Any idea just how much of this impeding tsunami is due to derivatives?
Harvard (and this is incredible, aren't they one of the top business schools in the country???) is getting huge losses due to credit default swaps.
To go digging further on what precisely is going on with these large institutional pension funds would be one of those "neutron bomb" posts.
As I recall AIG was whispered in the same breath as "retirement funds" but the details, what exactly is going on, did these large institutional funds invest in this Ponzi scheme too, or were they hoodwinked and how exactly these large institutional investors are regulated (are they regulated???) to make sure they are not gambling with retirement funds....
this entire realm, I do not recall a statistic specific, graphed detailed article or even research paper flying by the bitstream.
You might all be wondering where that upgrade is and I'm here to give you an update that it is @&*)%&*)@.
What the issue is ....I'm still trying to determine frankly, a lot can go wrong. But while EP is working perfectly, when I migrate the database to any source, I have major errors and I'm still working on it.
Long slow haul...sure Drupal is easy to upgrade, sure thing.
Let them fail. What ever happens happens. By giving them more money they are not going to magically find a resolution.
Let if fail, let it crash. It's time for a reboot.
No, I don't buy simple cause and effect. However, I can see how regulation (or lack thereof) breeds a "need" (read: demand) and "smart" executives see a "business opportunity" (read: supply). Isn't that the essence of unfettered, free market capitalism? Afterall, neither AIG nor their clients ever thought the insurance policies (CDS) would be called in. These people were only interested in playing a game to inflate their income statements. In their world, regular people don't even exist! There are no consequences beyond their boardrooms and stock prices. Greed, hubris, megalomania .... pick a description!!!!
I watch CNBC daily, but they bear some responsibility for not informing the public sooner about the true nature of this problem. I recall the Squak Box show when Paulson was on speaking with Steve Leese. Paulson was about as arrogant
as anyone could be, as he was being hard presses by Leese for answers. The fact was, and Steve pointed it out, that Paulson was 9-12 months too late at figuring out the true nature and extent of the problem.
There would've been reserve requirements otherwise, as with all their other insurance lines. That's why they ought to sell off all the traditional insurance subsidiaries and
firewall the really toxic entities and flush what they can through controlled bankruptcies. Their annuities and other insurance products were regulated by states so they're backed by various Insurance Guarantee Associations (similar to FDIC for insurance). In other words, Glass-Steagall didn't totally impact the insurance industry. It's really all the pension plans that are at stake here.
I agree with you that AIG needs to be broken up. Only the derivatives unit in London is a drain. Likewise, the mega banks need to be broken up. Commerical banking and investment banking need to be separated as they were 15-20 years ago. The fallacy of "too big to fail" is as evident as the fallacy of "free-market capitalism" to any rational person.
There is enormous pressure coming down from the oligarchs, I am sure of that. Further connections to the Saudi's, vis a vis countering the Iranians and the Ruskis in the Middle East, makes quite a bit of sense too.
But damn, why do they continue the ruse when there is every indication that you, me and all of the experts who know more than we do, are on to the game? This is definitely uncharted territory and past indicators are no longer valid, in my opinion.
At minimum, we need to re-think the recently passed stimulus package and the new omnibus budget. I'm afraid that the "bottom" may not even be on the horizon.
Yeah, I changed the slogan but it was more than reflecting deflationary spirals, I thought the 2 ¢ made it more clear we're a community blog.
Bill Simon gave a Moyers interview that the oligarchy was behind the "gun to their heads".
I would look to Saudi Arabia as well as China as the reasons to perpetuate this incredible zombie. The Godzilla of Zombies.
I think they need to break up AIG, which most divisions are fine, turning a profit and it was just one division in London which screwed the entire company, so I think they should break it up, set the good parts back to the private sector and basically wipe out those derivatives and stuctured investments though a public clearing house or something...
but they need to move, this zombie bank slow death...well, if they believe they are staving off an economic collapse I need to see those numbers because it looks like it's causing an economic collapse by not plain dealing with this Ponzi scheme operations.
Could also be the executives/boards/large shareholders of these insitutions themselves...
but it appears the stock market is "nationalizing" these banks anyway, their stocks are now penny stocks.
The invitation here at EP used to be, "Come speak your mind, one dime at a time." Presumably, Robert changed it 2 cents since that might be what a dime is worth nowadays.
Anyway, I'd like to spend my 2¢ by passing on the insightful words of John Carney:
No company has ever lost as much as AIG did last quarter. All told, it lost almost $100 billion last year, with $61.7 billion of those losses in just the last quarter of 2008. Few companies have ever been worth that much, or been able to put anything like that much at risk. It's almost unfathomable.
Let's see if we can break it down into a more reasonable number.
Every day AIG lost: $670 million.
Every hour AIG lost: $27.9 million.
Every minute AIG lost: $465 thousand.
Every second AIG lost: $7,750.
That's more like it. It means that every six and half seconds, AIG loses the equivalent of the median household income in the US.
Now, it seems that every economist, trader, financial consultant, casual observer, etc., etc., sees the idiocy in continuing to support failed institutions like AIG, Citicorp, JP Morgan Chase, Goldman Sachs, et al. The only people that see the merits in this are Geithner, Summers, Bernanke and Obama. These are really smart guys but they are looking awfully lonely out there on that optimistic island, don't you think? Is it coincidental that they all happen to be part of the governing administration and all the doubters are not? Does their inside postion give them some kind of privileged perspective that no one else can have?
So, here is what I can't stop thinking. Are they part of this grand financial scam, or is there a gun being held to their heads? If it is the latter (yeah, that's what I think is most likely), who is holding the gun?
We have no reason to be optimistic. As you pointed out in your post titled "Regulating Alphabet Soup", the Obama administration has appointed many of the chief instigators and enablers of the financial collapse to repair the problem. In a sense, it is reasonable to put people who know how the system works in charge of repairing it. But those should be operational positions. Putting them in policy-making positions (as the Obama administration has done) is manifestly idiotic. These are the very people whose past behaviors have unequivocally demonstrated an inability to anticipate the consequences of their decisions (or actions). And they're in charge now?? By the same reasoning, why not bring back Alberto Gonzales to fix the damage to the Justice Department? Why aren't the people (and there were plenty) who could forsee the collapse, now in charge of our financial policy?
This has been a collossal failure by President Obama and because it seems to involve his judgement of people (which is a very personal issue) and not some strategic error, I doubt it can be fixed easily. Who am I or anyone else to tell a Harvard-educated lawyer, surrounded by his Harvard-educated friends, that he is a poor judge of character and ability? I don't think we'll be able to impact that no matter how loud we yell. Massive street demonstrations might do it, but as a society we no longer seem capable of that.
Putin gets it
For the last several years the Russian Central Bank has been buying gold.
Vyacheslav Shtyrov, president of Sakha, approached Prime Minister Vladimir Putin on Wednesday with a plea for help. The sparsely populated republic, home to companies including Transneft, Surgutneftegaz and Mechel, is suffering from the drop in prices for gas and coal.
Putin listened and then took a breath.
"Vyacheslav Anatolyevich," he said, addressing him by his patronymic, "the global prices of coal, gas, metals and even diamonds have fallen. But the price of gold is rising -- and gold is mined on your territory."
When Shtyrov called attention to miners' problems with creditors, he was once again rebuffed. "We'll solve the problem with gold mining," Putin said. "Especially since -- I'll say it again -- I'm well aware that the price of gold is rising on world markets."
We have Cramer trying to "Obama proof" portfolios, bummer he was pushing the entire health care sector, not getting the costs of health care are destroying the U.S. competitiveness and crippling it long term with deficits....
and seemingly "upset" that Geithner isn't "bailing out the rich more", while others scream "socialism" etc.
It's insane, would all of these people just stop for a moment, whip out a calculator and see the goal is to get some real jobs, real economic growth and stop this fictional money ponzi scheme?
I have listened to more opinions without fact and details it's enough to drive someone nuts.
It is amazing how fast the balance of power has changed within the last decade. It probably will take a few more years when we stop referring to "Eastern European Countries" as such.
While you are correct to acknowledge that situations have changed and women can no longer count on a “prince charming” to be her breadwinner, I think the solution to the problem lies more in reforming labor laws which no longer reflect our situations. Most of the labor laws were written in the 1930’s and reflect the circumstances of the time which was primarily men in the workplace and women staying home. We all know this has changed. However, I do not think it is completely fair to say that this is outright discrimination. It is fair to say that women should not be forced to make a decision about either having a career or being a mother. Most women want both and this is what our labor laws need to reflect. I think we need to focus on giving women the freedom to make more of their own choices. We should be working for workplace flexibility, portable benefits and tax fairness.
Any idea just how much of this impeding tsunami is due to derivatives?
Harvard (and this is incredible, aren't they one of the top business schools in the country???) is getting huge losses due to credit default swaps.
To go digging further on what precisely is going on with these large institutional pension funds would be one of those "neutron bomb" posts.
As I recall AIG was whispered in the same breath as "retirement funds" but the details, what exactly is going on, did these large institutional funds invest in this Ponzi scheme too, or were they hoodwinked and how exactly these large institutional investors are regulated (are they regulated???) to make sure they are not gambling with retirement funds....
this entire realm, I do not recall a statistic specific, graphed detailed article or even research paper flying by the bitstream.
guarantee on a treasury?
what is an "eligible" collateral and what is a existing collateral?
It sure sounds like you're right, they are going to ?? derivatives on toxic derivatives?
You might all be wondering where that upgrade is and I'm here to give you an update that it is @&*)%&*)@.
What the issue is ....I'm still trying to determine frankly, a lot can go wrong. But while EP is working perfectly, when I migrate the database to any source, I have major errors and I'm still working on it.
Long slow haul...sure Drupal is easy to upgrade, sure thing.
(uh huh).
Let them fail. What ever happens happens. By giving them more money they are not going to magically find a resolution.
Let if fail, let it crash. It's time for a reboot.
Taxpayers are assuming too much downside risk with this plan. They are talking non-recourse loans to private investors. How ironic is that?
No, I don't buy simple cause and effect. However, I can see how regulation (or lack thereof) breeds a "need" (read: demand) and "smart" executives see a "business opportunity" (read: supply). Isn't that the essence of unfettered, free market capitalism? Afterall, neither AIG nor their clients ever thought the insurance policies (CDS) would be called in. These people were only interested in playing a game to inflate their income statements. In their world, regular people don't even exist! There are no consequences beyond their boardrooms and stock prices. Greed, hubris, megalomania .... pick a description!!!!
I watch CNBC daily, but they bear some responsibility for not informing the public sooner about the true nature of this problem. I recall the Squak Box show when Paulson was on speaking with Steve Leese. Paulson was about as arrogant
as anyone could be, as he was being hard presses by Leese for answers. The fact was, and Steve pointed it out, that Paulson was 9-12 months too late at figuring out the true nature and extent of the problem.
There would've been reserve requirements otherwise, as with all their other insurance lines. That's why they ought to sell off all the traditional insurance subsidiaries and
firewall the really toxic entities and flush what they can through controlled bankruptcies. Their annuities and other insurance products were regulated by states so they're backed by various Insurance Guarantee Associations (similar to FDIC for insurance). In other words, Glass-Steagall didn't totally impact the insurance industry. It's really all the pension plans that are at stake here.
This is incredible. Now there is a plan to buy bad assets.
This is ridiculous, it's worthless assets throwing U.S. taxpayer money at banks to buy their worthless crap to "get them off of the books"...
This is getting worse and worse by the hour.
That AIG Was caused by regulation? I don't think so, my understanding is it was deregulation which enabled the CDS market itself.
I agree with you that AIG needs to be broken up. Only the derivatives unit in London is a drain. Likewise, the mega banks need to be broken up. Commerical banking and investment banking need to be separated as they were 15-20 years ago. The fallacy of "too big to fail" is as evident as the fallacy of "free-market capitalism" to any rational person.
There is enormous pressure coming down from the oligarchs, I am sure of that. Further connections to the Saudi's, vis a vis countering the Iranians and the Ruskis in the Middle East, makes quite a bit of sense too.
But damn, why do they continue the ruse when there is every indication that you, me and all of the experts who know more than we do, are on to the game? This is definitely uncharted territory and past indicators are no longer valid, in my opinion.
At minimum, we need to re-think the recently passed stimulus package and the new omnibus budget. I'm afraid that the "bottom" may not even be on the horizon.
Yeah, I changed the slogan but it was more than reflecting deflationary spirals, I thought the 2 ¢ made it more clear we're a community blog.
Bill Simon gave a Moyers interview that the oligarchy was behind the "gun to their heads".
I would look to Saudi Arabia as well as China as the reasons to perpetuate this incredible zombie. The Godzilla of Zombies.
I think they need to break up AIG, which most divisions are fine, turning a profit and it was just one division in London which screwed the entire company, so I think they should break it up, set the good parts back to the private sector and basically wipe out those derivatives and stuctured investments though a public clearing house or something...
but they need to move, this zombie bank slow death...well, if they believe they are staving off an economic collapse I need to see those numbers because it looks like it's causing an economic collapse by not plain dealing with this Ponzi scheme operations.
Could also be the executives/boards/large shareholders of these insitutions themselves...
but it appears the stock market is "nationalizing" these banks anyway, their stocks are now penny stocks.
The invitation here at EP used to be, "Come speak your mind, one dime at a time." Presumably, Robert changed it 2 cents since that might be what a dime is worth nowadays.
Anyway, I'd like to spend my 2¢ by passing on the insightful words of John Carney:
Now, it seems that every economist, trader, financial consultant, casual observer, etc., etc., sees the idiocy in continuing to support failed institutions like AIG, Citicorp, JP Morgan Chase, Goldman Sachs, et al. The only people that see the merits in this are Geithner, Summers, Bernanke and Obama. These are really smart guys but they are looking awfully lonely out there on that optimistic island, don't you think? Is it coincidental that they all happen to be part of the governing administration and all the doubters are not? Does their inside postion give them some kind of privileged perspective that no one else can have?
So, here is what I can't stop thinking. Are they part of this grand financial scam, or is there a gun being held to their heads? If it is the latter (yeah, that's what I think is most likely), who is holding the gun?
We have no reason to be optimistic. As you pointed out in your post titled "Regulating Alphabet Soup", the Obama administration has appointed many of the chief instigators and enablers of the financial collapse to repair the problem. In a sense, it is reasonable to put people who know how the system works in charge of repairing it. But those should be operational positions. Putting them in policy-making positions (as the Obama administration has done) is manifestly idiotic. These are the very people whose past behaviors have unequivocally demonstrated an inability to anticipate the consequences of their decisions (or actions). And they're in charge now?? By the same reasoning, why not bring back Alberto Gonzales to fix the damage to the Justice Department? Why aren't the people (and there were plenty) who could forsee the collapse, now in charge of our financial policy?
This has been a collossal failure by President Obama and because it seems to involve his judgement of people (which is a very personal issue) and not some strategic error, I doubt it can be fixed easily. Who am I or anyone else to tell a Harvard-educated lawyer, surrounded by his Harvard-educated friends, that he is a poor judge of character and ability? I don't think we'll be able to impact that no matter how loud we yell. Massive street demonstrations might do it, but as a society we no longer seem capable of that.
a few overview posts on the robbing of retirement. The upcoming generation doesn't have hardly any and this issue gets no press.
Putin gets it
For the last several years the Russian Central Bank has been buying gold.
It has always been about class warfare.
We have Cramer trying to "Obama proof" portfolios, bummer he was pushing the entire health care sector, not getting the costs of health care are destroying the U.S. competitiveness and crippling it long term with deficits....
and seemingly "upset" that Geithner isn't "bailing out the rich more", while others scream "socialism" etc.
It's insane, would all of these people just stop for a moment, whip out a calculator and see the goal is to get some real jobs, real economic growth and stop this fictional money ponzi scheme?
I have listened to more opinions without fact and details it's enough to drive someone nuts.
It is amazing how fast the balance of power has changed within the last decade. It probably will take a few more years when we stop referring to "Eastern European Countries" as such.
While you are correct to acknowledge that situations have changed and women can no longer count on a “prince charming” to be her breadwinner, I think the solution to the problem lies more in reforming labor laws which no longer reflect our situations. Most of the labor laws were written in the 1930’s and reflect the circumstances of the time which was primarily men in the workplace and women staying home. We all know this has changed. However, I do not think it is completely fair to say that this is outright discrimination. It is fair to say that women should not be forced to make a decision about either having a career or being a mother. Most women want both and this is what our labor laws need to reflect. I think we need to focus on giving women the freedom to make more of their own choices. We should be working for workplace flexibility, portable benefits and tax fairness.
http://www.familyissues.ncpa.org/
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