Global Financial Crisis 2008

The Big Short - Inside the Doomsday Machine
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Based on reading Michael Lewis' Liar's Poker and Moneyball, I wondered whether The Big Short would prove to be entertaining and informative. If you've read some of Lewis' books, you might agree that the "entertaining" part would seem to be a reasonably safe bet. It turns out, it is. The Big Short is fast-paced, straightforward, conversational and salty--very much like his earlier works. Indeed, if you didn't know Michael Lewis had written this book, you could probably guess it. It is easy reading and very hard to put down. In short (no pun), The Big Short doesn't disappoint in being entertaining........

This is a very interesting, entertaining and informative book that accomplishes what it sets out to do. Chances are you'll enjoy it.
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Michael Lewis was on the inside. He knows what he talking about and lets us, the little people know.

 

The Financial Crisis A Libertarian Perspective
A real economist writes - that is not necessarily a good sign but he insists on evidence of what works and what does not.

 

Banks Survive 5 MPH Bumper Test
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With great fanfare it was leaked (at strategic market moments throughout the week) and then announced that the 19 largest banks all passed the so-called "stress tests." Under a test track of their own choosing, and with the ability to negotiate the interpretation of the damage resulting from an ultra low-speed collision, the banks have now been proclaimed "safe at any speed."
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Do you feel more relaxed when they start lying to you? I don't. Perhaps I am paranoid.

 

Financial Regulation Explained
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Our view of the economy is governed by three fantasies. One is the currently [ 2009 ] unfashionable illusion of eternal boom. Second is the now dominant delusion of doom. Experience tells that these visions, while harmful, express errors that are ultimately self-healing. It is the third of the illusionary prejudices about which we need to worry. It is the illusion of regulation. Those infected by this fantasy assume that the current crisis could have been prevented and can be overcome by devising new regulatory instruments. Do you suspect that the crisis came about because existing regulations have failed? In that case you will be concerned by the effect of the rules about to be imposed upon us. Of the three illusions, the regulatory one is the most dangerous because its exaggerated assumptions become institutionalized. Therefore, the fallacy's harmful consequences can not be overcome by nature asserting itself. Politics will make the correction of the wrong regulations long and tortuous.
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Good sense is rare, especially when big, big money is involved.

 

Financial Problems Solved
Germany and Adolf Hitler had the same problems but worse. They were sorted and the system keeps very quiet about how it was done. This is an important clue pointing to the perpetrators. How many bankers are stinking rich? More to the point how many are poor now?

 

Protecting Yourself From The Next Bernie Madoff
There are some straightforward things to do. Ask the right questions and sleep sound at nights.

 

South Sea Bubble
Is any of this new? Not a chance. We have been there before. The trouble is that people have forgotten. The comedian that worked this one went on to do it to the French as well. He was another Jock, just like Brown.

 

Mississippi Company
This was when the French tried to get something for nothing. They came unstuck.

 

Tulip Mania
It happened to the Dutch too.

 

Wall Street Under Oath: The Story of Our Modern Money Changers
Was written by Ferdinand Pecora after he did a major inquiry into the Wall Street crash of 1929. The moral is clear: The more things change, the more they stay the same.

 

People

Capitalist Fools?
Capitalist fools or capitalist rogues? Vanity Fair tells us about the players.

 

Ronnie Regan Fool Or Rogue?
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No. 1: Firing the Chairman
In 1987 the Reagan administration decided to remove Paul Volcker as chairman of the Federal Reserve Board and appoint Alan Greenspan in his place. Volcker had done what central bankers are supposed to do...... Volcker also understood that financial markets need to be regulated. Reagan wanted someone who did not believe any such thing, and he found him..... Greenspan played a double role. The Fed controls the money spigot, and in the early years of this decade, he turned it on full force..... A flood of liquidity combined with the failed levees of regulation proved disastrous.  
UNQUOTE
This is fair criticism from Joe Stiglitz as far as it goes which is not far enough to be honest about his own complicity in the 'liar loans' that did so much to cause the collapse. He does not mention that Greenspan was confirmed by the Senate, Bush, Clinton and Bush Mark II.

 

Warren Buffet - The Sage Of Omaha
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Add Warren Buffett to the list of people to blame for the financial crisis: The Oracle of Omaha made a huge profit investing in Moody's, a firm that gave toxic assets the holy triple-A rating. Will anyone escape unscathed by responsibility from the great financial crisis? Not, it would appear, Warren Buffett, the revered Oracle of Omaha. One of the faulty pillars that brought the whole house crashing down was the super-safe, triple-A investment ratings awarded to what we now know were "toxic assets."......... By 2008, while there were still only 12 triple-A-rated corporations in the world, there were more than 64,000 triple-A-rated debt packages with a face value of some $3 trillion, spreading like kudzu through the global banking system.

After Moody's Corp. went public in 2000, Warren Buffett's holding company, Berkshire Hathaway, invested just under $500 million, making it by far Moody's largest shareholder. At the time, Moodys was a stodgy bond-rating company that, together with Standard & Poor's and Fitch, enjoyed what amounted to a government-backed monopoly on issuing investment ratings.

The most coveted grade is triple-A, which implies a very low risk of default and allows corporations to sell these bonds to insurance companies, pension funds, and other institutions that are restricted by law to the safest investments. The ratings firms play a double role, both evaluating the risk of a company's debt and for additional fees offering consulting services to help a company raise its score to triple-A.........

Buffett is not only one of the savviest investors in the annals of capitalism; he is also one who prides himself on scrutinizing his major investments. So he must have been aware that Moody's immense profit was based on the proliferation of derivative-backed debt. He is also well-acquainted with credit default swaps which were the window dressing used to justify triple-A ratings because Berkshire Hathaway is one of the major sellers of them.
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The writer seems to know what he is about. He could well be right.

 

Greenspan Fool Or Rogue?
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President Reagan nominated Dr. Greenspan..... as chairman of the Board of Governors of the Federal Reserve,... After the nomination, bond markets experienced their biggest one-day drop in 5 years. Just two months after his confirmation he was faced with his first crisis, the 1987 stock market crash. His terse statement that the Fed "affirmed today its readiness to serve as a source of liquidity to support the economic and financial system"  is seen by many as having been effective in helping to control the damage from that crash. Another famous example of the effect of his closely parsed comments was his "irrational exuberance and unduly escalating stock prices" that led Japanese stocks to fall 3.2%.
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He kept a lot of people happy for a long time. Now that chickens are coming home to roost fingers are being pointed. The criticisms have a large measure of truth. He let a lot of rogues get away with it.

 

Madoff Fool Or Rogue?
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But on Thursday morning, this consummate trader, Bernard L. Madoff, was arrested at his Manhattan home by federal agents who accused him of running a multibillion-dollar fraud scheme, perhaps the largest in Wall Street's history.........
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Stealing $50 billion is big time thieving. Gambling the lot away is incompetence as well. You might wonder why he bothered. Most men would settle for a billion without any difficulty.

 

Paulson Fool Or Rogue?
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Notable statements
In Spring 2007, Secretary Paulson told an audience at the Shanghai Futures Exchange that "An open, competitive, and liberalized financial market can effectively  allocate scarce resources in a manner that promotes stability and prosperity far better than governmental intervention."  
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He was trying to calm us down or did not really know what was going on. Mr. Gilani in The Global Financial Crisis Explained goes with the latter view. I am not sure. Some problems are just too big. Albeit Hank wanted the absolute authority to spend $700 billion with the slightest accountability or oversight. A man could get even richer that way. He might be a Useful Idiot or just useful.

 

Charles Ponzi Fool Or Rogue?
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The sensational rise and fall of Charles Ponzi attracted some attention this side of the Atlantic. The Times christened him the "whirlwind financier", and on July 28, 1920, reported on an amazing "get-rich-quick" scheme [ click on the links for the original Times reports ]:
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The mug shot is a give away. How long did he get? The Times reported on the man and his times in real time. Greed is a constant. Fear is a variable. Ignorance is dangerous.

 

Bill Clinton Fool Or Rogue?
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Today's subprime mortgage meltdown began with a lofty, deliberate, fuzzy-headed effort by the Clinton administration to turn more Latinos and blacks into homeowners, or so it appears from 1999 news reports buttressed by hard data from a 2007 study of subprime lending. Yesterday's soft and cuddly government program is today's financial chainsaw massacre. Far from an illustration of free-market dysfunction, today's mortgage mess is a classic case of socialistic governmental intervention gone awry.
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Clinton was brought up in Hot Springs, Arkansas's answer to Sodom and Gomorrah. It didn't get any better. There was the Waco Massacre. Forcing banks to lend to minorities [ code for blacks and Hispanics ] who couldn't pay back was setting up a disaster down the line.

 

George Bush Fool Or Rogue?
That is easy. Unmitigated evil is the agenda. Whether he wrote it is or was just the front man is another matter but the White House was full of Zionist Jews who certainly made matters worse. The results are dreadful either way.

 

Ben Bernanke Fool Or Rogue?
It is too early for me to say. Given that he is another Jew I am not optimistic.

 

John Law
Was the Scot who gave us the  South Sea Bubble in England and the Mississippi Company in France while on the run from a murder rap.

 

Robert Rubin Fool or Rogue?
A Jew who worked for Clinton. This is not a recommendation.

 

Rutting Chimp Dominique Strauss-Kahn
Kahn ran the International Monetary Fund when he wasn't fornicating or raping. A vicious bully, the sort of Jew we do not need anywhere near the levers of power.

 

Stiglitz Fool Or Rogue?
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Joseph Stiglitz is a professor of economics who go a Nobel prize which means that he is intelligent and part of  the Establishment. It is does not mean that he is right. He tells us that Al Greenspan is part of the problem but glosses over his own role. Advizing Clinton to make firms lend to people who couldn't pay back, to make 'liar loans' was a certain road to disaster and he knew it. The problem blew up years later, after the 2001 Nobel award and the cheque had cleared. I settle for rogue.  He is great at running other people down. He is mouthy. You have to give him that as well as being a Jew. But read for yourself, think for yourself and decide for yourself.
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He comes across as arrogant and mouthy. See the mug shot; make the decision.

 

The Times Fingers The 10 Most Guilty
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The global financial crisis has evolved into a worldwide recession of epic proportions. Analysts fear the sudden slump which has followed the credit crunch could even rival the Great Depression of the early 1930s and lead to global stagnation. But who is responsible? The bursting of the housing bubble and the collapse in confidence throughout financial markets was not caused by one individual or a single decision, so pointing the finger of blame is a near-impossible task. But Times Money has given it a shot...................

1. Dick Fuld
Multi-billionaire and US squash all-star Dick Fuld, 62, was CEO of Lehman Brothers when it went bust in September last year. Dubbed the "scariest man on Wall Street", Dick Fuld is blamed for a litany of mistakes that include leaving Lehman Brothers heavily exposed to toxic US sub-prime mortgage debt and other assets that collapsed in value in the wake of the credit crunch.

2. Hank Paulson
If Dick Fuld is responsible for the collapse of Lehman Brothers, Henry Paulson, the former US Treasury Secretary, is the man who let it happen. Anatole Kaletsky, of The Times, says: "The global banking collapse could perhaps be described as a bullet in the head, since its proximate cause was a conscious decision by the US Treasury to jeopardise the stability of the world economy in pursuit of an essentially political objective........... [ Take ANYTHING Kaletsky says with a large grain of salt - Editor ]...... Hank didn't just let Lehmans fail. He made a series of mistakes in the run up to the Lehmans collapse. He also proposed a 700 billion package [ $$s actually ] to boost the US banking system. And how did Hank come up with a figure of 700 billion? "It's not based on any particular data point", a Treasury spokeswoman told Forbes.com, the US financial website. "We just wanted to choose a really large number."

3. Alan Greenspan
Alan Greenspan was feted for his management of the US economy while he stood in charge of the US Treasury, but has since been put under the spotlight. He was responsible for cutting interest rates to near zero in the US in the aftermath of September 11, flooding the world with cheap and easily available money...........

4. John Tiner/Hector Sants
John Tiner was in charge of the Financial Services Authority, the watchdog that polices the UK's complex financial services industry until 2007, when it was taken over by Hector Sants. The FSA failed to keep a close eye on Northern Rock, the Newcastle-based ex-mutual which gorged on wholesale mortgage securitisation and came a cropper as a result. A key parliamentary committee has said that the FSA was guilty of a "systematic failure".

5. Fred "the shred" Goodwin
The "world's worst banker" has brought the Royal Bank of Scotland (RBS), Britain's second biggest bank, to its knees. Last week it announced humiliating losses of �28 billion, the biggest in British corporate history, and economists and analysts have concluded that it could soon be fully-nationalised. In mid-January, taxpayers saw their stake in the banking giant increase from 58 per cent to 70 per cent.

6. Gordon Brown
Apparently Gordon Brown predicted the global financial crisis ten years ago, in a speech he made to Harvard students. Sadly he did little to prevent it. James Gordon Brown was Chancellor of the Exchequer during the longest period of growth in the UK's history, but economists blame Mr. Brown for encouraging soaring house price inflation and the spread of credit which fuelled the years of boom and led eventually to the current bust.

7. George Bush
The former President was in charge during the boom years when the seeds of the sub-prime implosion were sown, but has failed to take any responsibility for the financial disaster which occurred on his watch. In a speech last year he blamed the bankers in New York for the problems facing his country's economy.

8. Kathleen Corbet
The credit rating agencies have been blamed for failing to ask tough questions about the collateralised debt products containing so many toxic sub-prime mortgages, which investors traded for millions of dollars during the booming housing years.....

9. "Hank" Greenberg
Another Hank. This one was head of AIG, the insurance giant that had to be rescued in an $47 billion US government bailout just days after Lehman Brothers was allowed to go bust. Hank was in charge between 1967 until 2005, during which time the insurer got heavily involved in the murky world of credit default swaps.

10. Angelo Mozilo
Mr. Mozilo was head of the largest sub-prime mortgage lender in the US, Countrywide, until July 2008. Sub-prime lenders in the US have been accused of using misleading marketing to push unsuitable mortgages on sub-prime homeowners who could not afford to service the debt,........ Mozilo reportedly earned $470 million [ make that paid himself - Editor ] in salary and other income.
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Bush is a fool and a rogue who was used by cunning rogues. Brown is a gross spendthrift and still very dangerous. Add in one innocent. Eliot Spitzer tried to stop thieving on Wall Street and got screwed big time. Here is a picture of the whore he paid for with his very own money unlike various crooks.