obewon

JPMorgan and the Alabama Swaps

This is only one of the many, many ways that JPM defrauds the American people, its federal government, as well as state/ local governments.

@OptionsGirl:
State and Local governments (including county governments) want to boost the returns on their investments. The problem is twofold:
1. these government officials know nothing about leveraged investments, and
2. the smooth-talking crooks from the big US banks infiltrate state/ local governments and convince the government employees that they "have ways" of juicing the returns through various means (e.g. leverage, or derivatives, or credit default swaps, etc.).

Back in the mid 1990s, a CA county (Orange County) was forced to declare bankruptcy for this very reason.
Link: www.google.com/search?...

The Orange County politician was so inept, he didn't even understand what he had gotten into; but I still remember his explanation to an inquiring press: "you all simply do not understand the sophisticated investment techniques that I'm using."

Gold Is Not in a Bull Market

@GoMyLittleSheep:

This morning, I read Mish Shedlock's rebuttal of Nadler's nonsense. Perhaps you should check it out, if you value Mish's opinions.
Title: Nadler Nonsense
URL: globaleconomicanalysis...

Philosophy 101:
On second thought, maybe you should just stick to reading Nadler's narrow-minded views, because they coincide with your own (when we point a finger at someone, we are always pointing 3 fingers at ourselves... )


On Nov 02 06:49 PM GoMyLittleSheep wrote:

> Basically every one of your points were of the form: gold is liked
> by many people I trust and respect, and gold is hated by many people
> I don't trust or respect.
>
> Perhaps you should learn to think for yourself instead.

Gold Is Not in a Bull Market

Good points, Tipalia.
Nadler's best points are twofold: first, gold is money. Second, be "sensible" about gold investing. Do not have a very large percentage of your money into gold.

Here's my take on Nadler's commentary:
1. Some good points therein, though he presents a very unbalanced case.

2. He's an employee of Kitco (a positive), but he's a PR guy (a negative), not a world-class investment guru like Marc Faber, or Martin Weiss, or Paul Tudor Jones, or John Mauldin. All of the guys I just mentioned are bullish on gold.

3. I've never trusted PR guys because they're like used-car sales people. Can I trust what he is saying (... I've heard that they have shorted the gold price), or is he just "talking his book" ? Or would I rather trust what Faber, et al are saying? At the end of the day, it's guys like Faber, et al, who have a reputation that they must uphold.

4. There are many other factors that Nadler did not mention, yet they also have a big influence on the gold price.

5. Barrick & JPM have had a cozy relationship over the past 10 years... yet the king of the gold shorts is JPM. And look at the financial problems that Barrick (ABX) is now in, because they excessively hedged their gold production at the suggestion of JPM.

6. JPM currently has a net short position of over 25 million oz. and has tremendous influence over firms such as Kitco and Barrick.

At the end of the day, I'll take Faber, et al over Nadler.


On Nov 02 09:23 AM tipalia wrote:

> a lot of people get out of their shell when we talk about gold .
> What I really get from this article is don t buy gold but instead
> buy the miners
> since that with gold at 800$ they still make a lot of money. Instead
> of buying GLD buy GDX is the conclusion of this interview . Now
> it s up to each individual to do his/her homework and decide what
> they want to do . We can agree or disagree with the author(s) but
> at the end it s your money and only you can decide what you want
> to do with it .

Mathematical Realities Will Trump the Dollar

@ebworthen:

Yeah, generally true, but only in the short term!

Of great importance to the current administration (and our corrupt politicians in general) is to "keep the hope alive." Their mistaken belief is that a heavily manipulated stock market will continue to make many Americans happy this holiday season, and so that is is their fundamental short term objective.

But with deficits spiralling out of control, continuing high unemployment, and virtually guaranteed $2 trillion deficits each year over the next 5 years, this "house of cards" will eventually collapse on our politicians and their agents, GS and JPM. A government can't continually manipulate EVERYTHING, and continually increase national debt, while expecting any kind of solid economic growth.


On Oct 23 02:06 PM ebworthen wrote:

> Political realities (e.g. - get re-elected) are trumping mathematical
> realities.

Warning: The Coming Credit Dislocation

@Teresa:

Nice supplement to Karl's thought-provoking commentary; from my experience, your "assessment" of the US economy is "on target." There is no "real" recovery, as the venerable John Mauldin (www.2000wave.com/gatew...) has often written; instead, our "new normal" will be a jobless recovery, with continuing recessions over the next 10 years.

While I always read Karl Denninger's daily commentaries (market-ticker.denninge.../); I don't always agree with him, but his website is a "must read" for at least two important reasons:
1. His analysis and commentary are based on factual data, not myths or "hopes", and
2. Most of the time, he provides very useful info that forces us to think of all the various alternatives ahead.


On Oct 24 12:10 PM TeresaE wrote:

> The government is a bankrupt entity at nearly every level.
>
> The only way to go forward into next year and continue the fallacy
> to those still stupid enough to buy T-Bills, is to have a whopping
> good year end where many end up paying taxes on "gains."
>
> Gains which will evaporate before you can cash any out and cut the
> tax checks.
>
> The banks started upping rates in '06 when Congress decided to shoot
> us in the foot (head actually) with "help."
>
> This is just continuing the process AND thanks again to Congressional
> "help" Citi knows it won't be able to spread the increases after
> February thanks to the new "protections." Which once again equate
> to more money from our pockets flooding directly into the bankster's
> pockets.
>
> I am still amazed at how those that stand to lose the most (the upper
> middle-class - not filthy rich, just rich) will NOT open their farkin'
> eyes.
>
> My father-in-law is dying of cancer, his wife will only have investment
> income once he goes. I was trying to speak with her about starting
> now to protect herself. She told me that I was just a "cynic" and
> that America is recovering and government debt and debased currency
> won't effect her at all.
>
> My bro-in-laws concur with her. My husband too. Wish I had the
> blind faith that currently being "rich" or well-off brings.
>
> Meanwhile, I continue to take any extra funds I have to buy necessities,
> clothes for the upcoming years for my growing daughter and non-perishable
> foodstuffs, oh yeah silver too.
>
> Most of us have no idea how truly bad things were in the 30s, or
> in the run-up in Germany until Hitler "saved" the country.
>
> Bad times are coming and yes, I fully expect at least one more strengthening
> of our currency as soon as the stock market is exposed as the casino
> it is. One more chance to save ourselves by trading our soon-to-be-worthless
> dollars into something else.
>
> Heed the warnings of those that see reality - like Karl - or start
> figuring out how to eat non-food items and still survive.

Central Banks: More Harm than Good?

Thanks for another great commentary, J.S!

The Blight that is the FED:
The FED (and central bankers, in general) are an economic blight on the face of the earth. Since 1913, the general public has been brainwashed into believing that the FED was essential to a smooth running economy, when in reality, the reverse is true. The “law” that established the FED as a “private bank” was passed late at night, in late December of 1913, during a Congressional recess. The Power Elite at that time
(e.g. JP Morgan, Hapsburgs, Rothschilds, Warburgs, Rockefellers) were the force behind the creation of this illegal law, established so they and their families could benefit from the transfer of wealth from the US population.

The FED as Psychopaths:
Arguably, one could say so; they certainly fit the mold. But, without question, the 20,000 employees and consultants at the FED certainly qualify as being “non violent sociopaths”, defined as people who:
a) are completely free of internal restraints, whether from government or the general public
b) take illegal actions that are kept invisible from the population at large
c) believe they answer to no one, and are therefore able to do anything at all
d) are without conscience.

The FED ~ From the Eyes of Abe Lincoln:
In the early 1860s, Abe Lincoln recognized the illegal and despicable behavior of the Power Elite in the USA. Though the FED wasn’t established until 1913, he had this to say about them.
“The money power [i.e. the Power Elite] preys on the nation in times of peace, and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy. It denounces, as public enemies, all who question its methods or throws light upon its crimes. - Abraham Lincoln

Bill Friend’s Comment:
I encourage all readers to read Bill Friend’s comment, as it is “on the money.” The FED will be audited, in spite of the fact that the politicians (including Barney Frank and Chris Dodd!) have slow-rolled Ron Paul’s cries in the wilderness for years!). No doubt, the politicians will try to “water down” this legislation, because that is what politicians do best. However, in my opinion, it is essential that HR 1207 be passed “as is”, without adding or taking away from it in any way, as Mr. Friend has stated. Please consider this carefully, then contact your elected officials.

P.S. @ Jason Rines:
Good Calls! Obama now has over 30 direct report “Czars”, who freely bypass Cabinet officials. Within the Executive Branch of government, it’s only a matter of time before the internal squabbles and turf fights begin. Clearly, Obama doesn’t understand the First Principals of good management (and sadly, I was a strong supporter of Obama in 2008!).

Jobless in August

The BLS is a joke!

And their monthly BLS unemployment stats have always been "a sad joke" during recessions; but this time around, their stats since late 2007 have been so far off from reality that it's frightening!

That's because:
1. Their so-called "birth-death" model is useless (unless the economy is booming),
2. They purposely understate the actual unemployment data, and
3. They grossly overstate "job creation" in each industry, using artificial methods that are useful ONLY when the economy is expanding.

Another factor to consider. The government's Emergency Unemployment Compensation (EUC) program was initiated back in June 2008, yet the EUC benefits were extended on 2 occasions since then by Obama. If my memory is correct, I believe that the EUC benefits are set to expire this month (Sep '09).

But not to worry; Obama's checkbook has unlimited funds; he will likely extend them for a 3rd time.


On Sep 04 02:12 PM Ed Zimmer wrote:

> I can't help looking deeper into the figures for August. The number
> of people employed fell from 140.041 M to 139.649 M, a drop of 392,000
> people. At the same time, the number of unemployed frose from 14.462
> M to 14.928 M, an increase of 466,000. Add to that the Not in
> labor force increase of 143,000 people and we lost a lot more than
> what the government is headlining.
>
> How did we add 609,000 people (unemployment & NILF) and only
> lose 392,000 from the employed numbers? (Oh yeah, that's how they
> got -216,000). The actual unemployment numbers are 2.5 Million
> more out of work in August vs QTR 1 average. Green Shoots? Pondscum
> is more like it.

Is a Crash Impending?

excellent observations, Karl!

Isn't it interesting how investor "opinion" is so polarized? For example, "BaseHitz" provides an excellent, thought provoking response to your commentary. On the other hand, "mikemichaelson" provides a response that has no basis or substantiation for his shallow assertions!

P.S. Adding "fuel to the fire" is the recent China decision to allow State-owned firms to default on commodity hedges. I guess the Chinese have finally "had it" with the massive fraud by NY investment banks, selling China worthless crap!

In the Midst of an Extreme Black Swan (Part I)

Jim:
Somehow, I missed this Sep '08 commentary; somewhat long, but a good one!

That was then.

. . . and this is now: in Taleb's CNBC video this past week, he stated that "we're all doomed"; interestingly, I agree with all of his major points, as shown below:
• We're all in denial
• We're replacing private debt with public debt.
• We're not dealing with the cancer in our banking system.
• We're not making the structural changes we need to make.
• We're not being aggressive enough about restructuring debt (debt for equity swaps).
• Bernanke is a wimpy Greenspan sycophant
• Obama's rewarding the fools who got us here (Summers, Bernanke, Geithner)
• The banksters are taking over again

Link to "must-see" Taleb video:
www.businessinsider.co...

Will Gensler Curb Manipulations in Futures Markets, or Is It Just Smoke and Mirrors?

Excellent commentary, J.S. Kim!

If your first sentence were: "Gensler was a former partner and co-head of finance at Goldman Sachs" . . .

. . . then most folks wouldn't have had to read all the rest!

Yes, it will all be "smoke & mirrors"; Gensler is a despicable person who can not be trusted to act in the best interests of American citizens.

Garmin: Serious Problem?

Karl:

Thanks for the commentary. Yes, you indeed know what you're talking about!

Garmin has a very serious problem. For anyone who is contemplating a purchase of one of their GPS products, if you want to verify what Karl is saying, do one of the following:
1. simply ask a few of your friends/ neighbors who have purchased a Garmin GPS; if they say it's working, ask them if they've used it within the past 2 weeks.

2. Go on line (e.g. Amazon) and pretend that you want to buy a Garmin GPS. Read the "reader reviews". You'll be amazed at the high incidence of "total failure" within a month of purchase.

Disclosure: I bot one last year; it lasted several months, then quit on me. This same event happened with several of my friends, as well.

Goldman says the euro will continue to gain on the dollar as risk tolerance returns to the markets. Firm thinks the timing's right to go long euro/short dollar.

Other commentators have already implied what I'm about to say here ... but, in essence: "When GS makes a pronouncement, be very, very skeptical; in fact, don't fall for it."

Daniel Harrison said it best: GS pronouncements are almost always the best contrarian indicator!

Telltale Signs That a Significant Correction Isn't Imminent

Couldn't have said it better than "doubleguns."

The great American financial scam continues! The big "investment" banks need to raise more capital through secondary offerings (i.e. to be read as "they need to find enough fools to buy their stock quickly!").

So barring a financial disaster during June:
the PPT, FED, and the master manipulators JPM and GS will do their best to keep the market from sinking in June.

The old addage: "sell in May and go away" is now, for 2009:
"sell quickly in July, before the ship sinks."


On Jun 02 08:12 AM doubleguns wrote:

> Kim, I believe you have nailed it!! Great insight.
>
> We can not stop the fleecing only protect against it. However I have
> had to get out of my shorts since the pain has been to much.
>

PIMCO's Bill Gross Sees a Bleak Future

In the bond market, there is no doubt that Bill Gross is King. However, when Geithner proposed "his" PPIP (disclosure: it was really developed by his GS cronies!), Gross lost all credibility when he proclaimed: "The PPIP is a WIN-WIN-WIN."

Yes, it's a Win-Win-Win for the banks, and a Lose-Lose-Lose for the taxpayer, who will pick up 93% of all losses. Any astute investor knows that. So I have to endores what James Quinn said, as noted below:


On Jun 02 09:57 AM James Quinn wrote:

> Gross is extremely smart, but he is now in bed with the Government.
> Nothing he says can be trusted.
>
> theburningplatform.com...

OBAMA'S BIG LIE

It's "Confession Time":
Sadly, I confess that I was a strong supporter of Obama ... a man I knew very little about. I distinctly remember one of his campaign pledges:

"I believe it is never appropriate for the President of the USA to lie to the American people." Barrack Obama, October 2008

=====

Fast Forward to May 2009:
Over the past few months, there have been a great many officials in the Obama administration who have lied repeatedly to the American people. Countless comments made by them (e.g. Geithner, Lawrence Summers, Rohm Emmanuel, Sheila Bair, etc.) were not only deceptive, but were outright lies. Add Bernanke to that bunch, though technically, the FED is supposed to be an independent entity). They knew it, and Obama knew it.

So maybe he will keep his campaign pledge; he will simply encourage his team to do the lying for him.