Reggie Middleton with Max Keiser on the Keiser Report Discussing Banks, Fraudclosure and Derivative ExposureSubmitted by Reggie Middleton on 10/28/2010 10:42 -0500
Reggie Middleton with the rather animated Max Keiser (the guy actually had a Lloyd Blankfein action figure for waterboarding) on the Keiser Report Discussing Banks, Oligarchs, Fraudclosure & Derivative Exposure. Also included - how Britain is avoiding confrontation with suicide bankers who took down the financial system "for kicks". If you guys think I'm offensive, you ain't seen nothing yet. Regular ZHers will probably enjoy the whole thing. Those in the banking industry should just fast forward to my portion so you can just harshly disagree vs being thoroughly offended :-)
Junk economics and the Taylor Rule guide the Fed's QE2 monetary policy. Junk or not, the important thing is that they believe it. So does Goldman Sachs. How many dollars will the Fed print? $1Trn, $2Trn, $4Trn? You should know that they are all just guessing and have no idea how this will come out. Remember this word: stagflation.
Two weeks ago we first touched upon a key tangential topic of the whole mortgage mess, namely the implication of what potential MERS fraud means for Commercial Mortgage Backed Securities. Well, the topic which has so far avoided broad media attention to the benefit of all CMBS holders may be about to go mainstream. As part of our initial inquiry, we asked: "If residential mortgage foreclosures are being halted and if the very fabric of the MBS securitization architecture is put into question, when will someone ask whether MERS® Commercial allowed such pervasive title fraud as is now apparently ubiquitous in the residential space, to take the CMBS space by storm, and how many billions in dollars will Banc of America Securities, Bear Stearns (d/b/a JP Morgan), GE Capital Real Estate, GMAC Commercial, John Hancock and Wells Fargo be forced to buy back loans that were fraudulently certified." Our question is now being reiterated by Barclays Capital. Next up Bloomberg, Ratigan, and everyone else.
The inaugural Chris Martenson "Straight Talk" contributor is Mike Shedlock, author of Mish's Global Economic Trend Analysis, one of the most visited and respected economic blogs on the Web. Mish is an outspoken deflationist and outlines his rationale for being so in his answers to our questions. He is also a registered investment advisor representative for SitkaPacific Capital Management.
Goldman is Ratcheting Up VIE Risk!!! More So Than the Top of the Bubble! Many Thought the Enronesque Days of “Hide the Sausage” Accounting Games Were OverSubmitted by Reggie Middleton on 10/27/2010 07:27 -0500
“Goldman, unlike the rest of the street and practically the rest of the I banking world, is ratcheting up VIE risk!!! Is BoomBustBlog the only one inquiring as to WHY??? We have a few reasons in mind… And to think, many thought the Enronesque days of “hide the sausage” games have come to an end…”
Sovereign wealth funds are a force to be reckoned with. Some like Singapore's GIC have started to selectively take on more risk while others, loading up on domestic debt, are in for a nasty surprise...
The US population is starting to get restless: investors are beginning to sue, there are protests over HAMP, and foreclosure probes are happening.
Here is my latest article in the October issue of Institutional Investor. But first I want to bring to your attention two articles from the NY Times.
Wall Street responds to my missive on the potential of concentrated derivatives risk blowing up the banking system. Traders, salesman and financial engineers chimed in, and made some cogent points. Of course, I must rebut. It is the actual rebuttals that are probably more stinging than the original article - particularly the one concerning hedge funds. Please read on and feel free to chime in. Don't forget to bring the "Fiery Sword of Truth!"
A little knowledge of history can be a dangerous thing. We are trapped in a runaway Toyota, with the doors locked and broken, the accelerator stuck on the floor, careening towards a cliff at 100 miles per hour. Gridlock assures we can do nothing about it. Be careful what you wish for. This is what lost decades are made of.
A Step by Step Guide to Exactly How Much Derivatives Risk Each of the 5 Big Banks Actually Have, and How It Could All Go Boom!Submitted by Reggie Middleton on 10/25/2010 13:13 -0500
Blogs, Banks, Derivatives Risk and the Fiery Sword of Truth: This One Has It All - Even a step by step guide to the TRUTH!
The Treasury Secretary who surfs. The crisis was caused by excessive debt levels, the adjustment of which is now mostly behind us. Permanent investment tax credits for domestic R & D are on the way. So is a one year tax credit for capital investment. Stepped up spending on infrastructure is a big priority. The US will not engage in a debasement of its currency. There will be no non dollar reserve currency in our lifetimes. By any measure, the Chinese Yuan is undervalued. Promises, promises. Don’t expect to see any Geithner signed dollar bills soon.
What's keeping Leo de Bever, CEO & CIO of the Alberta Investment Management Corporation, up at night?
When financial markets have become riddled with fraud, embezzlement and corruption that goes unpunished, then institutional players will avoid that market as crooked: the well has been poisoned. The full consequences of what I termed The Rot Within: Our Culture of Financial Fraud and the Anger of the Honest are now unfolding: the well has been poisoned. One of my most astute correspondents made a critical observation that I've seen nowhere else: once a market has been poisoned by fraud which goes unpunished, then institutional players will avoid that market as untrustworthy. Without institutional trust and participation, the market then withers on the vine-- exactly what has happened to the U.S. mortgage securities market. The market for mortgage-backed securities has vanished, except for one player: the Federal Reserve, which has bought a staggering $1.2 trillion in the past 18 months to create the facsimile of an active market.
When people ask what to expect in the large bank, GSE and real estate sectors in 2011, we say that the day of reckoning put off by not restructuring Countrywide, Bear, Merrill, Wachovia et al two years ago is now coming due. The operational and financial reality of insolvency can only be put off for so long. Or to refer to the immortal words of Joaquin “el chapo” Guzman, spoken after the mistaken 1993 killing of Cardinal Posadas at the Guadalajara airport: “Esto se va a poner de la chingada”