New York Times
Goldman Apologizes For Its Horrendous December "US Economic Renaissance" Call, Begins QE3 DiscussionSubmitted by Tyler Durden on 06/05/2011 21:30 -0500
Back on December 1, 2010 Goldman announced it was "fundamentally" shifting its "bearish" outlook on the economy, when Jan Hatzius said "This outlook represents a fundamental shift in the thinking that has governed our forecast for at least the last five years" we accused the Goldman economics team, which we had previously respected, of "jumping the shark" and in describing the piece of fluff said it was nothing but "Hopium", concluding that "Jan Hatzius used to have credibility." Ten minutes ago, Hatzius just threw in the towel and apologized for this horrendous call. "Six months ago, we adopted the view that the economy was
transitioning to a more self-sustaining recovery and predicted
sequential real GDP growth of 3½%-4% (annualized) in 2011-2012. There
were three reasons for our shift: a) a pickup in “organic” growth—GDP
excluding the estimated impact of fiscal policy and inventories—to more
than 4% in late 2010; b) visible signs of progress in private sector
deleveraging, and c) another round of fiscal and monetary stimulus....It hasn’t happened." Needless to say, this apology has made us regain some confidence in Hatzius. Of course, we fully expect that he and his entire team will relinquish their 2011 bonus (and possibly a 2010 bonus clawback) following this massively wrong call, which only Zero Hedge had the guts to call out. Anyway, we can now move on... to QE3. Just as we predicted in January (but were late by a month, expecting this preliminary discussion would occur in May at the latest), Hatzius has just launched the first shot across Bill Dudley's bow. "So what is the hurdle for QE3?" Hatzius asks... And a very dovish Bill "You can't eat iPads" Dudley will answer very shortly. Next up: QE 3.
Unemployment During the Great Depression Has Been Overstated and Current Unemployment Understated (We've Now Got Depression-Level Unemployment)Submitted by George Washington on 06/03/2011 11:47 -0500
No, QE3 is NOT the answer ...
The shiny metal still looks good ... in the long-run
This evening's latest NYT Story-Morgenson Joint Venture story about Goldman beats a well-beaten drum: the question, which has been discussed extensively on Zero Hedge and elsewhere before, of just how ridiculous and ludicrous is the notion, used by Goldman in both Congress and before the SEC, that Fabrice Tourre, then a midlevel 28 year old whose story has been told millions of times, worked completely and entirely alone when perpetrating the Abacus CDO "transgression" (for which Goldman neither admitted nor denied guilt). Obviously this is such BS that nobody but an entity as entitled (and for the implications of perceived infinite self-entitlement look no further than DSK or David Sokol) as Goldman (and hence the SEC which needs Goldman for future employment prospects) could possibly believe it. There is however, a link in the story that is so weak, that it raises extensive questions about either the credibility of the entire narrative, or the complete worthlessness of Goldman's IT security and VPN firewall, two possibilities that demand further inquiry.
Billion Dollar Fund Managers Agree: The Government Never Fixed the Underlying Economic Problems, So We'll Have Another CrashSubmitted by George Washington on 05/31/2011 13:54 -0500
What the smart money is saying ...
The only thing that could prevent another oil shock from happening before the end of 2012 would be another major economic contraction. The emerging oil data continues to tell a tale of ever-tightening supplies that will soon be exceeded by rising global demand. This time, we will not be able to blame speculators for the steep prices we experience; instead, we will have nothing to blame but geology... With Brent crude oil having lofted over $100/bbl at the beginning of February and remained above that big, round number for four months now, we are already in the middle of a price shock. It may not be a perfect repeat of the circumstances of the 2008 oil shock, but it's close enough that the risk of an economic contraction, at least for the weaker economies, is not unthinkable here. Japan, now in recession and 100% dependent on oil imports, comes to mind. Looking at the new data and reading even minimally between the lines of recent International Energy Agency (IEA) statements, I am now ready to move my ‘Peak Oil is a statistically unavoidable fact’ event to sometime in 2012, which tightens my prediction from the prior range of 2012-2013. Upon this recognition, the next shock will drive oil to new heights that are currently unimaginable for most. First, $200/bbl will be breached, then $300, and then more.
What's the hole that is swallowing up the economy? The failure to follow the rule of law. The rule of law is what provides trust in our economy, which is essential for a stable economy. The rule of law is the basis for our social contract. Indeed, it is the basis for our submission to the power of the state.
We are supposed to be a nation of laws, not of men. That's what humanity has fought for ever since we forced the king to sign the Magna Carta.
Indeed, lawlessness - the failure to enforce the rule of law - is dragging the world economy down into the abyss.
Are they pulling a Columbo?
Daniel Ellsberg: “Secrets ... Can Be Kept Reliably ... For Decades … Even Though They Are Known to THOUSANDS of Insiders”Submitted by George Washington on 05/25/2011 12:43 -0500
Each claim of collusion - such as between Lloyd "Doing God's Work" Blankfein and Ben "We're Not Printing Money" Bernanke - must be judged on its own merits, either disproven or proven by the facts. But keeping it secret for years ... pfffft ... that's the easy part
Obama says we should "look forward" instead of prosecuting Wall Street fraud. That guarantees that we will have more economic crises.
Similarly, if we only "look forward" and never look back at unanswered questions, it will ensure more hanky panky in Iraq ... er, Libya ... um, Iran or elsewhere ...
The world's most anticlimactic, yet overexpected, news has finally arrived. Reuters reports that Senator Chuck Grassley is investigating possible insider trading at SAC Capital Advisors LLP. Possible. LOL. And so it begins: "The Financial Industry Regulatory Authority last week provided Senate Judiciary Committee head Charles Grassley with about 20 instances of suspicious trading at the hedge fund, a spokeswoman for the senator confirmed on Saturday. Grassley had asked Finra in April for information on any such trading at Steven Cohen's $13 billion hedge fund...It was not clear if the trades had been referred to the Securities and Exchange Commission's enforcement staff, and authorities have not alleged wrongdoing by SAC or Cohen. Court filings also show prosecutors are investigating trade accounts at SAC, including one tied to Cohen, SAC Capital's founder. SAC representatives and congressional investigators met in Washington on May 10 to discuss possible suspicious trades, according to the Wall Street Journal, which earlier reported Grassley's receipt of information from Finra." So even once it is finally uncovered that Cohen's billions in personal wealth have been allegedly accumulated after years of information arbitrage, and we get yet another confirmation that hedge funds only make money through economies of scale, but mostly size (until the implode), or simple insider trading, we are supposed to remember that Cohen is a great humanitarian at heart, and has spent a few million of his allegedly ill-gotten gains for civic pursuits: "Also at the meeting, SAC Capital's
Washington-based policy adviser Michael Sullivan cited Cohen's
"civic-minded interest" in purchasing a stake in the New York Mets
baseball team, the report said." Last but not least, SEC heart SAC because with it gone, liquidity (and volume) on the NYSE would plunge by another 15% (and likely much more) in yet another confirmation that fair and efficient US capital markets are nothing but a farce. "At the meeting, SAC representatives suggested the investigators go easy on the hedge fund, saying it has internal procedures to track down and prevent illegal trading, according to the Wall Street Journal report."
"Fuel Rods Most Likely Melt[ed] COMPLETELY at Reactors 1, 2 AND 3 in the Early Hours of the Crisis, Raising the Danger of More Catastrophic Releases"Submitted by George Washington on 05/19/2011 01:01 -0500
But the Nuclear Regulatory Commission says things are stabilizing ...
New, Inexpensive Blood Test Tells You "How Long You Will Live" ... But You Can Cheat and Live LongerSubmitted by George Washington on 05/18/2011 16:23 -0500
What we are witnessing is the ideological exhaustion of “Western liberal democracy” and therefore the last gasp of the fraud upon which it rests: the state, even its best form. No longer able to hide behind the Jeffersonian dream of constitutional freedom and order or the Lincolnian myth that the dream could be preserved at the expense of the principle upon which it was founded, the American state’s demise proves that “the final form of human government” has not yet arrived – not because a final form shouldn’t have arrived but because, for those who have had so much fun during historical times, the aftermath won’t be any fun. On the contrary, it will be “a very sad time”
And now for something different...