Sentinel

Exclusive: Big Banks' Recent Profitability Due to AIG Scam?

Yep, and all you idiot Cornucopians who started this sucker's rally will see going into the "Summer of Hell" that the Banks are STILL just as insolvent as before as their REAL profits become non-existant when the bailout money dribbles to a close as AIG gets completely nationalized.

Or mass unrest insues when the bailout of the Banks through AIG continues unabated and we finally wake up and realize the continuance of the scam.

Either way.....Dow 4000 or less here we come.

Preview from Europe: The Horror Show's Alive and Well

Yes the horror show continues. It's the fact that 400 trillion dollars of derivative asset valuation takes a long time to wash out of the system. And government intervention makes it worse and longer.

And it couldn't be a better director than Sam Raimi. Looks like he is finally returning to his horror film roots with "Drag Me To Hell". The old hag even looks a little like one of his zombies from the original "Evil Dead" movie which launched his career and eventually took him to the "Spider Man" franchise. The first "Evil Dead" movie is still one of the most disturbing films ever made. Glad to see him take on the "hell" that is the world of mortgage finance.

Although I would have explored another title for the movie. If you literally translate the word "Mortgage" is means.....

Death Pledge

Preview from Europe: Stocks Go Cliff Diving Again

Yeah....

But are the stocks wearing those cute little Speedos?

That Daily episode where he rips apart CNBC with their own "experts" own words is absolutely priceless!

The Economy, And Why It's Taking So Long to Fix It

Hey spigzone, I've been bringing up Peak Oil on this blog for some time now. I don't beat the drum every time but in order to give proof to some of my statements about the end of exponential growth being a certainty in the future vis' a vis' any long term recovery I certainly remind folks that part of the American Miracle from the Industrial Revolution of the late 1800's until the early 70's was in large part due to abundant, cheap, local fuel sources.

But there are many Cornucopians (a type of American Utopian who thinks that the horn of plenty will always overflow with milk and honey in this country) who poo-poo the notion of Peak Oil with "Drill Drill Drill".

Hell.....I'd drill through the skull of an American Bison laying down in Yellowstone if I could hit a motherlode of oil underneath it's carcass. But the fact remains that the cost of getting that oil out would not make much economic sense seeing how much global demand there is. The oil companies know that. Otherwise with Oil Friendly Presidents like Reagan, Bush the Elder and Bush the Stupid we would have oil wells in every other back yard.

But we don't. Because of the simple fact that we have tapped out our cheap stuff here in this country. Sure add Alaska, do some offshore. Any little bit will help. But it is not a long term solution because quite simply what is left is too expensive below 100 a barrel to get out of the ground. And around 140 dollars a barrel is when our economy begins to grind to a halt.

Ergo....do not expect much of a long term, sustained, exponential growth trend anytime soon.....if ever.

America's Insolvent Banks

Artful Dodger....

That figure is a best guess conservative figure. Watch "The History of Money" based on the book and that figure is given as well.

Because a lot of this is simply Monopoly Valuation, the true value is somewhat unknown. However, some very smart people have also said the figure is as high as 700 trillion.

I know that these figures are absolutely mind-boggling. However, all you have to do to come up with 600 trillion dollars and know that it is spot-on accurate is simply look at every countres' total debt obligation on this planet.....

....and simply add.

And you will get 600 trillion dollars. So when you realize that most of this derivative valuation came from debt instruments (ie mortages and such) plus the multiplier effect (you know....for every 1 dollar spent or 1 dollar of debt you can "leverage" that 10:1...50:1 even 300:1) and you can now see how 400 trillion is a good ball park estimate.

By the way....the President of the Dallas Fed was on C-Span a few days ago and he put the entire National U.S. debt (all on-the-books and all off-the-books) at 88 trillion.

Here's the scary part......that did not count ANY....I repeat.....ANY of Paulson's TARP bailout, the U.S. automakers' bailout, and The Messiah's Stimulus Package.

It is a metaphysical certainty that our total National Debt will exceed 100 trillion dollars by the time Obama is run out of office.

America's Insolvent Banks

Oh and to ironpants who made the snide comment about Felix being a short-seller sympathizer.....

I'm sure your "ironpants" are beginning to rust from all that load you dropped from missing all the short selling you could have done.

Of course Japan's 13% drop in GDP and about the same in Manufacturing is all because of short sellers too.....I mean, we the American consumers don't buy anything from that country anyway....

Right?

America's Insolvent Banks

Simple facts.....

There was 400 Trillion dollars of derivatives (MBS, CDO, CDS, etc) valuation.

There are 100' of billions of dollars of distressed properties on the banks books.

The Commercial Real Estate market is crashing and taking the Regional Banks.

Credit card defaults are spiraling out of control.

Now let't take the Derivatives....if just 5% were real money, that's 20 trillion dollars. That's more than the combine total of the top twenty banks in this country. We know for a fact the Europe's banks hold 24 Trillion dollars in rotten assets.

So are the banks broke. Yes....and if some are not they soon will be.

As far as Geithner having a plan or not....OF COURSE HE DOES NOT! How can anyone on this planet have a plan to bail out the banks who are involved in the World's Largest Ponzi Scheme gone bad?

All Big U.S. Banks May Need More Aid in Severe Scenario

No friggin' DUH!

There was at the height of its madness 400 trillion in derivatives valuation. If just 5% of that was real ( 20 trillion dollars) then you are looking at more valuation than all the top 20 U.S. banks combined.

Now, today comes the leaked report from Europe that the top banks in Europe are sitting on 24 trillion dollars of toxic assets.

This is PRECISELY why Geithner has not revealed any details about the new and improved Bank Bailout. He and Obama now know what Bush and his cronies knew before getting the boot by the American people.....

The entire global financial system is broke and they do not have a clue how to fix it. It's not because they are dumb.....but this thing is SO massive that they are changing their underwear 3 times a day.

Nobody wants to be the party that Nationalized the ENTIRE U.S. Banking system and at the same time, there is not enough money on the ENTIRE PLANET to bail out the world's banks.

And from somewhere deep inside Treasury there is a printing press singing a siren song to its masters at the Federal Reserve......

"Let me print....Let me print.....Let me print !"

Turning Japanese: The Audacity of Reality (Part 3 of 3)

WONDERFUL ARTICLE!!!!

All you Cornucopians should bow at this man's feet. There is nothing but cold hard facts and truth in this article, which the Main Stream Press, Wall Street, The Banksters and our Government are INCAPABLE OF DOING!

I encourage everyone to reread this several times to digest it all. Recommend it to friends and relatives and link up to eveyone web-site imaginable.

And if I may add, the chart on page two showing how our GDP has flattened over several years, I encourage everyone to go to this link at ShadowStats.com which shows why that GDP curve has flattened......

www.shadowstats.com/al...

Scroll down to the bottom and you can see that not only has the percentage gain year over year shrunk but we have actually been in recession since late 2004-early 2005 if the FEDS counted GDP like they used to before Bill Clinton change it to make his administration look even better. Even worse, they have not updated the chart yet to reflect today's GDP report showing an unrevised 3.8% DROP in GDP. Look for that number to be revised downward later on.

That's why there were all those articles about how so many people felt like they were being left behind even though the housing market and all the money being made from it and its derivatives was in full swing.

That's how fake the last several years have been. A major multi-year recession (technically does that qualify as a Depression?) has been masked by 100's of TRILLIONS of dollars of absolutely fake valuation.

And now this leperous lie has been suddenly, even horrifyingly revealed.

Recovery in mid-late 2009?

More like revolution.

Thinking the Impossible: Could Bank of America Go to Zero?

Gooooood Mooorning all you Cornucopians, who believe we doom and gloomers and short sellers have all the power in the world to bring the global financial system to its knees.

In honor of my 45th birthday let me bring you some tasty morsels to down with you corn flakes and coffee while you wait on the GDP number to come out.

Banks are bellyaching about the unemployment rate. Why? Because they have models that suggest they will be in even DEEPER DOO-DOO if unemployment nationwide reaches 8.7%-10% depending on the bank.

WELLLLLLL......mozy on over to ShadowStats.com to look at the unemployment numbers compile there or click this link......

www.shadowstats.com/al...

All compiled from BLS data. It shows the "official" (ROTFLMAO) number as 7.2%. But the broader U-6 number is around 13.8%. But if we counted unemployment as we did during the Great Depression we would be at nearly 18% now.

BTW....that 7.2% number is of course an old figure. We are definitely above 8.7% now.

So as unemployment explodes, defaults on credit cards, auto loans, etc. also explode.

I kind of feel bad for the Banksters. I mean after all....they're having such a hard time continuing to hide all the toxic derivatives from the light of day, and keeping most of their foreclosed properties off the market in a desperate bid to keep the home market from cratering further.

And picking out new drapes and area rugs and a new jet.....JEEZ can't a Bankster catch a break?

BUT WAIT THERE'S MORE!!!!!

Steve Schwarzman of Blackstone stated in Davos that 40% of the world's wealth has dissappeared.

www.telegraph.co.uk/fi...

Who contained most of that wealth? RIIGGGHTTTT.....THE BANKS!

Cheers!

Thinking the Impossible: Could Bank of America Go to Zero?

Excellent point Rakesh.

These guys know in their gut the banks are zombies. But it is a combination of trying to somehow fight the good conservative, libertarian, free-market capitalism, pro-American fight against some boogy-man made up of liberal, anti-American, socialist doom-mongerers AND trying hard to keep a belief system in place held for years perhaps all their lives that the American Empire unlike all other world empires that came before it was capable of never diminishing.

I should know....I used to be one of those good conservative, libertarian, free-market, pro-American fighters.

I'm just tired now of carrying water for all those in power who have claimed for decades that they too were conservative, libertarian, free-market, pro-American fighters.

You're all full of crap and your fighting skills suck. I haven't joined the other team in the form of Obamanation. Never have been a socialist....never will be. But I also have never blamed another team for beating mine. This fight for a constitutional, free market government was ours to lose and lose we did.

The worst of it is the American people. These leaders, both the feckless and useless Republicans and the Socialist-lite Democrats all came to power not by some military coup, or space alien invasion....

They came from us....the people. They were born amonst us, raised by us, their values shaped by us, they were educated by us, they came to power by us.

That is why we are in the mess we are in. So no matter how much you put your heads in the sand, the banks are broke because the right team, the good team, fumbled the ball so badly that the bad team became the fans' favorite.

But we the people played the game as well as rooted from the stands. We have fumbled as well.

Thinking the Impossible: Could Bank of America Go to Zero?

Oh, yeah....just in case some of you "Good News Economist" types chime in about the regional banks being in good shape, just remember they are leverage up the yin-yang in Commercial Real Estate, which is now looking at a financial tsunami as well.

How many CompUSA's, Circuit Cities, Linens & Things, Mervyn's and other big box stores have to close, along with thousands of mom's and pop's before you guy's finally get hit with a clue by 4?

Hell....some of these CRE folks can't even pay their property taxes, much less make a payment on the real estate themselves. Bad news for state and local governments as well.

Oh....by the way....news just out now about how the credit unions are being propped up too.....

It's allright Cornucopians.....sunny days just a couple of quarters away....

Right?

The Fed's Decision: A Desperate Statement

Check out this article at iTulip.com.

Dovetails very nicely with this article. Lots of facts and charts.

Not a pretty conclusion.....but the logical one, I'm afraid.

www.itulip.com/forums/...

Thinking the Impossible: Could Bank of America Go to Zero?

***SIGH***

All you anit-short sellers and nay-sayers slay me.

There was at its peak mania around 400 trillion dollars of derivative asset valuation. A lot of this, perhaps most, was fake. Simply Monopoly valuation.

But here's the catch....or catches. That valuation had a lot to do with the supposed valuation of stocks and also supposed profits of these companies for, at the very least, 6 years....perhaps for more than a decade.

Let's say that just 5% of all the Monopoly valuation is actually real (as real as all paper (fiat) money can be). Then we are looking at 20 trillion dollars of valuation down the toilet. The banks held most of that.

Even at that figure, most of the US Banks are insolvent, perhaps technically, but insolvent nonetheless.

But let's get real.....that 5% figure is low-ball.

That's why, if we let them, the Banksters will come back, time and time again, with hat in hand for their TARP bailout.

Because they are broke, not because of some evil short-seller.

For those with intestinal fortitude and the courage to admit you are wrong read this.....

www.itulip.com/forums/...

Remember all you Cornucopians....we have been, since the Reagan administration, an ultra leveraged, ultra high debt load society. Debt cannot be piled up forever. Particularly, since our percentage gains year over year for the last 20+ year has been shrinking.

In other words, although we have been making more money, except for a couple of weak recessions, as a nation, we are making less and less year after year.

In other words, Uncle Sam has been taking pay cuts. However, Uncle Sam and her inhabitants have been piling on the credit card to keep up our lifestyle and our global hegemony.

Then Uncle Sam got involved in the largest Ponzi Scheme in the Universe (Derivatives) and has now been laid off.

So what does Obamanation want to do.....open 20 more credit cards and run them up to the hilt.

So go ahead you Cornucopians....if you believe the banks are doing great and all of this nonsense about them being broke is just that, then pour money into them like there's no tomorrow.

Should be a hellava buy...right?

<Crickets chirping>

RIGHT??!!!!!

Banks: The Final Countdown?

Whatever the government is going to do it had better do it quick and effectively.

The coming tsunami of loan devaluations, whether they be car loans, credit card accounts, commercial real esate etc., is picking up pace just due to the downcycle itself.

The banks have to fess up to their bad debt, get it off the books and move on to handle the other stuff that is heading their way.

Oh yeah....let's not forget that Alt-A and even Prime will be news topics starting next quarter and into the rest of the year as the layoffs mount.