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Egan Jones Downgrades Jefferies On Concerns About Sovereign Exposure Amounting To 77% Of Equity
Because like with insolvent sovereigns and the law of communicating vessels, there rarely is just one cockroach.
From the note:
Jefferies Group Inc: EJR lowered BBB to BBB- (Neg.) (S&P: BBB)
Synopsis: Changed environment - the problems of MF have increased scrutiny of other medium-sized broker/dealers. We are concerned about the values included the $2.7B of " sovereign obligations " per page 24 of the Aug. 2011 10-Q representing 77% of shareholders equity. Although not as highly leveraged as MF Global's 40:1, we would prefer that JEF maintain a lower leverage than its 12.9:1. Note, the fiscal statements of JEF are skewed by the change in fiscal years. The financials are respectable especially given the tough operating environment. An item to watch is the $108M rise in interest expense (reflecting in part the $420M purchase of Pru Bache's Global Commodities Group) On the pos. side, JEF is a respectable competitor.
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Another domino, eventually all dominos will fall and this time Ben you will not be able to save the world!
We are almost at the end. It's only a matter of time. I have my popcorn and recliner all ready.
So the HFT's are going to do what kind of manipulation now. Up 300 or Down 300.
Anybody with knowledge knows the rallies in U.S. Equities are not real are already gone. 100% Cash.
This make believe EW Wave Shit and Robo garbage trades are done. Now What.
Will anybody finally admit; We are Worse than Japan Now
Or will make believe land still live on. The CNBC frauds or the Bloomberg circus.
By 100% cash do you mean stacks of $100 bills in the wall safe behind the family portrait, or do you mean 100% cash - safely secured in a segregated account held by your broker??? If its the latter the 100% cash position you have may be closer to a 72.5% cash position.
I think he means this.... CASH CASTLE!
ZIMBABWE CASH CASTLEhttp://www.youtube.com/watch?v=L6yFnXAZgMA
ZIMBABWE CASH INVESTMENT PYRAMID
http://www.youtube.com/watch?v=CHjjUZugFCE
Corzine was SENT into MF Global with the objective of collapsing it and rolling the remains into Goldman (presumably). And he was paid eight figures to do it, AND promised SEC TREAS after Geithner. If you had said six months ago that the largest FCM in the U.S. would be taken down, everyone would have laughed in your face, but here we sit. The only question is, who is next? How long will an FCM like ADM last before looking at Dodd-Frank and saying, "Screw this. We're selling our clearing operations and we'll just go back to straight-up product merchandizing." Why shouldn't they? If the FCM profit center is made impossible by the government and the corrupt regulatory bodies, why would they continue to operate an FCM? Why not sell to Goldman or one of the other megabank entites and then do their exchange-traded hedge business through them as a customer? When will the old Chicago boutique firms be similarly forced out, either through regulation that makes their business impossible, or through outright sabotage as with Corzine and MF? None of you FCMs are safe. THEY WILL COME AFTER YOU AT SOME POINT. You have been targeted for extermination. Either you wake up to this fact and expose these regulatory bodies, megabanks and the Federal Government and fight them, or you are going to end up like MF, being bought by Goldman or one of the other fascist government-connected megabanks for pennies on the dollar. You have been warned.
Channeling Ann Barnhardt today are we? Credit would be in order. Integrity is really nice but absent that maybe a little shame?
pffft
Edit: The "thumbs down" is definately very personally directed at the low-life messenger, not the message. I happen to think Ann is wrong but I'd discuss that with her, not this poseur.
Definative proof, or failure, of your hypothesis will come in the form of Corzine getting either a perp walk or the Sec. Treasury job.
It is amazing how my silver has no volatility. Every time I weigh one of my JFK '64 halves, it always comes to .361 ozt.
this really pinpoints how critical it was for this latest eu summit to produce something large and competent enough to float market confidence for a few months. the few days of market relief that were achieved didn't amount to nearly enough time to stabilize balance sheets and offload assets to increase capital ratios. the continued degredation in bond and equity markets will corroce the viability of a number of financial institutions, one day at a time, until a tipping point where bank lending freezes due to fears of interacting with a soon to fail bank. sound familiar...
Don't be so downbeat. I bet luxury sales will have another blockbuster Q to match an even higher Wall Street Bonus Christmas season.
After all, 'tis the Season!
time to start tip toeing into financials?
Dick Bove, is that you?
When all the counter-parties are insuring each other, is that what you call a circle jerk?
http://www.youtube.com/watch?feature=player_detailpage&v=yQj2NP25TIo
will that work for ya?
I am probably one of the least math-iest folks here, but I could venture the following formula.
But, on the other hand, I have a decent working understanding of arithmetic, algebra, geometry, and calculus.
Regards,
Cooter
Division by Zero, Coot?
Undefined ...
But then that is where we are (undefined land).
Try L'Hopitals Rule.....
I thought Mr B said today that the MF thing had no impact and was isolated? Ummm.
"Subprime is contained."
- Golem Bernanke 2007
Busted. 3rd rule of fight club: You do not watch CNBC.
There is a certain artistic and comedic value you can glean from it.
CNBC is must viewing.
As a contrary indicator, you cannot find a more accurate barometer.
They exist solely to herd the masses to the other side of Goldman's positions.
Collateral damage. TBTF is offering up sacrificial shatheads. Gotta keep them Central Banksters scared.
My money is in my pocket. Do you know where your money is?
It was all in Gold. Then I spent it all on coke and hookers. I swear. All of it.
I am very sorry to hear that.
From,
Victim of a boating accident
You must have been with Gorden. Happened to someone else I know.
And fnord must have been with Charlie Sheen.
Unfortunately, I traded all mine for Pokemon and Beanie Babies. I mean you can't just print a...oh shit, I see my problem now.
Dbl post.
I find that hard to believe when every employee is a top 5 MBA with the FRM, CFA, CPA, CAIA and every Finra license 01-99. I rate them AAAA+^3
I remember the FP division of a monoline going down in flames.... The hubris and self-delusion was palpable....
>On the pos. side, JEF is a respectable competitor.
Pretty sure I heard that said about MF.
I'm glad I bought some popcorn. Now whether it will last through the weekend is another thing entirely. :p
I recommend popping a small bowlful now, and making it last through next week. Can as much as the stores will sell you. These are desperate times friend.
More popcorn!!!
+ 1
At this rate I am going to need a new machine to pop it, and will have to buy popcorn in BULK!
Store it a 5 gal bucket with a gamma lid, mylar bag, and oxygen absorbers.
Screw popcorn, I am loading up on rice ... my first 24 pounds of Japonica and Wehani are in the mail!
Regards,
Cooter
Cooter, don't forget import commodities like coffee and sugar. Cooking oil substitutes like Crisco. I like to rotate powdered milk and eggs. I lean toward whatever will be least available in my region for luxury commodities. Have some stuff you enjoy eating and drinking. Lots of water filters. If you can generate your own power your really ahead of the game.
The idea is to maintain a quality of life and trade the rest. Oh yeah have Forex like Yuan. I view that as once in a lifetime trade. But I wouldnt hang onto it like Gold much past 2014.
Read up on criminals and how they behave at the ground level, particularly Russia 1998. Good luck and God bless all people of all nations. None of this has been easy and good things to come never are.
Fuck living like a king amongst paupers in the most armed state in the union.
I plan to share/donate excess through local churches.
No lamp post for me ... I am in the fox hole with the people ...
Regards,
Cooter
just short gmcr through the 9th..it's an easy trade...do it
Care to elaborate, Caerus? I'm all ears, sitting with a little dry powder.
i figure a quick dip to 40 at best...they delayed earnings till the ninth...thought i would be out of the position by now...
Interesting. I'll check the puts, see how they look. You're expecting a miss on earnings, eh?
they already missed...i didn't trust them before the delay...i don't trust them now
Thanks for the heads up. Might place a bet tomorrow. If it pays off, I'll send you of bottle of single malt.
good man...hope im not an idiot
No sweat, I wouldn't blame you, I make my own decisions. I'm always open to some insight, and if it looks good to me, I pull the trigger. No guts, no glory, and no blame.
Besides, how could I not trust a guy who goes by Caerus? I'm always seeking kairos myself.
smart
i think the stars are aligned to make the short of the century, rumor has it that Green Hill is sourcing "conflict beans" from the Congo with child labor. They set up a shell special purpose vechicle to funnel over cooked beans off the balance sheet into a swap arangement with McDonalds. They are over leveraged to hell with milk derivatives and the cardboard cups are cuts from unsubstainable Amazon Brazil wood. My target for this stock is $0.99
the preceeding text is not to be taken as investment advice or related to any actually registered security. all comments are fantasy and part of a delusional creative writing exercise. the author is not qualified to scan documents or authorize GL entries at any financial institution.
how is that for a buy signal! this stock is really going to 420
that gap at 40 is a bitch...short that shit
i would be a seller over 70
I do NOT trade. In fact, I don't know shit about this whole parade.
With that said, my red neck read of this market is that its going to the shitter quickly and then to the moon. MF Global is about big boys getting big positions at discount prices. What better way to vaccuum up commodities than to blow up MF Global, give the poor bastard customers liquidation only options, and proceed to buy it all up at much less than par as everyone with positions in the market cut back risk.
Regards,
Cooter
Top 10 reasons to buy gold and silver.
1. Fed prmary dealers are exploding.
2. You're not a fiat idiot.
3. You don't need 10 damn reasons.
1. It can't be printed into existence
0) Zero counterparty risk.
Actually (being pedantic here) gold can be "manufactured" just like diamonds are today. It just so happens that the energy inputs are way out of whack with profits if you pay for the energy inputs.
I don't have a source, I would have to really dig. If you happen to be a physics geek that chances by my comments, sources are appreciated because I am feeling lazy tonight. Also happy to be wrong if you got those sources too. :-)
Regards,
Cooter
All it takes is a good fusion reactor. Put simply, fusion builds bigger atoms out of smaller ones; it's the opposite of fission, which is the splitting of atoms (as in the atom bombs dropped on Japan). The catch is, if anyone had a good fusion reactor then the world would be awash in cheap energy, and that would probably be very deflationary. Too bad no one has a good fusion reactor yet.
Correct.
Iron is as high as you can go on the periodic table and produce energy through fusion. This is why stars ... well ... die ... if the process didn't reverse, the universe would be very different.
For those that didn't follow that, fusion past iron absorbs energy, it becomes a sink.So a mass that is sufficient for fusion produces energy until enough of its matter is iron or up and then it begins to lose energy.
Stars tend to settle down and collapse at this point. As gravity settled in and all this formerly "hot" mass closes in ... its like a teenage male on prom night ... and ... things get really wild in that moment ... and the star guts itself in a moment of ecstasy ... that is where gold comes from ...a heavy element that absorbs enormous energy when a start blows its wad ...
Keep that in mind the next time you hold a heavy coin. It is star cum plain and simple.
Save the thread the money shot jokes, they are not funny ...
Regards,
Cooter
4. They had to invent the "RentenMark". Nobody's ever had to rename their gold and pretend it was something different.
Oh, I get it. I am "renten" a place to live. So, that is like, "renten" your money?
Regards,
Cooter
4. it can be worn around your neck to attract women
- you can't wear FRNs
- you can't wear FRNs"
Who says?
http://www.worth1000.com/entries/130367/
http://themoneylaundry.com/press/
http://rumbleinthedistance.blogspot.com/2011/04/dollar-dollar-bills-yall...
But but it's not backed by anything!! At least the dollar is backed by the gov
i find it utterly mind warping fu$%ing amazing the very same recycled liars, crooks, war mongers and incompetent asswipes are still let alone free, have a VERY high paying job, even more so amazing, a public microphone or media to voice their diatribe and more BS.
truly a Bizarro World the masses have been teleported to. What else is a possible answer?
"ask me no questions and i'll tell ya' no lies" is a possible answer.
Can we just be done with USA proxies?
Give ODummer the FFFFN he deserves, and be done with it.
Protesters have just shutdown Oakland's port... one of the biggest in the US.
Cops are about to crack a lot of skulls.
http://www.livestream.com/globalrevolution
Very bullish...
A car just ran over 3 protesters. Looked like one was covered in a blanket when they put the cart in the wagon.
Where?
Oakland. Saw it live on the ABC aerial feed.
http://www.youtube.com/watch?v=tMS2uMUQNnQ
Just watch your step.
there rarely is just one cockroach
Since you guys beat up on Gartman gleefully, at least give him some credit for popularizing that phrase. I know he didn't coin it, but I am guessing 95% of the WS street crowd first saw it in his letters.
Corzine the Porcine? Or did you you mean the SouthPark Cartman?
Wrong
Man, I thought I could get you guys to throw poor Dennis one little bone.
The "there rarely is just one cockroach" line comes from 16th century Parisian Brothels when French soldiers would walk into the room with the hooker and a cockroach ran under past out the door, the prostitute replied - "ohh don't worry they are all gone".. after the services were rendered and the soldier not seeing any more roaches, he believed the room was sanitary and clean. untill the next day he woke up with the syp.. Ahhh there never is just one roach!!
My father would womanize, he would drink. He would make outrageous claims like he invented the question mark...
I do agree we are getting closer, but not there yet.
O great one, please tell us when.
If not now, when?
http://www.youtube.com/watch?v=uyjV0AfGRVo
IMO, this is the game that never ends. After 'the event' that everyone seems to think is coming, the next day people will still be looking to 'invest' and one-up the next guy. This game only ends when you die.
It will end, at least temporarily. I would define "the event" as one where there simply is no longer a market enabling investment in the standard way.
You can bet there will be a banker class hurriedly rushing to put together the next con, so in that context you're right, it never ends.
In the meantime between the event and the next con, non-stanandard investing will be around. Someone is always going to be willing to split the take from some black-market gasoline, coffee, or MJ in exchange for transportation. That will be the new investment.
Yes, Seek those are called local warlords. Old Hopsi guard style.
Life in the state of nature: "...a restless seeking of power after power that ceaseth only with death."
Thanks TD.
I'm going to name my first two kids Egan Jones & Zero Hedge.
More to the topic, JEF is not MF. At least with respect to the possibility that sovereigns wiil sink them. A) There is a big difference between 40:! and 13:1 leverage. B) Their CEO is not a reckless, adrenaline-freak psychopath.
That's the scary part. That asset book isn't even very aggressive and yet look how many ways it could blow itself to shit.
Corzine is a reckless, adrenaline freak psychopath?
Just thought he was a typical Liberal freak.
Dam.
Forget MF, european bank leverage makes myron scholes et al @ LTCM look like amateurs
Wells Fargo site is unavailable. No biggie. Just sayin'
ATM working here, an oddity. It's been cashless for 2 weeks.
Ratings, the most unappreciated yet most important rule of the game. Or is it? I vaguely remember a day when ratings mattered. Maybe I'm wrong, but if the EFSF lends money solely to poor credit risks, why should we be so quick to rate the EFSF AAA? Seems to me that guarantees trump ratings with spades. Egan Jones know their shit, and this proves it.
http://www.reuters.com/article/2011/07/18/rating-bonds-eganjones-idUSN1E...
Still, one has to concede the power of sovereign guarantees. This is what Greece has already lost by being part of the EURO FARCE. I'm getting a little off topic there though, all I really wanted to say is that, "increased scrutiny of other medium-sized broker/dealers", is a REALLY big deal.
credit ratings? pashaaaa. when will actual television ratings finally matter again? "Amish have beards shaved off"????? WTF?http://www.youtube.com/watch?feature=player_detailpage&v=NZR64EF3OpA
Television ratings...
Yeah, I guess that says a lot too doesn't it?
I don't watch television, but recently a fried of mine wanted me to see a show called "Jersey Shore" to show me where we are on that very subject. A show about getting drunk and having sex with strangers. Wow. I mean really, wow. Society is sick beyond words. Just, wow.
Is there a coke and hookers ETF?
I mean, if that is where the money goes, shouldn't we invest?
You want the Dem Party, but it isn't publicly traded.
Just bought and sold. Ask George.
http://www.haaretz.com/print-edition/news/israel-and-iran-are-fighting-a...
Israel and Iran are fighting a war of nerves
The speed of events on the Israel-Iran front is beginning to recall the eve of a war.
Israel conducts a rare ballistic missile test; the Israel Air Force reports a successful exercise in Sardinia, far from home; Iran's chief of staff says the "likelihood is low" of an Israeli attack, but threatens that his country would respond forcefully.
British sources tell The Guardian of preparations for an attack on Iran's nuclear sites coordinated with the United States; Britain's chief of staff makes a secret visit to Israel. The defense minister goes to London for talks; MKs from the extreme right demand that the former head of the Mossad be put on trial (! ) for daring to object to an Israeli attack. The speed of events on the Israel-Iran front is beginning to recall the eve of a war.
To all of you advocating popcorn, I say with all due respect, I'd rather have the following whilst I watch the world blow to smithereens:
1) Lube
2) Poppers
3) Porn
4) Cheez-Its
5) Water
That's all.
... and some pure cocaine.
There is a laundry list of safety steps to take here.
Move your cash out of money market funds.
Exit leveraged closed end fund participation.
...
I think a financial market catastrophe pre-flight checklist would be useful to many people.
WFC back up. Just a little downtime. Guess I'm skittish.
Corzine was SENT into MF Global with the objective of collapsing it and rolling the remains into Goldman (presumably). And he was paid eight figures to do it, AND promised SEC TREAS after Geithner. If you had said six months ago that the largest FCM in the U.S. would be taken down, everyone would have laughed in your face, but here we sit. The only question is, who is next? How long will an FCM like ADM last before looking at Dodd-Frank and saying, "Screw this. We're selling our clearing operations and we'll just go back to straight-up product merchandizing." Why shouldn't they? If the FCM profit center is made impossible by the government and the corrupt regulatory bodies, why would they continue to operate an FCM? Why not sell to Goldman or one of the other megabank entites and then do their exchange-traded hedge business through them as a customer? When will the old Chicago boutique firms be similarly forced out, either through regulation that makes their business impossible, or through outright sabotage as with Corzine and MF? None of you FCMs are safe. THEY WILL COME AFTER YOU AT SOME POINT. You have been targeted for extermination. Either you wake up to this fact and expose these regulatory bodies, megabanks and the Federal Government and fight them, or you are going to end up like MF, being bought by Goldman or one of the other fascist government-connected megabanks for pennies on the dollar. You have been warned.
FCM as victim. You guys are fucking hilarious.
hey guys remember this ?
going to california
Most excellent.
Ah yes, some good memories. Wasn't it required to listen with blonde lebanese or panama gold?? I can't seem to remember.
do you know if your counterparties are solvent, tonight?
As long as they play the Level III shell game adroitly, model their hedge fund portfolio unicornly and leave their customers' money the fuck alone, perennial wannabe Jefferies should be able to maintain their perennial wannabe status. But who knows for how long now that they've been targeted as an intermediary of concern by the Shadowy Figures Who Decide. It would be interesting to see who benefited CDS-wise from the MF bankruptcy. Is it beyond the realm of possibility that some competitor bought a truckload of CDS on EJR then took steps to torpedo the firm? Without a proper insurable interest, all the incentives are on the side of the devils. It's like something out of a Dickens nightmare.
It's a colonization strategy. Dust off old books in best manners of loss mitigation for both sides.
Correction: Is it beyond the realm of possibility that some competitor bought a truckload of CDS on JEF then took steps to torpedo the firm?