Posts Tagged ‘Matt Taibbi’

Populism: Just Like Racism!

Populism: Just Like Racism!

populismBy Matt Taibbi

It’s easy to see why politicians would be drawn to the populist pose. First, it makes everything so simple. The economic crisis was caused by a complex web of factors, including global imbalances caused by the rise of China. But with the populist narrative, you can just blame Goldman Sachs.

via Op-Ed Columnist – The Populist Addiction – NYTimes.com.

Normally one would have to be in the grip of a narcissistic psychosis to think that a columnist for the New York Times has written an article for your personal benefit. But after his latest article in the Times, in which he compares the “populism” of people who “blame Goldman Sachs” with exactly the sort of racist elitism I ripped him for last week, I think David Brooks might be trying to talk to me.

I think that’s at least part of what’s going on in his latest column, which is odd. If I were in his position, I probably would have punched me in the nose for the shot I took at him last week, but the response of David Brooks to being called out as a racist weenie is to write a passionate defense of the rich, one that includes the admonition that while blaming the wealthy is easy and feels fun, truly wise men should “tolerate the excesses of traders.”

I don’t want to get into the position of fixating on one guy for personal reasons. Obviously I’ve done too much of that with Brooks already, and I absolutely promise to give that part of it a rest for a good long while after this.

But leaving aside any discussion of Brooks the human being, this latest column of his is something that has to be discussed. The propagandistic argument he makes about the dangers of “populism”  is spelled out here as clearly as you’ll ever see it expressed in print, and this exact thing is a key reason why so much of the corruption that went on on Wall Street in the past few decades was allowed to spread unchecked.

That’s because this argument is tacitly accepted by almost everyone in our business, and most particularly is internalized in the thinking of most newspaper editors and TV news producers, who over time develop an ingrained habitual fear of publishing material that seems hysterical or angry.

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On kleptocracy and the sense that we have a one-party system

On kleptocracy and the sense that we have a one-party system

Matt TaibbiCourtesy Edward Harrison at Credit Writedowns

As a writer, Matt Taibbi is a lot more vitriolic than I am. He curses, makes some pretty over-the-top personal attacks, and divines a policymaker’s intent where I don’t think he can. But, this goes mostly to style.  Substantively speaking, he has a lot to say and we should take notice. 

I wanted to highlight a piece he wrote yesterday called Fannie, Freddie, and the New Red and Blue. The crux of his argument is this: The partisan rhetoric is on full display in the dust-up over the unlimited liabilities coming from Fannie and Freddie thrust upon taxpayers on Christmas Eve. This rhetoric is not just beside the point, it is specifically designed to obscure the point, namely that both Democrats and Republicans, private industry and the government are culpable in the shambles our economic system has become.

Taibbi says:

Over the Christmas holiday a nasty thing happened: Tim Geithner’s Treasury Department decided to lift the cap on aid to the Government-Sponsored Entities, Fannie Mae and Freddie Mac, apparently in response to Obama administration fears that the two agencies would become insolvent. The cap was raised from $200 billion on each and government backstopping of the mortgage market will apparently now extend into infinity for at least three years, through 2012.

The move has already inspired a mini-firestorm, with several outlets delving deeply into the recent history of the GSEs and uncovering some disturbing new facts…

Sometimes I’m amazed at the speed with which highly provocative information like this GSE business can be converted into distracting propaganda in this country…

What worries me is that we’re… starting to see fault lines develop, where one side blames the government while another side blames Wall Street for the messes of the last two decades…

Everyone was involved in the mortgage scam. At the lender level the deceptions were myriad; liar’s loans, fraudulent income documentation, negative amortization loans, HELOCs, etc. The rush to get as many loans written as possible and then get those hot potatoes moved to the next sucker in the line was furious and extended from coast to coast, sinking one lender after another in Ponzoid debt and indictments….

Everyone had a hand in the bubble,


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The American Prospect Savages Matt Taibbi For Savaging Obama

The American Prospect Savages Matt Taibbi For Savaging Obama

Courtesy of Lawrence Delevingne of Business Insider/Clusterstock

American Prospect, the left-leaning political magazine, doesn’t like Matt Taibbi’s latest Rolling Stone piece slamming the Obama administration’s economic sell-out, calling it a "nightmare of a story:"

Tim Fernholz: The piece is a factual mess, a conspiracy theorist’s dream, doesn’t even indict Obama for his real failures…and of course invokes the cold hands of Bob Rubin like a bogeyman at every turn.

This is pernicious for a lot of journalistic reasons, but politically it’s bad for progressives because conspiracy theories stand in the way of good policy analysis and good activism, replacing them with apathy and fear.

Fernholz then lists 15 points he says are errors in the article.

What worries him is that all serious critiques of Obama’s policies will be lumped with "Taibbi’s meandering conspiracy:"

Is it disconcerting that employees of the financial industry make a ton of money? Yes. Is it the revolving door between Washington and Wall Street problematic? Yes. Does the Administration take it too easy on the banks? Absolutely. Are White House advisers too centrist for progressive tastes? Sure. But when you try and tell that story with a lot of lies and innuendo, and misunderstand the basic policies that these people are producing, you don’t hurt them. Now anyone who criticizes the Administration will just be lumped in with Taibbi’s meandering conspiracy.

Taibbi will likely hit back. At least that’s what he did after Charlie Gasparino wrote a take-down of his controversial piece on Goldman Sachs this summer.

Some commenters on the American Prospect site are siding with Taibbi, calling Fernholz an Obama apologist.

"How does it feel to be a second rate Ari Fleischer? Apologia is all the so-called progress media has left," wrote "soullite." Or this from "Paul B:" "Really, these countless apologies for Obama are getting tired."

You can bet there will be a round two.

(via @felixsalmon)

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Matt Taibbi: Obama’s Big Sellout

Edward shares thoughts on the Obama administration and Matt Taibbi’s latest article. – Ilene

Matt Taibbi: Obama’s Big Sellout

obama, courtesy of Jesse's Americain CafeCourtesy of Edward Harrison at Credit Writedowns

Matt Taibbi is one of the few commentators in the mainstream media who is not worried about ‘access’ and has, therefore, been free to write much more critically about the economic crisis and reform efforts on Wall Street.

His first piece was a polemic against Goldman Sachs, which triggered a backlash against the venerated Wall Street firm due to its incestuous relationship with Washington.  Afterwards, he took on health care reform. Now, he is taking on the Obama Administration and its status quo bias. I have an excerpt below and a link to the full article. But, first, let me say a few words.

As you probably know, I have been quite disappointed with this Administration’s leadership on financial reform. While I think they ‘get it,’ it is plain they lack either the courage or conviction to put forward a set of ideas that gets at the heart of what caused this crisis. 

It was clear to many by this time last year that the President may not have been serious about reform when he picked Tim Geithner and Larry Summers as the leaders of his economic team.  As smart and qualified as these two are, they are rightfully seen as allied with Wall Street and the anti-regulatory movement. 

At a minimum, the picks of Geithner and Summers were a signal to Wall Street that the Obama Administration would be friendly to their interests. It is sort of like Ronald Reagan going to Philadelphia, Mississippi as a first stop in the 1980 election campaign to let southerners know that he was friendly to their interests.

I reserved judgment because one has to judge based on actions. But last November I did ask Is Obama really “Change we can believe in?” because his Administration was being stacked with Washington insiders and agents of the status quo.

Since that time it is obvious that two things have occurred as a result of this ‘Washington insider’ bias.  First, there has been no real reform. Insiders are likely to defend the status quo for the simple reason that they…
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Obama’s Big Sell Out

Obama’s Big Sell Out

Courtesy of Jesse’s Café Américain

This is an effective articulation of why so many Americans who voted for Barack Obama and ‘change’ and reform feel betrayed, and rightfully so.

The funny thing is, the result would most likely have not been all that different if McCain had won, except the world might be worrying quite a bit about his health, given his utterly unqualified successor, the Decider in a skirt. American politics sometimes appear to be more like competing crime families and special interests than legitimate alternatives to national governance.

Well, at least an American President has not appointed his favorite horse to the Senate — yet.

Obama’s Big Sellout
By Matt Taibbi
Dec 09, 2009 2:35 PM

The president has packed his economic team with Wall Street insiders intent on turning the bailout into an all-out giveaway

Barack Obama ran for president as a man of the people, standing up to Wall Street as the global economy melted down in that fateful fall of 2008. He pushed a tax plan to soak the rich, ripped NAFTA for hurting the middle class and tore into John McCain for supporting a bankruptcy bill that sided with wealthy bankers "at the expense of hardworking Americans." Obama may not have run to the left of Samuel Gompers or Cesar Chavez, but it’s not like you saw him on the campaign trail flanked by bankers from Citigroup and Goldman Sachs. What inspired supporters who pushed him to his historic win was the sense that a genuine outsider was finally breaking into an exclusive club, that walls were being torn down, that things were, for lack of a better or more specific term, changing.

Then he got elected.

What’s taken place in the year since Obama won the presidency has turned out to be one of the most dramatic political about-faces in our history. Elected in the midst of a crushing economic crisis brought on by a decade of orgiastic deregulation and unchecked greed, Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias, while packing the key economic positions in his White House with the very people who caused the crisis in…
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Matt Taibbi: Obama Baited And Switched Us, And Let Wall Street Take Over The White House

Can’t say I disagree either…  this is why Obama’s doing so poorly in the polls. – Ilene

Matt Taibbi: Obama Baited And Switched Us, And Let Wall Street Take Over The White House

Courtesy of Joe Weisenthal at Clusterstock

Continuing his crusade against Wall Street, Matt Taibbi takes aim at the Obama administration. He accuses the President of running as a progressive, but then allowing Robert Rubin and various Wall Street allies dictate policy. Can’t say we disagree. (video via ZeroHedge)

 

 


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Short Sales: The Real Issue

Karl Denninger presents a compelling argument that market makers should not be exempt from rules preventing short-selling shares that cannot be borrowed (naked short selling). Because the quantity of a given stock in "float" is fixed, traders and market makers should not be allowed to create unreal and illogical bets on stocks that result in perversion of market dynamics and wild price swings. That’s my summary, Karl explains in detail. – Ilene

Short Sales: The Real Issue 

Stack of red gambling chips over two numbers on roulette table

Courtesy of Karl Denninger at The Market Ticker

Matt Taibbi once again writes in Rolling Stone, this time on naked short sales, and while he gets a good part of the issue right, he (and many others who have opined on this situation over the years) miss the forest for the trees.

Matt writes:

But the most damning thing the attack on Bear had in common with these earlier manipulations was the employment of a type of counterfeiting scheme called naked short-selling. From the moment the confidential meeting at the Fed ended on March 11th, Bear became the target of this ostensibly illegal practice — and the companies widely rumored to be behind the assault were in that room. Given that the SEC has failed to identify who was behind the raid, Wall Street insiders were left with nothing to trade but gossip. According to the former head of Bear’s mortgage business, Tom Marano, the rumors within Bear itself that week centered around Citadel and Goldman (GS). Both firms were later subpoenaed by the SEC as part of its investigation into market manipulation — and the CEOs of both Bear and Lehman were so suspicious that they reportedly contacted Blankfein to ask whether his firm was involved in the scam. (A Goldman spokesman denied any wrongdoing, telling reporters it was "rigorous about conducting business as usual.")

Matt gets so close, but fails in the closing.

See, there are two area of naked shorting that nobody wants to really deal with, yet both have to be if we are ever to make a difference. Let’s deal with them in turn.

The first, the writing of "naked" swaps, is one that I’ve written about before. The essence of a "credit default swap" is a contract whereby the buyer of protection insures…
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Matt Taibbi: Wall Street’s Naked Swindle

Matt Taibbi: Wall Street’s Naked Swindle

Courtesy of Jesse’s Café Américain

This is worth reading.

Wall Street’s Naked Swindle by Matt Taibbi.

Closing quote from this story:

"The new president for whom we all had such high hopes went and hired Michael Froman, a Citigroup executive who accepted a $2.2 million bonus after he joined the White House, to serve on his economic transition team — at the same time the government was giving Citigroup a massive bailout. Then, after promising to curb the influence of lobbyists, Obama hired a former Goldman Sachs lobbyist, Mark Patterson, as chief of staff at the Treasury. He hired another Goldmanite, Gary Gensler, to police the commodities markets. He handed control of the Treasury and Federal Reserve over to Geithner and Bernanke, a pair of stooges who spent their whole careers being bellhops for New York bankers. And on the first anniversary of the collapse of Lehman Brothers, when he finally came to Wall Street to promote "serious financial reform," his plan proved to be so completely absent of balls that the share prices of the major banks soared at the news.

The nation’s largest financial players are able to write the rules for own their businesses and brazenly steal billions under the noses of regulators, and nothing is done about it. A thing so fundamental to civilized society as the integrity of a stock, or a mortgage note, or even a U.S. Treasury bond, can no longer be protected, not even in a crisis, and a crime as vulgar and conspicuous as counterfeiting can take place on a systematic level for years without being stopped, even after it begins to affect the modern-day equivalents of the Rockefellers and the Carnegies. What 10 years ago was a cheap stock-fraud scheme for second-rate grifters in Brooklyn has become a major profit center for Wall Street. Our burglar class now rules the national economy. And no one is trying to stop them."


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Matt Taibbi Takes An Inside Look at Naked Shorts and How Goldman Sachs Lobbies the Senate

Matt Taibbi Takes An Inside Look at Naked Shorts and How Goldman Sachs Lobbies the Senate

Courtesy of Damien Hoffman at Wall St. Cheat Sheet

This is a guest post by Matt Taibbi at True/Slant (a must-add to your bookmarks).

The SEC is holding a public round table Tuesday to explore several issues around securities lending, which has expanded into a big moneymaker for Wall Street firms and pension funds. Regulation hasn’t kept pace, some industry participants contend.Securities lending is central to the practice of short selling, in which investors borrow shares and sell them in a bet that the price will decline. Short sellers later hope to buy back the shares at a lower price and return them to the securities lender, booking a profit. Lending and borrowing also help market makers keep stock trading functioning smoothly.

via SEC Weighs New Rules for Lending of Securities – WSJ.com

Matt Taibbi

Matt Taibbi

Later on this week I have a story coming out in Rolling Stone that looks at the history of the Bear Stearns and Lehman Brothers collapses. The story ends up being more about naked short-selling and the role it played in those incidents than I had originally planned — when I first started looking at the story months ago, I had some other issues in mind, but it turns out that there’s no way to talk about Bear and Lehman without going into the weeds of naked short-selling, and to do that takes up a lot of magazine inches. So among other things, this issue takes up a lot of space in the upcoming story.

Naked short-selling is a kind of counterfeiting scheme in which short-sellers sell shares of stock they either don’t have or won’t deliver to the buyer. The piece gets into all of this, so I won’t repeat the full description in this space now. But as this week goes on I’m going to be putting up on this site information I had to leave out of the magazine article, as well as some more timely material that I’m only just getting now.

Included in that last category is some of the fallout from this week’s SEC “round table” on the naked short-selling issue.

The real significance of the naked short-selling issue isn’t so much the actual volume of…
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“The ugly essence of capitalism”

"The ugly essence of capitalism"

Courtesy of Tim Iacono’s The Mess That Greenspan Made

This week’s Goldman Sachs bashing comes via a New York Magazine story with the interesting artwork reproduced below. The hands look a bit large, though not menacing, the thighs and torso look seductive, and the big shoes look downright deadly.

IMAGE :  Goldman Sachs

The report itself is equally intriguing, though it seems to give up early on any attempt at the kind of shock-value pulled off by Matt Taibbi’s Rolling Stone piece, citing in the very first paragraph the "great vampire squid wrapped around the face of humanity" characterization of Goldman, made famous by Taibbi a few weeks ago.

How could anyone possibly top that anyway?

A few highlights…

The AIG rescue is the incident from which all other Goldman conspiracy theories spring—the original sin, in a sense, of Goldman’s current public tarring. It’s the act that first made the average man on the street sit up and say, “Hey, wait a minute. The secretary of the Treasury, who used to be the Goldman CEO, just spent $85 billion to buy a failing insurance giant that happened to owe his former firm a lot of money. Does that smell right to you?” It also seems to have the legs of a potential scandal, with Neil Barofsky, the inspector general overseeing the Troubled Asset Relief Program, conducting an audit of the buyout.



The decision that put Goldman’s reputation in play is now almost a year old. On the weekend of September 12, 2008, as the financial system shuddered and appeared to be on the verge of lurching to a halt, two Goldman Sachs men, former CEO Hank Paulson and current CEO Lloyd Blankfein, huddled with other banking heads at the Federal Reserve Bank of New York to consider how to stave off disaster. Bear Stearns was dead. Merrill Lynch, run by another former Goldman man, John Thain, was in desperate need of a savior. And now Lehman Brothers was on the brink. As secretary of the Treasury, Paulson asked the banks to come up with a


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Phil's Favorites

The Portfolio Gap

 

The Portfolio Gap

Courtesy of 

Dalbar is known for publishing a study on returns from equity funds compared to the returns that investors capture in those same funds. Every year reveals the same message: The average investor, with remarkable consistency, underperforms their own investments, ostensibly by buying and selling at inopportune times.

The methodology behind the study has been under assault for at least the last 15 years. Here is ...



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Zero Hedge

Fiat's Failings, Gold, & Blockchains

Courtesy of ZeroHedge View original post here.

Authored by Alasdair Macloed via GoldMoney.com,

The world stands on the edge of a cyclical downturn, exacerbated by trade tariffs initiated by America. We know what will happen: the major central banks will attempt to inflate their way out of the consequences. And those of us with an elementary grasp of economics should know why the policy will fail.

In addition to the monetary and debt inflation since the Lehman crisis, it is highly likely the ...



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Digital Currencies

Visualizing The New Cryptocurrency Economy

Courtesy of ZeroeHedge

Over a decade ago, the birth of Bitcoin sparked a revolution in the digital world - and just last year, the number of active cryptocurrencies jumped from roughly 1,600 to over 3,000 worldwide.

As Visual Capitalist's Ashley Viens details below, cryptocurrencies have now evolved past simple digital currencies, offering solutions to meet the complex needs of modern financial markets.

Today’s graphic from Abra visualizes the complex, ever-evolving cryptocurrency ecosys...



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Kimble Charting Solutions

Gold Miners Indicator Attempting Multi-Year Breakout, Says Joe Friday

Courtesy of Chris Kimble

Are Gold Mining stocks about to be sent a bullish signal they haven’t received in years? Possible says Joe Friday.

This chart looks at the Senior Miner/Junior miner (GDXJ/GDX) ratio over the past few years. Historically when the ratio is heading up, miners tend to do very well.

The ratio has created a series of lower highs just below the falling line (1), since the summer of 2016. The ratio is currently testing the strong falling resistance line and the June 2019 highs at (2).

Joe Friday Just The Facts Ma’am; If the ratio succeeds in a double breakout at (2), it sends miners a long-awaited bullish message.

...

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Insider Scoop

Scott Galloway Calls For Twitter's Board To Replace 'Part-Time CEO' Jack Dorsey Amid Africa Move Plans

Courtesy of Benzinga

A shareholder in Twitter Inc. (NASDAQ: TWTR) and New York University business professor wrote an open letter Friday to the company's board calling for the replacement of CEO Jack Dorsey.

What To Know

Scott Galloway, who owns more than 330,000 shares of Twitter stock a...



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Lee's Free Thinking

Chart Shows the Fed Ramping Up Not QE - Funding Almost All Treasury Issuance

 

Chart Shows the Fed Ramping Up Not QE – Funding Almost All Treasury Issuance

Courtesy of Lee Adler, Wall Street Examiner 

The Fed is ramping up “Not QE” .

The Fed bought $2.2 billion in notes today in its POMO, “not QE,” operations. Actually $2.15 billion because they sold back a whole $50 million. Must have been a little glitch in the force.

This brings the Fed’s total outright purchases of Treasuries to $170 billion since it started Not QE, on September 17.

It also did $107 billion in gross new repo loans to Primary Dealers to buy Tre...



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Chart School

Silver stock taking the sector higher

Courtesy of Read the Ticker

As the US economy begins to show late cycle characteristics like: GDP slowing, higher inflation, higher wage costs, CEO confidence slump. 

Previous Post: Gold Stocks Review

The big players in the market are looking for the next swing off good value lows. This means more money is finding it way into the gold and silver sector, and it is said gold and silver stocks actually lead the metal prices.

The cycle below shows prices are ready to move in the months ahead (older chart re posted).


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Members' Corner

Sacha Baron Cohen Uses ADL Speech to Tear Apart Mark Zuckerberg and Facebook

 

Sacha Baron Cohen Uses ADL Speech to Tear Apart Mark Zuckerberg and Facebook

By Matt Wilstein

Excerpt:

Sacha Baron Cohen accepted the International Leadership Award at the Anti-Defamation League’s Never is Now summit on anti-Semitism and hate Thursday. And the comedian and actor used his keynote speech to single out the one Jewish-American who he believes is doing the most to facilitate “hate and violence” in America: Facebook founder and CEO Mark Zuckerberg.

He began with a joke at the Trump administration’s expense. “Thank you, ADL, for this recognition and your work in fighting racism, hate and bigotry,” Baron Cohen said, according to his prepared...



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The Technical Traders

VIX Warns Of Imminent Market Correction

Courtesy of Technical Traders

The VIX is warning that a market peak may be setting up in the global markets and that investors should be cautious of the extremely low price in the VIX. These extremely low prices in the VIX are typically followed by some type of increased volatility in the markets.

The US Federal Reserve continues to push an easy money policy and has recently begun acquiring more dept allowing a deeper move towards a Quantitative Easing stance. This move, along with investor confidence in the US markets, has prompted early warning signs that the market has reached near extreme levels/peaks. 

Vix Value Drops Before Monthly Expiration

When the VIX falls to levels below 12~13, this typically v...



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Biotech

Why telling people with diabetes to use Walmart insulin can be dangerous advice

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

 

Why telling people with diabetes to use Walmart insulin can be dangerous advice

A vial of insulin. Prices for the drug, crucial for those with diabetes, have soared in recent years. Oleksandr Nagaiets/Shutterstock.com

Courtesy of Jeffrey Bennett, Vanderbilt University

About 7.4 million people ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

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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...

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