Musk was kind of cocky calling everyone who questioned the rebounding economy as Chicken Little. When I mentioned Europe failing, he scoffed and said "when is it going to happen?", when is Europe and the European banks going to fail? He made it sound as if it never would.
Well, the first big #$%$ in the armor happened this weekend. The EU has basically looted the bank accounts of every person in Cyrpus. They are stealing 6.75% on people with less than 100,000 Euros and taking 9.9% if you have more than 100,000 Euros. This is a chilling proposition.
Basically, the banks have decided that if they need your money that they can take it. The favorite mechanism for banks to steal, debasing the currency, hasn't worked as they needed it to. If you think this can't happen in the U.S., think again. Take a look at Jon Corzine. Here is a guy who stole $1 billion from his clients at MF Global and not only is he still free and walking around last week, he is still allowed to trade futures. That is right. Not only has he not been tossed in jail, he can still trade in the market and swindle his customers.
As for Musk's contention that we are at record profits, you need look no further than the Senate Hearings on JPM Chase. This is from Matt Taibbi who was live blogging it, First off there is this, "In September of 2009, the Commodity Futures Trading Commission nailed Chase for co-mingling $725 million of its own money with $9.6 billion in customer money, essentially the same activity we saw in the Corzine/MF Global scandal. Chase, incredibly, was allowed to settle for $300,000 in that case." So once more, we see that banks think that they have the right to steal from their customers. More on next post.
Nobody talks about mark to market and the accounting games anymore. REPO loans and off balance sheet transactions? They are as transparent as sand paper. Trust me nobody knows what they are buying with the banks. it's all a guessing game. You can't even do due dillgience if you tried because they hid stuff off the books.
Hey Doc, comming out of my hole to say hello.
On Europe, listen to this one, i just got taxed 21% on a savings account in France. Meaning 21% on her retirement #$%$...??? See that on the news ?Thank Francisco i took most out half way thru last
years rebounding economy in Europe, basically saving some 20 k, what a fool me be...
Cant,t beleive muskeete used caps on you, i will deal with him later. Maybe when he gets out of the closet.
Still obsessed with me? You want to "deal" with me? Can´t you think about anything else? Even my wife thinks you are gay, how else explain the obsession?
P.S. If the sky fell today, I didn´t notice it.
Another Taibbi jewel, "A general point about the rest of the hearing, what it's all about and what its significance is. What we're getting in this report is a rare insight of how an Too-Big-To-Fail bank sees itself and its accounting. We're seeing how they actually come up with the numbers that get spit out to the rest of us as shiny, seemingly objectively-arrived-at profit and revenue statements every quarter. What we find out from this hearing and from the research that spurred it into existence is that the accounting procedures at a bank like Chase, particularly with regard to derivatives, are closer to being an exercise in creative writing than real accounting. This giant mountain of a company is made up of a core of optimistic assumptions, almost kid-like fantasies, and in some cases, outright lies. It's really incredible."
"But as we've already seen at this bank, where the losses from just one portfolio can be calculated as $700 million in one person's eyes and $1.2 billion in the eyes of another, the whole process is highly subjective. Anyway: in this email, Hagan lays out a number of different methodologies he could potentially use to determine the bank's regulatory capital."
So here we have the core issue with "record corporate profits". Corporations are allowed to lie about what they are.
And another jewel, "Ladies and gentlemen, welcome to federal financial oversight! The chief examiner of one of America's largest depository institutions -- largest federally-insured depository institutions -- has what is in essence a $100 billion hedge fund made up of insanely complicated exacta bets on inscrtuable synthetic credit derivatives, and he doesn't think it's high risk."
So here we have the real economy. A bank that is allowed to make up numbers. A government regulator who allows them to do so and when the entire ponzi scheme falls apart, you just let the banks/corporations steal from the citizens. It is private gains, public losses just like we had befor
1. US corporate profits are at record levels across many industries, crooked bank accounting not withstanding. That is just a fact. To be sure, accounting is a somewhat subjective practice. If you have a problem with accounting talk to FASB. fasb dot org
2. JPM is a hedge-fund, and Jamie Dimon is a crooked bankster taking outlandish and unknown risk with public funds. I think we agree.
3. I think we agree that the Cyprus confiscation is probably the dumbest policy response since the very begining of the financial crisis. Nothing undermines confidence in a banking system as much as deposits at risk. But most of the other stuff has worked fairly well, so far. Of course you are entitled to disagree, but most of the facts do support that view. I am not sure what to make of logic that says: Actions A, B and C have been herlpful, but Action D has not, therefore the entire effort is a dangerous waste...