the same eagerness one approaches a clogged up, never cleaned, bathroom at a frat party that is about 50 years past its due date, (pretty much like Keynesianism) this one just put us over the top. In his latest pointless drivel on the economy, instead of reverting to his usual mode of praying to John Keynes, bitching at those who dare call for accountability and the punishment of all those, such as Krugman, responsible for what is now a $4 trillion taxpayer monetary bailout tab, and begging for trillions, then quadrillions, then quintillions, then an infinite amount of money, the Op-Ed writer has instead decided to start a mudslinging campaign against none other than Jim Rogers, the co-founder of George Soros' Quantum Fund, who has been pretty much spot on with his calls for decades.
When the crisis began in the US in 2007, many commentators called it a “Minsky moment” or even “Minsky crisis”, after the late economist Hyman Minsky who had developed what he called a “financial instability hypothesis” over the years after 1960 and to his death in 1996. Minsky was my PhD dissertation advisor and I had already used his approach to analyze the Saving and Loan crisis. Unlike the typical explanation that invokes Minsky's theories, I recognized that Minsky did not simply provide a “euphoric bubble” approach. Rather he argued that the transformation of the economy and especially its financial system from “robust” toward “fragility” took place over a very long span of time, indeed, over the entire postwar period. The increasingly frequent and severe crises, as well as the growth of fraud as practically normal business practice were a consequence of that transformation. Hence, we should not call this a Minsky moment or crisis but rather a Minsky half-century.
Part four of David DeGraw book "The Road Through 2012: Revolution or World War III.”: "Now that we have an understanding of how the Global Banking Intelligence Complex ran operations through BCCI, let’s look at how some of BCCI’s key players kept operating after the bank was finally shut down. As discussed in the last chapter, during the 1980s and early ’90s, the CIA worked in partnership with BCCI in what was, at the time, the agency’s largest covert operation ever, pumping an estimated $10 billion into funding the Afghan Mujahideen. Through this operation, Osama bin Laden’s al Qaeda network was formed. Bin Laden had accounts in BCCI and ran CIA/BCCI-funded camps."
1 of the 2 Administrative Judges at the Commodity Futures Trading Commission Vowed NEVER to Let a Complainant Win. He's Kept His Promise for 20 YearsSubmitted by George Washington on 10/20/2010 18:59 -0400
Is America a great country or what?
It's worth stepping back on occasion to consider the progress that has been witnessed in particular academic fields. Astronomy took a giant step forward centuries ago when it finally realized the sun was at the center of the solar system. Geology adapted to the fact of a round earth. The continuous evolution of Physics boggles the mind. Engineering perpetually pushes into new frontiers. And how does Economics compare...
A free market and laws against criminal fraud are both necessary. Indeed, they are interrelated and mutually self-reinforcing.
Buried in the recently passed Dodd-Frank financial reform bill are massive financial rewards for turning in your boss. Turning in Goldman Sachs could have earned you a reward of $500 million. Wall Street firms are bracing themselves for an onslaught of claims, legitimate and otherwise, by droves of hungry gold diggers looking for an early retirement.
No problem can be fixed before a solution is formed. No solution can be formed until the underlying problems are clearly identified. The officials in charge of fixing the economy have not articulated the underlying problems. Worse, many of these officials - directly or indirectly - created or contributed the underlying problems. It is shear lunacy to expect that the people who screwed up the economy have any chance at fixing what they destroyed.