Posts Tagged ‘Banks’
The Fix is In – The Long and the Short Of Wall Street
Another bumper day on the Street. The Government bails out another basket case bank. Everything’s right with the world. Hurrah! Yet again, Wall Street proves it’s an utterly amoral, self-interested, club that has nothing whatsoever to do with you and me.
Massive market volatility, huge gains on the basis of nothing, followed by huge losses and back to gains. Is there a pattern to all this? Not on the surface, at least. The press loves reasons, and tacks on some or other reason for that day’s movements. Recession indicators, new appointment at Treasury, another baby for Angelina and Brad.
But maybe something else is in play too, something mysterious, something very, very fishy.
Traders either go “long” hoping a stock will rise, or they go “short” on borrowed stock hoping the stock will drop and they get to keep the difference on the sale. Long traders and short traders are not in competition, but supposing they were, even in some unspoken way, in collusion. Wall Street traders aren’t known for their mild-mannered approach to business, so could be…
Paulson – The Man With The Plan
After nationalizing Fannie and Freddie, then letting Lehman Brothers die for no apparent reason, then bailing out AIG to the tune of $85 billion (now around $150 billion but who’s counting), Hank Paulson sat back to watch the credit markets unfreeze. But instead they just froze up some more.
Hank was totally bummed. “This job totally sucks”.
“The credit freeze just keeps on freezing”, he said to his posse of former Goldman Sachs hacks. “What the frick do I do?”
“You need one big plan”, said Neel Cash and Carry, “not just a whole bunch of little plans stuck together”. Hank nodded furiously. “Yes, yes, that’s right”. After scribbling a few notes on the back of a dry cleaning bill he looked up. “I’ve got it”. Read the rest of this entry »