Financial fuckery thread

[PopeTom]

Warren Buffet knows something we don't know.

Bank of America [BAC  6.99] soared 20 percent after Berkshire Hathaway [BRK.A  106350.00  ---  UNCH] said it will invest $5 billion in the bank.

not digging back through the thread, but wasn't there someone here that shorted it?

hope you covered that ages ago

That would have been me and yes I did.  Never intended to hold it for long and it's unlikely I'll short a stock again anytime soon.  At least until I can get upgraded in my options trading on E*Trade.

[Cain]

I give Nixon a pass on Bretton-Woods.  He didn't put it in place and he had nothing to do with the run on the US by foreign governments to cash in the dollars to gold.  They were printing money and it was, possibly for the last time, OBVIOUS and any sitting President in his place would have been pressured to do the same thing by the cost of the Vietnam War, a war I will never agree was necessary, and precipitated the collapse of Bretton-Woods.  If anyone, I blame LBJ for stepping up that war and lying about it, causing the increase in spending necessary to perpetuate it.

Clinton supporters amaze me for their ability to completely blank out when NAFTA is brought up, especially considering how protectionist and Union supporting a large number are.  I know it was in the works long before he signed it into law but man the glazed eyes and "BUT NO IT WAS BUSH I AND II" talk I hear when you mention Clinton and NAFTA.

As you said, the sharks are the back door guys that get "appointed" to one administration, (usually after taking a fat severance from a major financial institution so they can bring in new Harvard meat" and when that one gets voted out, they just go to work for one of their buddies in D.C. until "their guy" gets back in.  

I'm not even sure that Academic Economics should even be a term anymore.  It certainly cannot, looking back over the last 50 years, be in any way considered a Science.  Despite blatant evidence and the numbers to back it going on 40 years, they continue to use the same exact medicine that was taught by Keynes.  The end result is that we all suffer, because the "growth" was really only an illusion of growth, and since deflation is seen as worse than inflation, to be avoided at all costs, even at the risk of stagflation, we all become more poor as the decades grind on.

[EDIT CONCERNING THE ABOVE BOLDED]  I keep forgetting, considering your areas of expertise, you're likely used to having a knock at your door to discuss those sorts of things.  Just meant that spiders look for that sort of thing.  Something you must already know as well.  Never mind then.  Continue on.

Nixon also followed policies which further heightened the war, though, increasing the costs in money (as well as in human terms).  Sure, he wasn't entirely to blame, but he was the man in the seat during the events, and it was his choices which helped shape the post-Bretton system, and therefore there is a significant measure of responsibility, which of course does not excuse those who followed on after him.  But if you ask the average person in the street, or even pundit, you'd probably get a puzzled look for even mentioning Bretton Woods, unless they're economists or Fareed Zakaria (maybe).

Well, Clinton supporters are dumbfucks.  As are Democrats in general.  This explains a lot about them.   The real question is who is more stupid, the union-supporting protectionist types who voted for him in spite of his record on such issues, or the neoliberal "Washington Consensus" types who helped drive the US economy into the ground.  I mean, it's almost certainly the latter, but then again, they convinced the former to vote for their guys time and time again...so like I say, hard call.

Academic Economics hasn't been a science since about the time of Ricardo, and even then that is being generous.  I wouldn't necessarily blame Keynes though.  Or at least, not just Keynes.  There has been consistent failure in the face of expert advice pretty much since economics was first considered an academic subject, but especially in the past 30 years.  The core assumptions of economics are basically untenable and unprovable, rendering it even less of a "science" than psychology, sociology or political science.  In fact, almost every system of economics shares a certain abstract, a priori approach favoured by technocratic wonks the world over, and is almost always useless, utterly wrong and unable to admit its own failings.

I'm not saying anything a certain former Canadian ambassador has suggested, so I have no fear of that.  Besides, the best thing about pissing off Harvard Business School alumni is you're already picking on a target population noted for magical thinking, inability to plan and rote repetition of jargon and buzz phrases as substitution for thought.  It's like picking on retards, only at least retards know they are retards and so have a reasonable understanding of their limitations.

[Cain]

UK home ownership is projected to fall from 72% to 64%.

Meanwhile, government signals its intent to keep house prices artificially high through the blatant manipulation of the green field zones, limiting the land available for building projects and forcing companies to work on inferior "brown field" sites with additional hidden costs, which investors are loathe to support.

[Cain]

http://www.bbc.co.uk/news/business-14771936

US authorities are to sue 17 major banks for losses on mortgage-backed investments that cost taxpayers tens of billions of dollars.

The Federal Housing Finance Agency said it was taking action against banks including Goldman Sachs, Barclays, Bank of America, Deutsche Bank, and HSBC.

The agency says they misrepresented the quality of the mortgages they sold during the housing bubble.

The values plunged as the US was engulfed in the financial crisis.

The FHFA oversees mortgage giants Fannie Mae and Freddie Mac.

The two firms lost more than $30bn (£18.5bn), partly because of their investments in the subprime mortgages, and were bailed out by the US government.

Since the rescues, US taxpayers have spent more than $140bn to keep the firms afloat.

Other banks facing action include Royal Bank of Scotland, Nomura, Citigroup, and Societe Generale.

About bloody time.  The case for fraud is clear...even in spite of the SEC's malicious data deletion.

[Adios]

I guess I would be surprised if anything more than a slap on the wrist came from all of this.

[Precious Moments Zalgo]

I guess I would be surprised if anything more than a slap on the wrist came from all of this.

Even if the government wins, the suit only aims to recover a small fraction of the trillions in bailout money given to those same banks, so yeah, exactly.  They are suing to give them a slap on the wrist, but the case will settled for a stern look.

[PopeTom]

Federal agency sues banks for fraud and wins.

Settlement & penalties cause banks to be at risk for failure.

Many of these banks already having been deemed 'too big to fail' are then bailed out (again) by the federal Government.

lolz

[Precious Moments Zalgo]

Cost to bail out (again) > proceeds from settlement & penalties, resulting in net loss to taxpayers.

[Triple Zero]

Nassim Nicholas Taleb, on the Great Bank Robbery:

http://www.project-syndicate.org/commentary/taleb1/English

[Cain]

Weenies at Chase bank feel threatened by an artist

http://www.latimes.com/news/local/la-me-bank-painting-20110828,0,4395501.story

Alex Schaefer's depiction of a Chase branch going up in flames drew the attention of L.A. police, who asked if he was a terrorist. He said the work was a metaphor for the havoc banking practices have caused the economy.

Standing before an easel on a Van Nuys sidewalk, Alex Schaefer dabbed paint onto a canvas.

"There you have it," he said. "Inflammatory art."

The 22-by-28-inch en plein air oil painting is certainly hot enough to inflame Los Angeles police.

Twice they've come to investigate why the 41-year-old Eagle Rock artist is painting an image of a bank building going up in flames.

Schaefer had barely added the orange-and-yellow depiction of fire shooting from the roof of a Chase Bank branch when police rolled up to the corner of Van Nuys Boulevard and Sylvan Street on July 30.

"They told me that somebody had called and said they felt threatened by my painting," Schaefer said.

"They said they had to find out my intention. They asked if I was a terrorist and was I going to follow through and do what I was painting."

No, Schaefer said. He explained that the artwork was intended to be a visual metaphor for the havoc that banking practices have caused to the economy.

A terrorist certainly would not spend hours on a public sidewalk creating an oil painting of his intended target, he told the officers.

The police took down his name, address and telephone number on a form — Schaefer declined to provide his Social Security number — and departed.

"They were friendly. They weren't intimidating," he said. "I figured that when they left, they probably decided the episode was stupid and they'd just wad up the form and throw it away."

Wrong. On Tuesday, two more officers showed up at Schaefer's home. This time they were plainclothes detectives.

"One of them asked me, 'Do you hate banks? Do you plan to do that to the bank?' " Schaefer again explained what his painting symbolizes.

[Adios]

Good god. Smells like they are trying to use the law to place themselves above accountability.

[Disco Pickle]

alright, playing devil's advocate a bit here, but if I worked in a building and there was a guy across the street painting a picture of it burning, without knowing the guy at all, I could see how that might seem a bit intimidating. 

Personally, I'd be inclined to walk over and ask him what the hell he's thinking and that does he know that if he wasn't on the list before, he most certainly will be now.  Not everyone would just strike up a convo though and quite a few people would probably call the cops, being the post twin towers world that it is.

And if it's called in and the cops don't check it out and run it down and be absolutely fucking SURE this guy is just a painter, when a bank comes down and it's found to be him (come on now, that's not too damn far fetched) then people will ask why the hell didn't the cops do their job and feel this guy out.

Great publicity for the guy as a painter though. 

[Cramulus]

 
great piece of horrormirth there

It tells a story about the times we live in. An absurd story.

It's a story about how legitimate resistance to abuses of power are interpreted as Working For The Enemy.  It's a story about how we only have free speech if we're spouting the party line. And most importantly, it's a story about the relationship between banks, private citizens, and the law.

[Cramulus]

alright, playing devil's advocate a bit here, but if I worked in a building and there was a guy across the street painting a picture of it burning, without knowing the guy at all, I could see how that might seem a bit intimidating. 

Yes, intimidating. But a legitimate expression, protected by the first amendment. Your right to express yourself doesn't stop as soon as it makes some people uncomfortable.

Personally, I'd be inclined to walk over and ask him what the hell he's thinking and that does he know that if he wasn't on the list before, he most certainly will be now. 

So essentially, you'd try to dissuade him from painting a picture by warning him that if you make too much noise, the jailers will hear him.

And if it's called in and the cops don't check it out and run it down and be absolutely fucking SURE this guy is just a painter, when a bank comes down and it's found to be him (come on now, that's not too damn far fetched) then people will ask why the hell didn't the cops do their job and feel this guy out.

How do you confirm that somebody is "just a painter?" You run a background check? You ask to see his portfolio and count the bowls of fruit?

The guy isn't doing anything illegal. It may make some people that work at banks uncomfortable, but fuck, he's an artist, what is he supposed to do, write them a polite letter and ask them to stop?

[LMNO]

Ok, sorry to be the rationalist here, but there's one more thing this could be a sign of:

Bureaucracy and established police procedure.

It goes like this: A call comes into a police station that a person is concerned about a guy acting suspicious outside Chase Bank.  Yes, I know that's not what he was doing, and I don't have access to the call that came into the station.  This is a hypothetical.  I would imagine that would immediately trigger two beat cops to go to that location and assess the situation.  They see no immediate threat so the guy isn't arrested.  However, determining whether or not he poses a future threat is above their pay grade.  So, they take the guy's info, and at the end of their shift file a report.  The report then triggers an automatic response for two detectives to visit the guy so they can fully write him off as a non-threat.

It all looks insidious, and it can absolutely be corrupted and abused, but this simply looks to me like they were following SOP and best practices.  If you want to blame someone, blame the asshat who got scared by a painting and called the cops.