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The Goldman Tapes And Why The Delusion Of Macro-Prudential Regulation Means The Next Crash Is Nigh
Submitted by David Stockman via Contra Corner blog,
There is nothing like the release of secret tape recordings to clarify an inconclusive debate. I recall that happening with Nixon back in the day. Even as a Washington apprentice I could see that he was a ruthless, power hungry abuser of his office, but much of official Washington just denied it. Then came the tapes. Soon there was no doubt. In short order Nixon was gone.
So now comes the Goldman tapes - 46 hours of recordings by an embedded New York Fed regulator at Goldman Sachs who got fired for attempting to, well, regulate. Would that the Carmen Segarra affair generates a Nixonian result - that is, exposure that “regulatory capture” is an endemic, potent and inextricable evil that can’t be remediated in situ.
Never mind that what Ms. Segarra was attempting to regulate–whether Goldman had a conflict of interest policy with respect to its M&A clients—-was actually none of the state’s business in the first place. If in the instant case GS was giving squinty eyed advise to its client, El Paso Corporation, because it owned a $4 billion position in the other party to the transaction, Kinder Morgan, so be it. Either the conflict was harmless or eventually Goldman’s M&A business would have been punished by the marketplace—–even stupid executives and boards wouldn’t pay huge fees to be taken to the cleaners for long.
Actually, what the tapes really show is that the Fed’s latest policy contraption - macro-prudential regulation through a financial stability committee - is just a useless exercise in CYA. Apparently, even the colony of the bubble blind which inhabits the Eccles Building has started to get nervous about financial bubbles and instability in recent months. What with junk bond yields sporting a 5 handle, the Russell 2000 trading at 80X reported profits and the IPO market having gone full-tilt manic with last week’s pricing at 27X sales of a Chinese e-commerce mass merchant that is a pure proxy for the greatest credit fueled house of cards in human history—-it needed to show some gesture of concern.
Now, it might have gone straight to the horse’s mouth. It might have asked about 70 consecutive months of zero money market rates, for instance, and the manner in which that has enabled speculators to mount massive momentum trades everywhere in the financial markets by funding any “risk asset” that generates a yield or a short-run gain with nearly zero cost options or repo. Or it might have inquired about the destruction of the market’s natural internal mechanisms of stability and financial restraint—-that is, short sellers and two way trading—that has resulted from the Greenspan/Bernanke/Yellen Put; or it might have wondered whether its bald-faced doctrine of “wealth effects” and ever rising stock prices does not in itself create a massive bias toward speculative risking taking and a blind buy-the-dips herd mentality in the casino.
But that would have been inconvenient because it would meant an abrupt end to its labor market focused policy of “accommodation” and a violent hissy fit in the casino. So Yellen and here Keynesian compatriots have invented out of whole cloth a method to drive the wildly vibrating Wall Street financial jalopy with both feet to the floor. That is, on the monetary “policy” side they intend to perpetuate ZIRP for at least another 9 months and near-ZIRP as far as the eye can see , while at the same time interposing in today’s frothy financial markets a Stanley Fischer led posse of regulators to keep speculator exuberance within safe boundaries.
At this point it is not clear which part of the Fed’s “macro-pru” initiative is the more preposterous. Why would you think that a system which required only 9 months to fire Carmen Segarra for comparatively trivial meddling in Goldman’s M&A department is capable of bubble prevention when we are talking about trillions of inflated value in the stock, bond, derivatives and real estate markets? Or that putting a proven serial bubble generator—-that’s essentially what Fischer accomplished during his stint as head of Israel’s central bank—at the head of the financial stability committee would produce, well, financial stability?
It should be evident by now that regulatory capture and the inherent capacity of the marketplace to evade bureaucratic rules, edicts and embedded supervisors mean that “macro-pru” is a crock—an excuse to prolong a dangerous monetary experiment that is inexorably fueling a giant financial bubble and the crash which must inevitably follow.
Take the soaring issuance of sub-prime auto credit, for example, which now accounts for a record 30% of car loans and is putting people in cars at 130% loan-to-value ratios—-borrowers that have no hope of avoiding the repo man a few months down the road. On the margin, nearly all of this explosive growth is being funded in the non-bank market. That is, by freshly minted sub-prime auto lenders who have been given a sliver of equity by LBO houses and a ton of debt by the high yield market. Who is Stanley Fischer going to crack down upon—–the LBO houses creating these fly-by-night lenders, the Wall Street underwriters lead by Goldman who are distributing the junk or Bill Gross’s yield-parched successors at PIMCO and its mutual fund competitors who are buying the stuff?
OK, Stanley Fischer being from MIT, the IMF, Citibank, the Bank of Israel—and to say nothing of his long ago supervision of Ben Bernanke’s PhD thesis which merely Xeroxed Milton Friedman’s false claim that the Fed’s failure to engage in massive QE during 1930-1932 caused the Great Depression—-is too sophisticated to say “no auto junk, period”. What his committee will likely do is issue guidance about keeping debt-to-EBITDA ratios “prudent” at some notional leverage of say 6-8X when these newly minted auto junk yards are issuing the same.
But that’s before the underwriters parade in with a host of complications embedded in “adjusted EBITDA” to account for the fact that two fly-by-night subprime lenders, for example, just merged and therefore need a pro forma adjustment for down-the-road synergy savings; or that a newly minted lender is still scaling up its volume and that on a last month’s run-rate basis, its adjusted EBITDA ratio is 7.8X, not the 16X ratio embedded in its actual GAAP results.
And that doesn’t even account for the fact that the loan books of these start-up auto sub-primes are inherently unseasoned. It does take some time for an assistant night shift manager at a McDonald’s to become the subject of a “restructuring” initiative by the local franchisee and to subsequently default on his car loan. Indeed, the Fischer committee would even be up against the inherently vexing math of a rapidly ramping loan book. That is, while the denominator of loans issued is soaring, the numerator of delinquencies is still lagging. So loan loss reserves are invariably understated during the final blow-off stage of a financial bubble, meaning that earnings and EBITDA are over-stated and hidden leverage risk is rampant. The evidence is there in spades in the wreckage of the LBO and high yield markets during 20009-2010.
In short, even assuming that the obsequious culture of accommodation at the New York Fed so evident in the Goldman tapes could be uprooted, macro-pru is inherently impotent because of information asymmetry. What the Austrian thinkers 100 years ago said about socialism in general is true in spades with respect to the gambling casinos created by the Keynesian money printers. Without honest market prices in the trading pits and at loan desks and underwriting syndicates, financial booms and busts are inevitable, and the state’s regulators and supervisors are hopelessly at sea because they cannot hope to gather and process enough information to stymie the army of speculators chasing false prices with cheap credit.
Or to take another example, what is the Fischer committee going to do about leveraged stock buybacks? Not only is this fueling the speculative rise in the stock averages and the illusion that earnings are growing, when in fact it is only the share count which is shrinking, but it is also adding to the dangerous build-up of corporate debt that will become hugely problematic when interest rates are finally allowed to normalize.
But imagine the utter hissy fit that would instantly arise on Wall Street if the Fischer committee was even rumored to be addressing the issue of leveraged stock buybacks. It would generate a violent sell-off of the likes not seen since the House Republicans voted down TARP the first time around.
And then would come the information miasma. Wall Street would trot out the cash on the sidelines canard, arguing there is no problem here because not withstanding the current $700 billion annualized run-rate of buybacks for the S&P 500 alone, there is plenty of cash cushion available to corporate chieftains who wish to invest in their own company’s future— albeit with shareholder money, not theirs.
In truth, of course, the business sector did not delever one wit after the financial crisis. Since the fourth quarter of 2007, business debt in the US has risen from $11 to $14 trillion. That $3 trillion gain dwarfs the $500 billion pick up in business cash balances. In fact, the rise in cash was never a sign of returning financial health in the fist place: it was only a telltale sign that by causing debt to be drastically mis-priced, the Fed was encouraging companies to artificially balloon both sides of their balance sheets.
Yet it would take the Fischer committee months to sort-out the truth and refute the sell-side propaganda—even if it had the will. Meanwhile, the bubble would continue to expand.
So here’s the thing. Our monetary politburo has its ass backwards. Macro-pru is an impossible delusion that should not be taken seriously be sensible adults. It is not, as Janet Yellen insists, a supplementary tool to contain and remediate the unintended consequence - that is, excessive financial speculation - of the Fed’s primary drive to achieve full employment and fill the GDP bathtub to the very brim of its potential.
Instead, rampant speculation, excessive leverage, phony liquidity and massive financial instability are the only real result of current Fed policy. We are at peak debt in the household and business sectors of the private economy. Accordingly, the credit channel of monetary transmission is broken and done. Indeed, the modest pick-up in leverage in the household sector has been exclusively among utterly marginal borrowers. That is, among students who are just treading water until the eventual day of default and sub-prime auto borrowers who are actually underwater they day they take out their loans.
No, the central bankers’ one time parlor trick has been played and leverage was ratcheted-up until it reached a peak in 2007-2008. Now the central bankers are pushing on a string.
But even as their liquidity tsunami never escapes the canyons of Wall Street, and, as an empirical matter, circulates right back to excess reserves at the New York Fed, it does have an immense untoward effect during its circular journey. Namely, it causes the most important price in all of capitalism—that is, the cost of overnight money and the speculators’ “carry” on his asset positions—to be drastically mispriced. It turns the central bank into a serial bubble machine.
Not 10,000 Carmen Segarra’s could stop the boom and bust cycle thus manufactured by the money printers ensconced in the Eccles Building. Stanley Fischer’s financial stability committee, therefore, is not merely a pointless farce. Its evidence that the next financial crash is nigh.
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AS far as the eye can see is not very far now, is it?
People don't give a flying rats ass about justice, lawlessness or fairness as long as their stawks go up.
On the way down though, the lawyers come out like locusts....
All these asinine new words, wtf? It's like a make-work project for Websters dictionary. Quantitative Easing, Macro Prudential Regulation, Most Favored Nation, Operation Twist, Discount Window, Overnight Rate, .....
I mean, FFS..... lets' call this shit what it really is - A broken financial system on printer support. This is so for 1 main reason:
Jobs have been exported and we've become a financially engineered nation producing financially engineered instruments using financially engineered smoke and financially engineered mirrors. Over the last 15 years, "Growth" only occured through increasing amounts of credit and financing. Since the US is the reserve currency, other nations were forced to follow the US into the credit abyss. Soon the entire globe will have all financial scripts wiped out. With this level of fraud, that is a given.
These terms, invented to keep everyone placated like the new fancy word is some kind of a solution, are fucking ridiculous.
An honest pair of hands needs to put in an honest effort everyday. Gambling and controlling the markets is NOT an honest living. Honest hands dont' need "macro prudential regulation"....
What an incredible farce!
Some things never change.
A little perspective from the history books.
What were the political and financial terrorists doing to the sheep 145 years ago ?
On September 24, 1869, the U.S. financial sector descended into chaos after rebel speculators Jay Gould and Jim Fisk attempted to corner the nation’s gold market. The robber barons hoped to make a mint by driving the price of gold into the stratosphere, and to help pull it off, they built a network of corruption that extended from Wall Street and the New York City government all the way to the family of President Ulysses S. Grant. The conspiracy finally unraveled 145 years ago on what became known as “Black Friday,” but not before Gould and Fisk had dragged the entire U.S. economy to the brink of catastrophe.If any pair of investors had the financial clout and lack of scruples required to engineer the bedlam of Black Friday, it was Jay Gould and Jim Fisk. As president and vice president of the Erie Railroad, the duo had won a reputation as two of Wall Street’s most ruthless financial masterminds. Their rap sheets boasted everything from issuing fraudulent stock to bribing politicians and judges, and they enjoyed a lucrative partnership with Tammany Hall power player William “Boss” Tweed. Gould in particular had proven an expert at devising new ways to game the system, and was once dubbed the “Mephistopheles of Wall Street” for his preternatural ability to line his own pockets. “[Gould’s] nature suggested survival from the family of spiders,” historian Henry Adams later wrote. “He spun huge webs, in corners and in the dark…he seemed never to be satisfied except when deceiving everyone as to his intentions.”
In early 1869, Gould spun a web aimed at conquering what was perhaps the most audacious target in the American financial system: the gold market. At the time, gold was still the official currency of international trade, but the United States had gone off the gold standard during the Civil War, when Congress authorized $450 million in government-backed “greenbacks” to fund the Union march to war. Competing currencies—gold and greenbacks—had been in circulation ever since, and Wall Street had formed a special “Gold Room” where brokers could trade them. Since there was only around $20 million in gold in circulation at any given time, Gould wagered that a speculator with deep enough pockets could potentially buy up huge amounts of the precious metal until they had “cornered” the market. From there, they could drive up the price and sell for astronomical profits.
Gould’s gold ploy faced one very significant hurdle: President Ulysses S. Grant. Since the beginning of Grant’s tenure as chief executive, the U.S. Treasury had continued a policy of using its massive gold reserves to buy back greenbacks from the public. This meant that the government effectively set the value of gold: when it sold its supply, the price went down; when it didn’t, the price went up. If a speculator like Gould tried to corner the market, Grant could simply order the Treasury to sell off huge amounts of gold and drive the price through the floor. For his gold scheme to work, Gould needed President Grant to keep a tight grip on his purse strings.
“The Mephistopheles of Wall Street” found an elegant solution to the government problem in the form of Abel Corbin, a former Washington bureaucrat who happened to be married to Ulysses Grant’s sister, Jennie. In the spring of 1869, Gould befriended Corbin and persuaded him to help with his secret plan to corner the gold market. As a quid pro quo, he deposited a cool $1.5 million in gold in an account under Corbin’s name. The president’s brother-in-law sprang into action that summer. To ensure Gould would have an ear on the government’s actions, Corbin used his political influence to help install General Daniel Butterfield as the U.S. sub-treasurer in New York. In exchange for providing advance notice of any government gold sales, Butterfield was given a $1.5 million stake in the scheme and a $10,000 loan. Corbin also used his family connections to cozy up to Grant and try to persuade him that high gold prices would benefit U.S. farmers who sold their harvest overseas. He arranged for Gould to meet with Grant to discuss the matter, and even helped anonymously author an editorial in the New York Times claiming that the president had reversed his financial policy. The constant wheedling eventually paid off. During a meeting with Corbin on September 2, Grant confided that he had changed his mind on gold and planned to order the treasury not to sell over the next month.
Jay Gould and a few other conspirators had been secretly stockpiling gold since August, but upon learning that the fix was in, they disguised their identities behind an army of brokers and proceeded to gobble up all the gold they could. Gould also enlisted the help of his fellow financial buccaneer Jim Fisk, who promptly dropped $7 million on gold and became one of the cabal’s leading members. As the Gould-Fisk ring increased its stake, gold’s value climbed to dizzying heights. In August, a $100 gold piece had sold for around $132 in greenbacks, but only a few weeks later, the price spiked as high as $141. In Wall Street’s Gold Room, distraught speculators and gold short-sellers suddenly found themselves caught in a vise. Rumors spread about a nefarious group of investors who were trying to “bull,” or drive up, the gold market, and many began calling for the Treasury to intervene by selling its gold reserves. Fisk and Gould kept mum, but by that point, they personally owned a combined $60 million in gold—three times the amount of the public supply in New York.
Gould’s shopping spree continued unabated until September 22, when he learned from Abel Corbin that the president was on to them. Corbin had written Grant a letter looking for assurance that he remained firm on his new, non-interventionist gold stance, and the note had finally aroused the president’s suspicions that his brother-in-law might be involved in a gold scheme. Furious at having been manipulated, the president had gotten his wife to write a response chastising Corbin and warning that Grant would not hesitate to “do his duty to the country” and break the corner. Gould was stunned, but in true robber baron fashion, he neglected to divulge the new information to Fisk or his other partners. Instead, when the buying bonanza resumed on September 23, he began secretly selling off as much of his own gold as he could.
By September 24, 1869—the day that would become known as “Black Friday”—the hubbub over gold had reached a fever pitch. Mobs of spectators and reporters gathered near Wall Street, and many of the Gold Room’s indebted speculators walked to work like men on their way to the gallows. Gold had closed the previous day at $144 ½, but shortly after trading resumed, it took a tremendous leap to $160. Unaware that the game might soon be up, Fisk continued buying like a madman and bragged that gold would soon top $200.
In Washington, D.C., Ulysses S. Grant resolved to bust Gould and Fisk’s corner on the gold market. Shortly before noon, he met with Treasury Secretary George Boutwell, who had been following the chaos via telegraph. After a brief conversation, Grant ordered Boutwell to open his vaults and flood the market. A few minutes later, Boutwell wired New York and announced the Treasury would sell a whopping $4 million in gold the following day.
Along with finally loosening Gould and Fisk’s grasp on the gold market, the news sent Wall Street into a tailspin. “Possibly no avalanche ever swept with more terrible violence,” the New York Herald later wrote. Within minutes, the inflated gold prices plummeted from $160 to $133. The stock market joined in on the plunge, dropping a full 20 percentage points and bankrupting or inflicting severe damage on some of Wall Street’s most venerable firms. Thousands of speculators were left financially ruined, and at least one committed suicide. Foreign trade ground to a halt. Farmers may have felt the squeeze most of all, with many seeing the value of their wheat and corn harvests dip by 50 percent.
Ripples from “Black Friday” affected the U.S. economy for several years and blighted the rest of Ulysses S. Grant’s tenure as president. Nevertheless, Jay Gould and Jim Fisk managed to escape the disaster none the worse for wear. Despite multiple allegations of malfeasance and an official investigation by Congress, the two leveraged their political connections and employed a brigade of attorneys to avoid spending a single night in jail. Fisk even ducked out on his massive losses, claiming third party brokers had made the trades without his knowledge. Gould may have proved even more fortunate. It’s unclear how his finances fared on Black Friday, but according to some estimates, his last minute fire sale may have netted him somewhere around $12 million.
Same as it ever was
Regulation .....we dont need no stinking regulation !!!!!!
Was just going to add how we forget all the angles. I might be off topic here:
Outsourcing takes many forms
- US Outsourced Logistics, Food, Beauty Shops, Massage in the Iraqi war to foreigners of all kinds like Filipinos
- US Mercenaries, Private Company Armies
- US was a source of Loans, Material, Weapons, Food, Ammo for Europe in World War I & II
- CIA Proxies, Mujaheddin, Al Qaeda, Mossad, NeoNazis, Muslim Brotherhood, NATO,
Even when we look at Crisis and think there is a golden lining for GDP, Jobs, Re-Machining US Factories... There is little indication that TBTJ Wall Street bankers partnered with US Government in War, Banking Crisis, or Fixing the FED or Economy... will put the money into USA.
Just like ZIRP, NIRP, QE, Operation Twist, Obama Care, or Dodd-Frank... and NAFTA & CAFTA-DR & "Free Trade" in General & Open Borders & Amnesty.
- Disenfranchised Youth
- Teen Angst
- OWS
- Secession Movements
- Major Whistleblowers
- Military Protests over Syria
- Elderly & Retired People become a Political Force?
All together now
Sing with me
Greenspanbernankeyellenisticquantitativeeasing
Listening to the printing press sounds very pleasing
Problem, reaction, solution, again...
The reason you don't have decent paying jobs available is due to making China a "most favored nation" trading status partner; eg. globalization. this was done by congress, signed off by Bill Clinton, but paid for; by the large corporate employers; to export all manufacturing to china. Everything else is just a distraction. T he cure is; cut off the trade; stop the ships and turn them back. No more trade with China. Nada. Nothing. We have plenty of "rare earths" in Arkansas to supply the US; of course, we also need to eliminate the EPA, the DEA, The UN, and several other anti-success groups. Anyone even mentioning global warming should be publicly whipped.
...Department of Education, Department of Energy.
Term Limits.
Tort Reform.
Slash all welfare payments by 75%. To start...
Outlaw government employee unions.
End all foreign aid. ALL of it.
Bring the armed forces home to work on OUR country. Project One: A border fence from the Gulf of Mexico to the Pacific Ocean.
Crash my ass, the circuit breakers will be hit, and when the markets resume, it will go back up. The economy is a national security issue at this point.
The only way the markets will crash if our polititicans fail to pass bailout legislation. Remember that?
That is one hell of a profile photo, buddy
She needs a bag over her head.
You are wrong.
They can go back up nominally with cash injections from the Fed. Just like markets went up nominal in the Weimar republic.
You end up with something like this.
At the end there, 100% of people's incomes were going to food, and they were still starving.
I want to date Carmen. Where does she hang out these days? I think it's the knee-high boots photo that swung it for me
MSNBC just did a 4 minute story on the tapes.
That's 4 minutes more than any of the financial channels.
Does anybody know the story behind ING changing its name. Has to be something nefarious. I smell a GMAC.
Oh, and Mr. Stockman is not taking into account the 10%+ depreciation on that new auto once its driven off the lot. So that would be financing at 140% of value.
I know a gal who just paid 12.9% and went 39,000 in debt just to establish credit. They saw her coming from afar.
i give stockman props for mentioning subprime auto lending.
Canary dying/dead
You kidding?
The canary has been dead and taxidermied for a long time.
It is kinda like those plastic Owls that people move around their roof line to pretend that they have real Owls.
Quote "Either the conflict was harmless or eventually Goldman’s M&A business would have been punished by the marketplace—–even stupid executives and boards wouldn’t pay huge fees to be taken to the cleaners for long."
I'm not a Financial Expert, Economist, or geopolitical expert:
But maybe that is why they just gamble with the money we give them... maybe they are facing a bunch of Municipalities & Corporations that realize they are in over their heads with TBTJ Banks... like AAA Rated Junk Derivatives or Jefferson County or having a University Trust Fund tied to a Zombie hedge fund.
http://www.nytimes.com/2012/02/19/business/jefferson-county-ala-falls-of...
http://dealbook.nytimes.com/2012/06/04/hedge-funds-of-the-living-dead/
BTW I don't know why no MSM discusses the possibility that the USA might have caused a War with Europe through it's Toxic Deals if it weren't for Federal Reserves Loans without limits, kept under wraps in the shadows & which surely enriched elite bankers through out the Eurozone.
".....macro-prudential regulation....."
Corruption is always in search of a reasonable explanation for unreasonable (read corrupt) behavior.
Ultimately the people listening want to believe what they are hearing. Who wants to believe you are sleeping with the crooks and they control not only your money, but the teat you suckle from?
The problem with "nigh" is that it may
be 1-18 weeks or 1-18 months...
How "nigh" is "nigh" ROFL
?
'They' don't give Sh!t about the 99.9%
http://www.bbc.co.uk/news/uk-politics-29402844
Labour said Mr Osborne was standing up "for the very wealthiest few".
And who is going to pay for the pitiful plight of the wealthiest few?
“The welfare freeze would include Jobseeker's Allowance, Income Support, Child Tax Credit and Working Tax Credit, Child Benefit and Employment Support Allowance, paid to those judged capable of work.
About 10 million households would be affected, roughly half of which are working, the Treasury said.”
Children in families in receipt of benefits/tax credits and income is 60% below national average. More than a quarter of Bristol's children live in poverty
here is doug noland's take on the fed plan. http://www.prudentbear.com/2014/09/only-for-wonks.html#.VCnGExYaXxt probably the simplist math on the subject.
they think they are within sight of the end of the tunnel so it is full steam ahead once they gain some room with "this market is going to crash any second now" coming from the mainstream. this market will crash but it has a ways to go, yet. it is becoming a pickers market in the russell 2000.
Sure, just like rates will rise... ...any second now...
Once a fiat currency (fractional reserve currency) is debt saturated, its game over. We are at the end of a 100 year economic, demorgaphic, social and technological cycle. Everything we have is tired and played out: the fiat dollar, financialization of everything, the industrial revolution, signals traveling on wires and through the air, the internal combustion engine. This fall phase will come to an end and everything in the cycle will wind down and freeze in winter. Then a new cycle will begin, but in-between is gonna be rough.
The author claims Nixon "was a ruthless, power hungry abuser of his office". Isn't that true of most of them at those elevated levels?
Richard Nixon was a rank amateur compared to the serial corruption of the Clinton criminal enterprise, which was simply the warmup band for the headliner: The arrogantly racist and treasonous machinations of the current Marxist MF.
Dipping into the hugely overplayed and distorted Watergate vein, means simply that the author is a double standard, Leftist propagandist.
Next crash is baked in. It's by design.
The next crash will be purposeful.
hank paulson admitted TARP legislation written months before fall 2008 and placed in drawer ... just waiting
another serving of Shock Doctrine, anyone?
The Goldman Tapes will contain the same number of blockbuster revelations as the Snowden (remember him? I can't think of his first name...) documents of the past 6 months, namely, zero.
I love Stockman, but this was strange stuff.
We all know it is easier to get rid of a President than it is to control Goldman SAchs, for reasons that are prima facie obvious.
Also, his rant on macro-prudential regulation was silly. The Fed has a device called Regulation T. It can raise margin requirements on subprime debt, or junk bonds, or anything else, whenever it wants. But it doesn't.
I don't buy the "Nixon was power hungry" meme, Nixon was not all bad, he hated intellectuals for example.
He would have been a rare politician were he not power hungry -- though I suppose a few of them are just in it for the money.
Pull the plug already you MF'ers I'm playing who wants to be the first trillionaire
And staving off bankruptcy is a hedge not an option waiting for the big planned downturn
Mr. Stockman have a Freudian slip?
" In fact, the rise in cash was never a sign of returning financial health in the fist place:"
Cash can mean a lot of things. Probably Stockman is smarter than I... but I've been complaining about CAP-EX not occurring.
Best Charts I can find are these two:
http://research.stlouisfed.org/fred2/series/NINV (Poor Trend)
http://research.stlouisfed.org/fred2/series/RINV (poor Trend)
But then I looks like Foreigners are buying up and Investing in the USA... Not sure if BEA IIP Glance include Long Term US Treasuries so I can add them (Anybody have good charts for Capital Expenditures in the USA for the last 15 years?)
http://www.bea.gov/newsreleases/international/intinv/iip_glance.htm
http://research.stlouisfed.org/fred2/series/ROWFDN... (Foreign Direct Investment $3.2 Trillion)
http://research.stlouisfed.org/fred2/series/GPDI (Private Domestic Investment $2.8 Trillion) US Domestic Investment is less than Foreign Investment... clearly the gaming by the wealthy leads to loss of US Assets, $60 Trillion in Debt, and $210 Trillion in Liabilities.!!!
http://research.stlouisfed.org/fred2/series/FDHBFIN
Federal Debt Held by Foreign & International Investors
2014:Q2: 6,013.2 Billions of Dollars (+ see more)
Quarterly, End of Period, Not Seasonally Adjusted, FDHBFIN,
market pulls back ....... fed buys stocks till they rise.......... correction over.
Carmen Segarra may have discovered the only hope for containing the problem. As long as we’re going to tolerate the NSA spying on everyone they should install an unremovable 24/7 recording collar around the neck of every investment bankster and regulator.
The BANKS are putting Hedge Fund Assets on their books for a few days around tax time to minimize Hedge Fund's tax obligation while enhancing the BANK's profitibility. If we only knew half the $hit these guys are doing and how it is killing this country.
More Stockman? Well, "macro-prudential" is a different question than regulation or regulatory capture, but he's half right, the reason "macro-prudential" and QE and ZIRP must and will always fail is that that parasites and rent seeker glom onto it - until the host is dead.
So it is zero surprise that Goldman or someone has captured the regulators, it has always happened and it's always gonna happen and anyone with half a brain knew it was gonna happen, and maybe even Bernanke and Yellen *did* know but they did it anyway, but now it's time and the question is can they unwind it without going boom. I don't know the historical record on that, but I can't be too optimistic.
This is not news, its just proof.
Just like when Geithner was on Charlie Rose's show, and he said that when the plane's on fire, you gotta land it. We all knew he was supposed to be the fire marshall. But he never saw himself as a regulator. Nice work if you can get it.
So who was the head of the NY FED when Biem wrote his secret report? Was it Timmay? I think so....please correct me if I'm wrong.
LOVE that opening line. Telling.
"I don't believe in fraud", ...alan greenspan
ha!
release of "secret" tapes.... any meeting i go to the first order of biz is no phones or electornic devices allowed.... then the room is swept and then the meeting begins... secret tapes like leaks are done for a purpose... manipulation or one sort or another... who says the big boys dont want a financial collapse ... they engineered it in the first place.. balloon the dollar, stomp on gold, sell the dollar and buy gold while it's cheap... then crash the dollar inflate gold and replay...