• Monetary Metals
    05/02/2016 - 01:28
    The price of gold shot up this week, and silver moved proportionally. Headlines are screaming for gold to hit $10,000 or $50,000. Does this alleged new bull market have legs?

"The Shape Of The Next Crisis" - A Preview By Elliott's Paul Singer

Tyler Durden's picture




 

Transcribed from a speech given by Paul Singer of Elliott Management

Investing is an art, more so than a science. And for me, what I get paid for is managing the “dark art,” if you will, of risk management and trying to be a visionary and having a dark vision at all times about what can go wrong.

It’s a particularly fruitful and impactful time to be thinking about risk management and the thing I want talk about today is what I’ve described as “The Shape of the Next Crisis.” That doesn’t mean we’re going to be talking about the timing of it or exactly what to short or how to make money from it. But it’s to provoke thought about what the elements are, the current landscape, the various aspects that will shape the timing, as well as the amplitude, the predictability, the suddenness of the next crisis.

It’s not something that I can talk about in any kind of hierarchical fashion. There are a number of elements that are in play, some of which are novel, completely new in virtually the human landscape.

But they combine in what I think of, when I’m thinking of risk management and how to hedge my portfolio, what I think of as kind of “an evil stew.”

But here they are, and it should be obvious when you really think about it, but you have to bring these elements from other facets of life to see how they impact trading and investing.

On Modern Communications and Information Processing

It is increasingly the case (and I’ll give you a couple of recent examples) that people coalesce, form, and reform ideas in a much more powerfully focused, and abrupt, and stark way than they ever have in the past.

 

One of the most interesting examples of this is the so-called “Arab Spring” where the forces underlying these societies – totalitarianism, security services, violence, oppression, etc. – have existed in the countries that have been affected for decades. All of the sudden it started in January with a singular small event in Tunisia. And now it’s a few months later and there are 11 countries in various stages of more or less similar wide-spread revolts.

 

And how did this happen? You speak to experts in the Middle East, you speak to experts in that area or in those particular countries, and you don’t get a satisfactory answer. You get “totalitarianism.” The answer, I believe, relates to social media and the way people are connected - it’s the Internet, it’s Facebook, it’s Twitter – and the way people process information enabling people to develop the same thoughts simultaneously and to act and coalesce physically as well as emotionally.

 

The vector changes with something like this are virtually instantaneous. In 6 months, for 11 countries that have been more or less family run or totalitarian, to be in revolt is a very, very powerful illustration of this point. The Flash Crash about a year ago in stocks, where all of the sudden, the technology of the marketplace and the way the exchanges had their rules about processing orders in relationship with other exchanges, coalesced one afternoon, to have hundreds of stocks virtually evaporate all at once - within seconds or minutes or five minutes or half an hour.

 

This is a very powerful element and will serve as an accelerant in the next crisis so hold that one up on the blackboard, metaphorically speaking, while I talk about the next elements.

On The Financial System And Leverage

Let’s talk about financial institutions and the financial system. The major message that I want to give you (and I’ve invited challenge on both parts of my thesis here and I’ve never had anybody challenge it): The major financial institutions in the US and around the globe are utterly opaque; and The next financial crisis will happen faster, more suddenly.

 

We cannot (I have 110 investment professionals), and I surmise that you cannot, understand the financial condition of any bank, major financial institution. You can’t see the actual size of the balance sheet. You have no idea what that derivatives section means…it’s 10 to 100 times the size of the actual balance sheet.

 

So when people say, “Well, it used to be 40x leveraged,” (some of them were 90x leveraged) “but now they’re 15 to 20 times leveraged.” Well that’s just great. Except you go to the derivatives and see numbers in the trillions and trillions and trillions and there is no clue, you have no clue, no understanding, of what that is actually composed of. Is that composed of trades that are basically unwound where all you have is counterparty risk? Is that composed of actual hedges of upper tranches the way we would have in an admitted hedge fund?

 

So you are looking at balance sheets without any real understanding of how the balance sheets and the companies would perform in the event of a crisis. Which of these trades or trillions of dollars of trades, which in normal times oscillate like this [very small motion] and that’s why they’re so big, would in really bad times start going like this [large motion]. And if you actually have capital of only half a percent, or one percent or five percent of your actual footings, not just unwound trades that happen to still be on balance sheet, but actual footings, you’re in trouble.

 

The kind of thing that wound up the financial system three years ago is expected to be different in form than the kind of things that would unwind the financial system the next time. But I’m going to argue that the next time will be faster. If you think back to ’07 and ’08, it was episodic. It wasn’t just suddenly that in the second or third week in Sept that Lehman goes under and that’s the crisis and the whole world collapsed. No, there were several episodes leading up to that.

 

After that, what kept the entire financial system from coming to a grinding halt was quite simple. It wasn’t that all of the other firms were in much better shape than Lehman. It’s very simple, it’s that governments, here and in Europe, underwrote the entire system. Ben Bernanke, of whom I’m not a fan... at all, has been quoted as saying that in the absence of the government guarantee and underwriting, 12 of the 13 biggest banks in the world would have gone out of business following Lehman. Whether it’s 12/13, or 13/13, or 6 or 8 of 13, is completely imponderable, but the point is actually well-taken. In the absence of that guarantee there would have been a cascading collapse because of the opacity.

 

There are people in this room that are on trading desks or manage trading operations at investment banks. You know for a fact that you knew nothing about the financial condition of your five biggest counterparties. And so your relationships, and your willingness to trade, with those counterparties was dependent on rumor or credit spreads widening or not widening. And that’s a very terrible place for the financial system to be in.

 

So take the opacity, take the fact that you can’t really understand the financial condition, and take the fact that the leverage hasn’t really been rung out. And what you realize is that the lessons of ’08 will actually result in a much quicker process, a process that I would describe as a “black hole” if and when there is the next financial crisis.

 

The next financial crisis obviously can only happen if, believably, the governments either cut loose the major financial institutions - believably and credibly unwound the guarantee - or even more difficult and scary, if the government guarantee were not enough. And that’s one of the next elements in the shape of the next crisis. As you know, risk has migrated upward, it’s migrated from lenders and borrowers really to governments. It’s gone on the balance sheet of the US, the ECB (the various countries of Europe, particularly Germany, France, etc.). That the credit of Europe, the credit of America, is being called into question in the starkest way is part of what will shape the next crisis.

 

But before I get to that part, and explain how I think that impacts, I want to come back to the trader and trading part of this. The lesson of ’08, which is indelibly stamped upon every hedge fund forehead and trading desk head, is: Move your assets first, stop trading first, sell the paper first, and ask questions later. Those that moved from Lehman days or weeks before the end were happy. Those that sat there thinking that they were protected in prime brokerage accounts or protected in some other ways, or that firms like Lehman wouldn’t be allowed to go under were stuck in the company (of course Lehman is still in bankruptcy) with claims trading at 20-something cents on the dollar, depending on where you are in the capital structure.

On 'Orderly Liquidation' And How Dodd-Frank Has Made The System More Brittle

 So, I want to put one more element in place in the trading and financial institution part of the equation.

 

And that’s the law that was signed into law a few months ago, Dodd-Frank. I don’t know what it’s actually called, but it is the financial institution reform law and it is designed purportedly to make the system safer. “Safe” actually, not just “safer.”

 

In my opinion, what Dodd-Frank has actually done is to make the system more brittle and complete the picture, in my mind, of a black hole, meaning a very vicious, sharp and abrupt process if you put together all of the things that I’ve said so far.

 

So what is it about Dodd-Frank that contributes to this black hole, or contributes to this brittle, unsafe condition? It’s the “Orderly Liquidation Authority,” a very humorously named part of this law because what I think it actually represents is a very disorderly process. Under this authority, which was purportedly designed to provided a “not-Lehman” outcome (you know, no government bailout and a calm resolution of large financial institutions), under this process the FDIC has the authority, contrary to all US bankruptcy practice and law, to seize financial companies which are quote “in danger of default.”

 

Under previous bankruptcy law, companies had to default, actually default, or managements voluntarily put them in bankruptcy in order for them to be in bankruptcy.

 

“Danger of default,” if you think about that, plus with the other parts of this that I’ll describe, means that if a company is in trouble, and it’s large and opaque, then it’s in danger of default and can be seized any day. And if I say any moment it’s only a slight exaggeration, because by statute the process of throwing a company into the Orderly Liquidation Authority is about 48 hrs long, and is effectively unreviewable (even though there is an injunction attached to this process with the Treasury secretary and a couple of other people looking at it).

 

So companies can be seized that are in danger of default, and what is the FDIC ordered to do and what can it do? It is ordered to throw out management…quite bizarre. It is enabled to discriminate among classes of creditors similarly situated... strange. It’s enabled to move assets around and transfer assets to bridge companies. And it’s enabled to go against people in or out of the company who are quote “responsible for the financial condition.”

 

Let me define Systemically Important Financial Institutions first and then continue on. Under this legislation, the government is supposed to designate certain companies as “systemically important.”

 

I’ve been quoted as saying that I feel that’s nutty. It’s nutty because no financial institution should be too big to fail. All financial institutions should be governed by the same rules regarding leverage and risk. And companies can become systemically important, or un-become systemically important, extremely quickly in today’s world as a result of taking on leverage, changing their positions.

 

Let’s put that all together. If you are trading with a big company and that company or other companies have been identified as systemically important institutions, if you are observing a large company getting into trouble, what you know is that you have to pull your assets because those assets can be transferred (regardless of the financial condition of the subsidiary that your assets are a part of, whether it’s a prime brokerage subsidiary or otherwise). You don’t know how your claim will be treated, so you have to sell the bonds that you own; if the guy down the block, Bob’s Big Bank [is a similarly situated creditor and] has been designated as systemically important, that guy may be getting a priority recovery.

 

So the whole thing militates toward stepping away abruptly from any company that is designated as systemically important. So I think that the opacity, the lessons of ’08, the vicissitudes and thoughtlessness of Dodd-Frank, militate in favor of a very, very abrupt resolution.

On Japan And The Confidence-Destroying Implications Of Monetary Policy

There isn’t time to flesh out in detail the other accelerants of what the next financial crisis might look like, but let me just say a word or two on monetary policy. Monetary policy, which is now doing virtually all of the job creation work in the United States (in particular) and of course in Japan also, has created a very distorted recovery and some people think, including myself, that it’s been at least partially responsible for inflation in commodities and gold.

 

Quantitative easing which is this duration shortening mechanism, zero interest rates which is extraordinarily unusual and is now in the United States as well as Japan, as well as the long term entitlement insolvency in the United States, are platforms for a possible loss of confidence.

And In Conclusion

I think people who are managing money or investors who are trying to figure out what the next crisis may look like, should be processing these elements and thinking about how they can interact, together with the modalities of modern communications and the way people process information, to create something very sudden.

 

Nobody in America has actually seen, or most people probably can’t even contemplate, what an actual loss of confidence may look like. What I’m trying to struggle with as a money manager, who really seriously doesn’t like to lose money, is how to protect our capital and how to think about the next crisis.

 

If you think about some of these elements and how they might interact, you might come up with other paths of transmission or risk and pain. But I wouldn’t go about your business thinking it’s business as usual in a typical post-crisis, post bear market recovery.

Questions And Answers Section...

Q: [Thoughts on Europe]?

A: Yeah, that’s really important. My view about Europe starts with my view 15 yrs ago (and by the way, on Wall St if you’re early, you’re wrong). My view 15 yrs ago was that the Euro was an inappropriate backdoor experiment on quasi-sovereignty. And all it would take would be a stark variation in economic performance or geopolitical or military considerations or interests. And here we are and there’s been a stark divergence and the Euro is in the process of centrifugal force and breaking up.

Will it break up? It’s entirely unclear, and I’m not going to predict that it’s going to break up or whether Greece is going to actually leave it. What I will say is that it doesn’t make sense for the underperforming countries to actually be part of this. Everyone looked like they were getting benefits during the period of time when there was convergence. Exports for Germany, lower interest rates for Greece and Portugal and Spain and the rest.

Big risks were built up, big variations in performance, and now Germany in particular is writing out checks. As long as Germany keeps writing out checks, the euro can limp along, Greece can limp along.

But the answer to your question is the fixes to this, even if to kick the can down the road, are deflationary, they’re harmful to growth despite the fact that a breakup of the euro would fall upon Greece. Pulling out by Greece from the euro would trigger other consequences in several of these other countries, would create a banking crisis which would have to be dealt with.

So there is near term pain in doing, in my view, the right thing. But the medium- to longer-term pain of writing out checks to insolvent countries like Greece (insolvent, it’s not a liquidity crisis, insolvency), is ultimately something that’s going to be dampening growth in Europe, dampening global growth, possibly creating the transmission mechanism for the next banking crisis. So I think we’re watching it. And by the way, how do I think it’s going to actually happen that the situation is resolved? It’s going to be from the bottom up, the political process. It’s going to be on the streets, it’s going to be hundreds of thousands of Greeks, or hundreds of thousands of Germans demonstrating against the bailouts.

The elites want to keep writing the checks because their paradigms, their desire to have this experiment (because that’s what it is, it’s only 12 or 13 yrs old) continue. That’s what their dream was: one Europe - sovereign. And they were going to get to sovereignty through the back door. It isn’t working out at the moment; I don’t think it’s going to work out. And the fact that it’s not working out is quite painful and the way they’re doing it is stretching out the pain.

Q: [Insights on using CDS on sovereign debt to hedge your portfolio]?

A: Very good question. The question was about buying credit default swaps on countries or companies in order to hedge your positions, as a general risk management tool. I think that’s a really great question, it’s one that people like us really struggle with.

One of the things that 2008 (I had forgotten to say this before, so thanks for reminding me) showed us about risk management was that some of the tools that we thought that we had for risk management were actually tools that could be harmed or defeated by the actions of governments. And governments have shown an increasing inclination to push us around, us as a community. Meaning overnight bans on short selling, statements and the beginnings of action against credit default swaps, so-called “naked” credit default swaps.

Credit default swaps in the abstract, or actually in practice up till recently, are very effective at bringing liquid tools for taking judgments long and short about securities, and countries, companies that otherwise would be completely illiquid. Borrowing sovereign debt to sell short is not easy.

When countries and companies get into trouble, it’s very easy and very standard to be blaming speculators and credit default swaps as one of the reasons, or the main reason why a spread is blowing out and why the country or company is in trouble (because when a spread blows out, financing opportunities and possibilities diminish, etc.). Who can say what portion of CDS trading is so big that it actually creates prices rather than just discovers prices?

But one of the very difficult parts about running a portfolio that is aimed to be absolute return or very risk conscious and trying to avoid the consequences of the next crisis, is that it’s very difficult to predict using tools like that, which of these tools will be left unimpaired, or which will be suddenly impaired or destroyed by government action.

One of the things that bothers me about running a gold position is (since gold is, really to me, a thermometer about how people think about real money versus fake money or versus paper money possibly for the first time in people’s lives of anybody in this room), if gold actually is starting to be priced at a price that would represent real fear about paper currencies, what will governments do to derivatives or actual gold to keep themselves from being subject to what they feel is inflation caused by speculators?

So I think everyone who is using these complicated instruments needs to understand that governments have sent out a shot across the bow that they are not in the mood to allow for free markets, when the free markets challenge the “everything-is-fine-and-we-can-kick-the-can-down-the-road” way of governing.

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Sun, 12/09/2012 - 16:15 | 3047248 slackrabbit
slackrabbit's picture

In short: 'I have no idea what going on'.

Thats the point dude!

Sun, 12/09/2012 - 17:21 | 3047319 Seer
Seer's picture

Actually, there isn't any way to "know" because the entire field of economics/finances is based on made up shit.  When shit can be made up there's an infinite number of possibilities.  That is, there's an infinite number of VIRTUAL possibilities.  Anyone betting in this house of mirrors is going to go crazy.   If one steps outside this circus and out into the real/physical world it would be VERY clear what's going on: well, it's probably easier to see through the lens of viewing what's not continuing very well.

Sun, 12/09/2012 - 20:05 | 3047532 Diogenes
Diogenes's picture

In other words what you don't know can't hurt you until you wake up in a train wreck with your face on fire.

Sun, 12/09/2012 - 23:07 | 3047681 Ignatius
Ignatius's picture

Alternately, turn off the TV and think about what we're really doing to thrive/survive.

The circus (eg, Dem/Rep) is set uo to let you think one side won 7 to 6 (yeah), when in reality most are losing 56-3 to the corporate/government hegemon.

Sun, 12/09/2012 - 17:42 | 3047351 ivana
ivana's picture

Sill there are some certain leads to near future:

1. Gov and all associated expenses MUST be covered. That's where all next QEs will go

2. Financial markets are now completely detached from ordinary people and investors... led by major criminal players , algos etc ... serving banksters and those who's names should notbe mentioned

3. Corporations will slowly suffer with revenues but will use hoarded cash to survive + more layoffs + new M&A ...

4. People will have more taxes, more controls, less social & med security, more financial repression , wars ... nothing good will happen to us

5. Zombie banks (see point2) will slowly capture all and any valuable colateral in western world incl. other banana state vital assets (see piigs etc)

6. Idiotic leverage, toxic assets and intentionally unregulated mess will be used to create sequence of new crises which will totaly shutoff any sign of democracy in western world (seefuckin EU) ... like paulson kidnapped congres etc

7. more financial crisis, more wars at middle east, more crisis around china, russia ... higher interest rates... bankrupted govs (grecce 1st) ... ALL WITH CLEAR INTENTION TO PRESERVE CRIMINAL FIAT SYSTEM RUNNING (see all above)

Sun, 12/09/2012 - 16:16 | 3047249 Iam Yue2
Iam Yue2's picture

There is no next crisis; we are in the crisis. Script by Bloomberg and Reuters, who have the audacity to tell the sheeple who follow them on twitter, that every GDP miss is something of a surprise; as though we are all expecting to wake upsome day to find that the Draghi magic medicine has worked and that we are in full scale recovery.

As Adorno said; " for the individual, life is made easier through capitulation to the collective."

Steve Cohen or Leonard Cohen ...U decide.

Sun, 12/09/2012 - 21:22 | 3047614 Cathartes Aura
Cathartes Aura's picture

Leonard please.

Sun, 12/09/2012 - 16:19 | 3047253 LawsofPhysics
LawsofPhysics's picture

In the absence of any accountability and real consequences for bad behavior, all these paper promises will burn and possession will quickly be the only thing that matters.  If you don't find yourself surrounded by trustworthy people in a realitive safe and resource secure place on the planet, now would be the time to get there.  You would think this is common sense (I mean who would actually hire untrustworthy people or live in a place they don't love), but it isn't.

Stupid sheep.

Sun, 12/09/2012 - 16:58 | 3047290 Seer
Seer's picture

Only those who are strong enough to stand up to ridicule can manage to achieve escape velocity from the flock.

I find it kind of humorous that Singer talks about preserving capital.  Really, that's Old Paradigm; that is, it's a good bet that that "capital" is based on the old (currently dying) paradigm, and I'm not thinking that that's going to really be very smart.

Sun, 12/09/2012 - 17:15 | 3047309 LawsofPhysics
LawsofPhysics's picture

Perhaps.  I would say that those who are truly smart will be gone without a word, they already have their alliances in place, and all the physical assets they and their tribe need to weather the storm.  You are correct though, things like "money" are bullshit, wealth is real but it isn't what 90% of the sheeple think it is.  Power and control is what all this has always been about.  Get your tribe in order before it's too late and remember truly successful people don't say shit, they simply execute the plan.  

Sun, 12/09/2012 - 17:27 | 3047330 Seer
Seer's picture

"truly successful people don't say shit, they simply execute the plan. "

Truly successful people survive...  Plans go awry.  Being open and flexible is key.  I might say that it is "vision" (attained through wisdom) that provides the ground work for achieving"success."

Sun, 12/09/2012 - 16:22 | 3047258 Rustysilver
Rustysilver's picture

If anybody says they know what's going to happen they're full of $hit, all of them. Track record doesn't consist of one data point.

Sun, 12/09/2012 - 16:27 | 3047262 Carpathia
Carpathia's picture

My take away is that when the shit hits the fan it will happen quickly.  There will be no safe asset class to hide in.  Physical possession of precious metals may be the best option, but the powers that be have the ability to change any and all of the rules at a moments notice.  The coming collapse is going to be so horrific, that protecting your financial assets will not be ones top priority.

Sun, 12/09/2012 - 17:02 | 3047296 Seer
Seer's picture

Good points.  Do not, however, rule out that TPTB wouldn't end up powerless: the faster a collapse the greater the probability that their powers will be complete toast.

Sun, 12/09/2012 - 19:40 | 3047500 willwork4food
willwork4food's picture

I've heard it said that TPTB- the ones with true power will eventual destroy the earth in an illogical uncontrollable dark passion for more control. Just as evil eventually consumes itself not unlike a 'blackhole'. Let's hope that is not the case.

Funny though, because there is a statement in the bible somewhere that relates explicitly to that (loosely parapharsed): "in the end days the Lord will come to save the earth, or there would be no life after .."

Sun, 12/09/2012 - 23:07 | 3047732 Seer
Seer's picture

I don't doubt that there are forces acting as such, though I tend to lump them all under "entropy."  The concept of "balance" requires there to be two opposing forces; if one side is missing then there's really no other side (wouldn't it tend to just fly apart?).

Since nature works through deception for self-preservation, and humans are OF nature, I can't help but think that that which we might view as "evil" is merely gross self-preservation?  That it may negatively impact others is just the consequence of competition.  The reason why there is a concentration of power in many is because we continue to believe in gods and masters... most humans are trained to a controlling hierarchy either through the acceptance of "governments" or "religious institutions."

The earth will be just fine.  Despite our hubris humans cannot end the earth.  Yes, the earth will one day be without life (when the sun burns out), but that's a bit of a ways out.

I suspect that the notions of there being some sort of end-days is based on the arrival of the next glacial period, after/during which pretty much all traces of civilization get destroyed.  The earth has super-cycles, whether they were part of the "great design" or not matters less than the fact that they WILL happen: earth needs comprehensive tilling from time to time in order to start a new growth cycle (redistribute minerals that have been washed into the seas).

I really would like it if there we some sort of judgement day in which the shit-heads would get whacked, but this seems like way too much of a stretch to base my actions on.  Besides, vengeance steals precious energy.

Sun, 12/09/2012 - 21:41 | 3047636 Unprepared
Unprepared's picture

For reference, post-USSR russia is a good and recent test case.

Sun, 12/09/2012 - 23:09 | 3047736 Seer
Seer's picture

Russians tend to be a bit hardier.  And, the rest of the world was there to continue bartering with.  I'm thinking that it's going to ouch a bit more when it hits the US (cause it'll be hitting everywhere else too, if it hasn't by the time it hits the US).

Mon, 12/10/2012 - 10:11 | 3048342 TrumpXVI
TrumpXVI's picture

Yup.

TPTB are already only marginally competent.  I don't know why most people don't grasp this simple reality.

Just take one look at the track record of the establishmant's assets, and their efficiency.

SEC - Couldn't figure out Bernie Madoff.....after being told about him numerous times

CIA - Couldn't figure out whether or not Saddam Hussein had a viable nuclear weapons program

FBI - Couldn't figure out 9/11

NSC - Couldn't figure out that a war in Iraq would go on for years and cost trillions of dollars; ditto Afghanistan

The list doesn't end with these exmples.  But most people make the assumption (stupidly, I believe) that TPTB are "in control" and when things really start to fall apart will "clamp down" and force everything back into the box.  It ain't gonna happen that way, I don't believe.  I'm not Nostradamus, I don't know what will happen, but that TPTB are not going to maintain their control is something I belive is highly likely.

 

Mon, 12/10/2012 - 12:35 | 3048770 Panafrican Funk...
Panafrican Funktron Robot's picture

@Trump:

 

SEC - Couldn't figure out Bernie Madoff.....after being told about him numerous times

CIA - Couldn't figure out whether or not Saddam Hussein had a viable nuclear weapons program

FBI - Couldn't figure out 9/11

NSC - Couldn't figure out that a war in Iraq would go on for years and cost trillions of dollars; ditto Afghanistan

 

You seem to be arguing the case that they are incompetant.  I would suggest they are actually just evil/corrupt.

Sun, 12/09/2012 - 16:37 | 3047268 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I was just doing some back reading on ZH and found this post from 04/15/2010 to be aprapos to today's news cycle.

War Between Israel And Hizbollah "Imminent" Syria Warns US:

http://www.zerohedge.com/article/war-between-israel-and-hizbollah-imminent-syria-warns-us#comment-303453

Sun, 12/09/2012 - 16:40 | 3047270 PUD
PUD's picture

Extremely little in the "market" is "investing". It is betting. "investing" and "Investors" have become the two most perverted words in use today.

When you  buy a share of stock you are not "investing", you are buying someone elses interest. Your funds do not go to the company (outside of an IPO of course) Your gain is totally dependent upon someone sometime paying you more than you paid which if it happens, has little bearing on the company whose stock you hold. PE multiples are not set by nature..they are completely arbitrary and subjective. Value is subjective. A stock price has nothing to do with a companies earnings or prospects or balance sheet (by and large) and everything to do with simple perception and whether or not money is pouring into equities or coming out of them. The stock market is a pyramid scheme that has been fueled by demographics and government intervention (IRAs 401ks etc)  I really would like to see the word "investor" banished as its current context is extremely deceptive.

Sun, 12/09/2012 - 16:40 | 3047272 WhiteNight123129
WhiteNight123129's picture

I think the one who would have survived is probably HSBC, you can check in teh Bloomberg report the amount of money they took from the Fed, it was very small.

 

Sun, 12/09/2012 - 17:12 | 3047304 Seer
Seer's picture

If one were to identify a single point of no return in the rush to expand the housing/credit bubble that would be HSBC's acquisition of Household Finance.  When this took place it was the green light that it was all legit.

Not saying the HSBC started it all, but they sure as hell popularized it.  And by this act they are guilty as hell.  HSBC is, after all, a London bank: enough said.

Sun, 12/09/2012 - 16:42 | 3047276 edmondantes
edmondantes's picture

Interesting but as usual with these people he avoids the obvious conclusion: that the fiat money system is fraudulent and only physical gold will remain. The contortions these people will engage in to avoid this conclusion are remarkable.

I suppose it can be explained by the fact that he is paid 2/20 to 'manage' AUM - and if he came to the conclusion that physical gold is the only ultimate store of wealth ten he wouldn't be able to continue charging fees.

Sun, 12/09/2012 - 16:53 | 3047283 Clint Liquor
Clint Liquor's picture

 

"governments have sent out a shot across the bow that they are not in the mood to allow for free markets"

This fact, makes wealth preservation very difficult.

Sun, 12/09/2012 - 16:58 | 3047291 jim249
jim249's picture

Another way of saying this is, it is sucking the life out of everyone. ZIRP and a fake economy.

Sun, 12/09/2012 - 17:17 | 3047314 HoaX
HoaX's picture

"Investing is an art, more so than a science. And for me, what I get paid for is managing the “dark art,” if you will, of risk management and trying to be a visionary and having a dark vision at all times"

He should have kept his mouth shut after that.

Mon, 12/10/2012 - 07:26 | 3048165 Urban Redneck
Urban Redneck's picture

That's a perversion of the normal usage of DARK ART, which would normally apply to an opaque and corrupt trade dominated by insiders.  Whether it's intentional, who's to say, but no more needs to be said-

Sun, 12/09/2012 - 17:25 | 3047324 mind_imminst
mind_imminst's picture

"So I think everyone who is using these complicated instruments needs to understand that governments have sent out a shot across the bow that they are not in the mood to allow for free markets, when the free markets challenge the “everything-is-fine-and-we-can-kick-the-can-down-the-road” way of governing."

 

Most people are aware of the propensity for governments to move against gold in times of turmoil (banning it, confiscating it) but I am unsure if everyone is aware that governments are starting to lay plans for "stepping in" (as the author would put it) on almost every paper and hard asset one could use to hedge against government driven collapse. Everything.


Sun, 12/09/2012 - 18:53 | 3047429 Clint Liquor
Clint Liquor's picture

Agreed. Nothing and nowhere is totally safe. Especially for Americans who will be blamed worldwide. Do your research, review history, pay your money and take your chances.

Sun, 12/09/2012 - 17:30 | 3047335 JR
JR's picture

Between the November 6 election results and the fiscal cliff negotiations, Americans are being herded down a cattle chute to slaughter: a Marxist-inspired mob, seeing their election victory, is screaming for taxpayer blood.

Corrupt lawmakers of both parties are beginning to use cattle prods urging tax increases and dashing expectations of legitimate Social Security and Medicare payment claims with “Yes, the promises were broken, but cuts must be made or it will be disaster.”

Never mind that Congress spent and replaced the SS trust money with a bunch of paper IOUs or that millions of nonpaying additions were made to help corporate- and system-induced preferred class immigrants receive free SS and Medicaid support.

This is the same banker-controlled liar class that made the promises, that stole the money, that used it for their re-election and pet lobbyist projects: to believe them now is to give them a ticket to promise and steal again.

The fiscal cliff “entitlement” blackmail is bad enough; but the election results are an alarm bell tolling in the night for any American who owns property.

A major aspect of the shape of the real next crisis is covered in a severe column this week from Ann Coulter. Whether you agree with her politics or not, it’s the tone of the backlash that’s coming.

____________________________________________________

AMERICA NEARS EL TIPPING POINTO | Ann Coulter | December 5, 2012 

I apologize to America's young people, whose dashed dreams and dim employment prospects I had laughed at, believing these to be a direct result of their voting for Obama.

On closer examination, it turns out that young voters, aged 18-29, overwhelmingly supported Romney. But only the white ones.

According to Pew Research, 54 percent of white voters under 30 voted for Romney and only 41 percent for Obama. That's the same percentage Reagan got from the entire white population in 1980. Even the Lena Dunham demographic -- white women under 30 -- slightly favored Romney.

Reagan got just 43 percent of young voters in 1980 -- and that was when whites were 88 percent of the electorate. Only 58 percent of today's under-30 vote is white and it's shrinking daily.

What the youth vote shows is not that young people are nitwits who deserve lives of misery and joblessness, as I had previously believed, but that America is hitting the tipping point on our immigration policy.

The youth vote is a snapshot of elections to come if nothing is done to reverse the deluge of unskilled immigrants pouring into the country as a result of Ted Kennedy's 1965 immigration act. Eighty-five percent of legal immigrants since 1968 have come from the Third World. A majority of them are in need of government assistance.

Whites are 76 percent of the electorate over the age of 30 and only 58 percent of the electorate under 30. Obama won the "youth vote" because it is the knife's edge of a demographic shift, not because he offered the kids free tuition and contraception (which they don't need because it's hard to have sex when you're living with your parents at 27).

In 1980, Hispanics were only 2 percent of the population, and they tended to be educated, skilled workers who got married, raised their children in two-parent families and sent their kids to college before they, too, got married and had kids. (In that order.)


That profile has nothing to do with recent Hispanic immigrants, who -- because of phony "family reunification" rules -- are the poorest of the world's poor.

More than half of all babies born to Hispanic women today are illegitimate.
As Heather MacDonald has shown, the birthrate of Hispanic women is twice that of the rest of the population, and their unwed birthrate is one and a half times that of blacks.

That's a lot of government dependents coming down the pike.
No amount of "reaching out" to the Hispanic community, effective "messaging" or Reagan's "optimism" is going to turn Mexico's underclass into Republicans.

Any election analysis that doesn't deal with the implacable fact of America's changing demographics is bound to be wrong.

Perhaps the reason elections maven Michael Barone was so shockingly off in his election prediction this year was that, in the biggest mistake of his career, Barone has been assuring us for years that most of these Third World immigrants pouring into the country would go the way of Italian immigrants and become Republicans. They're hardworking! They have family values!

Maybe at first, but not after coming here, having illegitimate children and going on welfare.

Charles Murray recently pointed out that -- contrary to stereotype -- Hispanics are less likely to be married, less likely to go to church, more supportive of gay marriage and less likely to call themselves "conservative" than other Americans.

Rather than being more hardworking than Americans, Hispanics actually work about the same as others, or, in the case of Hispanic women, less.

It seems otherwise, Murray says, because the only Hispanics we see are the ones who are working -- in our homes, neighborhoods and businesses. "That's the way that almost all Anglos in the political chattering class come in contact with Latinos," he notes. "Of course they look like model Americans."

(Black males would apparently like to work more. Nearly 20 percent of black males under 30 voted for Romney, more than three times what McCain got.)

An article by Nate Cohn in the current New Republic argues, as the title puts it: "The GOP Has Problems With White Voters, Too." As proof, Cohn cites Jefferson County, Colo.; Loudoun County, Va.; Wake County, N.C.; and Somerset County, N.J., all of which went Republican in presidential elections from 1968 through 2004, but which Romney lost in 2012.

Smelling a rat, I checked the demographic shifts in these counties from the 2000 to the 2010 census. In each one, there has been a noticeable influx of Hispanics (and Asians, who also vote Democrat), diminishing "the white vote" that Cohn claims Republicans are losing.

Between the 2000 and 2010 census, for example, the white population of Jefferson County declined from more than 90 percent to less than 80 percent, while the Hispanic population more than doubled, from 6 percent to 14 percent.

In Loudoun County, the Asian population tripled from 5 percent to 15 percent and the Hispanic population doubled from 6 percent to 12 percent. Meanwhile, whites plummeted from 83 percent to 69 percent of the population.

Similarly, Wake County shifted from 74 percent white to 66 percent white in the past decade, while the Hispanic population doubled, from 5 percent to 10 percent, and the black population stayed even at about 20 percent.

In Somerset County, the Hispanic population grew by 63 percent and the Asian population grew by 83 percent since 2000. The number of whites has remained steady, resulting in a population that is now just 62 percent white.

These were the counties chosen by Cohn, not me, to show that Republicans are losing "the white vote." Except they're not so white, anymore. With blacks, Asians and Hispanics voting 93 percent, 73 percent and 71 percent for Obama, Republicans have to do more than just win the white vote. They have to run the table.

Romney got a larger percentage of the white vote than Reagan did in 1980. That's just not enough anymore.

Ironically, Romney was the first Republican presidential candidate in a long time not conspiring with the elites to make America a dumping ground for the world's welfare cases. Conservatives who denounced Romney as a "RINO" were the ones doing the bidding of the real establishment: business, which wants cheap labor and couldn't care less if America ceases to be the land of opportunity that everyone wanted to immigrate to in the first place.

http://www.anncoulter.com/columns/2012-12-05.html#read_more

Sun, 12/09/2012 - 19:03 | 3047428 Radical Marijuana
Radical Marijuana's picture

Yup, the point has already tipped. The tidal wave is already here. For the sake of over-simplification, one can express the demographics in this way:

Women that have less than 2 children are committing suicide.

Women with more than 2 are declaring war on the neighbors.

Thus, overall, the rich are committing suicide, while the poor are declaring war on the rich. Hence, we seem to be rushing towards more and more gated communities, smaller islands of wealth, in a vast waste land of poverty. The landscape of America appears to be becoming blotched, as it goes rotten. The skin of the land has more discontinuities between the smaller patches of wealth, compared to the growing domains of desolation, through the processes of internal colonization, or of there being more areas like the Third World, cropping up within the First World.

Frosty Wooldridge is another writer who has been emphasizing these kinds of statistics:

http://www.frostywooldridge.com

However, the point has already tipped, and the tidal wave is already here. There is no way to stop those processes now. Indeed, as with the driving force of the runaway fascist plutocracy juggernaut, there is NO going backwards to resolve any of these problems. The demographic tidal wave force is already way too great to resist. As with the fascist plutocracy, it is impossible to arrest that. Any talk about stopping it is ridiculously unrealistic. The only possible sane responses are to perhaps surf with it, and to perhaps drive it past where it would have other wise stopped???

Of course, I have no first-hand experience with respect to any of these topics. I am merely responding with the basic notions that we need a different set of death controls, or murder system, and that is especially true since we ARE going to get those, one way or another, sooner or later. However, those who want to go backwards to do that are already too late.

My recommendations are to go with what is happening anyway, like judo would, and thereby throw what is already happening on through faster, beyond where it would otherwise tend to stop. But then, I am not the least bit interested in saving anything about the old-fashioned Western civilization except its scientific method, and other cultural aspects that support that.

Therefore, I have no problem with overwhelmingly unbalanced immigration and reproduction rates destroying the established culture, since I never like that culture much anyway. However, I am interested in a more scientific society, that survives through more self-knowledge, and respects all other aspects of an integrated culture that would sustain that.

The nice thing about the financial crises, like the demographic crises, are that various people are being forced out of their comfort zones, and their habits disrupted sufficiently so that they have to start thinking about things. From past posts, I get the feeling that JR is a classic reactionary revolutionary, whose solutions tend to prefer the various impossible ideals, and going backwards somehow.

However, both the financial crises, as this article, where another professional money manager is forced, by worrying about losing money, to face some of the social facts, and the demographic crises, as others within the mainstream are gradually being forced to face those facts too, DRIVE PEOPLE TO THINK!

Personally, I rather like that! In a perverse way I like how things are getting so bad, and so much more obviously bad, that more and more mainstream morons are beginning to wake up, and as their habits are impeded, they are forced to begin to think a little bit more. Of course, most of them still then want to go backwards, but, I presume, eventually they will be forced forwards. In my opinion, all of the genuine solutions to both the financial crises and the demographic crises require profound paradigm shifts, which embrace the overwhelming power of already runaway trends, and struggle to redirect and transform those, in ways which also have almost nothing in common with either those who want to go backwards, nor with those who want to stay the same.

Going forwards is to accept we already have gone past the tipping point, and the tidal wave of change is already here. We are past the point where we can still talk about how we should change before this deadline, or that deadline, or else it is too late. It is already too late. The deadlines for emergency actions to try to save what was have already gone by. As I have been repeating in almost every post on Zero Hedge for a few months, there is a COMBINED MONEY/MURDER SYSTEM. The financial crises and the demographic crises are inseparably connected, and BOTH have to be radically transformed at the same time, in one way or another, sooner or later.

Sun, 12/09/2012 - 20:10 | 3047537 JR
JR's picture

The results you admire – the technology, the scientific method -- plus the orderly progress of a society’s priorities will all be destroyed along with the culture that established them if Western Civilization is destroyed.

You may not be concerned, but it was the old-fashioned Western Civilization, its work ethic, its morality, its loyalty to ideas, that produced the greatest technological and economic system the planet has ever known.

And, now, you’re saying you want to proceed forward with its destruction and knock the blocks out of the very foundation that built that miracle and hope that something will be left that you may like.

I don’t know how old you are, but if you have 20 more years to live and you get your way, you are going to see the extreme waves of destruction that come with a Third World, primitive, agnostic society.

The future that you hope for already is being designed as a divisive, hate-filled, racist, Marxist-driven disaster to purposely demonize European culture in order that property can be transferred to the non-producers who are the willing supporters of the new welfare state. History proves that in that disastrous system, property rights will be gone, the patent system will be gone, Christianity will be gone, all resistance to monopoly will be gone, the rule of law will be gone, personal and business security will be gone and the integrity of contracts will be gone – the lynchpin of technology.

Going forward in your terms reminds me of President Obama’s campaign, and, yes, you have me figured right. I do want to go back. I want to go back to honest government, I want to return to a country based on representation of the people and not of an international banking cartel aligned with a foreign power dominating America’s domestic and foreign policy.

And I disagree that it is too late. And I expect a fight, soon, to begin to save it.

Sun, 12/09/2012 - 21:44 | 3047610 Aurora Ex Machina
Aurora Ex Machina's picture

I will attempt, Sir, to fashion you an answer. I call you Sir, because at a guess, you're over 50, have forged your own business and are probably in the top 1-2.5% of America (not the 0.1%), so credit due where credit is due. I can hope that you will suspend your ire for at least five minutes, and read this.

The first thing that you must grasp is that "Ann Coulter" is a construct. She is a media personality, following a script, and nothing more. She no more believes what she says than Obama when he claims the Noble Peace Prize and ramps up drone attacks at the same time. She is currently playing the race card, because ~50% of Republican voters cannot understand how Fox, the GOP and Romney's campaign got the numbers so wrong. They, and you, are suffering from cognitive dissonance, and they're angry at the mouths that feed them lines. So, playing the Race Card (And I can assure you - I'm 100% sure that when I check her numbers, I'll find that they're fairy tales) is an assured way of deflecting that anger onto "the other".

The simple answer is, I'm afraid, they lied to you. Now, there's differing elements to this (a very nice talk on how the Romney camp's polls ended up so wrong can be found in this talk, it basically boils down to politics and staying on message), but the bottom line is that Fox News isn't an American company. It's a Murdoch company, and part of the very trans-global system that you dislike. Who benefits from Fox News? From an America that can't even pass simple bills in Congress due to the infighting? Fox News (and so forth) are about money and the people who pay for their opinion to be heard. The idea that they represent "the American people" is insane; they feed off "the American people".

Next up - "Marxism" is dead, as a Governing State ideology, outside of North Korea. Russia is not Marxist. China is not Marxist. There are no Marxists left (barring Nepal and S. American rebel factions). To that matter, you can insert "Communism" in there and get the same result. The 20th Century is over, and in the battle of ideologies that cost ~400+ million lives, "Capitalism" won. Anyone talking as if Communism or Marxism were serious global ideologies instantly marks them as out-dated and unable to process the new century. Now, maybe you've earnt that right, in blood and sweat, but if you think like this, you're now merely a tool for newer, sharp-pointy-teeth thinkers.

"and, yes, you have me figured right. I do want to go back. I want to go back to honest government, I want to return to a country based on representation of the people and not of an international banking cartel aligned with a foreign power dominating America’s domestic and foreign policy."

There was never such a thing as "honest Government". It was always a bloody mix of selfish interests, money, priveledge and slavery. What's changed is that politicians are now proxies to this, not directly involved.

There was always Commerce, or Business, or some kind of global trading / banking class. They funded things like the Enlightenment, which you're so fond of ~ might want to check the % of Enlightenment thinkers who were lawyers or from the professional classes.

America is an Empire, and has been dominating other sovereign states for over 100 years, the idea that it has been taken over, usurped or has not always worked like this is insanity. If you're referencing Israel, the relationship is complicated, but be assured ~ it's all about nukes, and balance of power.

The honest truth is that your version of history is all a fairy tale, told by hypocrites to protect the ideal on the pedestal.

 

As for Christianity? Check yourself, and your hubris. Looking around, I'm fairly sure if Jesus has a second coming, he's going to be really pissed off at what perversion has taken hold in his name. "Hate the Gays", "Money is more important than People", "Jesus wants your money to build new mega-temples" and so on. Not really on message there. If I were in his shoes, I'd cancel the second coming until you all grew up; simply claiming a membership badge to the club is not the point of the exercise.

 

Now, be honest with yourself. Can you even process that side of the coin? If you can't, retire gracefully ~ because both sides of that coin are part of the past. I'll repeat: both sides of the tired American "left - right" paradigm are outmoded. Don't feel special though: the self-satisfied "liberals" are just as bad, corrupt, (sm)irksome, and just as tiresome. As I've said before: you have to sweep away old preconceptions, and starting thinking again. If you don't, the mutants will get bored, and simply eradicate the 1.0's.

There's a strong argument for it, you're all not doing so well managing this crisis thing. So far, the turn is inwards and not edifying at all.

Sun, 12/09/2012 - 22:14 | 3047668 nmewn
nmewn's picture

Point of order, "Marxist thought" is very much alive and well.

Capitalism lost.

Capitalism starts with earned income that has been saved...not printed into existence to invest. This act by itself disregards capitalism as the device at its core.

"From each according to his ability, to each according to his needs" IS the progessive income tax code now so well established around the world, is it not?

Now meld that concept of taxation (for government coffers) with an oligachy (right & left) that has ensnared those (elected) governments around the world to tax their people with it...that is, wage earners.

What do you come out with on the other side?...you come out with this...

"The worker in a capitalist state - that is his greatest misfortune - no longer a human being, no longer a creator, no longer a shaper of things. He has become a machine."

Both of those quotes are from socialists with very different perspectives on how to get from point A to point B.

The second is Goebbels.

By the way, Jesus didn't have a problem with his disciples being armed...both types of the above socialists did & do.

Sun, 12/09/2012 - 22:50 | 3047713 JR
JR's picture

Great stuff! nmewn.

Sun, 12/09/2012 - 23:11 | 3047742 nmewn
nmewn's picture

These people, I swear JR.

They are completely ignorant of what passes right before their eyes, locked into some weird over arching concept that can never be...some new age Zen or something.

The poor and the powerful have ONLY one over arching theme.

The individual...themselves.

Sun, 12/09/2012 - 23:24 | 3047760 Yen Cross
Yen Cross's picture

 You are both, " Human Libraries".  I'm honored to have the opportunity to learn from you two knuckleheads... Back to work bitchez/

  :-D

Sun, 12/09/2012 - 23:36 | 3047793 nmewn
nmewn's picture

JR's a good man...what we disagree on, we disagree on vigorously. What we agree on, will ALWAYS be stronger than our disagreements.

Sun, 12/09/2012 - 23:38 | 3047795 JR
JR's picture

An original and powerful quote, nmewn. A keeper.

The poor and the powerful have ONLY one over arching theme.

The individual...themselves.

The first level of truth, it is said, is to tell the truth to yourself about yourself. I’m afraid many folks simply refuse to do that, often accusing others of what they themselves are guilty.

Mon, 12/10/2012 - 00:02 | 3047856 nmewn
nmewn's picture

Even with animals (high and low order) its self preservation, before charity ;-)

Good night my friend.

Sun, 12/09/2012 - 23:31 | 3047780 Aurora Ex Machina
Aurora Ex Machina's picture

It's too late tonight to get into this, but the point you're making is sloppy; I get what you're saying, but you're being lazy.

Marx was barely used by 20th Century Communists, let alone 21st Century Radical Socialists. Sure, there's some parts stolen, but it's not a manual, and nor do they believe in his theory of Production / analysis of Capital anymore. Hint: Where's the Fifth International? Doesn't exist, outside of the SWP and other marginal groups.

 

You're looking at the wrong bogey-man.

Sun, 12/09/2012 - 23:59 | 3047848 nmewn
nmewn's picture

"I get what you're saying, but you're being lazy."

Why shouldn't I be lazy if I earn the same as any other while sitting under a shade tree watching them break their backs toiling away in the hot sun?

Otherwise, under a real merit system, I might earn more, therefore have more than them, so I'll just sit here under the shade tree and watch. I mean, if I have more, suddenly I've become evil and subject to derision and I don't want to be evil and ostracized by society ;-)

Mon, 12/10/2012 - 00:02 | 3047796 Alexandre Stavisky
Alexandre Stavisky's picture

Jesus most wanted his disciples armed with the sword of truth, to dispense the ideology which would make an oasis of every desert.  He chided his bodyguards in Gethsemane as they slept as he endured his most dire trials.  But he made all his oppositions by knowledge, truth, and undeniable logic only whipping moneychangers who had polluted his father's house.  Even his great duel with the Enemy of Righteousness was done with the gift of faith, knowledge, and forebearance.  Still headstrong Peter drew his sword and smote off the ear of a challenging Centurion.  As the messiah replaced the man's ear, and demanded Peter to replace his sword, he was being bound, and bound over for a false trial which would lead him to Golgotha.

First he came to establish his and Father's ideas (gospel), and make men immortal, also able to obtain a merciful punishment for transgression.  Second he shall come to reap his reward from the sowing in prior season.  And wrath to those who have opposed or sought to exalt without merit.  All will recognize it.  The first messiah will be the ever Messiah.

Now is the season to remember HE whose great sacrifice was able to rebalance an entirely out-of-balance spiritual consumption.  Ever he sought that the great RICH man forsake his worldy possessions, giving them to the poor in spirit, and follow HIM.  Seek ye the kingdom of God and ALL these things shall be added unto you.  Knowingly, the opposite also true.  He who would obtain the world, very likely shall lose his soul.

Nevertheless his reminder was, if you err, err small, for great errors are outside the pale, and for it, you shall be cast into outer darkness.

So, too, modern economic man.  Never should you have made such magestic errors, because of such is made perfect bankruptcy, and NOTHING will make it whole.

The entire global system seeks to swallow a camel just as it strains at a fly!  And denies the author and perfector of the system. He vouchsafes every nation, tribe, tongue, and individual man.  Creation shall comes to univeral knowledge of the Creator.

Sun, 12/09/2012 - 22:41 | 3047706 JR
JR's picture

I think I can help you with your problem. First, you tend to categorize people and institutions, thereby, completely coloring whatever they may offer in the way of logic or fact.

You categorize me (incorrectly) and then you know exactly where I’m coming from and are able to explain in detail not only what I believe but what the sources of my beliefs are.

You categorize Ann Coulter as a media person so that you can disregard the facts that she presents. And, btw, why would you spend so much time on an argument against an issue when you have not yet checked the facts to detemine if they truly are a “fairy tale”? If they’re not a “fairy tale,” after you check them tonight, will you return and apologize? Probably not. You’ve made your statement, you see.

Next, you categorize Fox News, of which I am absolutely no admirer and which is certainly no exemplary institution, and you’re able to mysteriously guess that’s where we are getting all of our “fairly tale” material.

You categorize the Romney camp; you know Christianity inside and out so you are able to judge today’s Christians by your analyses. You even have Jesus figured out.

You categorize Marxism at a time when the United States is dealing with the full force and power of the essential elements of Marxism and you are unable to see it. Yet, I have a Russian cohort on my engineering consulting team who is arming himself because he sees the Marxism that is fully enveloping America; another Russian immigrant wrote recently here on ZH that he came to America to escape Marxism but now that he sees the US following in an identical pattern, in his fears of what is coming is looking to emigrate again.

Perhaps if you work on dealing with facts and not categories you’ll be able to hold someone’s attention for a few minutes longer than I’ve been able to stay with it.

The first part of your response, I have to say, made me a little angry in that you so misunderstood the dangers that confront us. But near the end, I began to develop a sympathy for you when you callously suggested that the first government established on this continent by men such as Thomas Jefferson and George Washington was just another exercise in commerce and self interest. How could you be so blind to the incredible miracle achieved by these selfless men who all pledged to give their lives so that there could be freedom so precious that eternal vigilance was necessary to keep it; how could you deny this?

I feel sorry for you, and the country, if you are a recent example of our state-controlled educational system.

Sun, 12/09/2012 - 23:26 | 3047764 Aurora Ex Machina
Aurora Ex Machina's picture

This is the research she's referring to. The split is 44 - 51 % Obama - Romney. She didn't even manage to get that right [hint: she conflated white male 18-29 voters into "all 18-29 voters", another part of her "let's not let women vote" insanity]

Now, before you run around trumpeting this as a "Race issue", take a look further - the "white" split is 47-49 for college educated 18-29 yr olds (or, roughly even, with a bias towards Romney, largely due to traditional WASP Republicans - look downwards, 91% Republicans voted Romney); the difference comes when they have "no college" - the split jumps to 38 - 58 (thus giving us our +7% for Romney).

The conclusion? Low educated voters, who are statistically more likely to be low information voters (i.e. they watch Fox News) voted for Romney.

This isn't a Race issue, it's an education / information issue. She's talking her book. i.e. She's showing how Fox News was worth all that advertising $ from super-Pacs to swing low-information young people to Romney. And you can't see it.

 

No apology needed, see? I can read a table, unlike Ms Coulter. Also, please note this is a single source: I've found other breakdowns with different results.

 

I "categorised" you as white and over 50 and successful to be kind; otherwise, you fall into that "low information" category.

I "categorised" Ann Coulter as a media construct, because otherwise she's a professional troll and bat-shit insane.

I "categorised" Romney's pollsters from a talk by the guy who called the election with a 98% accuracy margin, and who had direct access to many of Romney's pollsters. Might want to watch the talk & learn something.

I "categorised" Marxism because what's being forged at the moment has nothing to do with Marx, and referring back to Marx is blinding to the inherent dangers of one path being chosen. It's not "Marxist" thought, it's something different [read: a version of Fascism]

I "categorised" Jesus by reading the Bible, and studying the ethics / morality of his teachings.

I "categorised" American Christians by studying a lot of media, and being able to compare this to the previous point.

I "categorised" the American Empire due to Historical facts. See here (as a randomly picked list, there's enough of them, all agreeing, out there) for a pretty consistent pattern over the last 100 years. Or, hell, we could do a list from 1775 to the present day.

I "categorised" the "Great Founders" of America as I did because Thomas Jefferson owned thousands of acres of slave plantations, as did George Washington.

 

 

Facts? You're only interested in the Disney version of America; and, as such, you're part of the rot.

 

I'll await my apology, but I doubt I'll get it.

Mon, 12/10/2012 - 11:39 | 3048576 Aurora Ex Machina
Aurora Ex Machina's picture

All those junks, and our big-hatted JR, so quick to lecture in this thread, doesn't answer?

 

Apology accepted.

Sun, 12/09/2012 - 21:28 | 3047618 sumo
sumo's picture

I agree with much of your post. As a big fan of the Enlightenment, I am dismayed by the way so many enjoy its benefits while simultaneously waging culture war on those benefits.

"Going forward in your terms reminds me of President Obama’s campaign, and, yes, you have me figured right. I do want to go back. I want to go back to honest government, I want to return to a country based on representation of the people and not of an international banking cartel aligned with a foreign power dominating America’s domestic and foreign policy."

Yeah well, Smedley Butler would disagree with you. Politics has always been a dirty business. "Go back to" what, exactly? When was this golden age? The British Empire? The Spanish Empire? The Dutch Empire?

The Roman Empire?

 

Sun, 12/09/2012 - 23:11 | 3047741 JR
JR's picture

I share your sentiments. Thanks. But go back to what? you ask.

America! America!  Break the chains that bind you. Rise off your knees! Abolish the Fed. Seize back the blessings of your freedom. Reclaim your sovereignty. Prosperity can only be for the free. Push aside those who have commandeered your greatness and outsourced your livelihood. You, the patent king and producer of the world! – THAT AMERICA! Not the one Smedley Butler denounced, founded by the Fed. The one that made possible Carl Sandberg’s Chicago.


CHICAGO
HOG Butcher for the World,
Tool Maker, Stacker of Wheat,
Player with Railroads and the Nation's Freight Handler;
Stormy, husky, brawling,
City of the Big Shoulders:

They tell me you are wicked and I believe them, for I
have seen your painted women under the gas lamps
luring the farm boys.
And they tell me you are crooked and I answer: Yes, it
is true I have seen the gunman kill and go free to
kill again.
And they tell me you are brutal and my reply is: On the
faces of women and children I have seen the marks
of wanton hunger.
And having answered so I turn once more to those who
sneer at this my city, and I give them back the sneer
and say to them:
Come and show me another city with lifted head singing
so proud to be alive and coarse and strong and cunning.
Flinging magnetic curses amid the toil of piling job on
job, here is a tall bold slugger set vivid against the
little soft cities;

Fierce as a dog with tongue lapping for action, cunning
as a savage pitted against the wilderness,
Bareheaded,
Shoveling,
Wrecking,
Planning,
Building, breaking, rebuilding,
Under the smoke, dust all over his mouth, laughing with
white teeth,
Under the terrible burden of destiny laughing as a young
man laughs,
Laughing even as an ignorant fighter laughs who has
never lost a battle,
Bragging and laughing that under his wrist is the pulse.
and under his ribs the heart of the people,
Laughing!
Laughing the stormy, husky, brawling laughter of
Youth, half-naked, sweating, proud to be Hog
Butcher, Tool Maker, Stacker of Wheat, Player with
Railroads and Freight Handler to the Nation.

CARL SANDBURG

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