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Friday, November 18. 2011
I'm not inclined to believe conspiracy theories, and the thought that Jon Corzine would comply with something along these lines seems absurd. But Jon is very well connected and does have an interest in maintaining the strong link between the government and Wall Street. That link, however, is starting to show signs of wear. Between Tea Partiers and OWS complaining about crony capitalism, and the fact that market rigging only lasts so long before it collapses on itself, we may well be seeing the end stages of the game being played out.
From that standpoint, a 'hit' on MF Global would make perfect sense. It's true that even in the best economic conditions, speculators are viewed as evil. The balance they bring to prices and markets, as well as the liquidity they provide, are overlooked because they operate in a realm many people simply don't understand. As a result, there is a belief that somehow speculators 'control' market outcomes. Nothing is further from the truth, but it is a widely held concept.
Did the Fed want to see some pressure taken off upward price movements? Yes. Will this help? Yes. Does this undermine markets further? Yes. Does this increase the uncertainty which is keeping our economy from moving forward? Yes.
We can ask many other questions, but none will answer whether or not this was a hatchet job. My guess? It wasn't, it was just mismanagement. But there is an awful stench coming from this whole affair.
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I think it's just risk-taking, and the counterparties got spooked. Corzine has always needed to be a BSD.
The concern, of course, is the handling of the clients' funds - and the ripple effect of MF's demise.
This seems like a conspiracy theory on steroids. To believe in the "hit" suggested, we are asked to accept that Corzine would be complicit in a conspiracy that would deliberately destroy his own reputation and subject him to criminal charges on a Bernie Madoff scale. Furthermore, none of the speculation about the "hit" does anything to explain how the $600 million disappeared. We will know in a few days, but I can't see any other reasonable possibility than comingling of funds in a last gasp effort to make up losses. I have as much trouble contemplating this as a "hit" as I have in the 9-11 conspiracy theories.
I have no trouble at all seeing it as a part of the deliberate attack on the free market that you can look into by searching 'the Freeman Report' --for starters.
I think it's just mismanagement.
However, I'm also sure the Fed was quite pleased because the collapse allows them to continue their misguided plan, while claiming "the system works".
Sometimes, things just happen the way people want and it has the appearance of being planned. I believe that's the case here. Which isn't to say the cronies aren't all happy about it....
Look into why Gary Gensler recused himself from the case, Bulldog. MF Global was hustled into the fast lane as soon as Corzine got defeated by Christi. The list of special treatment is perfectly designed to allow another 'head case' CEO --like Cassano at AIG London and Dick Fuld at LEH, to go wild for a short length of time, during which the sales forces in all three cases were suddenly granted bonuses three and five times greater than normal, before 'all fall down' --on the strength of huge overlevering right under the noses of regulators --Gensler, Shapiro, Geithner, the usual SEC, NY Fed which licenses the dealers, and in MFG's case, the Commodity Futures Trading Commission --Gensler the chair. Look at Gensler's bio --the wiki if nothing else. And the mechanicals --off balance sheet liabilities, LEH's 'Repo 501', a replay of Enron designed by Gensler when he was at Goldman Sachs on leave to Enron. MFG's same trick, but stashing the trash in Euro bank sovereign debt --now that Repo 501 is 'closed'.
Notice the planted international articles --Russia's down spiral demographics, China's miff at a Marine brigade basing awhile in Oz. Baloney --the energy situation in USA re Obama is just what they want, for their own reasons --and Obama is executing their foreign policy in nearly every way imaginable.
OBAMA DELAYS OIL SHALE, KILLS 200,000 JOBS. “President Obama’s United States Department of Agriculture has delayed shale gas drilling in Ohio for up to six months by cancelling a mineral lease auction for Wayne National Forest (WNF). The move was taken in deference to environmentalists, on the pretext of studying the effects of hydraulic fracturing.”
Posted at 12:49 pm by Glenn Reynolds
add that to the BP shutdown, and the Keystone shutdown.
In each case, the only way to deny the half-century of voluminous records that are the evidence of the safety and utility and economic tailwind provided by drilling 45,000 post WW2 wells in the Gulf, 25,000 miles of pipelines across the Ogallala, and 50 years of fracking ordinary 'tight' pay zones a mile or more far below the cased-off water-well depths, is to simply deny them, without comment. Something that only someone like an Obama --raised by a screaming harridan grandmother from the exploiting race and learning thus early on how to pull inside himself --could do.
Now we know why he was picked.
raised by a screaming harridan grandmother
Really? I haven't heard that before.
stories are out there --read 'em, in 2008. tongue-lashing in public places, witnesses interviewed. I gotta go out --running out of daylight and must tend my exersize resolve or bury it evermore --or i'd do some search on it. maybe later.
There are two aspects of this that bother me. The co-mingling of funds and the complete and total disappearance of $600,000,000 dollars. Done - gone - zip - nothing to see here, move along.
There can only be three answers - Corzine knowingly did it to bolster the bottom line, Corzine did it as part of larger effort to punish the commodities market or Corzine is incompetent.
Corzine isn't incompetent. The commodities conspiracy would require more than just Corzine to pull off - it is plausible, but more suited for a novel.
I think it is the first - he was in trouble betting on Eurozone debt and currency and tried to make that one big bet to get everything back on track. Even smart professional gamblers do that from time-to-time. Does that mean he isn't criminally liable? No, but I'd be willing to bet when the smoke is cleared and Corzine comes clean, that will be the answer.
That's the story, alright. What you're 'spose to believe in your intellect --while down below in Gutsville something is rumbling.
They can't very well say the idea is to discredit capitalism right during the Occupy Movemment and while the Eurozone is rolling over, and an election is a year away.
I just don't think anyone, let alone Obama or his advisors, understands the interlinking pieces of the market enough to truly believe they can manipulate anything sufficiently to achieve predetermined goals.
Obama may not believe in, or trust, the market, but he's at least intelligent enough to know that in the end it will steamroll most of what he hopes to manipulate.
Then again, I could be wrong. I know some of the 'Masters of the Universe' on Wall Street believe THEY understand it enough to pull off some manipulation. But a full blown conspiracy is so complicated, and would require so much silence (not to mention multiple assassinations to keep people quiet) that in the end the idea is preposterous.
You can link ANYTHING. If you ever watched the program "Connections" (which I happen to really enjoy), you can show the link between Trafalgar, oil, and Nescafe. Sure, most of the time it's incidental or coincidental, but it can be done.
Was Corzine stupid enough to think he could commingle funds and get away with it? Sure - why not? After all, he oversaw the Goldman IPO and while he is often viewed as a very mediocre CEO, he did get rich. In the US, getting rich is enough evidence anyone needs to believe the rich person is a genius. Even when they probably are not.
Nobody understands it - including the math geniuses who built the arbitrage electronic trading system.
Its a crap shoot.
--i hear ya --and you're right --the type of conspiracy to which you allude is improbable. And at the other end of the definition, where a political party sets the conditions where human nature takes over and more or less unknowingly executes a general plan, is known as ''politics''.
But do look into the Managed Funds Association, wouldja? Sometime when you're of a mood.
Stupidity and Cupidity: A Toxic Combination. Especially with a liter of Arrogance mixed in.
No market-wide manipulation needed --just a CEO with the power to leverage capital and plenty of insurance among cross-linked counterparties of the credit-default-swap variety, insuring the sums of that leverage.
The 'stupid cupid' theory has to believe that what happened in 2008, that resulted in a corrective of 2,500 pages that is resulting in hundreds of new regulations, Dodd-Frank that is, still somehow managed to forget to prevent its own reason for being, and with MFG let the exact same thing happen all over again, with more or less the same cops on the beat, and with the added fillip of simply pulling client cash from one bank to another, the second an account that the money's former owners cannot access.
Dodd-Frank's other two objectives-of-record (that is breaking up the 1998-2008 Too Big To Fail free-market surrender sequences, and lastly raising the transparency of dealer-to-dealer transactions so that the public's potential borrowers could know the nature of the systemic risk-on) were also somehow forgotten, in favor of a Ling-Chi (half the regs, over a year after D-F passed, are still unwritten and thus hanging fire, by the body that was able in no time at all to slap together Stimulus and ObamaCare) on the 8,000 banks not TBTF, with the effect that a huge part of the economy --collateral-based small-biz lending --has frozen on the inability of terrified and understaffed lenders to price the collateral (establish the loan-to-value ratios) what with almost all real-estate markets caught in a spiraling price-collapse with no clear end in sight.
PS, the point is, that array of D_F regs, 600 to 800 new regs, each one needing to be airtight, the last of them promised to go into effect (often retroactively) is an approach to the problem of what (Ralph Nader says is about) 150 persons did to global markets culminating in 2008, that is so important it is worth years more of enormous economic destruction possibly existential to the western market economies and the US Dollar.
This approach is THAT important, SO important that the time-decay of economies being crushed by loss and unemployment while waiting for the regulations to be written is of a clear enough lesser importance that there is no question that the time-decay risk and loss are worth it.
Yet the committees charged with the writing haven't thought to double their staffs and halve their delays?
Conspiracy? How many would have to design the above-described approach, and communicate it via innocent-sounding and even hyper-responsible marching orders that would have to be no more incriminating than what we the people were and are being told, that ''this time we are determined to get it right, we are going to make sure that these banks can't do this to the people again'' associated with ''we are trying to do what we can to avoid waste and are trying to operate congress as per the new austerity the people demand''.
Meanwhile several hundred thousand small businesses that might otherwise be hiring and moving things in the markets, watch the calender for November 2012 and sullenly mark time at best, and at worst slowly liquidate themselves, as the unemployment and consumer confidence, not to mention M3, deteriorate.
And the administration can, and does, say, "What, you want more carelessness? After all that happened because of the previous administration's carelessness?''
I say, if the admin was not trying to topple the economy and the Dollar, Dodd-Frank would have taken a month, not 18 months, to write, and the 800 regs would have been maybe about 8 (the non-TBTF lenders average 30 employees -should not regs be written to that reality?), and would have been in force by Easter of 2009 (if not on Inauguration Day).
...and Dodd-Frank as a disguised attack (by circumstanctial effect rather than in/by the ordinary description), is just one among many clues as to the intent behind what this 'here's our lucky-chance' president's handlers are doing.
IMHpO, that is (small 'p' for paranoid).
PS, the point is, that array of D_F regs, 600 to 800 new regs, each one needing to be airtight, the last of them promised to go into effect (often retroactively) 'by the end of 2012, or early 2013' is an approach to the problem....