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Author: utofbu on October 04 2008 Viewed 1347 times. 5 people liked this blog. You can rate it below if you haven't already.
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I think I figured out one of the prime culprits in this crisis we all are watchin unfold.
the amount of money that flows through the paper market every day is about 40% of the bailout bill. Sometimes its more, sometimes its less. so ostensibly, if bonds fail 3 days in a row, and cds's account for over 100% of daily leverage, the bailout will cover less than 3 days of loss. And considering that the bailout is distributed to more than just the paper market, you can assume that it would cover even less.I guess that is my point. I will get you real sources. 15-20 people in a single firm can blow a hole in the market like we are seeing.
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10/05/08
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astroid
it's all about jerome kerviel
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10/05/08
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adcBicycle
urgent!!! the billionaires are going to starve!!!!!
10/05/08
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utofbu
nice scott, nice.
10/05/08
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utofbu
join my damn facebook group! lolz!
10/05/08
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ignatius
at least w/the AIG loan they gave it at 8.5% and became the majority shareholder in the company. that's a good deal for the USA tax payer as AIG has plenty of assets to sell off to pay the loan back + 8.5% is a fucking loan shark rate for that kind of loan. so that one they did right.. regardless of how you feel about the fed bailing out companies in a supposedly "free market economy".
10/05/08
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utofbu
but, this does not stop Moody's from rating AIG as BB or B+ which undermines who knows how many untold cds or cdo deals that aig was tied up with in other pension firms and other hedge funds(the hedge funds are fine but the pension firms will have to retract the loaning that THEY have been involved with which will create collateralised loss)
10/07/08
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jogn
oh shit those drops in stocks from the hedge funds getting out is amazing.
10/07/08
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astroid
there's a lot of dentists beating their kids tonight
and then later we'll all eat our young
yay 2008!
10/07/08
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fakeBlooper
i keep all my money in soybeans.
and i keep them under my bed.
10/08/08
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astroid
"if i were going to put money in this market, i'd invest in replacement bones for babies. they're going to take some serious beatings over the next few months" zach braff on the market
10/08/08
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eyesnine
unregulated markets crash because there are people that gain from it.
i think it's about time we consider a paperless economy, and full regulation. all transactions are monitored. every cent is accounted for. problems are detected before they induce a recession. credit rates are calculated exactly. the black market is reduced to bartering.
that's just my opinion, though.
10/09/08
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utofbu
eyesnine you are very right. Ive been looking at the problems that have come out of the gramm-leach-bliley act and the Futures Modernization act. A total hands-off environment for oversight has erupted in 10 years. Not to say that the problems began before G-L-B act ( 1999 ). but alot of the problems we see in the risk sector worldwide are due to this act and following acts that basically spawned an environment of "Inaction" from the banking sector.
10/09/08
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utofbu
OMG astroid lol! replacement bones! LOLZ!
10/10/08
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jogn
10/10/08
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utofbu
wow jogn, very interesting
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