:max_bytes(150000):strip_icc()/GettyImages-80275878-c3c0f8de82854fcfb3f22eace85e95b2.jpg)
Continue reading “THIS DAY IN HISTORY – Bear Stearns collapses, sold to J.P. Morgan Chase – 2008”
Tag: Bear Stearns
IS THE U.S. BANKING SYSTEM SAFE? – 15 YEARS LATER
“We’ve got strong financial institutions…Our markets are the envy of the world. They’re resilient, they’re…innovative, they’re flexible. I think we move very quickly to address situations in this country, and, as I said, our financial institutions are strong.” – Henry Paulson – 3/16/08
“I have full confidence in banking regulators to take appropriate actions in response and noted that the banking system remains resilient and regulators have effective tools to address this type of event. Let me be clear that during the financial crisis, there were investors and owners of systemic large banks that were bailed out . . . and the reforms that have been put in place means we are not going to do that again.” – Janet Yellen – 3/12/23
With the recent implosion of Silicon Valley Bank and Signature Bank, the largest bank failures since 2008, I had an overwhelming feeling of deja vu. I wrote the article Is the U.S. Banking System Safe on August 3, 2008 for the Seeking Alpha website, one month before the collapse of the global financial system. It was this article, among others, that caught the attention of documentary filmmaker Steve Bannon and convinced him he needed my perspective on the financial crisis for his film Generation Zero. Of course he was pretty unknown in 2009 (not so much anymore) , and I continue to be unknown in 2023.
Continue reading “IS THE U.S. BANKING SYSTEM SAFE? – 15 YEARS LATER”
BlackRock: The Company that Owns the World
Click to visit the TBP Store for Great TBP Merchandise
THIS DAY IN HISTORY – Bear Stearns collapses, sold to J.P. Morgan Chase – 2008
On March 16, 2008, Bear Stearns, the 85-year-old investment bank, narrowly avoids bankruptcy by its sale to J.P. Morgan Chase and Co. at the shockingly low price of $2 per share.
With a stock market capitalization of $20 billion in early 2007, Bear Stearns seemed to be riding high. But its increasing involvement in the hedge-fund business, particularly with risky mortgage-backed securities, paved the way for it to become one of the earliest casualties of the subprime mortgage crisis that led to the Great Recession.
Continue reading “THIS DAY IN HISTORY – Bear Stearns collapses, sold to J.P. Morgan Chase – 2008”
THIS DAY IN HISTORY – Bear Stearns collapses, sold to J.P. Morgan Chase – 2008
On this day in 2008, Bear Stearns, the 85-year-old investment bank, narrowly avoids bankruptcy by its sale to J.P. Morgan Chase and Co. at the shockingly low price of $2 per share.
With a stock market capitalization of $20 billion in early 2007, Bear Stearns seemed to be riding high. But its increasing involvement in the hedge-fund business, particularly with risky mortgage-backed securities, paved the way for it to become one of the earliest casualties of the subprime mortgage crisis that led to the Great Recession.
Continue reading “THIS DAY IN HISTORY – Bear Stearns collapses, sold to J.P. Morgan Chase – 2008”
BULL IN A CHINA SHOP
“So the modern world may be increasing in technological knowledge, but, paradoxically, it is making things a lot more unpredictable.” – Nassim Nicholas Taleb, Antifragile: Things That Gain From Disorder
“Success brings an asymmetry: you now have a lot more to lose than to gain. You are hence fragile.” – Nassim Nicholas Taleb, Antifragile: Things That Gain From Disorder
I had read Nassim Taleb’s other best-selling tomes about risk, randomness and black swans – Fooled by Randomness & The Black Swan. They were not easy reads, but they were must reads. He is clearly a brilliant thinker, but I like him more because he is a prickly skeptic who scorns and ridicules academics, politicians, and Wall Street scumbags with gusto. There were many passages which baffled me, but so many nuggets of wisdom throughout each book, you couldn’t put them down.
When his Antifragile book was published in 2012, the name intimidated me. I figured it was too intellectual for my tastes. When I saw it on the shelf in my favorite used book store at the beach, I figured it was worth a read for $9. I’m plowing through it and I haven’t been disappointed.
His main themes are more pertinent today than they were in 2012. He published The Black Swan in 2007, just prior to one of the biggest black swans in world history – the 2008 Federal Reserve/Wall Street created financial collapse. His disdain for “experts” like Bernanke, Paulson, and Wall Street CEOs, and their inability to comprehend the consequences of their actions and in-actions as the financial system was blown sky high, was a bulls-eye.
ALL TIME HIGHS
The stock market has reached new all-time highs this week, just two weeks after plunging over the BREXIT result. The bulls are exuberant as they dance on the graves of short-sellers and the purveyors of doom. This is surely proof all is well in the country and the complaints of the lowly peasants are just background noise. Record highs for the stock market must mean the economy is strong, consumers are confident, and the future is bright.
All the troubles documented by myself and all the other so called “doomers” must have dissipated under the avalanche of central banker liquidity. Printing fiat and layering more unpayable debt on top of old unpayable debt really was the solution to all our problems. I’m so relieved. I think I’ll put my life savings into Amazon and Twitter stock now that the all clear signal has been given.
Technical analysts are giving the buy signal now that we’ve broken out of a 19 month consolidation period. Since the entire stock market is driven by HFT supercomputers and Ivy League MBA geniuses who all use the same algorithm in their proprietary trading software, the lemming like behavior will likely lead to even higher prices. Lance Roberts, someone whose opinion I respect, reluctantly agrees we could see a market melt up:
“Wave 5, “market melt-ups” are the last bastion of hope for the “always bullish.” Unlike, the previous advances that were backed by improving earnings and economic growth, the final wave is pure emotion and speculation based on “hopes” of a quick fundamental recovery to justify market overvaluations. Such environments have always had rather disastrous endings and this time, will likely be no different.”
As Benjamin Graham, a wise man who would be scorned and ridiculed by today’s Ivy League educated Wall Street HFT scum, sagely noted many decades ago:
“In the short run, the market is a voting machine but in the long run, it is a weighing machine.”
IT’S NOT THE BREXIT STUPID
Just over a week ago the world was coming unglued, as enough British citizens grew a pair and spit in the face of the EU establishment and global elite by voting to exit the EU. The fear mongering by central bankers and their puppet political hacks failed to deter people who have become sick and tired of being abused and pillaged by bureaucrats working on behalf of bankers and billionaires.
Stock markets around the world plummeted on Thursday and Friday. The world braced for another Black Monday. The phone lines were buzzing between central bankers around the world over the weekend as their banker constituents demanded relief. If one thing has been proven over the last seven years, its a coordinated effort between central bankers and Wall Street banks to rig the stock market higher can work over a short time period.
The titans of finance were able to once again confound short-sellers and the prophets of doom with a 5% surge from the Friday lows over the next week. It was surely a coincidence the Fed declared all Wall Street banks, safe, sound, and capable of buying back their stocks to the tune of billions early in the week.
These insolvent zombies were now free to borrow billions to buy back their overvalued stocks, destroying shareholder value, while boosting executive compensation. Poor Jamie Dimon is struggling to get by on his $27 million per year. The Wall Street banks obliged by immediately announcing multi-billion dollar buyback schemes to capitalize on the short-term trading mentality of the 30 year old MBA trading geniuses who bought the news without worrying about the actual value of the stocks they were buying.
DERANGED CENTRAL BANKERS BLOWING UP THE WORLD
It is now self-evident to any sentient being (excludes CNBC shills, Wall Street shyster economists, and Keynesian loving politicians) the mountainous level of unpayable global debt is about to crash down like an avalanche upon hundreds of millions of willfully ignorant citizens who trusted their politician leaders and the central bankers who created the debt out of thin air. McKinsey produced a report last year showing the world had added $57 trillion of debt between 2008 and the 2nd quarter of 2014, with global debt to GDP reaching 286%.
The global economy has only deteriorated since mid-2014, with politicians and central bankers accelerating the issuance of debt. These deranged psychopaths have added in excess of $70 trillion of debt in the last eight years, a 50% increase. With $142 trillion of global debt enough to collapse the global economy in 2008, only a lunatic would implement a “solution” that increased global debt to $212 trillion over the next seven years thinking that would solve a problem created by too much debt.
Continue reading “DERANGED CENTRAL BANKERS BLOWING UP THE WORLD”
Paramount’s “The Big Short” In Pictures: Lehman, Bear, and Credit Default Swaps (CDS)
Guest Post by Anthony B. Sanders
Only a couple of days until Paramount Pictures’ “The Big Short” hits the theaters.
As I have discussed before, the movie (and book) is about collateralized debt obligations (CDOs), subprime lending and the crash of the housing prices. The housing price bubble went hand-in-hand with the growth of subprime lending in the mortgage market.
Not to mention the growth of exotic adjustable-rate mortgages (ARMs), acting to offset the decline of real median household income that had been dropping from 1999-2005. The area in electric blue is the focus of “The Big Short” where Christian Bale says the whole housing market is propped up by bad loans.
THE FED INDUCED FARCE
The minutes from the last Fed meeting were released on Wednesday afternoon. The minutes, along with a squadron of jabbering Fed heads lying about the economy doing great, pretty much locked in the most talked about .25% interest rate increase in world history. Evidently the Wall Street titans of greed have convinced the muppets higher interest rates are great for stocks, as the market soared by 250 points. As institutional money exits the market on these rigged up days, the dumb money retail investor buys into the market with dreams of riches just like they did with Pets.com in 2000, McMansions in 2005, and Bear Stearns in 2007.
The Fed has lost any credibility they ever thought they deserved by delaying this meaningless insignificant interest rate increase for the last three years, so they will make this token increase in December come hell or high water. They want to give themselves some leeway for easing again when this debt saturated global economy implodes in the near future. The Fed is trapped by their own cowardice and capture by the Wall Street cabal. If they raise rates the USD will strengthen even more than it has already. The USD is already at 11 year highs. It has appreciated by 25% in the last year versus the basket of world currencies. The babbling boobs on the entertainment news channels authoritatively expound with a straight face about the rise in the dollar being due to our strong economic performance. It’s beyond laughable, as the economy has been sucking wind since the day the Fed turned off the QE spigot in October 2014.
JIM CRAMER & CNBC ARE A JOKE
Does it ever get old watching the lying sack of shit Jim Cramer and his discredited Wall Street Shill network CNBC get raked over the coals for their blatant propaganda and absolutely horrible investment advice?
A Brief History Of Jim Cramer’s Opinions On “Pillar Of Strength” Best Buy
Submitted by Tyler Durden on 01/16/2014 17:36 -0500
You really can’t make this shit up. From the funniest person on financial comedy TV (whose most memorable TV appearance will always be roaring that Bear Stearns is fine days before its collapse), here is his “opinion” on Best Sell Buy, entirely in his own words.
November 20: Jim Cramer opines on Best Buy:
Pillars of Strength in Retail
The homework doesn’t dovetail with the shares. That’s how I felt about the way Best Buy (BBY), Home Depot (HD) and Dick’s (DKS) traded in the wake of the earnings calls — because all three were basically in all-systems-go mode for suppliers.
Regarding Best Buy, it looks as if the tablet is the standout. I know that Apple (AAPL) has become a hated equity, but I keep hearing good things, so I can’t join the nitpicker mob. You did get a nice Chrome call-out for Google (GOOG), but that’s just icing on the Google lovers’ cake.
All three chain stores — Home Depot, Dick’s and Best Buy — are pictures of strength, not weakness. All three stocks should be bought, not sold, on share weakness, despite whatever the “action” says about how well the companies performed. They have performed superbly against both their fields and against retail in general.
Then the next day, November 21, just in case the message was lost:
Best Buy Co. Inc. Jim Cramer ranked this stock a Buy. Cramer previously ranked this stock a Buy on November 15, 2013. The news about tablets also bodes well for Best Buy, a company that has turned around its ailing retail position to once again become one of the stronger names selling technological products to consumers. Cramer said that retail stocks were especially well-positioned at the moment, and he did not neglect to mention Best Buy near the top of his list of retail all-stars.
Fast forward to today, following a 30% collapse in the stock price in one day. From TheStreet:
It really makes you wonder what went wrong when you see a company down 30% in a single trading session, TheStreet’s Jim Cramer said of Best Buy.
The co-portfolio manager of the Action Alerts PLUS portfolio said most analysts had been bullish on the stock, all the way into the upper $30s.
Uhm, just the analysts?
Those expectations were way off, Cramer said. The company reported sales fell 0.8% for the nine weeks ended Jan. 4, while analysts had expected growth and no real degradation in gross margins.
Cramer advised investors who want to buy the stock to wait until Friday because these types of violent moves tend to pan out over a two-day period.
So buy, buy, buy Best Buy at $40, but wait at $26? Gotcha.
And the piece de resistance comes from CNBC this morning:
Cramer said the electronics retailer needs a “big reset,” and that analysts erred in thinking the company could compete with online shopping outlets. He said the holidays were an “Amazon quarter.”
…
A steady stream of positive analyst notes before the busy holiday season helped set up Best Buy for its huge 30 percent drop Thursday, CNBC’s Jim Cramer said.
“Each day one came out and then another came out,” Cramer said Thursday on “Squawk on the Street.” “If they had all come out at once, the stock wouldn’t have been pumped to where it was. It was a serial rollout of positives.”
Wait a minute. It was precisely the “steady stream of positive analyst notes” that Cramer used to pitch as the buying catalyst in Best Buy just back on November 19 and as the reason why people should not sell the stock!!!
The people who are selling [Best Buy] don’t realize the power of the reiteration of [analyst] recommendations we are going to get in the next few days.
But… but… less than two months later it was this very reason that Cramer used as an excuse why the company sold off! It really isn’t… it doesn’t… it can’t… it makes no…
Aghhhh #Ref!
Summarizing it all below:
And now we eagerly await the sequel: “Get Poor Instantly”
