Wednesday, March 4, 2009

The Looting ... more

More stories of the looting of corporations seems to arise daily. And if one applies some simple logic, a lot more can be inferred. They - the ruling classes - all wanted "to dip their biscuit in that gravy while it was still hot".

Quiz: What fine movie and actor are the source of that quote ?

Some examples ...

Bernanke - "“If there is a single episode in this entire 18 months that has made me more angry, I can’t think of one other than AIG,” he said. “There was no oversight of the financial products division. This was a hedge fund basically that was attached to a large and stable insurance company.” The crisis at AIG stemmed from its activities in the market for credit default swaps – derivatives that function as debt insurance.

We now know that Lehman Bros, Bear Stearns and Merrill Lynch were the same - huge hedge funds attached to other stable businesses. As we know is Goldman Sachs.

Stock options: a way to loot the stockholders and give pay for no work. Holders made huge profits from simple market fluctuations and excessive risk is encouraged.

Stock buybacks: a way to prop up the value of stock options and reward the SELLERS of corporate stocks, at the expense of the long term holders.

Private equity: just a fancy name for leveraged buyout, where excessive debt is taken on, workers lose jobs and the corporation is looted of assets.

All those traders on Wall Street wanted to get paid like hedge fund managers. So they took on idiotic risks. The whole hedge fund industry - in the US and Europe - is just full of non-productive speculation, trading funds, worthless management running "fund of funds" and feeder funds, etc.

Europe seems more aware of the abuses of hedge funds than the US: (FT) "Paris has recently proposed clampdowns on hedge funds and bankers’ bonuses, in both cases using the threat of tougher capital requirements as a way of reducing what it believes to be excessive risk-taking."

Let's regulate hedge funds as investment companies, get rid of all derivatives, require much more collateral for currency trading, and a lot more that I can't think of now. And somehow the stockholders must be given real power to control upper management pay. Europe seems way ahead in that, perhaps by social custom.

How does this trading speculation exist ? Derivatives let them do it without adequate capital or regulation. Get rid of derivatives. The capital markets worked fine for the real economy before derivatives were created.

Get rid of derivatives. Get rid of executive stock options. Get rid of stock buybacks. Get rid of excessive executive pay.

Observations

The price of copper seems to be breaking out up from a long base. It may be a feint, or ...

China's PMI was reported to be over 50, as I just heard on Blabberg. Perhaps they have real consumer demand. I also note that Chinese stock prices seem perky, too.

Word of the Day

"Interdict" - noun and verb [$10]
Interdict means (noun) 1. an authoritative prohibition; 2. (church) a sentence debarring person, or esp. a place, from ecclesiastical functions and privileges; (verb) to issue or promulgate an interdict.
Sentence: Governments around the world need to interdict derivatives from the financial system.

Le Mot du Jour

"Bourde" - noun, feminine.
Une Bourde means a blunder, slip, mistake.
La Phrase: Hier matin, l'homme du bunker à fait une bourde dans la phrase pour son mot du jour. Il l'à corrigé plus tard.
Sentence: Yesterday morning, Bunkerman made a blunder in the sentence for his word of the day. He fixed it later.

75 comments:

Bud said...

'non-productive speculation'


huh??? i don't like the sounds of that.........cuz pete defazio says that's exactly what i do

Bud said...

here is the scumbag on the trader tax.......look at that f'ng smirk


http://www.cnbc.com/id/15840232?video=1051076486&play=1



still think it ain't gonna pass.......'ace' ??????

Bud said...

wtf??


you guys are buyin GE ??? huh??? are y'all stupid??? that's crap........

Bman be careful listening to frosty.....he destroyed mern in a QID trade

Bud said...

jimmy stewart.......mr smith goes to washington ??

Bud said...

Bman do you think it's ok for a trader to buy and sell the same stock 30x a day ?? should it be outlawed......ummmmm.....i mean taxed ??

Spin-em said...

Bunk going all slap happy on the bunker boyz with the trader tax???Whats next wings???

Bunkerman said...

Oh, Bud, I don't mean individual traders. All freedom to individuals. Let them do anything they want as no one will bail them out if they blow up.

I mean hedge funds sucking up trillions from the dumb rich to speculate...

And banks speculating ...

etc.

mfl59 said...

how can you even think of such a tax when ARod has a cyst on his hip? all of our energy needs to be focused on that...

Bunkerman said...

I am opposed to any trader tax.

I want hedge funds regulated.

mfl59 said...

All I know is Obama loves this country....if you don't think he does you will be reprimanded...

Bunkerman said...

And I want a strong uptick rule including derivatives and ETFs.

If there is to be selling, let the real owners get the best prices.

Spin-em said...

"inherited"...sick of that one too...you wanted it bozo's

Bunkerman said...

Let me make this simple: populist libertarianism means the big boyz - the ruling classes - the rich and powerful - the aristocracy - get regulated and limited.

The bulk of the people get complete freedom.

Bunkerman said...

So you should be able to guess my opinion on almost any issue easily.

Spin-em said...

mern screwed this country for a $100 bet

Spin-em said...

"is just full of non-productive speculation,"

"is just full of non-productive speculation,"

"is just full of non-productive speculation,"

Spin-em said...

quite the hissy fit in the tank yesterday...guess there wasnt enough trading ideas going around....

Spin-em said...

Happy Hawaii Five 0 Liz!!!....as he reads the bunky blog..lol

Bunkerman said...

uh .. I think the subject of that sentence was edited out: hedge funds.

Bunkerman said...

I think another blog on the "Failure of Libertarianism" is needed.

Bunkerman said...

There have been numerous great nations and empires destroyed by the grasp for more and more power by the aristocracy, in this case, the ruling classes.

They take wealth andpower from BOTH the common man and from the central government, and lead the nation to destruction or poverty.

Bunkerman said...

trading ideas - sheesh, anyone shorting my Obama Fund stocks in January would be up bigtime.

Bunkerman said...

or shorting my GE buy at 12.

Just short my picks.

Bud said...

Bman i agree on the uptick rule, derivatives and especially.........'hogs at the trough' 'vikings looting the monastery'



but i am very strongly against restricting the animal spirits (greed) of beefers..........it hurts all of us ( u2 Bman )


beefers move stocks.......that's when stocks double and triple and quadruple in a few months


no beefers.......than 5% annual return in the market will be considered 'great'




PS......no beefers ?? than your Obama fund will take 5 years to move 12%........how long you plan on living ??

Bunkerman said...

heck, I give good shorts out for free

;)

Bunkerman said...

C ... WC ... GE ... Obama Fund stocks

One could be up 100% on those.

Bunkerman said...

There were no beefers in 1974 and stocks doubled out of recession in 18 months.

Bunkerman said...

ditto 1932.

Spin-em said...

The Obama Fund like a mini market..how do you handle it bunk?...no new money I see( contra Ben) do you cut em or "hope"?

Bud said...

no question that the spear chuckers advisers decided this weekend to start every sentence with either


'we inherited....
'the last 8 years....


that's ok......that's how politics is played....i understand it


but a time will come when it won't work............i'm gonna say about a year


"we won.......we wrote the bill"

Bud said...

don't worry ace


i'm preparing my A-fraud material..........got lots of good stuff.......let the regular season begin



PS......what type of lowlife dirtbag would cheer an A-fraud home run ??? we may have one here

Spin-em said...

Carlos Beltran lookin sharp..bring on those skanktown phils

Bunkerman said...

I'll probably add a bit to Obama Fund in April when I get some new skim ... ooops ... money.

I really don't follow them at all. Just sit. It's a speculation on eventual full recovery, not a trade.

But I should trade them some - I've been very pre-occupied with other matters: taxes, Spikie, visitors, etc.

Bunkerman said...

the stocks were all picked as possible 3-4x winners in recovery; I tried to cut the dumb management and excessive debt (nearby maturities), but probably missed some.

Most are quite risky.

One BK so far, but I expected it.

Spin-em said...

skimm ... ooops ... money.

loooooool

Bud said...

long GE for a beefer trade........let's play some ping-pong



"huge put action"

pfffffffffffffffffffffft

mfl59 said...

PSA short


"thanks jim"


refund please...

Bud said...

you're a real funny guy ace..........you know what else you are??


a tete de noeud

mfl59 said...

lmaooooo

i see "ace" has stuck...that's okay...i like it...

Ace from Casino...DeNiro indeed

Spin-em said...

ace is a great name and a helluva picker CEO.."thanks ace"

Spin-em said...

Eastern Europe my azz paul...we know it was bud

Bud said...

Bman you read the article on GE in wsj ?? what do you think

Bunkerman said...

hmm GE is now an Obama Fund candidate.

mfl59 said...

the Obama Fund shorts stocks?

Bunkerman said...

I don't see GE spinning off GECC - they use it to help buyers of GE equipment.

When I deal with GECC in the 1980s and early 1990s, they were smart & tough.

I read one article on GE in WSJ - didn't help much.

Bill Gross's thinking might be correct: bond sellers jumpting a donwgrade risk.

The industrial side is very strong competitively.

Of course what I don't know, I don't know.

They might have some real estate risks, but I don't think that's really leveraged much. I suspect they can just ride this out. If credit markets get tought fo rthem, they can sell CP to Fed.

Bunkerman said...

haha, mfl the comedian.

GE did a good sized levergaed lease book: losing tax benefits can hur tthat, but the loss of tax able income would have to be for a few years.

Bunkerman said...

GE should just shut up and run the business.

Bunkerman said...

so much for cutting dividends to "help"

mfl59 said...

just keeping it light Bunky....

Bunkerman said...

bot some GE in Obama Fund. Some room to add.

Now it's sure to go to zero.

Spin-em said...

Geithner blackout..lmaoooooo

Bud said...

Washington, D.C., March 4, 2009 — Effective on April 1, 2009, or 30 days after the date of enactment of the Commission's regular appropriation for FY 2009, whichever is later, the Section 31 fee rate applicable to securities transactions on the exchanges and over-the-counter markets will increase to $25.70 per million dollars. Until that date, the current rate of $5.60 per million dollars will remain in effect.






still think the trader tax ain't passin.....ace ???

mfl59 said...

so let me follow you here "jimmy jer"....anything that gets proposed in Washington automatically passes?

when guys like Schumer start yapping about this tax, then I'll worry...DeFazio is a South Alaskan loon...he carries as much weight in the House as I do...

Bunkerman said...

Hmmm $25 per million

=0.0025%

What a killer.

mfl59 said...

god forbid "he" posts a trade once in awhile...

Bud said...

south alaskan loon


LMAOOOOOOOOOOOOOOOOOOOOOO


ps.....is everyone from south alaska a faggot ??? ummmmm..........i think so

mfl59 said...

According to this blog, a board member with the Boston Securities Traders Association met with Congressman Barney Frank last Thursday to discuss the financial-transaction tax proposal. Frank assured him it was off the table for this presidential cycle (the next 4 years or so). Frank said the only way it would be enacted is if Wall Street doesn't pay back its share of tarp funds.

The good news: This is one leading Democratic Congressional leader who will not support and pass the financial-transaction tax during the Obama administration, and he probably speaks for other leaders too (Sen. Charles Schumer, NY and Sen. Dick Durbin, IL). A GOP Congress or administration would probably never support this ill-conceived tax.

mfl59 said...

now tell your boy to shut the fkkk up

Spin-em said...

wow....spinny be outta bniz with that sucka..pffttttt

Spin-em said...

hope you feel better now that you made me cry.... bud

Spin-em said...

bunk comrad Obama wants towhat was your room going for when you stayed at the Bellagio?...cnbc says 139 today

Spin-em said...

(for the record..I dont expect an answer..lool)

mfl59 said...

Bunkerman have you ever shared a cocktail with Donny Deutsch at the NYAC?

he wears colorful ties as well...

Spin-em said...

looooooooooooooool...

Bunkerman said...

I haven't stayed at Bellagio fo ryears.

My suite was free at the Venetian ... comped.

Bunkerman said...

I don't remember seeing Donny Deutsch there.

I didn't like the Bellagio when I was there.

mfl59 said...

what's your take on Deutsch bunkerman?

i know spin wants a piece of him....

Frosty said...

GE...great call Sal...atta boy, well done indeed sir.

Bunkerman said...

no opinion on DD.

Bud said...

gimme a f'ng break bob !!


'huge put action'


pffffffffffffffffffffffffffft

mfl59 said...

Kass with the call of the year.....unreal timing....

going to pay for a membership at Baltusrol thanks to his advice...

"thanks dougie"

Spin-em said...

jim looking small and bitter with that Kassiopia scolding..pffttt what scumbag would worship him??

Bud said...

LMAOOOOOOOOOOOOOOOOOOO


stop poaching my material !!! oh wait......i said lowlife dirtbag......never mind

Bud said...

speakin of lowlife dirtbags...............lemme ask u somethin bob


is me losin $$ some sort of amusement for you ??? cuz it ain't funny to me


i'll knock your teeth out if you do that again



'huge put action'

Bunkerman said...

Internet trouble just fixed - very annoying.