Posted on 09/18/2008 5:36:23 PM PDT by JasonC
JasonC said:
Well, Lurker on this thread for one.
What exactly are you accusing me of Jason? Please spell out exactly what 'treasonous' behavior you're accusing me of.
Be specific, because I do not take such charges lightly.
They made billions on Fannie and Freddie and they instantly threw those billions at Lehman and Merrill and AIG.
SO if Lehman and Merrill and AIG have all these 'billions' you say they do, why are they bankrupt?
They made billions more on Lehman and AIG and threw them instantly at Morgan Stanley and Goldman Sachs, much sounder companies.
So you're saying that these 'short sellers' made billions of dollars which they gave to companies which were bankrupt, and then made billions more dollars and are 'throwing them' at other companies which were doing exactly the same things the first three companies you mentioned were doing.
I have a question for you.
What color is the sky on your world?
L
Sorry, I’m too drunk and tired to respond the way I want to at the moment.
Tomorrow I’ll explain why the derivatives are a convergent series (converging towards zero) and not a divergent series, to explain my previous response.
Nice chatting with you. Enjoyed it. Seriously!
I said "They made billions on Fannie and Freddie and they instantly threw those billions at Lehman and Merrill and AIG." These are shorts making billions. How do shorts make billions? They sell what isn't his'n, and then buy it back before they go to prison. They sold millions of shares of Fannie and Freddie they did not own. Fannie and Freddie fell below $1 a share on massive volume. They bought back the millions of shares they had shorted at less than a dollar each. They made billions. Now they have extra billions in their brokerage accounts and their hedge funds. They use those billions as their margin as they sell millions more shares of Lehman and Merrill and AIG. Any strategy that profits enourmously from a previous trade naturally results in an increase in financial firepower for those exercising that strategy. The strategy didn't change, and the firepower increased. They couldn't make anything more shorting Fannie and Freddie, they still wanted to short financials. So they moved on to the next targets.
And blew away Lehman in less than a week, and AIG in a couple days. After which they were already firing away at Morgan Stanley and Goldman Sachs, despite their vastly better performance, recently confirmed. Why did a massive run against those two commence as they each posted outstanding results? Simple, the shorts from AIG were gorged on profits and full of vinegar, and looking for a fresh feast. And trying to keep the fear wave rolling along.
"so if Lehman and Merrill and AIG have all these 'billions' you say they do, why are they bankrupt?"
Shorts don't *give* money to the companies they clobber into oblivion, they *take* it from those company's shareholders.
"threw them instantly at" does not equal "gave to". It equals "sold short massive quantities of..."
Is it more charitable to think you understood perfectly but are attempting to impose on others who might not, or that you are honestly that stupid?
Don't patronize me punk.
How do shorts make billions? They sell what isn't his'n, and then buy it back before they go to prison.
So your position is that 'shorts' can sell things which don't legally belong to them. Have I got that right?
They sold millions of shares of Fannie and Freddie they did not own.
How does one 'sell' something which does not belong to them? What sort of fool 'buys' on this principle? Can you point out the Title and Section of the Federal Code which allows such behavior?
They bought back the millions of shares they had shorted at less than a dollar each.
We've gone form the bizarre to the surreal you and I. You're honestly telling me that these 'shorts' first sold something which didn't belong to them, which they had no legal authorization to sell things which didn't belong to them to depress the price, then they bought back their own value deflated assets?
What sort of moron would do that?
You make absolutely no sense. None whatsoever.
What is coming through loud and clear however, is the fact that you want the American taxpayer to 'bail out' these idiots to the tune of a couple of TRILLION dollars.
I've got a much simpler solution.
Got a pencil? Good. Here it is:
First, we form a mob. Actually we form two mobs. Mob 1 heads for Washington DC. Mob 2 heads for New York City. Both mobs have simple goals.
Mob 1 drags as many Congresscritters, Federal Appointees, Agency, Department, and Bureau Heads as they can find and then tars, feathers, and runs them out of town on rails.
Mob 2 repeats basically the same actions but on Wall Street.
Then the 'system' gets a much needed kick in the balls. Yea, it'll be tough for a few years, but in the long run we'll be better off as a Nation.
And we'll be rid of the real parasites. Those who engage in this sort of BS in the first place.
L
Hamilton argued that the bank fell within that caluse as a means to realize the congress's powers to tax, to regulate the value of money, and to regulate and promote interstate and international commerce. He also proposed a test which has survived in constitutional law since, as to the scope of the necessary and proper clause. It was, if the measure was useful for carrying out a proper power and did not abridge an explicit right of any state or individual, then it was to be presumed constititional. Congress and the president by signing the law determined on the usefulness question.
Washington agreed with Hamilton's argument. There is no valid founding era argument against central banking, which Hamilton strongly supported and carried with the rest, in that era. As for the specific legal power under the scope of the Federal Reserve Act, that is provided most plausibly in section 13-3, the same section appealed to in the AIG financing.
Yes Virgina, shorting means selling something only borrowed, not owned. And these days they often don't even bother to borrow it first, they just make sure they buy it back before the settlement date several days later. And repeat as needed, thereby able to maintain the short position indefinitely. They also short using derivative contracts (OTC custom, OTC listed option, individual stock future, etc) which effectively outsources the actual shorting to a brokerage firm. Yes they deliberately want the price of what they sold to go down, because they never owned it in the first place and make the difference in the two prices they enter the two halves of the trade, at, and yes they make billions when it does, and no I don't remotely believe I have to tell you this for the first time. Nobody trying to discuss this matter could possibly be that ignorant.
We should have complained about those "deadbeats" to those poor AIG CEO's and others that were counting their million dollar bonuses before running their companies into the ground.
Fourth tier. Everybody above them defaulted, that is how they were left with the paper in question.
And what did AIG have to do with it? To that point, essentially nothing. Years earlier before any of it had happened, they wrote some derivative contract policies that were effectively guarantees to pay Lehman's debts if Lehman couldn't, at a time when it was earning 10 times its debt service and none of this was apparent to anyone.
AIGs collosal recklessness consisted of expecting an A rated Wall Street bank to be likely to be able to pay its debts over the next five years.
If enough people welsh, there isn't any such thing as sound finance.
And what happens when the shareholders of AIG stand and take the $150 billion hit that no one ahead of them would stand and take, losing nearly their entire fortunes, many of them, and a lot even for those more diversified? Everybody and his brother throws a crapstorm of hatred at the ones who stood up and took the hit for all the deadbeats prior. The original deadbeats, they've got entire political parties dedicated to helping them sue the crap out of people for having handed them hundreds of thousands of dollars and lost it all (the welshers sue the welshees, of course, this is America).
God how I hate whiners!
LOL! Those poor bankers and lenders. Their CEO's had to take the time from counting their annual multi-million dollar bonuses to find out they'd driven their own companies into the ground.
If my private retirement investments go belly up, I'll call you and the Fedgov to come bail me out.
I expect you to be there in a timely manner with money in hand when things go south for me.
Stop the whining.
Next time, those share holders ought to be more careful where they stick their money and invest, instead of winking and nodding at the fat cats and CEOs as they collected their annual multi-million dollar bonuses while the companies slid into a ditch.
That's rich.
Everyone better pull themselves up by their bootstraps and don't expect government bailouts and handouts...
Except when it comes to *your* interest.
lol...
Oh wait, only you are allowed to practice one entry accounting.
US finance is the largest producer of positive economic externalities in this country's economy, and indeed in world history. The only things even in the same ballpark are scientific inventions and the personal valor of are servicemen. Compared to what they produce and give away to everyone around them as side effects, everyone else here is a useless layabout. Not that you are - plenty of other workers pull their own weight, some more than they own. Lots of others do not. But financiers are not among them.
If you doubt it, get through next week using only blueberry scones for transactions, and without touching any form of a means of payment of any kind, yours or anyone else's.
So, can I too expect a bailout if my personal private investments take a bad turn?
Yes or no?
All that's going broke too. You haven't heard? The politicians looted those programs.
I robbed them?
Look my money went to their CEO's million dollar annual bonuses...I paid, they just didn't notice my contribution. Obviously, I need to pay them much more, to rid myself of this guilt.
Were you high when wrote this?
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