sether

Berkshire Hathaway: Proof That the CDS Market Is Irrational

He may not have answered how these alleged hedge funds are using CDS to drive down the prices of companies who have lots of cash and little debt, but neither have you lent any creedence to your arguement that CDS are harmless, just "insurance contracts used to hedge debt defaults". That is ridiculous. How can 60 trillion in CDS be a hedge against debt default? They are 90% speculation. Do I have to explain to you how oddsmakers work? Heavy action on one side of a bet causes the odds on the other side to go long. If you have a hedge fund taking out insurance on debt they do not own, at 10X the loan principal, you think the 'house' (the collective subjective consciousness of the market) won't notice those CDS rates creeping up and the implied weakness in the root entity? Easy and obvious play from there to short the stock, maybe even collect some on that massive debt insurance (again, on debt you do not own). Hedge funds and major players could manage this with ease. Thanks to the CDS maket being unregulated and opaque, all we can do is wonder if this is going on or not. Seems obvious to me.

The Road to Economic Hell

Is this Roger Ailes?
Roger you forgot the Homos and Hollywood.

On Mar 05 09:03 AM patio wrote:

> It's far worse than you desribe. Obama, Pelosi, and Reid are using
> this crisis to cram through massive gifts of our money to their cronies
> ( ACORN; unions; you name a dem voting bloc, they get a payoff ).
> That's jsut the porkulus. Then they are putting together a multi-year
> spend and tax budget aimed at crippling our economy for decades,
> and solidifying power. They are targeting small and big business
> alike; they are still using the phony global warming scam ( exactly
> how cold, for how long does it need to get before the media pokes
> their head outside???) to target oil and gas; the list is endless.
>
> The sheeple are being led into socialism, and they are seemingly
> clueless.

Five Predictions for This Market

Caren, you twit.
Who milked the system? I assume that by 'milking the system' you mean 'made billions of dollars'. Was it the fly-by-night mortgage companies writing NINJA loans and immediately selling them to Investment Banks? I-Banks and the like who securitized those loans and re-sold them world-wide? The ratings agencies who rated this crap AAA? The folks buying and selling CDO's CDS's based on this junk? The de-regulators that facilitated all this?
You are not smart. Turn off the FOX and think for yourself. Duh indeed.


On Mar 04 04:18 PM Caren wrote:

> People milking the system generally tend to be more socialist in
> nature. Duh.

Five Predictions for This Market

Cheers. Yet another columnist who can't leave the gratuitous Obama bashing out of an otherwise fairly decent article. Like the rest of us, all these stock market fetishists are alot worse-off than they were just a few scant quarters ago. We're all angry about it. The difference is that they don't quite know where to direct their anger. Petty stock speculation is now and has always been superfluous to the economy. Wall Street is not the economy. Reviving Wall Street is therefore not at the top of this administration's to-do list. Thank God.


On Mar 04 09:17 AM oldcurmudgeon2 wrote:

> Why would I follow the advice of an idiot who is blaming President
> Obama for this crisis? Some kid who apparently thinks all the Bush
> tax-cutting created this extraordinarily strong economy we have?
> Garotte Garot!