Author Topic: Wall Street Implosion  (Read 33955 times)

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #112 on: 09-30-2008, 01:37pm »
Your "say" in government is through those you elect to represent you. I shudder to think what a system of action through popular referenda would look like.

Yeah, the unwashed masses could never govern themselves.

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Offline NON

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Re: Wall Street Implosion
« Reply #111 on: 09-30-2008, 12:40pm »
First the "tax payer" really didn't get their say in the bail out.

I find this statement totally anathema to our system of governance. The tax payer absolutely gets their "say" via their elected representatives. Which was on full display yesterday when the plan tanked in Congress, in large part due to the terrible job the Administration and Congress have done in explaining and selling this plan to the people. The people spoke, and those in close elections voted overwhelmingly against the plan. Some districts reported calls 30 to 1 in opposition from constituents, some 500 to 1.

Your "say" in government is through those you elect to represent you. I shudder to think what a system of action through popular referenda would look like.

 :-[

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #110 on: 09-30-2008, 12:03pm »
They don't know the value, b/c the market is frozen. Someone needs to get things moving and try and lessen the uncertainty, or all credit markets will continue to tighten and further slow the economy. I doubt a coalition of coporations will get together and do this. I don't like the fact that the gov't has to step in, but I still think its better than the alternative of doing nothing. 

It's not clear that doing nothing is better than the plans on the table.  All alternatives are going to lead to tightening and slowing of the economy.  Housing prices are still going to drop and homeowners are going to default.  Currently, the plans appear to be throwing good money after bad.

Am not really sure your point here. "Smart" people got us into this mess, so "smart" people shouldn't be involved getting us out? I still think we should be listening to experts like Bernanke & Paulson vs some congress members who are facing re-election. 

Congress members are listening to their constituents...as they should.

duke

Offline missa

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Re: Wall Street Implosion
« Reply #109 on: 09-30-2008, 11:53am »
yea, I'm never convinced that a barrage of messages from angry constituents is really all that persuasive since it's not necessarily representative of voter demographic even in the face of elections.

Why should be be throwing money at a problem if even the banks don't know what they have and what it's worth as you have stated.

Since we don't know if throwing $700 bil at a problem is going to fix I vote against doing it. 

Let's not forget, it was the "smart" people that got us into this mess.  I have to believe these assets are over valued because they spun around the St. with such velocity with the intention of over valuing them for the sake of keep that market moving, which is why new securities (ie CDS) were created to bet against them, for the sake of hedging.

Also, I keep wondering why Wall St doesn't actually turn to corporations for a bail out, if it's considered so necessary to a recovery.  If these assets have any real value, why doesn't Microsoft, GE, Google, Alcoa  etc. buy them up to shore up our economy?  Some really "smart" investment banker should be able to create yet another new security to sell to these CEOs.  $700 Bil, really isn't that much to such institutions.

 




I took a few minutes of my time and wrote a nice long (most likely unread) email to a few of the Hudson County Representatives in Congress.  All but one voted against the bailout, which I find interesting.  


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Offline skwirrlking

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Re: Wall Street Implosion
« Reply #108 on: 09-30-2008, 11:32am »

Offline SamS

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Re: Wall Street Implosion
« Reply #107 on: 09-30-2008, 11:24am »
I also doubt it.  I just posed it to demonstrate that the tax payer shouldn't be forced to do it either. 

I doubt a coalition of coporations will get together and do this. I don't like the fact that the gov't has to step in, but I still think its better than the alternative of doing nothing. 

Let's not forget, it was the "smart" people that got us into this mess.


Am not really sure your point here. "Smart" people got us into this mess, so "smart" people shouldn't be involved getting us out? I still think we should be listening to experts like Bernanke & Paulson vs some congress members who are facing re-election.

« Last Edit: 09-30-2008, 11:30am by MCA »
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Offline skwirrlking

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Re: Wall Street Implosion
« Reply #106 on: 09-30-2008, 11:08am »
Why should be be throwing money at a problem if even the banks don't know what they have and what it's worth as you have stated.

Since we don't know if throwing $700 bil at a problem is going to fix I vote against doing it. 

They don't know the value, b/c the market is frozen. Someone needs to get things moving and try and lessen the uncertainty, or all credit markets will continue to tighten and further slow the economy. I doubt a coalition of coporations will get together and do this. I don't like the fact that the gov't has to step in, but I still think its better than the alternative of doing nothing. 

Let's not forget, it was the "smart" people that got us into this mess. 


Am not really sure your point here. "Smart" people got us into this mess, so "smart" people shouldn't be involved getting us out? I still think we should be listening to experts like Bernanke & Paulson vs some congress members who are facing re-election. 

Offline SamS

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Re: Wall Street Implosion
« Reply #105 on: 09-30-2008, 10:03am »
I couldn't agree with you more in this point. That has been my position from the beginning. Incidentally, I only used those corporations as a short list for a rhetorical example, as I imagine you suspect.



2) Why is Congress focusing on purchasing the packaged swap products?  Only a small percentage of those portfolios are actually defaulted. Simply focusing on the mortgages that actually default would be much cheaper to taxpayer and then Congress could sell the defaulted houses.  The difference would be the true loss.  This is, at a minimum, a *real* dollar figure.



duke

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Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #104 on: 09-30-2008, 09:57am »
recovery.  If these assets have any real value, why doesn't Microsoft, GE, Google, Alcoa  etc. buy them up to shore up our economy?  Some really "smart" investment banker should be able to create yet another new security to sell to these CEOs.  $700 Bil, really isn't that much to such institutions.

Market Caps of:
MSFT: $241 billion
GE:     $234 billion
GOOG: $124 billion
MO:    $ 41 billion

We're still $60 billion short if we sell the full amount of these companies.

duke

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #103 on: 09-30-2008, 09:52am »
1) I submit that this problem should be looked at from a regional standpoint.  Arizona, Florida, and California represent 20% of the US population and 50% of the foreclosures.  Do we really want three states to be the beneficiaries of $350 billion?

2) Why is Congress focusing on purchasing the packaged swap products?  Only a small percentage of those portfolios are actually defaulted. Simply focusing on the mortgages that actually default would be much cheaper to taxpayer and then Congress could sell the defaulted houses.  The difference would be the true loss.  This is, at a minimum, a *real* dollar figure.

3) IMHO, it's fucked up that Congress is taking a few days off right now for a holiday.  I really don't think much of their stimulus package, but the rest of us work when it's crunch time and this is a once in a decade deal.

duke

Offline SamS

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Re: Wall Street Implosion
« Reply #102 on: 09-30-2008, 09:48am »
yea, I'm never convinced that a barrage of messages from angry constituents is really all that persuasive since it's not necessarily representative of voter demographic even in the face of elections.

Why should be be throwing money at a problem if even the banks don't know what they have and what it's worth as you have stated.

Since we don't know if throwing $700 bil at a problem is going to fix I vote against doing it. 

Let's not forget, it was the "smart" people that got us into this mess.  I have to believe these assets are over valued because they spun around the St. with such velocity with the intention of over valuing them for the sake of keep that market moving, which is why new securities (ie CDS) were created to bet against them, for the sake of hedging.

Also, I keep wondering why Wall St doesn't actually turn to corporations for a bail out, if it's considered so necessary to a recovery.  If these assets have any real value, why doesn't Microsoft, GE, Google, Alcoa  etc. buy them up to shore up our economy?  Some really "smart" investment banker should be able to create yet another new security to sell to these CEOs.  $700 Bil, really isn't that much to such institutions.



 

 


According to WSJ:

"Monday's vote split both parties, whose members had been barraged all week with angry messages from constituents who opposed the bill.
Seems like some taxpayers had their say.

In terms of the give the money to the people argument, I don't think it addresses the problem of how to evaluate the bad assets on balance sheets. Until the banks have a better idea of what they have and what the companies to whom they loan have, credit will continue to be tighter for everyone - from commercial paper to car loans. Simply giving taxpayers $2,800foreachofyou ($700bn/250mm people to make the math simple) might be a short-term stimulus for the economy, but does not fix the problem.  Who knows if using the $700bn to help create a market for these assets will be the ultimate solution? I still think its better than doing nothing and will defer to the "smart" people on this one.

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Offline skwirrlking

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Re: Wall Street Implosion
« Reply #101 on: 09-30-2008, 09:05am »
First the "tax payer" really didn't get their say in the bail out. Furthermore, no one has crystalized the components of the $700B plan, why it's $700B, what "assets" are really being purchased, and where the market for them will eventually really exist. There's just a lot of "smart" people lobbying for the plan to "save the economy".  Just like there were "smart" people creating new fangled financial instruments, backed by, risky mortgages, to help improve the economy.  In light of are more recent history, you can't be surprised that the "tax payer" is a wee bit suspicious of the plan and the "smart" people who are boosters for it.  But assuming that the "tax payer" has any say in this, we actually have no real facts.   Negotiations on the terms are basically behind closed doors and we'll never know what terms are being bandied around.  Of course, many of the "tax payers" aren't intimately familiar with what would help move the economy forward, nor how to improve the "credit markets".  We rely on the "smart" people.  In fact some believe if we have $700 bill to throw around, why not use it to keep people in their homes, by forgiving first the challenging mortgages, then consumer debt and then student loan debt.  Wouldn't that  free up spending, ultimately supporting the "credit markets"?


According to WSJ:

"Monday's vote split both parties, whose members had been barraged all week with angry messages from constituents who opposed the bill. Among Democrats, 140 supported the bill and 95 voted against. Support among Republicans, who had revolted against an earlier iteration of the bill last week, was at the low end of what was expected by the House Republican leadership, with 65 in favor and 133 against.

In voting against the bill, conservatives who opposed government intervention were joined by many Democrats facing tight races in November. Other no votes were cast by House members from poorer districts, including members of the Congressional Black and Hispanic caucuses.

Of the 18 Democratic and Republican incumbents in close races -- classified "tossup" contests by the Cook Political Report -- just three voted for the bill. All six freshmen Democrats in tossup races voted against the bill."

Seems like some taxpayers had their say.

In terms of the give the money to the people argument, I don't think it addresses the problem of how to evaluate the bad assets on balance sheets. Until the banks have a better idea of what they have and what the companies to whom they loan have, credit will continue to be tighter for everyone - from commercial paper to car loans. Simply giving taxpayers $2,800foreachofyou ($700bn/250mm people to make the math simple) might be a short-term stimulus for the economy, but does not fix the problem.  Who knows if using the $700bn to help create a market for these assets will be the ultimate solution? I still think its better than doing nothing and will defer to the "smart" people on this one.

Offline SamS

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Re: Wall Street Implosion
« Reply #100 on: 09-30-2008, 08:34am »
First the "tax payer" really didn't get their say in the bail out. Furthermore, no one has crystalized the components of the $700B plan, why it's $700B, what "assets" are really being purchased, and where the market for them will eventually really exist. There's just a lot of "smart" people lobbying for the plan to "save the economy".  Just like there were "smart" people creating new fangled financial instruments, backed by, risky mortgages, to help improve the economy.  In light of are more recent history, you can't be surprised that the "tax payer" is a wee bit suspicious of the plan and the "smart" people who are boosters for it.  But assuming that the "tax payer" has any say in this, we actually have no real facts.   Negotiations on the terms are basically behind closed doors and we'll never know what terms are being bandied around.  Of course, many of the "tax payers" aren't intimately familiar with what would help move the economy forward, nor how to improve the "credit markets".  We rely on the "smart" people.  In fact some believe if we have $700 bill to throw around, why not use it to keep people in their homes, by forgiving first the challenging mortgages, then consumer debt and then student loan debt.  Wouldn't that  free up spending, ultimately supporting the "credit markets"?


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Offline skwirrlking

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Re: Wall Street Implosion
« Reply #99 on: 09-30-2008, 07:52am »
The administration did a terrible job selling this plan to the tax payer. It seems a lot of people think this is simply a $700bn bail out of Wall St. This is about restoring the credit markets. LIBOR is 7% this morning. With the cost of short-term debt this high, companies will definitely be shedding variable costs (i.e. labor). Good work creating jobs congress.

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #98 on: 09-30-2008, 12:16am »
And finally the crisis has metastasized...

Quote
The FTSE 100 index of British blue chip stocks closed down by 253 points, or 4.97 per cent, taking it below the psychologically significant threshold of 5,000 to 4,835.45 and to a new low for the year, down 28 per cent from the 6,730.71 level it reached on October 12, 2007.

The steep sell off of sterling and London shares came as agreement reached on Capitol Hill on a proposed $700 billion rescue plan for the US banking system was overshadowed by the latest woes for British and continental European banks. As well as B&B, the Belgian, Dutch and Luxembourg Governments nationalised parts of Fortis, the European banking and insurance giant, and agreed to inject €11.2 billion into the group.

...more...


It's going to be an interesting day in the world markets tomorrow.

duke

Offline jennymayla

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Re: Wall Street Implosion
« Reply #97 on: 09-29-2008, 08:54pm »
The news will be another blow to Hefner who recently discovered that two of his "bunnies" may have been cheating on him.

Holly Madison, who has previously been named as Hefner's "No.1" girlfriend, is alleged to have had an affair with magician Criss Angel and another bunny, Kendra Wilson, is reportedly dating football star Hank Baskett.

Playboy spokesman Rob Hillburger denied the rumours, saying: "The rumours that Holly left Hef for Criss Angel are not true. Holly and Kendra are all still living at the Mansion."


I knew there was a reason that Bridget was my fave! Bridget seems to be the only one who can keep her twat in her pants!  :D

Team Bridget!  YAY!

Every time Holly calls him "Puffin" I wanna puke.  And that Kendra is deeeeeesgusting.

Go Bridget!

This is such a perfect anecdote to the real news of today.  God bless the Playmates.

Offline NON

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Re: Wall Street Implosion
« Reply #96 on: 09-29-2008, 05:38pm »
777 is the new 252/3:37.


Offline rokroller

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Re: Wall Street Implosion
« Reply #95 on: 09-29-2008, 01:24pm »
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Offline TMN

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Re: Wall Street Implosion
« Reply #94 on: 09-29-2008, 11:32am »
The news will be another blow to Hefner who recently discovered that two of his "bunnies" may have been cheating on him.

Holly Madison, who has previously been named as Hefner's "No.1" girlfriend, is alleged to have had an affair with magician Criss Angel and another bunny, Kendra Wilson, is reportedly dating football star Hank Baskett.

Playboy spokesman Rob Hillburger denied the rumours, saying: "The rumours that Holly left Hef for Criss Angel are not true. Holly and Kendra are all still living at the Mansion."


I knew there was a reason that Bridget was my fave! Bridget seems to be the only one who can keep her twat in her pants!  :D
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Online Soshin

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Re: Wall Street Implosion
« Reply #93 on: 09-29-2008, 08:21am »
I guess Hef's 83-year old schlong just ain't what it used to be.
"god hates you. you will all go to yuppie hell. in yuppie hell there is no starbucks or hole foods or sushi bar. in yuppie hell you will work 16 hours a day in a bodega. in yuppie hell your car will not start when the sweeper is coming down the street. in yuppie hell your doorman will terrorize you and have sex with your wife or husband...when you are at work....in the bodega. in yuppie hell you will go to the laundromat and lose your last quarter in a broken washing machine. in yuppie hell you will buy all your food and clothing at the 99 cent store. in yuppie hell there are no cell phones, you will use a pay phone. a filthy pay phone".      -   Cat_Man Dude

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #92 on: 09-28-2008, 10:45pm »
Duke, we live in strange times when I can't tell if a news story is written by the Onion or the Daily Telegraph.

Awesome story, either way.


Sorry, it's a real story.  I couldn't pass up the opportunity to post a pic of playboy bunnies in a financial thread.

duke

The sad part is that I know who Kendra is from watching The Girls Next Door and am frankly aghast at the awful, awful lies being spread about her.  Stay strong, Kendra!

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #91 on: 09-28-2008, 10:40pm »
Here we go, the pigs are at the trough now that it's been roundly agreed that we should take money from the taxpayers...it's time to make the rich richer again.  I can't really blame Buffet for taking advantage of the situation.

duke

Quote
What Warren Buffett Wants
Arnold Kling

He favors the bailout.

Without in any way impugning his motives, let me state the impact on Warren Buffett personally if the bailout is enacted.

Think of the mortgage securities market as the World Series of Poker. In fact, a great book about it is Liar's Poker, by Michael Lewis. Lewis was a trainee at Salomon Brothers, and he learned phrases like "Big Swinging D___," which describes a swaggering, aggressive mortgage banker. Henry Paulson fits the model.

The best players in this World Series of Poker are the folks at Goldman. They hired Fischer Black and other geniuses back when the markets were first getting going. They have typically had the best squad of geeks around.

Buffett just bought a stake in Goldman. That stake would be a lot more valuable if there were actually a poker game--that is, if mortgage securities were still trading. Right now, they're not trading. So Goldman is sitting there ready to play and no one is ready to play with them.

Along comes Uncle Sam, who wants to take a one-hour lesson in poker and then sit down and play in the World Series with $700 billion in chips. And whaddaya know? Warren Buffett thinks Uncle Sam really has to get in the game.

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Re: Wall Street Implosion
« Reply #90 on: 09-28-2008, 05:19pm »
Duke, we live in strange times when I can't tell if a news story is written by the Onion or the Daily Telegraph.

Awesome story, either way.

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #89 on: 09-28-2008, 03:26pm »

Quote
Hugh Hefner to sack Playboy bunnies amid financial crisis
Playboy bunnies have become the latest victim of the credit crunch.
 


By Charlotte Bailey
Last Updated: 10:17AM BST 25 Sep 2008

Tycoon Hugh Hefner has been advised to cut back on staff at his multi-million dollar glamour empire as it struggles to cope during the global economic turmoil.

The 83-year-old has been told to lay off some of his staff at his Los Angeles and New York offices as soon as this month or go bankrupt.

The company has recently seen shares fall from £6.20 to £1.55.

An insider at the company told the Daily Star that bosses had been aware of the worsening situation for "a while".

"Only the top brass has known for a while how bad things have been for Hef recently."

Spokeswoman Elizabeth Austin would not confirm the sackings, saying: "It is our policy not to comment on corporate matters such as employee issues."

The news will be another blow to Hefner who recently discovered that two of his "bunnies" may have been cheating on him.

Holly Madison, who has previously been named as Hefner's "No.1" girlfriend, is alleged to have had an affair with magician Criss Angel and another bunny, Kendra Wilson, is reportedly dating football star Hank Baskett.

Playboy spokesman Rob Hillburger denied the rumours, saying: "The rumours that Holly left Hef for Criss Angel are not true. Holly and Kendra are all still living at the Mansion."

Offline duke_of_earl

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Re: Wall Street Implosion
« Reply #88 on: 09-25-2008, 11:31pm »
Another one bites the dust...

duke

Quote
WaMu Fails, Is Sold Off to J.P. Morgan
Biggest Banking Collapse in U.S. History; Government Arranges a Deal to Safeguard Huge Thrift's Deposits, Branches
By ROBIN SIDEL, DAVID ENRICH and DAN FITZPATRICK

In what is by far the largest bank failure in U.S. history, federal regulators seized Washington Mutual Inc. and struck a deal to sell the bulk of its operations to J.P. Morgan Chase & Co.
...more...


Jersey City, NJ Community Forums

Re: Wall Street Implosion
« Reply #88 on: 09-25-2008, 11:31pm »