Guest View
User: Pass: | become a member
Posts Tagged ‘losses’

Obama No Longer Bothering to Lie Credibly: Claims Financial Crisis Cost Less Than S&L Crisis

Obama No Longer Bothering to Lie Credibly: Claims Financial Crisis Cost Less Than S&L Crisis

Courtesy of Yves Smith at Naked Capitalism 

I’m so offended by the latest Obama canard, that the financial crisis of 2007-2008 cost less than 1% of GDP, that I barely know where to begin. Not only does this Administration lie on a routine basis, it doesn’t even bother to tell credible lies. .And this one came directly from the top, not via minions. It’s not that this misrepresentation is earth-shaking, but that it epitomizes why the Obama Administration is well on its way to being an abject failure.

On the Jon Stewart Show (starting roughly at the 1:10 mark on this segment) Obama claims the cost of this crisis will be less than 1% of GDP, versus 2.5% for the savings and loan crisis (hat tip George Washington, sorry, no embed code, you need to go here):

Picture 3

The reason Obama makes such baldfacedly phony statements is twofold: first, his pattern of seeing PR as the preferred solution to all problems, and second, his resulting slavish devotion to smoke and mirrors over sound policy.

The savings & loan crisis led to FDIC takeovers of dud banks and the creation of a resolution authority to dispose of bad assets. That produced costs which were largely funded by the Federal government. I’ve heard economists repeatedly peg the costs at $110 to $120 billion; Wikipedia puts it at about $150 billion. This approach, of cleaning up and resolving banks, has been found repeatedly to be the fastest and least costly way to contend with a financial crisis.

The reason Obama can claim such phony figures is that many of the costs of saving the financial system are hidden, the biggest being the ongoing transfer from savers to banks of negative real interest rates, which is a covert way…
continue reading


Tags: , , , , , , , , , , , , , , , ,




How You’re Going to Get Cornholed Thanks To Obama

How You’re Going to Get Cornholed Thanks To Obama

Courtesy of Karl Denninger of The Market Ticker

The economy, that is.

This is a must-read from Chris Whalen.  He’s spot-on, and I will reprint only the conclusions – read through for the why, what and how.

  • The U.S. banking industry entering a new period of crisis where operating costs are rising dramatically due to foreclosures and loan repurchase expenses. We are less than ¼ of the way through foreclosures. The issue is recognizing existing losses ??not if a loss occurred.

  • Failure by the Bush/Obama to restructure the largest banks during 2008?2009 period only means that this process is going to occur over next three to five years – whether we like it or not. Lower growth, employment are the cost of this lack of courage and vision.

  • The largest U.S. banks remain insolvent and must continue to shrink until they are either restructured or the subsidies flowing from the Fed, Fannie Mae/Freddie Mac cover hidden losses. The latter course condemns Americans to years of economic malaise and further job losses.

Yep.

The bottom line folks is that the fraud – massive and outrageous concealment of losses, intentionally making bad loans in the mid-2000s (now admitted to under oath by Citibank’s chief underwriter, among others) and the selling of that paper everywhere and anywhere that the banks could manage, along with holding much of it themselves, condemns us.

The opportunity to take these banks into receivership in 2007 existed.  It existed in 2008 too.  I counseled on doing exactly this during those years. 

Instead, both Bush and Obama decided to protect those who had committed these offenses.  First by attempting to bail them out, and then when it became obvious that $700 billion of taxpayer money was literally trying to **** on a forest fire to put it out they decided instead to paper it over by extorting FASB so the losses could be swept under the carpet instead of recognized.

The problem is that unlike long-run spending problems like Social Security and Medicare, which will detonate in ten year or more, this is a current account cash-flow problem and the deterioration continues month-by-month as the payments are not made.  It’s like a barrel of dead fish.  The next morning it starts to stink.  Every day it stinks worse.  Putting a…
continue reading


Tags: , , , , , , , , , , ,




Investigation Begins Into E&Y's Role In Connection With Lehman's Repo 105 Scam

Investigation Begins Into E&Y’s Role In Connection With Lehman’s Repo 105 Scam

Courtesy of Tyler Durden

Fox Business reports that the investigation around Lehman is intensifying. Surely the SEC, now generically equated with objects that float around in sewers in formal conversation, has realized it has to do something, anything, to find at least one scapegoat for the financial collapse. Which is why we read with little surprise Gasparino’s report that "thee SEC has ramped up its inquiry into Lehman’s fall, particularly after court-appointed bankruptcy examiner Anton Valukas issued a lengthy report stating that Lehman’s top executives were “grossly negligent” in possibly hiding the risky nature of the firm’s finances during its final day." What we find much more interesting is that "yet another investigative agency, the Public Accounting Oversight Board — created under the 1992 Sarbanes-Oxley law to investigate and discipline public accounting firms — has launched an inquiry into the role of Lehman’s auditor, Ernst & Young, following the examiner’s report, which accused the big accounting firm of “professional malpractice,” for its work in approving accounting techniques Lehman used during its dying days in the summer of 2008." In the absence of any Wall Street villains, which it is now all too clear have endless diplomatic immunity from prosecution by the corrupt regulators, will the auditor, together with Dick Fuld, be made into the sacrificial lambs? Or will we continue the farce that anything even remotely related to capital markets integrity and reporting is real and valid? Judging by the nearly 60 days of no S&P downticks, the market has answered that question for us.

More from Gasparino:

It was the use of one of those accounting techniques, known as Repo 105, which appears to be at the top of the list of investigators, people with knowledge of the inquiry say. The use of the accounting technique, which is designed to temporarily lower the amount of “leverage,” or borrowing a firm uses to stay afloat thus lowering its risk levels, isn’t necessarily illegal. In fact, Lehman sought and received a favorable opinion from Ernst & Young to use the technique in 2008.

But what might fall afoul of the securities laws, according to people close to the inquiry, is if Lehman turned to the gimmick in a concerted effort to hide its risk level. One person with knowledge of the inquiry say investigators


continue reading


Tags: , , , , , , , , , , , ,




How to Get Off the Performance Roller Coaster

How to Get Off the Performance Roller Coaster

Munich Oktoberfest Preparations

By Brett Steenbarger 

Do you find yourself on a performance roller coaster? This is a situation in which you make money for a while, begin to think you have it all figured out, only to fall back, lose money, and feel like a rookie all over again. 

A while back, I wrote about the performance roller coaster and some of the emotional factors that sustain it. The gist of that important post was that how we process wins and losses affects our subsequent trading--and sometimes contributes to winning and losing streaks.

I just finished an enjoyable interview with Mark Wolfinger of the Options for Rookies site. One topic that came up was the way in which traders identify with their P/L. Once a trader’s sense of identity and esteem becomes caught up in profits and losses, the trader begins an emotional roller coaster simply due to the natural ups and downs of markets.

Continue here.>>

See also: Addictive Trading: When Trading Becomes a Problem


Tags: , , ,




What Happens in the Amygdala… Damage to Brain’s Decision-Making Area May Encourage Dicey Gambles

Evidence that the brain’s region called the "amygdala" is at least partly responsible for fear-based loss aversion: – Ilene

What Happens in the Amygdala… Damage to Brain’s Decision-Making Area May Encourage Dicey Gambles

Image Of Thinking Man's Brain Through Bowler Hat

By Katie Moisse at Scientific American   

Imagine you’ve lost your job. You have some money saved, and a chance to double it with a gamble. But if you lose the bet, you’ll forfeit everything. What would you do?

Most people would not gamble their savings, according to Benedetto De Martino of California Institute of Technology, author of a study published February 8 in Proceedings of the National Academy of Science. People tend to choose avoiding losses over acquiring gains—a behavior known as loss-aversion.

But people with damage to the amygdala—an almond-shaped part of the brain involved in emotion and decision-making—are more likely to take bigger risks with smaller potential gains, De Martino’s study found. Two women with bilateral amygdala damage showed a dramatic reduction in loss aversion compared with age-matched control subjects on a series of experimental gambles, despite understanding full well the values and risks involved.

Continue reading here.>>


Tags: , , , , ,




Five Fatal Flaws of Trading

Here’s an educational article on the fatal mistakes made by 90% of traders, resulting in – surprise! - losing money.  Courtesy of Elliott Wave International. – Ilene

Five Fatal Flaws of Tradingthe invisible hand, trading

By Jeffrey Kennedy

Close to ninety percent of all traders lose money. The remaining ten percent somehow manage to either break even or even turn a profit – and more importantly, do it consistently. How do they do that?

That’s an age-old question. While there is no magic formula, one of Elliott Wave International’s senior instructors Jeffrey Kennedy has identified five fundamental flaws that, in his opinion, stop most traders from being consistently successful. We don’t claim to have found The Holy Grail of trading here, but sometimes a single idea can change a person’s life. Maybe you’ll find one in Jeffrey’s take on trading? We sincerely hope so.

The following is an excerpt from Jeffrey Kennedy’s Trader’s Classroom Collection. For a limited time, Elliott Wave International is offering Jeffrey Kennedy’s report, How to Use Bar Patterns to Spot Trade Setups, free.

Why Do Traders Lose?

If you’ve been trading for a long time, you no doubt have felt that a monstrous, invisible hand sometimes reaches into your trading account and takes out money. It doesn’t seem to matter how many books you buy, how many seminars you attend or how many hours you spend analyzing price charts, you just can’t seem to prevent that invisible hand from depleting your trading account funds.

Which brings us to the question: Why do traders lose? Or maybe we should ask, ‘How do you stop the Hand?’ Whether you are a seasoned professional or just thinking about opening your first trading account, the ability to stop the Hand is proportional to how well you understand and overcome the Five Fatal Flaws of trading. For each fatal flaw represents a finger on the invisible hand that wreaks havoc with your trading account.

Fatal Flaw No. 1 – Lack of Methodology

If you aim to be a consistently successful trader, then you must have a defined trading methodology, which is simply a clear and concise way of looking at markets. Guessing or going by gut instinct won’t work over the long run. If you don’t have a defined trading methodology, then you don’t have a way to know what constitutes a…
continue reading


Tags: , , ,




Credit Card Issuer Advanta Has Huge Losses, Halts Lending

Courtesy of Mish

Credit Card Issuer Advanta Has Huge Losses, Halts Lending

The credit card industry is in huge stress and things are about to get worse. Please consider Advanta Halts Credit-Card Lending Amid Surging Losses

Advanta Corp., the issuer of credit cards for small businesses, will shut down accounts for its 1 million customers next month and seek to pay off securitized debtholders early as the recession pushes defaults higher.

Lending will cease June 10 as part of a plan to preserve capital after uncollectible debt reached 20 percent on some cards as of March 31, the Spring House, Pennsylvania-based firm said yesterday in a statement. Advanta will use as much as $1.4 billion to pay investors as little as 65 cents on the dollar to buy back securitized credit-card loans. That would be the first so-called early amortization of a trust since 2003, according to JPMorgan Chase & Co. analyst Christopher Flanagan.

“Early-amortization has been viewed as a catastrophic event for issuers,” Scott Valentin, an analyst at Friedman Billings Ramsey & Co., said today in a research note. “Given that all credit-card accounts in the trust will be shut down to future use, we expect losses to increase as the cards have substantially less utility to cardholders.”

The company plans to use up to $1.4 billion to make cash offers to trust investors at a price of 65 percent and 75 percent of the debt’s face value. While the company has “no indication” if investors will accept that offer, the price is “relatively consistent with recent trading levels of the bonds,” Browne said.

“They’re hoping they can stay alive barely until the environment changes,” said David Robertson, president of the Nilson Report, the Carpinteria, California-based industry newsletter. This is “a big sign that the credit-card industry has problems that are going to be around for several years.”

Advanta was the 11th-biggest U.S. credit-card issuer at the end of 2008 with about $5 billion in outstanding balances, and the only major lender focused on small business borrowers, Robertson said.

With the economy shedding jobs at an unprecedented rate, consumers and small businesses are under extreme stress. Please consider the following chart.

Economy losing 500,000+ jobs for six consecutive months

For more details on jobs, please see Jobs Contract 16th Straight Month; Unemployment Rate Soars to 8.9%.

Even if losses improve to


continue reading


Tags: , , , ,




 

Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!

 
 

Phil's Favorites

Charting the Average September Stock Market

Charting the Average September Stock Market Courtesy of 

Today you’re hearing a lot about how stocks act historically during the month of September. It’s considered to be the worst month of the year in terms of average annual returns and it usually leads to a pickup in seasonal volatility.

My pal Jon Krinsky CMT, technical analyst at MKM Partners in New York, put the below S&P 500 chart out last night…

While September is historically a negative month, it’s really the back half that tends to see the selling, which continues into October. Below is the average yearly chart for the SPX over the last 30 years. As we can see, there actually tends to b...



more from Ilene

Zero Hedge

Memo To Washington: Iraq Is Not A Nation And You Can't Build One There With Bombs

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by David Stockman via Contra Corner blog,

Washington’s strategy in Iraq is in shambles, but not just because America’s spanker-in-chief is really a wimp at heart. The problem is far more generic. To wit, the geographic territory of Iraq is not a nation; it is an arbitrary series of lines on a map drawn 100 years ago by dandies in the foreign offices of two fading empires (the British and the French) - which lines encircled numerous tribes, ethnicities and religious confessions which had no interest in sharing a common state...



more from Tyler

Chart School

Are Gold Prices Taking Cues From The Swiss Franc?

Courtesy of Doug Short.

The S&P 500 opened fractionally higher and hit its 0.14% intraday high moments later. The 10 AM August Manufacturing Report came in stronger than expected, but an hour later, the index started a selloff that would send it to its -0.43% intraday low in the early afternoon. A modest rally trimmed the loss to -0.05% at the close.

The S&P 500 went nowhere today, but Treasuries stirred a bit. The yield on the 10-year Note closed at 2.42%, up 7 bps from Friday's close.

Here is a 15-minute chart of the past five sessions.

Today's trading volume picked up after the pre-Labor Day doldrums but remains below its 50-day moving average.

For a longer-term perspective, here is a pair of charts based on daily closes starting with the all-time high prior to the Great Recessio...



more from Chart School

All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

more from David

OpTrader

Swing trading portfolio - week of September 2nd, 2013

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



more from OpTrader

Insider Scoop

NXP To Supply Apple With Mobile Payment Chips

Courtesy of Benzinga.

Related NXPI Stocks Hitting 52-Week Highs Morning Market Movers

NXP Semiconductors NV (NASDAQ: NXPI) gained three percent in pre-market trading Friday on a report it's providing wireless chips to the Apple (NASDAQ: AAPL) iPhone 6, enabling a mobile payment system.

The Netherlands-based semiconductor company makes so-called Near Field Communications chips that smartphones use to communic...



http://www.insidercow.com/ more from Insider

Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's the latest issue of Stock World Weekly. Click on this link and use your PSW user name and password to log in. Or take a free trial. 

Enjoy!

...

more from SWW

Option Review

Puts Active On Buffalo Wild Wings

Buffalo Wild Wings Inc. (Ticker: BWLD) shares are in positive territory in early-afternoon trading on Thursday, reversing earlier losses to stand up 0.50% on the session at $148.50 as of 12:15 pm ET. Options volume on the restaurant chain is running approximately three times the daily average level due to heavy put activity in the October expiry contracts. It looks like one or more traders are buying the Oct 140/145 put spread at a net premium of roughly $1.45 per contract. As of the time of this writing, the spread has traded approximately 3,000 times against very little open interest at either striking price. The put spread may be a hedge to protect a long stock position against a roughly 6% pullback in the price of the underlying through October expiration, or an outright bearish play anticipating a dip in BWLD shares in the next couple of months. The spread makes money at expiration if shares in BWLD decline 3.3% from the current price of $148.50 to breach the breakeven point...



more from Caitlin

Sabrient

Six Companies Push Tax Rules Most

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

Gradient Senior Analyst Nicholas Yee reports on six companies that are using a variety of techniques to shift pretax profits to lower-tax areas. Featured in this USA Today, article, the companies include CELG, ALTR, VMW, NVDA, LRCX, and SNPS.

Six Companies Push Tax Rules Most

Excerpt:

Nobody likes to pay taxes. But some companies are taking cutting their tax bil...



more from Sabrient

Digital Currencies

Disgraced Mt Gox CEO Goes For Second Try With Web-Hosting Service (And No, Bitcoin Not Accepted)

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Mt Gox may be long gone in the annals of bankruptcy, but its founder refuses to go gentle into that insolvent night. And, as CoinDesk reports, the disgraced former CEO of the one-time premier bitcoin trading platform has decided to give it a second try by launching new web hosting service called Forever.net and is registered under both Karpeles’ name and that of Tibanne, the parent company of Mt Gox.

From the company profile:

“TIBANNE Co.Ltd. ...



more from Bitcoin

Market Shadows

Helen Davis Chaitman Reviews In Bed with Wall Street.

Author Helen Davis Chaitman is a nationally recognized litigator with a diverse trial practice in the areas of lender liability, bankruptcy, bank fraud, RICO, professional malpractice, trusts and estates, and white collar defense. In 1995, Ms. Chaitman was named one of the nation's top ten litigators by the National Law Journal for a jury verdict she obtained in an accountants' malpractice case. Ms. Chaitman is the author of The Law of Lender Liability (Warren, Gorham & Lamont 1990)... Since early 2009, Ms. Chaitman has been an outspoken advocate for investors in Bernard L. Madoff Investment Securities LLC (more here).

Helen Davis Chaitman Reviews In Bed with Wall Street. 

By Helen Davis Chaitman   

I confess: Larry D...



more from Paul

Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



more from Pharmboy

Promotions

See Live Demo Of This Google-Like Trade Algorithm

I just wanted to be sure you saw this.  There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.

If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.

Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.

Follow this link to register for their training webinar where they’ll demonstrate the tested and proven Algorithm powered by the same technological principles that have made GOOGLE the #1 search engine on the planet!

And get this…had you done nothing b...



more from Promotions



FeedTheBull - Top Stock market and Finance Sites



About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

Learn more About Phil >>


As Seen On:




About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>