Archive for August 2008
Breaking news from the land of butterflies
Circulating the forums…
Breaking News: Lehman To Be Acquired by Tooth Fairy
The market responded with enthusiasm to reports that the Tooth Fairy has agreed to acquire Lehman. The purchase price has not yet been determined and will be set by Dick Fuld wishing upon a star, clicking his heels three times, and being transported back to that magical place where Lehman still sells for over $70 per share.
In related news, Lehman has agreed to sell all of its level III capital, including CDOs, ABSs, pet rocks, baseball cards, slightly used condoms, and credit default swaps written by MBIA and Ambac. Lehman’s level III capital will be acquired for 150% of its face value by Tinkerbell, who will carry it off to Neverland to be fed to a crocodile. Lehman is financing 90% of the acquisition at an interest rate that has not been announced; Tinkerbell’s up-front payment consists of a handful of pixie dust, three crickets, and a bullfrog. Analyst Dick Bove estimates that the bullfrog could eventually be transformed into three princes and a pumpkin coach. The deal gives Lehman no recourse to any of Tinkerbell’s assets other than the Level III capital. If Tinkerbell defaults, Lehman’s successor entity will stick its hand down the crocodile’s throat and attempt to get it to regurgitate. The firm’s historical value-at-risk analysis shows that sticking your hand down a crocodile’s throat is completely safe.
Treasury Secretary Hank Paulson issued a statement: “I am delighted that SWFs (Sovereign Wealth Fairies) continue to express confidence in the terrific values represented by American financial institutions. As I have been saying since August of 2007, this shows that the crisis is now over.”
Meanwhile, the SEC has announced an investigation of mean, evil, bad short-seller David Einhorn. While out for a beer with a friend, Einhorn reportedly suggested that the Tooth Fairy does not exist and that wishing upon a star is not a wholly reliable price discovery mechanism. Christopher Cox, chairman of the SEC, said, “Vicious rumors attacking the Tooth Fairy will not be tolerated. Our entire financial system and indeed the American way of life depend on the Tooth Fairy and wishing upon a star. How else could one value level III capital appropriately?” The SEC is reportedly planning to set up re-education camps for short-sellers.
Bye bye credit card market-”Fake Living”
Like Peter Schiff has been warning for at least 1 year, the next huge problem looming is credit card debt, that has been securitized and sold off to foreigners. Much of this debt will never be paid back, especially with the US economy entering a prolonged economic recession or depression.
When the foreigners who lent their money to American credit card holders realize they aren’t going to get paid back, they will stop lending the money, making it much harder for consumers to get credit.
Another knife in the back of a phony economy.
War Thrills the American Soul
“Deep inside we love war. We want war. Need it. Relish it. Thrive on war. War is in our genes, deep in our DNA. War excites our economic brain. War drives our entrepreneurial spirit. War thrills the American soul.”
Lehman Brothers near 52 week low
After all the lying and manipulating, all the positive spin and bs, Lehman Brothers is nearing it’s 52 week closing price today after losing 13% JUST TODAY to close at 13.04.
To flip Paulson’s words from a few weeks ago “The worst is over” no no, “The worst is just beginning”.
The lying and deception will continue, there is no alternative at this point, anything else would lead to mass panic.
Large US bank collapse ahead, says ex-IMF economist
Following a chain of events going back over the last 1 1/2 years I have seen headlines pop up like this, then silence about the issue, then all of the sudden it happens. Bernanke said “banks would fail” a month or so later….BSC(which was technically an Investment Bank).
My guess…… Citigroup!
A guide for those who are looking to learn more about the big mess
One of the best reader-friendly presentations I have seen on one of the major parts of the worldwide financial chaos that is currently just getting started.
The Debt Trap NY Times
Oh, I thought everything was ok
What the hell happened to Gold?
Many are still searching for reasons for the recent drops, but the fundamentals stay the same.
Credit crisis “Far from over”
That’s because it is not just a “credit crisis”. It’s a fiat money collapse. Greedy bankers and governments running wild in tandem with an ignorant populous sitting on the couch.
“Hundreds of banks will fail”
Nouriel Roubini, who has been calling for tough times since 2005, is now coming out saying he believes that “hundreds of banks will fail” and that “Americans are shopped out”.
On another note, Roubini who called the market going up in 2005-2006 a suckers rally on CNBC, said he is “bullish on the global economy in the medium and long-term.
