Trade With Dave

“It’s a political hail Mary. It’s unclear why they want to throw a monkey wrench into a $5 trillion market,” said John Kerschner, head of securitized products at Janus Capital Group in Denver. He said the net benefits for the economy are negligible, perhaps adding $20 billion to $30 billion “at best” to the U.S. economy.  Reuters News Service August 31, 2011

You remember a few years back when they reformed the bankruptcy laws.  People were simply walking away from their unsecured debts through a bankruptcy filing.  What did the banks do?  They reformed the laws so that if you sought relief and protection from creditors through the courts that certain debts (those owned by the banks in particular) would follow you for life.  The debts that couldn’t follow you (i.e. unsecured credit card debts) were allowed to charge exhorbitant amounts of interest to cover the high default rates. 

That’s business, right? 

Well, there’s a new plan coming down for those who want to refinance their mortgages.  This plan will be designed to save Fannie, Freddie and the  Dead Fed in one fell swoop all while sticking it to the Chinese.  How is this going to work exactly?  There are a lot of complicated details, but allow Dave to summarize. 

You borrow the  money in paper fiat dollars.  You have a thirty year note and the expectation that your wages will rise (say 5% inflation) and that gradually the value of your income stream rises while the value of your debt diminshes and maybe you experience some price appreciation in the value of your property.  Sounds like the American dream to Dave.  Don’t fall for it.

The real plan, and Dave expects it to be buried in the fine print of these new refinance contracts in the form of some new synthetic vehicle which will allow the International Monetary Fund to leverage the value of Too Big To Fail bank bonds that it will acquire once the banks are “rolled up.”  I digress…. let me get back to the point.

When you pay your debts off, you will be paying them off in a highly deflationary environment where the value of your wages is falling, your property value is falling and the future value of your debt is rising.  It gets better.  The dollars you will be paying back will be linked to the new divorced currency (see the new synthetic financial instrument that’s likely in the works) which will allow the banks to act as an extruder allowing the IMF to expand their drawing rights (balance sheet inflation offsetting your deflation) because you will be paying off your debts in gold.  That’s right…. gold.

This won’t  be gold you can get your hands on.  It will be gold that is “synthesized” through the roll-up of the TBTF banks and the floating of a new occidental bond that combines U.S. Treasuries with the pan-Euro bond.  You will be able to read about this more here at TradeWithDave, but I wanted to get this summary post up since the White House is preparing to make their release. 

Someone needs to contact John Kerschner at Janus and tell him that it’s crystal clear.  It’s a hail Mary alright… hail Mary full of gold. 

Here’s a link to the entire Reuter’s release:  http://www.reuters.com/article/2011/08/31/us-usa-obama-housing-idUSTRE77T6DV20110831?feedType=RSS&feedName=topNews&rpc=71

Share on Facebook

Imitation may not be the world’s oldest profession. but it is supposed to be the sincerest form of flattery.  You be the judge.

Dave wrote on August 3, 2011.

Just an old fashion love song… playing on the radio. You may not have noticed yet what Dave noticed. It may be due to the fact that you didn’t have a Panasonic portable cassette player and pirated recordings of The Grass Roots and Three Dog Night.

Do you know the one word you have heard over and over through the 2009 – 2010 financial season? That’s right – AUSTERITY. Well, that’s a thing of the past. The new word for the 2010 – 2011 financial season is… drumroll please…. HARMONY. That’s right – HARMONY. Actually to be more accurate it’s “harmonization.” To be downright specific… “financial harmonization.”

So Mohammed El-Erian’s (of PIMCO) new normal may be a multi-polar world and one of the new poles is Frankfurt where frankly speaking the whole idea of global banking cartels started with the launch of the Rothschild empire on the banks of the Main.

Even in a great band like Three Dog Night, singing an Old Fashion Love Song coming down in three part harmony, there’s still only one lead singer.

Bill Gross wrote in his September, 2011 Investment Outlook Letter released yesterday. 

Just an old-fashioned love song.  Comin’ down in three-part harmony.

Maybe flattering Dave by procuring his ideas and then calling them your own is going to be the new normal in a multi-polar world.  Dave realizes he wasn’t a member of Three Dog Night, but he did buy a pirated copy of their album at the flea market in the 70′s and he did stay in a Holiday Inn Express and he expects more than having his ideas simply ”ponced” on by Bill Gross.  Albeit, Bill and I disagree on who exactly is blowing the pitch pipe on this global a cappella financial tune.

There is one thing that isn’t new about those who prefer to promote the work of other “dirty shirts” so that they can keep their own shirt clean.  Promoting the world’s oldest profession is certainly not NEW and it’s not NORMAL, unless you consider getting other people to do your dirty work while you get paid for it as “normal”.  If the boys in Newport Beach keep their Huggy Bear act up, I’m going to be forced to call in Starsky & Hutch on their Allianz alliance (they are owned by the Germans you know).  According to the dictionary, to be precise, it’s pandering and PIMCO’s doing it with your pension money and that’s downright un-American.    

Here’s a link to Dave’s original response to the Gross’ Dirty Shirt proposal and how Dave equates the same with treason: http://tradewithdave.com/?p=7573

Here’s the link to Dave’s original 3-Dog-Night post: http://tradewithdave.com/?p=7583

Here’s a link to the entire Bill Gross PIMCO letter: http://www.pimco.com/EN/Insights/Pages/New-Fangled-Love-Songs.aspxd

Share on Facebook

One of Dave’s favorite websites is www.publicintelligence.net.  It’s an amazing site where amazing public information gets posted.  I think of it as a really good librarian who isn’t on the government’s payroll so they show you where the really good library books are. 

Over the years Dave has published a lot of links to their site and he has reposted content from their site.  Official documents from the Federal Reserve, Congressional accounting reports and investigations are the kind of thing that get brushed under the carpet, but not when it comes to PublicIntelligence.net.  They seek out those documents and publish them for everyone to see.  They are kind of like a non-hacking version of Wikileaks site without the court-ordered ankle bracelet while you wait months for juris prudence. 

Well, the other day I went to their site and it was gone.  I wasn’t really surprised.  I figured they had been taken down by the powers that be.  Here’s a link to their site and also a copy of the page content from the site.  I don’t understand it yet and it looks like one of the links they put up isn’t working.  It is also impossible to tell if this is actually their posting. 

If you are interesting in value of trading your time in exchange for ideas, then you’re interested in the same thing Dave is interested in.   If on the other hand, you’re interested in what the big media companies have to offer, then you can go back to your big networks and see if they are reporting on this.  When you wonder why the lights went off and you’re in the dark, at least you’ll know how it happened.  It’s because certain individuals (the White House Office of Information and Regulatory Affairs comes to mind) believe that they know better than you know what it is exactly that you need to know.

the following is reposted from www.publicintelligence.net

On August 21, 2011 our server in the Netherlands was shut down due to complaints made against content on our website.  We must make clear to all our readers and to those who would wish to do us harm: everything we post on our site is publicly available.  We do not “hack” anything.  We do not “leak” anything.  We distribute information that is already publicly available.

If we have posted information from your company, military unit, government agency or other corporate entity it is only because you or someone connected to you has published this information themselves by making it available for all the world to see.  Our only belief is that knowledge is free and that when you post your information to public networks for anyone to see, the public, who can so benefit from that knowledge, should be encouraged to see it as well.

The information published on our website has been referenced in news articles by Newsweek, Time, Vanity Fair, Mother Jones, Slate, the Atlantic, Wired, the Christian Science Monitor, the BBC, Der Standard, Aftenposten, the Toronto Star, the Guardian, Fox News, Foreign Policy, the Center for Investigative Reporting, NPR, Talking Points Memo, Gawker, Al Jazeera, the Los Angeles Times, the New York Times and Reuters, as well as a variety of other newspapers and publications around the world.

Information published on our website has helped to inform UN reports and has facilitated academic studies on a number of topics, from electronic privacy to the war in Afghanistan.  All of this has been done with information available to any member of the public at any time. To illustrate this point, we will direct our readers to the source of the information that we believe was most responsible for our server being taken offline:

http://bit.ly/qlIKDL

Alternatively, you can type this into Google and download whatever you like:

“document control” site:ecbaku.com

Equal access to information is a human right.

Share on Facebook

Bank of America CEO, Brian Moynihan starring in The Treasure Of Sierra Padre.  (translation:  “Warren Buffet is my daddy’”)

Here’s the B of A press release:

 http://mediaroom.bankofamerica.com/phoenix.zhtml?c=234503&p=irol-newsArticle&ID=1600360&highlight=

What does Dave think about this trade?  Dave thinks if B of A was truly “well-led”, as Mr. Buffett proclaimed, then this $5 billion purchase would have included price discovery and would have gone into the common stock, not convertible preferred.  Instead this pretty much guarantees that the indiscernable book value of the TBTF banks is as cooked as a pot of refried beans.  If not, why would a bank that the CEO said doesn’t need capital… needed the capital at this cost to existing shareholders?  If Dave’s speculation is correct, then it’s going to take a lot more than $5 billion to maintain the Mexican stand-off.  Hey Mr. Buffett!  Remember the Alamo. 

Here’s a link to what Dave is now referring to as “The Bank of Amoynihan” conference call where you won’t hear anything from Mr. Moynihan about offering any preferrential stock offerings to any private investors, much less one like Warren Buffet who had just received a phone call from President Obama the day before.

http://abcnews.go.com/Business/video/bank-america-ceo-brian-moynihan-holds-conference-call-14275506

Obviously, Mr. Buffet doesn’t need no stinkin’ badges… he has his already and now he’s diluted your B of A stock too with his warrants and vampire squidded your earnings with his 6% loan of $5 billion. 

Here’s the video of Warren Buffett receiving the nation’s highest civilian honor from President Obama

http://www.ketv.com/r/26881090/detail.html

Mr. Buffett told Becky Quick (who is at home with her new baby – congratulations Becky!) that he came up with the idea while he was “taking a bath.”  From the looks of things, not only did the shareholders get hosed, Monsieurs Buffett, Moynihan and President Obama could us a shower after this deal.  I think I smell something and it’s not that stinky Goldman Sachs laptop found in the New York garbage room or a dirty diaper.    

Here’s a handy guide on how you too can win your very own Medal of Freedom while ehancing shareholder value for Berkshire Hathaway.  Don’t fail to give the occasional jet ride to the staff of CNBC:  http://tradewithdave.com/?p=5931

Share on Facebook

Nomi Prins, (former Goldman M.D.) penned a beauty of a piece for the public relations department at Goldman Sachs to respond to.  Lucas van Praag is faced with saving face for Goldman Sachs in the face of the speculation on why Lloyd Blankfein has retained the representation of famed criminal defense attorney, Reid Weingarten.  Here’s a link to the Prins prison piece:

http://www.thedailybeast.com/articles/2011/08/23/lloyd-blankfein-why-goldman-sachs-ceo-hired-lawyer-reid-weingarten.html

The Washington Post reported in July that about 1/3 of President Obama’s $86 million raised had come from the financial sector.  I guess the timing on that was a coincidence.

For those who wish to dig deeper than a one-page van Praag press release, dig for Goldman with these links:

Unlike Fabrice, Dave’s laptop is not missing… he used it to type this post: http://tradewithdave.com/?p=7084

Dave, like Nomi, is just ”Too Cute To Fail” as an “85 Broad” : http://tradewithdave.com/?p=6889

Dave is not simply engaging in the popular Wall Street Rugby formation known as The van Praag Pile-On: http://tradewithdave.com/?p=6650

Blodget doesn’t limit his bludgeoning to Bank of America as Blankfein takes a beating:  http://tradewithdave.com/?p=6432

Wharton hears a Who and his name is Abacus:  http://tradewithdave.com/?p=366

To check out Nomi Prins other books and more:  http://www.nomiprins.com/

UPDATE:  Here’s a link to Nomi Prins radio interview August 25, 2011 with Alex Jones of Infowars.com:  http://rss.infowars.com/20110825_Thu_Alex.mp3

Share on Facebook

Photo: Wikipedia

Dave’s really feels like he’s been turned over like a flapjack on a hot griddle.  He’s feeling flatter than a short stack at the International House of Pancakes.  Dave is getting a very sneaky suspicion that this whole inflation threat may be as hollow as an empty bottle of Log Cabin syrup and as slick as butter on a hot knife.  You see Dave understands about upstreaming of assets, but he’s been having a little bit of trouble understanding how the wiring is engineered on the reset switch.  We have all seen enough Bruce Willis movies to know what happens if you cut the wrong wire.

So, here’s Dave’s latest theory on why the inflation threat may be flatter than a pancake.   They have managed to create a heavily debt-burdened society.  Much of this willingness to enter into debt is based on an expectation of future inflation and the expected ability to pay down debts in future inflated dollars.  In other words, you’re salary goes up but your debts stay the same making their relative size smaller some time in the future.

Then you formulate a big campaign to kill off the Fed by getting the media to cooperate and everyone takes up the Ron Paul End The Fed torch (except of course not Ron Paul himself… he’s just ignored).  Dave has already been a big contributor to this plan (http://tradewithdave.com/?p=7173).

Then after you engineeer the untimely death of the Fed, you can introduce a gold standard (remember what Alan said… gold is a currency, but this run up is still not inflationary… Huh?).  At this point, the stage is set for a massive deflationary event where the banks foreclose on the loans that they made in fiat dollars and collect them in gold-backed currency.  The question still remains as to how this works when there is a divorced currency (something Dave has written a ton about: http://tradewithdave.com/?p=6999  http://tradewithdave.com/?p=7114).  Somewhere along the line the dishes get washed… I’m still working on that part.   

Only the Tier 1 (i.e. SDR half) money will have the gold backing.  The Tier 2 pocket money will not need gold backing because it won’t have any fractional component, so it won’t be subject to bank runs, etc.  So think twice before you think that your greenbacks are going to buy much more than pancakes.  Thanks to the fiscal and monetary policies of governments, we now have two classes of people on the menu and it looks like they’re planning two classes of money as a side order.   

According to a report from Bloomberg.com today, former Chairman of the Federal Reserve Alan Greenspan had the following comments.

“The euro is breaking down and the process of its breaking down is creating very considerable difficulties in the European banking system,”

“Gold, unlike all other commodities, is a currency,” he said. “And the major thrust in the demand for gold is not for jewelry. It’s not for anything other than an escape from what is perceived to be a fiat money system, paper money, that seems to be deteriorating.”

Greenspan on Fox threatening inflation: http://www.youtube.com/watch?v=ZpR-vSVFWQc&feature=related

Greenspan on gold:  http://tradewithdave.com/?p=2187

http://tradewithdave.com/?p=954

http://tradewithdave.com/?p=458

After leaving the Fed, Greenspan founded the consulting firm Greenspan Associates and has been a consultant or adviser to Deutsche Bank AG, Pacific Investment Management Co. and hedge fund Paulson & Co.

Share on Facebook

A soldier who was caught stealing is drummed out of camp.  Could it have been for selling the other soldiers mobile phone #’s? 

There are alternative terms to “face the music.”  You could refer to it as being “drummed out” or how about “court-martialed?”  It’s all the same.  It’s being publicly disgraced and humiliated.  Facebook is backing down on their invasion of your privacy and misappropriation of your social grid, but only because Google+ is eating their lunch.

Here’s the official statement from Facebook:

http://blog.facebook.com/blog.php?post=10150251867797131

Here’s our small contribution to the drum corp:

http://tradewithdave.com/?p=4261

http://tradewithdave.com/?p=261

Share on Facebook

George Magnus of the Swiss Bank UBS issued a paper on what Dave would describe as an attempt to regain the global financial balance between Michele Bachmann and the Bank for International Settlements in Basel.  By all appearances, he’s calling on Steve Jobs to provide a technology solution in light of robots having replaced people at China’s Foxconn factory and the otherwise Hurt Locker-like rewiring of the reset switch for the labor theory of value sequel known as the innovator’s dilemma.

(Here’s a reposting of Dave’s original comment form ZeroHedge.com. The entire Magnus UBS note is at the bottom of the page)

George Magnus’ attempt to provide some relief for the convulsions his clients are experiencing is found within the comfort of his reminder, as Karl Marx originally tried to convince us; capital has no bounds.  You can rest easy, as there are companies that you can still invest in (read Apple, Google, Facebook) that have broken the sovereign bounds of political economy.  These select companies are the “world system definers” and if there’s one thing that sovereigns need it is help in designing their world system.  By selectively investing in “the definers” via the rapidly emerging “super entity” (http://tradewithdave.com/?p=7777) not only will you derive ”greater comfort”, you will also help to guarantee that the companies that build the new world system maintain their boundless lead.

Magnus reminds politicians that if you want innovation in your system design, then it comes at a price.  That price is allowing the companies that can deliver on a well-designed system the opportunity to also enjoy some extraordinary benefits (along with their shareholders) as not only system designers, but also as VIP system users.  Think of it as a Delta Airlines Medallion express check-in line for Apple Ipad owners… you can picture that…  comforting, no?

Magnus inadvertently reminds us that economics is no science, but rather the mere hand that reaches for the wallet upon the body politic.  He is careful to remind politicians too (Can you hear me now, Michele Bachmann, this is Verizon calling) that if they want system innovators to keep on innovating that they need to provide them with a front row seat in the political theater (http://tradewithdave.com/?p=5372).  If that’s inconvenient for the black mock turtle & hoodie crowd, then there’s always time for a tour bus drive-by comforting (verb), on Sand Hill Rd (comfort food included).

Take comfort ye CEO’s whose names are still on the invitation list, for if ye believe like Karl Marx suggests (http://tradewithdave.com/?p=7152) that you are as free from accountability as Norman Lear’s  Fred “my capital made me do it” Sanford, then who’s the wiser?  Magnus has given you the perfect Carville-Clintonian out (“It’s the political-economy stupid”) neatly wrapped in a made-for-Hulu version of Pygmalion.  There’s one small detail that both Magnus and Marx overlooked however and that is the role which FREE WILL plays in, well…. free will.

There’s a fourteen year old programmer out there somewhere who has plans for your “world system” and if you believe that the world IS your system, then just might you be believing that you can live by that sword.  As the super-entities give rise to the super innovating tech company which gives rise to the attempt to do what Marx believed in most all along – deciding what is best for you and your family, what’s a lobbyist to do?  4 out of 5 Politicians, technicians, economists and street rioters may agree that whoever possesses the information possesses the power to change behavior of the observed by the observer.  But what of the ten year old girl who revealed recently at DEFCON how she hacked the game clock to exploit a social gaming network http://www.pcmag.com/article2/0,2817,2390671,00.asp ?  Did she get the memo, or are you ready to see her download your entire Zynga/Farmville grain elevator into her offshore CFTC  integrity ”points” account.  http://tradewithdave.com/?p=4567

Hey Steve, Mark and Larry, Karl Marx is calling across time and space and he wants to know the answer to the proverbial is mobility the same as freedom question… “Can you hear me now?”  Charles Magnus and the fine folks at UBS need to know the answer.  Don’t keep us waiting.  Tell us you’ve got an app for that – a liberty app.

UBS-ByGeorge_The Convulsions of Political Economy2011!08!16

Share on Facebook

Like detergents and orange juice, there’s concentrate and then there’s SUPER CONCENTRATE.  Researchers and authors Stefania Vitali, James B. Glattfelder and Stefano Battiston produced this enlightening report from “inside the juicer” of the corporate wealth (i.e. individual wealth) concentrator.   

http://arxiv.org/PS_cache/arxiv/pdf/1107/1107.5728v1.pdf

The Top 50 Control Holders

1 BARCLAYS PLC GB 6512 SCC 4.05
2 CAPITAL GROUP COMPANIES INC, THE US 6713 IN 6.66
3 FMR CORP US 6713 IN 8.94
4 AXA FR 6712 SCC 11.21
5 STATE STREET CORPORATION US 6713 SCC 13.02
6 JPMORGAN CHASE & CO. US 6512 SCC 14.55
7 LEGAL & GENERAL GROUP PLC GB 6603 SCC 16.02
8 VANGUARD GROUP, INC., THE US 7415 IN 17.25
9 UBS AG CH 6512 SCC 18.46
10 MERRILL LYNCH & CO., INC. US 6712 SCC 19.45
11 WELLINGTON MANAGEMENT CO. L.L.P. US 6713 IN 20.33
12 DEUTSCHE BANK AG DE 6512 SCC 21.17
13 FRANKLIN RESOURCES, INC. US 6512 SCC 21.99
14 CREDIT SUISSE GROUP CH 6512 SCC 22.81
15 WALTON ENTERPRISES LLC US 2923 T&T 23.56
16 BANK OF NEW YORK MELLON CORP. US 6512 IN 24.28
17 NATIXIS FR 6512 SCC 24.98
18 GOLDMAN SACHS GROUP, INC., THE US 6712 SCC 25.64
19 T. ROWE PRICE GROUP, INC. US 6713 SCC 26.29
20 LEGG MASON, INC. US 6712 SCC 26.92
21 MORGAN STANLEY US 6712 SCC 27.56
22 MITSUBISHI UFJ FINANCIAL GROUP, INC. JP 6512 SCC 28.16
23 NORTHERN TRUST CORPORATION US 6512 SCC 28.72
24 SOCIÉTÉ GÉNÉRALE FR 6512 SCC 29.26
25 BANK OF AMERICA CORPORATION US 6512 SCC 29.79
26 LLOYDS TSB GROUP PLC GB 6512 SCC 30.30
27 INVESCO PLC GB 6523 SCC 30.82
28 ALLIANZ SE DE 7415 SCC 31.32
29 TIAA US 6601 IN 32.24
30 OLD MUTUAL PUBLIC LIMITED COMPANY GB 6601 SCC 32.69
31 AVIVA PLC GB 6601 SCC 33.14
32 SCHRODERS PLC GB 6712 SCC 33.57
33 DODGE & COX US 7415 IN 34.00
34 LEHMAN BROTHERS HOLDINGS, INC. US 6712 SCC 34.43
35 SUN LIFE FINANCIAL, INC. CA 6601 SCC 34.82
36 STANDARD LIFE PLC GB 6601 SCC 35.2
37 CNCE FR 6512 SCC 35.57
38 NOMURA HOLDINGS, INC. JP 6512 SCC 35.92
39 THE DEPOSITORY TRUST COMPANY US 6512 IN 36.28
40 MASSACHUSETTS MUTUAL LIFE INSUR. US 6601 IN 36.63
41 ING GROEP N.V. NL 6603 SCC 36.96
42 BRANDES INVESTMENT PARTNERS, L.P. US 6713 IN 37.29
43 UNICREDITO ITALIANO SPA IT 6512 SCC 37.61
44 DEPOSIT INSURANCE CORPORATION OF JP JP 6511 IN 37.93
45 VERENIGING AEGON NL 6512 IN 38.25
46 BNP PARIBAS FR 6512 SCC 38.56
47 AFFILIATED MANAGERS GROUP, INC. US 6713 SCC 38.88
48 RESONA HOLDINGS, INC. JP 6512 SCC 39.18
49 CAPITAL GROUP INTERNATIONAL, INC. US 7414 IN 39.48
50 CHINA PETROCHEMICAL GROUP CO. CN 6511 T&T 39.78

http://arxiv.org/abs/1107.5728

This paper (link at the top) includes a concept called “bow ties” that reflects the effect of the “concentrator” process.  I am working on some research of the possible relationship between the topology of a torus and these bow ties.  Here’s a link to an article I wrote about a year ago that relates the two concepts particularly in light of the emerging importance of the ESFS in Europe and the ESF in the U.S.  as a means of preempting the Federal Reserve System.

http://tradewithdave.com/?p=5833

Here are the articles on the end of the Fed: 

http://tradewithdave.com/?p=7173

http://tradewithdave.com/?p=7583

Share on Facebook

We will never forget what we never remembered in the first place.

Check out the second video in this link: http://tradewithdave.com/?p=2869

Share on Facebook