Like the lyrics of guns'n'roses puts it: "it's so hard to hold a candle in the cold November rain." As we approach and plummet thru the horrendous November 08 lows, can we even find a shed of light to guide us out? AIG's at its maximum 79.9% Gov bailout (unable to legally take anymore Government money), Citi is rumored to be in talks of nationalization, the US carmakers STILL need more money even after their bobbled-headed nods n smiles convinced us otherwise, the financials rallied with no inkling of support from any other sector today (and it was only on the possssssssibility of nationalization which Obie's dog even barked it last on her list), Geithner has yet to speak about anything more than another outline and perhaps a Pizza party at the local Chucky Cheese where he plays Chucky's younger half-brother Marco, and we still have 2-3 of the toughest yrs of sub-prime crappage to wade through...Not to mention that we are still overleveraged compared to the total asset value that's available, we have a continually slowing velocity of money and we have no way of borrowing overseas with such an inflated dollar price to everybody else (also since we've already killed our interest rate AND we've over-extended ourselves in first place)...So now we've come up to either letting the contractionary period persist or print more (a buncha fat ppl more) cash to front load M1 and M2 and pray that the gov return brings the treasuries up for ppl who have literally thrown their money at T-bonds worth zilch when in actuality the velocity of money is only matchin the contraction from derivatives and thus has no "real" asset backing to ever increase the value of that money. But it's okay!!! We'll survive (NOT!)!! I feel like I'm ranting about the same shit! WTF?! Someone LISTEN TO ME!!!!! (I feel like a cow chewing the same cud over and over and over again cuz i got like 4 stomachs n none of them can digest the same shit...)
Step 1: STOP WHAT YOU'RE DOING!!!! ONLY RESCUE THE MOOOOOST NECESSARY = AIG (and supply a few banks like JPM, GS and a buncha regionals with enough cash to back all the deposits that will be flooooding in. This cash will be significantly less than actually saving all the shittttty banks like C, BAC, WFC, USB, etc from dying out)
Step 2: Make sure that future regulations and laws are in place to prevent fraud and illegitimate children deals that put us back into this predicament again
Step 3: Hire a SHITLOAD of ppl to work the bankruptcy offices (prolli a buncha those ppl who lost their jobs) -- I guess we can do some infrastructure too as long as we keep with the war AND infrastructure jobs are legitimate like.. building bridges or restoring railroads...not makin gov buildings prettier...
Step 4: FIRE anyone associated with the ridiculous models that existed in all of these god forsaken tootsie roll suckin owlz that just care to get to the middle of the lollipop without any fuckin rhyme or reason...
Step 5: Setup senior life support and a buncha ghetto fab housin for all the unemployed
Step 6: DUCK AND COVER!!!!!
Step 7: WATCH!!! A whole shitload of M&A will eventually come out of this (give it a yr or 2) with a helluva strong dollar AND another shit load of companies will buy themselves private due to the liquid to asset ratio they have. ALL of the overleveraged, triple-spined, quadruple jointed carnivorous companies will cannibalize themselves...(what's it called when someone eats himself?!??) and we will RESET the whole fuckin US economy...in fact, the whole GLOBAL economy bc a few other countries like China and Brazil will FEAST on the feebled toooo!!!!
Step 8: FIRE Obama's ridiculous staff and send him back to his all talk, no walk, unfit for accompanying nomads who don't understand that its pointless to walk an endless journey around in circles to find yourself when you're standing right fucking there...shit...look in a goddamn reflection once in a while...
Let's put it this way, just go find some shelter and a blanket cuz itll be a damn cold year and you'd better keep dem matches to start a fire instead of wastin them on candlez in the rain!! November 09 is setting up to be much worse than 08. (Sub-prime part 2).
Monday, February 23, 2009
Tuesday, February 17, 2009
Farewell Obie...
Mr. Obama,
There comes a time in everyone's life when they have to admit that they just don't have the cahones to do the job...And after reading that a total of 20 House and Senators actually discussed and added value to the stimulus package and there was a total of 5...thats right FIVE copies of the stimulus bill at hand for everyone to read and because of this some of the senators and house members didn't even read the stimulus before they voted?! for shame on you! Especially after your speech about transparency and vigilant eyes... Mr. Obama, I don't think you deserve the title President. So far, in your first 30 days in office, you've added in ridiculous things to the stimulus package like STD research and unnecessary government building refurnishes, you've literally taken the market back to its November lows by refuting any type of outright stand on any formidable idea to resurrect this economy from the now inevitable depression and your plan has nothing to do with the problems of today nor will they fix anything in the future. The stimulus is partitioned 20% 2009, 40% 2010 and 40% 2011 when everyone knows that if you are going to inject money it better be now. The bad bank idea is suddenly foregone for a new lesser obvious allusion to a toxic bank. Your treasury secretary's plans for getting out of this predicament is nothing more than a laundry list of ideas that have already been discussed from the previous regime (minus the stress test, which I do admit is a good idea), and while all the ideas of HOPE, as you state it, can be flung around by the way side, implementation, execution, and reality should be your only concerns. The reality of it is that we are heading towards a Depression-like pre-Clinton un-adjusted unemployment rate of 25% and you have no idea how to fix it. Our currency is getting stronger by the minute which should tell you that we will have no way of selling ourselves out of this mess because no country will want to invest in us. On top of that interest rates are at an all time low across the globe and yet still we have only slightly budged off our high horse in the credit markets, we cannot expand within!! And our beautiful safety net Gold (now regaining its bubble-like status) can only dictate everyone's state of mind and how obvious it is...that in every currency...gold is approaching its high. The de-stabilization of currencies could cause a deeply disturbing riptide that will annihilate all of the sovereign funds that have so ignorantly obtained our assets and we have so ridiculously extended ourselves. With all who have invested in our assets and sub-assets, we will be in trouble and there is nothing we can do but wait. Oh, Mr. Obie, you do not know the crisis that we are in and you do not know the repercussions that you will incur with the lack of execution by any means of the term. Your words instill false hope of prosperity that will never be obtained with this path of flux and indecision.
If left up to me, I'd let the MARKET DECIDE, but given your limited knowledge of the situation and the fact that you lean too much on your advisory committee to execute something more implementable so that when we come out of this depressed state, you will seem the victor...I would recommend something like this:
Nationalize the banks. Assume the risk of the bad assets and use the good assets on balance sheet to suffice for much needed liquidity. In the meantime, increase the Fed interest rate at which the remaining banks borrow from you while subsidizing the interest increase with a tax cut on specific spending for the people (namely housing and necessary loans). The reason for this is to increase velocity at which a dollar circulates. This pseudo-inflation will have a ripple effect because the good banks with more cash won't borrow from the Fed but invest in other things because the fed rate is too high and the perceived risk/reward of "safety" is lower. The banks out there that are still struggling will pay a slight premium for their disservice to the community but they should also be able to stay afloat due to the increase in the velocity of M1 and M2 and thereby the increase in the amt of debt one can handle on a balance sheet.
To counter the unemployment rate, we need to setup funding and jobs (think military stylistics) for unemployed people. They will have free room and board if they need it and a government allotted subsidy only allowed for necessities. This will last for six months and during this time, they will await an assignment to do a particular task and then get trained for that task. Due to the evolution of a white-collared society, we will give these people an ultimatum of "whatever is available for work" or "going to war". The pay will be a certain percentage above minimum wage which will be determined by ranking. If someone refuses either of these options, they will be stripped of citizenship and deported. If one is able to sustain with the money they own, then there will be no consequence and they do not need to fulfill these duties and we will remove them from "unemployment ranks".
To counter the dollar, we will increase supply of bonds available to smaller countries. We can't do this right now because our T-bond rate would go negative but if we raise Fed rate steadily to 1% or 2%, we will have some room to play with the T-bond space. Now, the reason for doing all of this is because the euro will probably dissociate due to most countries not being able to adjust currency but we can definitely be the levered currency. By increasing the supply of bonds, and having certain countries lever themselves to our "stability" we bring up more of the world's currency together (and prevent more free-fall) and we effectively invest in these countries' currencies at a low price. In doing so, we keep our dollar value less inflated compared to the world and keep the rest of the world from imploding.
Of course there will still be some long term ramifications (unlike the complete market reset, which will better us in the long term), Mr. Obama, but at least we mediate the damages and we come up with a baseline that wasn't determined by arbitrary values.
But of course, you won't do that because it's not what you had in mind for all the "Joe Plumber's" in the world... oh well...Mr. Obama...I bid you farewell now...please hear my call before its too late!
There comes a time in everyone's life when they have to admit that they just don't have the cahones to do the job...And after reading that a total of 20 House and Senators actually discussed and added value to the stimulus package and there was a total of 5...thats right FIVE copies of the stimulus bill at hand for everyone to read and because of this some of the senators and house members didn't even read the stimulus before they voted?! for shame on you! Especially after your speech about transparency and vigilant eyes... Mr. Obama, I don't think you deserve the title President. So far, in your first 30 days in office, you've added in ridiculous things to the stimulus package like STD research and unnecessary government building refurnishes, you've literally taken the market back to its November lows by refuting any type of outright stand on any formidable idea to resurrect this economy from the now inevitable depression and your plan has nothing to do with the problems of today nor will they fix anything in the future. The stimulus is partitioned 20% 2009, 40% 2010 and 40% 2011 when everyone knows that if you are going to inject money it better be now. The bad bank idea is suddenly foregone for a new lesser obvious allusion to a toxic bank. Your treasury secretary's plans for getting out of this predicament is nothing more than a laundry list of ideas that have already been discussed from the previous regime (minus the stress test, which I do admit is a good idea), and while all the ideas of HOPE, as you state it, can be flung around by the way side, implementation, execution, and reality should be your only concerns. The reality of it is that we are heading towards a Depression-like pre-Clinton un-adjusted unemployment rate of 25% and you have no idea how to fix it. Our currency is getting stronger by the minute which should tell you that we will have no way of selling ourselves out of this mess because no country will want to invest in us. On top of that interest rates are at an all time low across the globe and yet still we have only slightly budged off our high horse in the credit markets, we cannot expand within!! And our beautiful safety net Gold (now regaining its bubble-like status) can only dictate everyone's state of mind and how obvious it is...that in every currency...gold is approaching its high. The de-stabilization of currencies could cause a deeply disturbing riptide that will annihilate all of the sovereign funds that have so ignorantly obtained our assets and we have so ridiculously extended ourselves. With all who have invested in our assets and sub-assets, we will be in trouble and there is nothing we can do but wait. Oh, Mr. Obie, you do not know the crisis that we are in and you do not know the repercussions that you will incur with the lack of execution by any means of the term. Your words instill false hope of prosperity that will never be obtained with this path of flux and indecision.
If left up to me, I'd let the MARKET DECIDE, but given your limited knowledge of the situation and the fact that you lean too much on your advisory committee to execute something more implementable so that when we come out of this depressed state, you will seem the victor...I would recommend something like this:
Nationalize the banks. Assume the risk of the bad assets and use the good assets on balance sheet to suffice for much needed liquidity. In the meantime, increase the Fed interest rate at which the remaining banks borrow from you while subsidizing the interest increase with a tax cut on specific spending for the people (namely housing and necessary loans). The reason for this is to increase velocity at which a dollar circulates. This pseudo-inflation will have a ripple effect because the good banks with more cash won't borrow from the Fed but invest in other things because the fed rate is too high and the perceived risk/reward of "safety" is lower. The banks out there that are still struggling will pay a slight premium for their disservice to the community but they should also be able to stay afloat due to the increase in the velocity of M1 and M2 and thereby the increase in the amt of debt one can handle on a balance sheet.
To counter the unemployment rate, we need to setup funding and jobs (think military stylistics) for unemployed people. They will have free room and board if they need it and a government allotted subsidy only allowed for necessities. This will last for six months and during this time, they will await an assignment to do a particular task and then get trained for that task. Due to the evolution of a white-collared society, we will give these people an ultimatum of "whatever is available for work" or "going to war". The pay will be a certain percentage above minimum wage which will be determined by ranking. If someone refuses either of these options, they will be stripped of citizenship and deported. If one is able to sustain with the money they own, then there will be no consequence and they do not need to fulfill these duties and we will remove them from "unemployment ranks".
To counter the dollar, we will increase supply of bonds available to smaller countries. We can't do this right now because our T-bond rate would go negative but if we raise Fed rate steadily to 1% or 2%, we will have some room to play with the T-bond space. Now, the reason for doing all of this is because the euro will probably dissociate due to most countries not being able to adjust currency but we can definitely be the levered currency. By increasing the supply of bonds, and having certain countries lever themselves to our "stability" we bring up more of the world's currency together (and prevent more free-fall) and we effectively invest in these countries' currencies at a low price. In doing so, we keep our dollar value less inflated compared to the world and keep the rest of the world from imploding.
Of course there will still be some long term ramifications (unlike the complete market reset, which will better us in the long term), Mr. Obama, but at least we mediate the damages and we come up with a baseline that wasn't determined by arbitrary values.
But of course, you won't do that because it's not what you had in mind for all the "Joe Plumber's" in the world... oh well...Mr. Obama...I bid you farewell now...please hear my call before its too late!
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