At tonight’s covered dish supper, we’re going to discuss the International Monetary Funds Special Funding Pool and just what makes the pool and it’s funding so special.
It would appear that the folks over at the IMF have been staying up late and watching Lorne Michael’s Saturday Night Live for inspiration. When Pimco’s Mohamed El-erian claimed last week that the global financial system was operating in a vacuum, he may have become somewhat confused between his geometric shapes http://tradewithdave.com/?p=5780. You see a torus can exhibit the traits of a vacuum, if you’re actually inside it. A torus is shaped like a donut. Then again a sphere is always a vacuum. When a torus is not a vacuum is when something passes through it… through the donut hole.
This may not seem that important to you, but if you’re PIMCO and you’re trying to figure out if this $550+ billion is in the vacuum, or outside the vacuum, you better know the difference between a torus and a sphere. If it doesnt seem that important to you, then I guess you’re like Grigori Perelman and you don’t want to pick up your $1 million cash prize for figuring out how we’re all simply connected in a three-sphere http://tradewithdave.com/?p=778 and how this essentially proves the existence of God.
I know it all sounds like a stretch, so maybe this will help you relate. You’re a torus. Your digestive system makes you a torus. Theoretically you can put something in your mouth and pull it out the other end (see a gastroenterologist for this – don’t try it at home), without puncturing the donut so to speak. If the $550+ billion can pass through the torus without puncturing it, then it’s not a vacuum, it’s just simply digested and 99% of it passes out the other end with the exception of a small amount of absorption in the form of fertilizer.
If I’m right and El-erian is wrong, then the Anglosphere wins once again. If El-erian is right, then the North-African brotherhood of revolutions has prevailed as we’re witnessing yet more riots in places like Syria. What’s the cause of all this upheaval? I would say we are and by “we” that would primarily be the White House. Now there is one way that you can almost turn a torus donut shape into a sphere, or at least you can turn it into a solid sphere. You take the donut hole (you know those bite-sized donut holes you can eat), in this case a $550+ billion donut hole and as it’s passing through the middle of the donut (the actual hole part – not the bite-size part) you seize it up. That’s right, you don’t allow it to pass through to the other side. It becomes stuck, like a cat burglar in a an air vent in a made-for-tv movie. You fuse it to the donut kind of like eating something and having it get permanently stuck in your stomach (or for seven years) like when your mom told you not to swallow gum.
In such a scenario, neither side would really win but what you would have is a systemic collapse. Like if you ate something big and never moved it along… so to speak. It would require surgery to take it out eventually. You would be put to sleep. And the $550+ billion would be removed under general anesthesia. Of course, there would be no way to know for sure, exactly how much was in there. You’d be relying on the surgeon to tell you. He might say it dissolved, or they were only able to save the original $50 billion. You know, it’s science… tough to explain.
If all this seems a little bit far-fetched or geometrically challenging, then I suggest you get some coffee and donuts. Head over to your local high school, community college or university. Sit down with a geometry, topology or physics teacher and ask them exactly why your donut and your coffee cup are the same thing and that neither one is a three-sphere. If you don’t believe Dave that there’s big business in making things seem different than they really are, then now I know who’s been sending their bank account information to that Nigerian prince. Here’s a video that may help you pick out the deception, just don’t try to pour coffee into the hole of your donut or your coffee will end up like that $500+ billion, impossible to ever recover:
Here’s a link to the Dow Jones Newswire report on the IMF’s $500 billion increase to a level in excess of $550 billion for the special funding pools.
In related news from ZeroHedge.com
TODAY TWO LARGE MACRO FUNDS OVER HERE HAVE GONE WILDLY LONG S&P. NOT LONG. WE TALKING 250% NET LONG. IT LOOKS LIKE CONCERTED ACTION ON GDP DGRADES FROM GS AND BOFA ARE THE LETTER DELIVERED TO BEN ON QE3. HUGE DIRECTIONAL BET WITH NEW CAPITAL PUT AT WORK. MOST LIKELY THE TWO INSTITUTIONS ARE COORDINATING ACTION WITH OFFICES IN CONNECTICUT. CHECK INFLOWS OF BLUE CHIP HEDGE FUNDS IN JAN FEB. APPLY 2.5 LEVERAGE. WE ARE TALKING ABOUT SOME 40-60BN PUT AT WORK PRIMARILY ON EMINIS AT THE MOMENT. WHETHER SOME EXTERNAL FORCE WILL LEAVE THEM HIGH AND DRY I DON’T KNOW. BUT IF ANYTHING SEEMED TO BE AT LEAST NOT TOO IRRATIONAL UP TO NOW, IN THIS THIRD WAVE, BE READY FOR REAL ROCK AND ROLL.
The Dave’s Response:
Be glad Ross Perot isn’t president because if he was, no “off-shoring” of QE would be allowed. Then again, they could be being suckered in as supporting sandbags for an oncoming dollar surge. You heard what Ben said, “people don’t buy gold, they buy snacks and clothes at the mall.” So, the same goes for hedge funds. If they get fleeced in this move, Ben can always say, “Hey, if we hadn’t done what we done, your dollars would be worthless… you ought to thank us.”
I’m going with the “We’re using you suckers as sandbags to protect us from the flood of a rising dollar” theory. Why not. You know what they say, third time’s the charm. Can’t you just see Obama smiling while he sticks it to Greenwich just as smoothly as he’s sticking it to those North-African CIA dictators. He’s a genius and he’ll never get blamed for any of it. Way, way more teflonic than Bill Clinton ever was. It’s one thing to be raised to be smart and slick, it’s something else altogether to be a double-agent who appears to simply be a bad golfer.
Like I always told my kids, when you leave the country, there’s no sherriff to call, much less your congressman. The rules have changed and the future of QE just set sail for distant shores. Good luck getting your money back.
Here’s the ZeroHedge link: http://www.zerohedge.com/article/someone-leak-something?page=1#comment-1099981