On 4/20/2010 3:53 PM, Winston wrote:

--Winston -- Sent at 3:53 PM PST

That was (embarrassed cough) 3:53 PM PDT, rather.

--Winston


--

Gary was a liar, a thief, a scoundrel and a psychologist.
He was the most redundant man I ever met.

"John R. Carroll" wrote:

Winston wrote:
On 4/20/2010 2:23 PM, John R. Carroll wrote:

(...)

This one was sent at 2:22 pm from a NIST machine.

I show:
Date: Tue, 20 Apr 2010 14:23:07 -0700

My RTC is probably off a little, though.



Weird...
This one was sent at 3:23 pm and I've turned DST on and reset the clock.
I wonder what Wes is seeing?

Maybe Terrell is just screwing with me.
Made Me Look Michael!


Laugh all you want, but your messages are the only ones arriving
before the 'sent' time.


--
Anyone wanting to run for any political office in the US should have to
have a DD214, and a honorable discharge.

On Tue, 20 Apr 2010 15:58:32 -0700, the infamous Winston
scrawled the following:

On 4/20/2010 3:53 PM, Winston wrote:

--Winston -- Sent at 3:53 PM PST

That was (embarrassed cough) 3:53 PM PDT, rather.

OH, sure. We always knew you lived in a different dimension, but time
zone, too?

--
"I think you very well may see a revolution in this country and
it will not be a revolution to overthrow the government," he said.
"It would be a revolution to restore government to its constitutional
basis." --Rob Weaver on VoA, 4/19/10

On 4/20/2010 10:20 PM, Larry Jaques inscribed:

OH, sure. We always knew you lived in a different dimension, but time
zone, too?

I figure I can explore all 11 dimensions if I'm in the right 'Zone'.

http://www.youtube.com/watch?v=NzlG2...eature=related

--Winston

--

Gary was a liar, a thief, a scoundrel and a psychologist.
He was the most redundant man I ever met.

On Tue, 20 Apr 2010 22:42:54 -0700, the infamous Winston
scrawled the following:

On 4/20/2010 10:20 PM, Larry Jaques inscribed:

OH, sure. We always knew you lived in a different dimension, but time
zone, too?

I figure I can explore all 11 dimensions if I'm in the right 'Zone'.

Sure you can, son. Now take your Lithium like a good boy and go play
in the street.


http://www.youtube.com/watch?v=NzlG2...eature=related

Ahhhh. Good memories of growing up, watching TwiZo with the whole
family every week. Thank you, Rod Serling.


Gary was a liar, a thief, a scoundrel and a psychologist.
He was the most redundant man I ever met.

Bwahahahahahaha!

--
"I think you very well may see a revolution in this country and
it will not be a revolution to overthrow the government," he said.
"It would be a revolution to restore government to its constitutional
basis." --Rob Weaver on VoA, 4/19/10

On 4/21/2010 6:24 AM, Larry Jaques scratched out:

Sure you can, son. Now take your Lithium like a good boy and go play
in the street.

Not again, Mr. Hyde?



--Winston

On 4/19/2010 12:00 PM, John R. Carroll wrote:
Winston wrote:
On 4/19/2010 10:08 AM, John R. Carroll wrote:
Ignoramus9593 wrote:
On 2010-04-19, wrote:
Let's say that I sell you a product that I know is worthless
and will almost certainly cause you to lose a large amount
of time and money. Let's say that I game the system
so that the product appears to be well regarded and a good
value; I use that to convince you to buy.

Exactly.

Let's say that I sold you a lathe that was made of parts handpicked
to fail, greased with abrasive added to grease, pee instead of oil,
etc.

Furthermore, assume that my client actually built this lathe so that
it will fail as early as possible, say to eliminate competition
(just to make this example more realistic).

I know that full well, sell you a lathe like that, and say "here's a
lathe, as far as I know it is great, it runs, but it is sold AS IS".

Then the lathe fails in 2 weeks.

Would I be a fraud? Yes. Would saying something like "but the buyer
considered hilself sophisticated", absolve me from responsibility?
No.

Nicely put, Ig.

They haven't been charged with, or done, anything criminal.

Bill Moyers Journal that aired last night:

http://video.pbs.org/video/1471123509/#

"SIMON JOHNSON: (...) the person who nailed this intellectually a
long time ago was from the University of Chicago. George Stigler.
Not a man of the left. He got a Nobel Prize for his observation.
All regulated industries end up with the industry capturing the
regulators."

It's a little disingenuous to claim that nothing criminal took place
only because the captured regulators were told to regard broad
categories of theft as 'technically legal'.


I follow Moyers to the extent possible and he's just excellent.

There isn't anything "disingenuous" about such a claim at all.
You and Ig are placing the failure of both the voters and regulatory
agencies on the backs of the regulated.
I'm not condoning GS's behavior in any way, I'm saying that putting people
in jail anytime someone gets mad is a bad idea.
Even promoting that possibility is counterproductive.

As close as there is to a silver bullet to our current dilemma would have
been to trade derivative products on regulated exchanges.
At that point, most of the behavior that proved so problematic wouldn't have
happened because all of the sleights of hand would have been obvious in real
time.

Another mistake was in letting money, real money as demand deposits, get
into the hands of businesses that are speculative by nature.
Goldman Sach's is a bank and they shouldn't be unless they want to divest
their investment banking and hedge fund divisions.

All of these companies were granted the power to print alternative
currencies that were backed by their actual currency based demand deposit
operations. Only an idiot would expect them not to have gone ahead and done
just that when it could be done in a completely opaque environment. They
would actually have been failing in their duty to shareholders had they not.

The final failure of our government was the lack of any resolution authority
whatsoever.
Having allowed the comingling of previously seperated types of financial
services operations, the resolution authority and mechanisms weren't updated
to reflect the new reality.

None of this couldn't have happened in the face of a well informed, active
and motivated electorate.
America did itself and what's "disingenuous" is claiming otherwise.



I agree with you in only one sense. The public did this to themselves.
When they voted in free market fundamentalist republicans and gave them
complete control of the government, in effect they were voting for that
fundamentalist agenda. Now, not all Americans did that but enough did so
that the Bush regime had the seal of approval from the majority. Did
they really understand what they were getting? Of course not. Most
people would not believe it if you told them the government's attitude
towards business would be business can do anything it wants and we won't
interfere with it. After all, by allowing business a free hand to do as
it wants it will bring about prosperity for everyone. At least that is
what they thought. Rational people know that if business isn't watched
by government it will run wild. But the fundamentalists belief is that
no rules is good rules and that is what they did. Did they dismantle the
regulatory apparatus, no. But they did fill the place with like minded
people who would not do their job of regulating business. After creating
this no rules on business administration it was inevitable that there
would be a bust some time down the road. The fundamentalists are blind
to this outcome and the electorate thought they gave the power to
financially responsible republicans. Both were wrong. So who is to
blame? The people who voted in Bush, the Bush administration, and the
business community.

So now we know who to blame what are we going to do to make sure it
doesn't happen again? I mean besides not ever electing another
fundamentalist republican administration.


Hawke

It's a little disingenuous to claim that nothing criminal took place
only because the captured regulators were told to regard broad
categories of theft as 'technically legal'.


I follow Moyers to the extent possible and he's just excellent.

There isn't anything "disingenuous" about such a claim at all.
You and Ig are placing the failure of both the voters and regulatory
agencies on the backs of the regulated.
I'm not condoning GS's behavior in any way, I'm saying that putting people
in jail anytime someone gets mad is a bad idea.
Even promoting that possibility is counterproductive.

I never suggested that the fraud was criminal.

i

Why not? If something is purposefully done fraudulently that is a crime.
What's criminal and what's not is a matter of opinion. You have the
elements of a crime but you have to have a district attorney that
believes those elements have been met. I guarantee you that a lot of
people would judge that many of the things these financial institutions
did are frauds. But if it's a republican who decides that question you
will find they find they are not. That's why it matters who wins the
election. With republicans in power you find that very few cases against
business are pursued because right wing leaning prosecutors just don't
think anything businesses do is a crime. Just like what happened here.

Hawke

On 4/22/2010 5:49 PM, Hawke wrote:

(...)

I agree with you in only one sense. The public did this to themselves.

(...)

I mean besides not ever electing another
fundamentalist republican administration.


You are absolutely right. I just don't understand folks that claim
there is no difference between 'left' and 'right'; that these are
merely distractions to keep us from considering Wall Street as
the real source of all political power.

Here is the deal for folks who still cling to that belief:
In a Republican administration, the poor are prevented from becoming
poorer until after the rich become richer.
In a Democratic administration, the rich are forced to become richer
before the poor are permitted to become poorer.

Night and day.

--Winston


--

Gary was a liar, a thief, a scoundrel and a psychologist.
He was the most redundant man I ever met.

Hawke wrote:
On 4/19/2010 12:00 PM, John R. Carroll wrote:
Winston wrote:
On 4/19/2010 10:08 AM, John R. Carroll wrote:
None of this couldn't have happened in the face of a well informed,
active and motivated electorate.
America did itself and what's "disingenuous" is claiming otherwise.



I agree with you in only one sense. The public did this to themselves.
When they voted in free market fundamentalist republicans and gave
them complete control of the government, in effect they were voting
for that fundamentalist agenda. Now, not all Americans did that but
enough did so that the Bush regime had the seal of approval from the
majority. Did they really understand what they were getting? Of
course not.

The American working class has bought into the thinking that if they devalue
themselves enough, they will still have a job.
The result is less prosperity and a devalued brand.
This is what killed General Motors.

--
John R. Carroll

On Mon, 19 Apr 2010 16:43:04 -0800, John R. Carroll wrote:

Warren Buffet, for example, called derivative products weapons of mass
financial destruction or something like that. He spent 400 million
dollars to get them out of General RE and to get General RE out of that
business. Warren Buffet, John Bogle, Ed Gramlich - the list is very
long, learned, experienced, and distinguished.

The real scandal is that those folks got punished because they missed
the profits of speculation before the bubble burst, and then missed the
TARP and other bailouts, because they were financially sound.

Just like the residential mortgages---folks who bought a house they could
pay for, and who didn't second-mortgage their equity when prices peaked,
will end up helping to bail out their less responsible brethren. I really
hope that the mortgage readjustment programs will have some sort of a
claw-back clause, because it would really be unfair if people would be
able to get their mortgage reduced now, and then profited from eventual
real estate appreciation. My suggestion would be to help underwater
mortgages by extending a zero-interest-rate loan for the negative equity
amount, that stays with the property until the appreciation wipes it out.

By the way, if the government bailed out institutions that made the wrong
bets, who is on the other side of the trade? I read that 10 to 20 B$ of
AIG bailout went directly to foreign counterparties. I would like for
someone to do a global accounting of this money flow, and see a global
picture.

On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to work
appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark. Transparency
is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them. Do
you know that major stock exchanges sell co-location space in their
computer enters, which gives big players who can afford it a, say, 1ms
latency to the transaction stream instead of 1 s that everybody else
sees? Remember the Russian guy who was arrested for stealing computer
code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to work
appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark. Transparency
is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them. Do
you know that major stock exchanges sell co-location space in their
computer enters, which gives big players who can afford it a, say, 1ms
latency to the transaction stream instead of 1 s that everybody else
sees? Remember the Russian guy who was arrested for stealing computer
code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the existing
contracts to still be traded off exchange. Well we are for the law, just
exempt us. Nice.

Bill McKee wrote:
"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them.
Do you know that major stock exchanges sell co-location space in
their computer enters, which gives big players who can afford it a,
say, 1ms latency to the transaction stream instead of 1 s that
everybody else sees? Remember the Russian guy who was arrested for
stealing computer code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the existing
contracts to still be traded off exchange. Well we are for the law,
just exempt us. Nice.

Buffet is concerned with the consequences of AIG's, BofA's, Citi's and
Goldman's crap will have on Berkshire's valuation as a company. I doubt that
what he's holding is toxic because of the research BH always does on what
they own. That won't matter, of course. Collateral damage has been the
boogie man behind nearly every action that's been taken to get a handle on
financial markets.


--
John R. Carroll

"John R. Carroll" wrote in message
...
Bill McKee wrote:
"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them.
Do you know that major stock exchanges sell co-location space in
their computer enters, which gives big players who can afford it a,
say, 1ms latency to the transaction stream instead of 1 s that
everybody else sees? Remember the Russian guy who was arrested for
stealing computer code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the existing
contracts to still be traded off exchange. Well we are for the law,
just exempt us. Nice.

Buffet is concerned with the consequences of AIG's, BofA's, Citi's and
Goldman's crap will have on Berkshire's valuation as a company. I doubt
that
what he's holding is toxic because of the research BH always does on what
they own. That won't matter, of course. Collateral damage has been the
boogie man behind nearly every action that's been taken to get a handle on
financial markets.


--
John R. Carroll



Does not matter if they are toxic or not. Is the principal. Publically
support the law and then try to be exempt from same law. What would you say
if Obama said they would regulate every bank, and then give an exemption to
his advisors favorite. Goldman-sachs?

Bill McKee wrote:
"John R. Carroll" wrote in message
...
Bill McKee wrote:
"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them.
Do you know that major stock exchanges sell co-location space in
their computer enters, which gives big players who can afford it a,
say, 1ms latency to the transaction stream instead of 1 s that
everybody else sees? Remember the Russian guy who was arrested for
stealing computer code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and
FBI obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the
existing contracts to still be traded off exchange. Well we are
for the law, just exempt us. Nice.

Buffet is concerned with the consequences of AIG's, BofA's, Citi's
and Goldman's crap will have on Berkshire's valuation as a company.
I doubt that
what he's holding is toxic because of the research BH always does on
what they own. That won't matter, of course. Collateral damage has
been the boogie man behind nearly every action that's been taken to
get a handle on financial markets.



Does not matter if they are toxic or not. Is the principal.
Publically support the law and then try to be exempt from same law.
What would you say if Obama said they would regulate every bank, and
then give an exemption to his advisors favorite. Goldman-sachs?

LOL
That's almost exactly what's been going on for two years now in the hope
that the exemptions and other consideration will be in the interests of the
greater good.

What I would say is that I wouldn't be pussy footing around so much. I don't
know how the financial services industry would react specifically to
re-enactment of Glass-Stegal or the repeal of CFMA-2000 but I know that they
would find a way to survive and prosper because it's what they DO. One firm,
or more even, might go away but others will come into being to fill any gap.
America is a 14 trillion dollar economy and nobody is going to walk away
with that kind of money on the table. Where the will wants not, a way opens.
Count on it.


--
John R. Carroll

In article ,
"Bill McKee" wrote:

"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to work
appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark. Transparency
is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them. Do
you know that major stock exchanges sell co-location space in their
computer enters, which gives big players who can afford it a, say, 1ms
latency to the transaction stream instead of 1 s that everybody else
sees? Remember the Russian guy who was arrested for stealing computer
code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the existing
contracts to still be traded off exchange. Well we are for the law, just
exempt us. Nice.

What Buffet is asking is that the rules not be changed retroactively, on
existing contracts. In other words, he is asking Congress not to make ex post
facto laws. If Congress refuses, there will be a Supreme Court case asking that
the constitutional prohibition against ex post facto laws be enforced.

Joe Gwinn

Joseph Gwinn wrote:
In article ,
"Bill McKee" wrote:

"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them.
Do you know that major stock exchanges sell co-location space in
their computer enters, which gives big players who can afford it a,
say, 1ms latency to the transaction stream instead of 1 s that
everybody else sees? Remember the Russian guy who was arrested for
stealing computer code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and
FBI obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the
existing contracts to still be traded off exchange. Well we are for
the law, just exempt us. Nice.

What Buffet is asking is that the rules not be changed retroactively,
on existing contracts. In other words, he is asking Congress not to
make ex post facto laws. If Congress refuses, there will be a
Supreme Court case asking that the constitutional prohibition against
ex post facto laws be enforced.

There won't be a court challenge.
There is no reason Congress can't now impose exchange trading conditions and
if Buffet is concerned, he can dump his position before the law takes
effect. " ex post facto" would only come into play if there was a
requirement now to disclose prior trading activity to the public beyond what
had been required. From what I've seen and read, there is no such condition
in the works and even the old law had settlement and disclosure deadlines
which were just ignored because the requirement was unenforceable. CFMA 2000
specifically prohibited requests for info and if you are denied knoweledge
of specific trades, you can't really claim a failure to disclose because
you'd be claiming a failure to disclose something that was specifically
beyond your ability to know about or inquire after.
LOL



--
John R. Carroll

In article ,
"John R. Carroll" wrote:

Joseph Gwinn wrote:
In article ,
"Bill McKee" wrote:

"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them.
Do you know that major stock exchanges sell co-location space in
their computer enters, which gives big players who can afford it a,
say, 1ms latency to the transaction stream instead of 1 s that
everybody else sees? Remember the Russian guy who was arrested for
stealing computer code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and
FBI obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the
existing contracts to still be traded off exchange. Well we are for
the law, just exempt us. Nice.

What Buffet is asking is that the rules not be changed retroactively,
on existing contracts. In other words, he is asking Congress not to
make ex post facto laws. If Congress refuses, there will be a
Supreme Court case asking that the constitutional prohibition against
ex post facto laws be enforced.

There won't be a court challenge.
There is no reason Congress can't now impose exchange trading conditions and
if Buffet is concerned, he can dump his position before the law takes
effect. " ex post facto" would only come into play if there was a
requirement now to disclose prior trading activity to the public beyond what
had been required. From what I've seen and read, there is no such condition
in the works and even the old law had settlement and disclosure deadlines
which were just ignored because the requirement was unenforceable. CFMA 2000
specifically prohibited requests for info and if you are denied knoweledge
of specific trades, you can't really claim a failure to disclose because
you'd be claiming a failure to disclose something that was specifically
beyond your ability to know about or inquire after.

Ex post facto (in other words) was one of Buffet's arguments. We shall see.

Joe Gwinn

Joseph Gwinn wrote:
In article ,
"John R. Carroll" wrote:

Joseph Gwinn wrote:
In article ,
"Bill McKee" wrote:

"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real
time. Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with
them. Do you know that major stock exchanges sell co-location
space in their computer enters, which gives big players who can
afford it a, say, 1ms latency to the transaction stream instead
of 1 s that everybody else sees? Remember the Russian guy who was
arrested for stealing computer code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and
FBI obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the
existing contracts to still be traded off exchange. Well we are
for the law, just exempt us. Nice.

What Buffet is asking is that the rules not be changed
retroactively, on existing contracts. In other words, he is asking
Congress not to make ex post facto laws. If Congress refuses,
there will be a Supreme Court case asking that the constitutional
prohibition against ex post facto laws be enforced.

There won't be a court challenge.
There is no reason Congress can't now impose exchange trading
conditions and if Buffet is concerned, he can dump his position
before the law takes effect. " ex post facto" would only come into
play if there was a requirement now to disclose prior trading
activity to the public beyond what had been required. From what I've
seen and read, there is no such condition in the works and even the
old law had settlement and disclosure deadlines which were just
ignored because the requirement was unenforceable. CFMA 2000
specifically prohibited requests for info and if you are denied
knoweledge of specific trades, you can't really claim a failure to
disclose because you'd be claiming a failure to disclose something
that was specifically beyond your ability to know about or inquire
after.

Ex post facto (in other words) was one of Buffet's arguments.

I'm sure it was. People make specious arguments every day. Even people like
Warren Buffet.
The best and most productive argument made so far have been the donations BH
has made to Ben Nelson. It got the desired result and that is something a
court won't provide under these circumstances. A better argument to any
court would be the forced disclosure of proprietary trading information.

We shall see.

Unlikely. Buffet won't pursue a lost cause.

--
John R. Carroll

Przemek Klosowski wrote:
On Mon, 19 Apr 2010 16:43:04 -0800, John R. Carroll wrote:

Warren Buffet, for example, called derivative products weapons of
mass financial destruction or something like that. He spent 400
million dollars to get them out of General RE and to get General RE
out of that business. Warren Buffet, John Bogle, Ed Gramlich - the
list is very long, learned, experienced, and distinguished.

The real scandal is that those folks got punished because they missed
the profits of speculation before the bubble burst, and then missed
the TARP and other bailouts, because they were financially sound.

Ed Gramlich was at the NY Fed at the same time Timothy Geithner was and he
published a brief but comprehensive analysis of the mortgage market and
government policies in support of both the residential and commercial
housing/rental markets. Unless his 401K was self directed, he didn't hit on
or miss anything and in the end, he's just dead.
John Boggle runs one of the worlds most successful and stable funds and
Buffet prevented General RE from looking like AIG.
They are both leveraging their strength's to good advantage.
Financially sound financial institutions were the beneficiaries of TARP
money to the same extent the public and unsound companies were.
Saving Chrysler and GM went too far but they are peanuts by comparison to
the trillions of dollars Treasury and the Federal Reserve has committed in
order to prevent the collapse of the financial services industry not to
mention the possible collapse of society as we know it.


Just like the residential mortgages---folks who bought a house they
could pay for, and who didn't second-mortgage their equity when
prices peaked, will end up helping to bail out their less responsible
brethren. I really hope that the mortgage readjustment programs will
have some sort of a claw-back clause, because it would really be
unfair if people would be able to get their mortgage reduced now, and
then profited from eventual real estate appreciation. My suggestion
would be to help underwater mortgages by extending a
zero-interest-rate loan for the negative equity amount, that stays
with the property until the appreciation wipes it out.

The moral hazard in this particular instance is real but relatively trivial.
Anyone I know would be tickled to death if the only cloud on the horizon was
moral hazard in the residential mortgage cram down process.
Really, and so would you be.


By the way, if the government bailed out institutions that made the
wrong bets, who is on the other side of the trade? I read that 10 to
20 B$ of AIG bailout went directly to foreign counterparties.

Counterparties got a lot more than $20 Bn but we will never know how much or
who. That's the law, distasteful or unfair as that may seem.
Simple loss ratio's would indicate somewhere in the neighborhood of $350 Bn
altogether and that's pretty cheap.TARP just bridged the gap. It didn't
shoulder the entire burden. I wouldn't be surprised to learn that the actual
accounting over a three or five year period was in the neighborhood of Three
Trillion dollars. That would represent a five percent loss ratio.


I would
like for someone to do a global accounting of this money flow, and
see a global picture.

I don't know why you'd want to see that. I'll be satisfied to know all of
that going forward and that's what's possible.
What you'd like to see isn't.

--
John R. Carroll

Przemek Klosowski wrote:
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to
work appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark.
Transparency is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them. Do
you know that major stock exchanges sell co-location space in their
computer enters, which gives big players who can afford it a, say, 1ms
latency to the transaction stream instead of 1 s that everybody else
sees?

Poorly written trading programs and goofy product integration are bigger
contributors to latency today that connectivity - by far.

Remember the Russian guy who was arrested for stealing computer
code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

High frequency trading is something that would be easy to deal with.
All you'd have to do is impliment a rule and time stamp the products.
A 20 minute mandatory retention period would not be unreasonable and it
would minimize or eliminate sniping and snipping for profit.

Even EBay could do this and cut out automated sniping completely. There
wouldn't be any advantage if a seller could refuse a lowball bid made within
limits of the end of an auction and in the absence of competitive bidding.

--
John R. Carroll

"Joseph Gwinn" wrote in message
...
In article ,
"Bill McKee" wrote:

"Przemek Klosowski" wrote in message
...
On Mon, 19 Apr 2010 14:48:20 -0800, John R. Carroll wrote:

Trading derivatives on an open exchange would cause the market to work
appropriately.
You'd be able to see the Goldman divisions operating in real time.
Investors aren't stupid, they just can't see in the dark. Transparency
is the key. The CFMA of 2000 turned out the lights.

Agreed, even with transparency it may be hard to compete with them. Do
you know that major stock exchanges sell co-location space in their
computer enters, which gives big players who can afford it a, say, 1ms
latency to the transaction stream instead of 1 s that everybody else
sees? Remember the Russian guy who was arrested for stealing computer
code from Goldman Sachs

http://www.wired.com/threatlevel/2009/07/aleynikov/

He was doing this kind of thing. No wonder GS went ballistic, and FBI
obliged.

Warren Buffet has $63 Billion of CDO's. He is asking for the existing
contracts to still be traded off exchange. Well we are for the law, just
exempt us. Nice.

What Buffet is asking is that the rules not be changed retroactively, on
existing contracts. In other words, he is asking Congress not to make ex
post
facto laws. If Congress refuses, there will be a Supreme Court case
asking that
the constitutional prohibition against ex post facto laws be enforced.

Joe Gwinn

Is not ex-post facto. Is changing the rules going forward. He could sell
his CDO's before the new law took effect.