How To Lose All Your Money With Goldman Sachs

Tyler Durden's picture


It seems the Muppets have been well-and-truly Oscar'd this time. Combining Goldman's once-in-a-lifetime equity buying opportunity position recommendation with their short Treasuries trade has produced an astoundingly un-positive return of -29% in just 48 days (based on SPY (stocks) and TBT (ultra-short TSYs given duration and beta). Extrapolated using the only tool that counts (Birinyi's famous ruler) this means your account is Corzined by Thanksgiving - happy holidays.

Percentage performance of the Goldman 'once-in-a-lifetime' trade recommendation from 3/21...


Chart: Bloomberg

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Wed, 05/30/2012 - 23:08 | 2478204 LetThemEatRand
LetThemEatRand's picture

Hmm.  I wonder where all that money comes from that ends up in the banker bonus checks [not counting direct injections via bailouts, of course]....

Wed, 05/30/2012 - 23:14 | 2478231 vast-dom
vast-dom's picture

TBT will soar when QE3 is announced and/or a few other variables. Gross was off too. But yes TBT has been brutal.

Wed, 05/30/2012 - 23:32 | 2478278 jekyll island
jekyll island's picture

Agreed.  Everybody who suggested shorting treasuries so far has been mauled.  It is a tough trade to go up against an opponent who has unlimited capital, there is no margin for error.   

Thu, 05/31/2012 - 01:12 | 2478429 strannick
strannick's picture

With the 10 year yield at 1.62, QE will be a bit of a harder sell, though with the USDX at 83 and gold in the mid 1500s, they might get away with it.

Thu, 05/31/2012 - 06:32 | 2478621 Comay Mierda
Comay Mierda's picture

Hello, McFly?  Isn't it obvious?

Goldman wanted to offload shares of SPY onto dumb money and load up on treasuries!

GS - the contrarian indicator that keeps on giving

BTW, they also have a price target of $850 on AAPL.

Thu, 05/31/2012 - 08:07 | 2478717 ndotken
ndotken's picture

"Keep in mind that every time someone loses in the market, someone else wins." - Mitt Romney

Thu, 05/31/2012 - 06:41 | 2478631 Soul Train
Soul Train's picture

Ha ha, you gotta read the comments by readers at the tail of the link. The common man like us are so sick of this shit and propaganda from the FED, their bedmate banksters, and the blowhard FED media like CNBC with baffoon manic depressive talking heads like Cramer. Anyway check it out! ha ha ha, hilarious

CNBC - the banksters' broadcaster - the real classic headliner from March

Thu, 05/31/2012 - 06:50 | 2478638 bdc63
bdc63's picture

strannick - don't forget about crude's slike into the $80's ...personally, I think they gotta wait until LSC has a 7 handle (even $79.99) and then they get the 'all clear'

Thu, 05/31/2012 - 06:31 | 2478623 eclectic syncretist
eclectic syncretist's picture

Any collapse in treasuries would presumably be quite sudden and violent, given the connection with interest payment on the national debt.

The FedGov is backed into a corner where they must do everything possible to avoid/prevent a return to the kind of interest rates we had in the 1980's.  It's pretty much ZIRP forever from here forward, with no plan beyond that, but don't hold your breathe waiting for FedGov to say it.  It's probably beginning to sound cliche, but just look at Japan, hopelessly stuck with ZIRP for decades now.

FedGov is finished using interest rates as a policy tool.  They don't have that in their toolbox anymore.  They are stuck with ZIRP for as far as the eye can see.

Thu, 05/31/2012 - 07:59 | 2478704 tarsubil
tarsubil's picture

"The FedGov is backed into a corner where they must do everything possible to avoid/prevent a return to the kind of interest rates we had in the 1980's."

Absolutely. Shorting treasuries seems silly to me. Once that trade starts to make money, the money you will be making will approach worthlessness.

Thu, 05/31/2012 - 00:16 | 2478358 The Monkey
The Monkey's picture

I wouldn't count on it. Only good time to short treasuries is following panic buying alongside the usual massive downdraft in equities.

Long treasuries may have another 50-100 basis points in them before we are done.

Thu, 05/31/2012 - 03:35 | 2478518 Dr. Engali
Dr. Engali's picture

I agree fully. I expect to se the yield to hit sub 1% as we are Japan now.

Thu, 05/31/2012 - 08:00 | 2478705 tarsubil
tarsubil's picture

Why stop there? Go full Mortal Combat with Subzero.

Thu, 05/31/2012 - 01:12 | 2478433 MuppetMaster
MuppetMaster's picture

wouldn't u be better playing futures contracts? besides, I wouldn't expect a bond market collapse for a long time.  But look to the PBOC no doubt ;D

Thu, 05/31/2012 - 06:46 | 2478636 uncle_vito
uncle_vito's picture

My bond funds have done great. Deflation is around the corner. Negative rates are a real possibility.

Wed, 05/30/2012 - 23:29 | 2478269 LeonardoFibonacci
LeonardoFibonacci's picture

Wouldn't it be nice to see Blankfein in the scene of the movie 300, where Leonidas kicks the Persian in the bottomless well.  Lloyd Blankfein being the Persian messenger.  It suits Lloyd to be that character since soon he will deliver a message to Americans that he'll need another bailout.  That is when Obama should scream out," this is the White House" and kick Blankfein out of the 3rd floor window.

Thu, 05/31/2012 - 00:05 | 2478341 imaginalis
imaginalis's picture

I'd like to see him kicked in the bollocks

Thu, 05/31/2012 - 06:24 | 2478614 Bobbyrib
Bobbyrib's picture

I'ts more likely Obama will scream "this is the White House" then go to Congress and get Blankfein his/our (in a Fascist economy what's the difference) money. Romney would do the same.

Thu, 05/31/2012 - 09:24 | 2478999 GhostfaceCracka
GhostfaceCracka's picture

Still smokin' that Hopium I see. YES WE CAN


Wed, 05/30/2012 - 23:29 | 2478270 jekyll island
jekyll island's picture

I can manage my own account to zero by myself, don't need no professionals to help me.  

Thu, 05/31/2012 - 00:37 | 2478387 taniquetil
taniquetil's picture

I have been taking the free advice of MillionDollarBonus.


Long Facebook anyone?

Thu, 05/31/2012 - 00:51 | 2478404 WonderDawg
WonderDawg's picture

Ol' MDB has been pretty scarce as FB has tanked. Must be scraping up pennies to buy more and lower his average cost. He does it all the way down, he can get his average cost to about $20 or so. Imagine the stories he'll be able to tell his grandchildren. His brilliance is blinding.

Thu, 05/31/2012 - 02:18 | 2478482 CCanuck
CCanuck's picture

He posted yesterday, or the day before, he bought the dip at 30.50 added 500 to the pile, says he is cost averaging.

Not sure where, but I know I saw it, because it cost me another keyboard, milk does the body good...keyboard..not so much!

Third keyboard since join'n ZH...This place is fuck'n hillarious!

Anyone know what happened to Trav?


Thu, 05/31/2012 - 03:32 | 2478517 Dr. Engali
Dr. Engali's picture

He was banned a while back along with Robo. But it seems Tyler let Robo out of the time out chair because he posted a few days back. I've only seen one post though. The shocked responses were pretty funny.

Thu, 05/31/2012 - 07:52 | 2478681 BigDuke6
BigDuke6's picture

He wasn't banned - the saga was on a thread one time.

i think he was just getting sick of pseudointellectual sanctimonious pricks like Akak.

He's not alone in that. 

Wed, 05/30/2012 - 23:53 | 2478322 SV
SV's picture

It's easy, it comes from taking the other side of their recommended trade.  They're (GS) making out like bandits, again, on the backs of the "muppets".  It's just recognizing the reality that is around you.  Brings a story to mind from my university days...  I was sitting for a CS 300 level final and the guy next to me is stretching.  I turn and ask, "So dude, why all the stretching - it's only a couple hours sitting?"  His response was priceless, "I want to be flexible, so when the time comes I can bend over easily and kiss my ass goodbye."  He had a great recognition of the reality around him - me, not so much.  I'm getting better though...  I'm here and I'm not a muppet.

Thu, 05/31/2012 - 00:10 | 2478350 ACP
ACP's picture

So there isn't an anti-GS hedge fund out there yet? Anyone wanna start one?

"Never fired and only droppped once..."

Wed, 05/30/2012 - 23:09 | 2478214 beaker
beaker's picture

Oh great! Now you had to go and blab this to everybody...

Wed, 05/30/2012 - 23:09 | 2478216 Timmay
Timmay's picture

On a long enough ruler, the return rate for everyone drops to zero.

Wed, 05/30/2012 - 23:15 | 2478235 SilverTree
SilverTree's picture

On a long enough ruler, every guys dick looks small.

Thu, 05/31/2012 - 01:27 | 2478443 strannick
strannick's picture

Not if you change the scale. Kind of like QE. 'We can guarantee pension funds amounts out to any timeline you choose, we just cant guarantee their purchasing power' -Allan Greenspan to Congress

Wed, 05/30/2012 - 23:11 | 2478221 veyron
veyron's picture

What's Birinyi's ruler?  Sounds like indian food ...

Wed, 05/30/2012 - 23:13 | 2478226 LetThemEatRand
LetThemEatRand's picture

It burns even more on the way out.

Thu, 05/31/2012 - 01:12 | 2478434 zhandax
zhandax's picture

What's Birinyi's ruler?

The device commonly used to measure cock size on wall street

Thu, 05/31/2012 - 01:04 | 2478424 WallowaMountainMan
WallowaMountainMan's picture

man, i had no idea as to what Birinyi's ruler was.

but i thought it good to explore.

so, it was time to highlight and right click and search. sure enough, that got me on the trail of a series of fine,fine articles from the zh past.

a big ty to zh for the adventure.

Wed, 05/30/2012 - 23:13 | 2478227 electricgorilla
electricgorilla's picture

I have to ask. What is a good forex broker for the retail investor?

Wed, 05/30/2012 - 23:14 | 2478229 veyron
veyron's picture

MF Global

Wed, 05/30/2012 - 23:29 | 2478272 JackT
JackT's picture

Wait for it....wait for it...

Thu, 05/31/2012 - 02:08 | 2478471 CCanuck
CCanuck's picture

I would............not for comex prices though!!!

Got silver maples for sale $50oz. if anyone is interested?


Wed, 05/30/2012 - 23:30 | 2478273 LongSoupLine
LongSoupLine's picture

anyone selling physical...

Thu, 05/31/2012 - 00:29 | 2478373 e_goldstein
e_goldstein's picture

Thanks, I think I just crapped myself.


Thu, 05/31/2012 - 01:01 | 2478416 bag holder
bag holder's picture

apmex, bro

Wed, 05/30/2012 - 23:17 | 2478237 StockHut
StockHut's picture

Why is there not an ETF that takes all the opposite trades of Goldman.... GSUX

Wed, 05/30/2012 - 23:19 | 2478242 veyron
veyron's picture

The real question is ... would Goldman go long or short the stock with ticker symbol GS?

Wed, 05/30/2012 - 23:30 | 2478275 tekhneek
tekhneek's picture

I'd sure as shit short the shit out of myself (with as much $ as I could) if my stock sucked as much as Goldman Suchs stock sucks.

I can see the PR now: "We're bankrupt, but it's okay err'body. The profits from our CIO's incredibly large, leveraged short position on our own company stock has literally returned 5x the money that was lost in our stock reaching it's resting place of $0.00. In other words, we're rich, bitchez."

Wed, 05/30/2012 - 23:47 | 2478308 veyron
veyron's picture

reminds me of the bank that booked a mark-to-market profit on its own debt ... want to say it was UBS ...

Thu, 05/31/2012 - 05:34 | 2478587 Acet
Acet's picture

They all did - it was all the rage to do this so as to be able to declare a profit in the 3rd or 4th quarters of 2011: we could theoretically buy back our own bonds for less than we sold them, so we're booking this as a profit.

(Nevermind that whatever the market price of the bonds they still have to pay the same coupon and pay the same amount of principal when their bonds mature unless they actually buy back those bonds, rather than theoretically)

To me this is clear evidence that the accounts of financial institutions are total and complete bullshit.


Wed, 05/30/2012 - 23:59 | 2478330 slewie the pi-rat
slewie the pi-rat's picture

i'm starting to wonder of this isn't just the plan they came up with to take the squid private, like warren's been talking since he ponied up the "bailout" money in '08

this will work out well for them if it is, i think

Thu, 05/31/2012 - 01:05 | 2478426 bag holder
bag holder's picture

GS is both long and short GS. See the JPM Act 2 sticky for details.

Wed, 05/30/2012 - 23:19 | 2478241 yabyum
yabyum's picture

Who do you trust? Who can you trust? The TBTF do not have your best intrests in mind .The BONUS rules all.

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