Banking Gnomes Do NOT Want To Be Rescued!

October 5, 2008

Elaine Meinel Supkis

This is just too funny and utterly pathetic: the banking gnomes who have been putting on this hilarious show about how they are DYING and need to be rescued, well, now they are no longer dying. They are in a surly mood. The bail out won't arrest them, alas. But it won't let them get millions of dollars in profits and bonuses, either! They HATE this. So they don't want to be rescued! HAHAHAHA. I warned everyone that this was FAKE. Their agony was full press faux, a hoax. We are in danger....FROM THEM. Arrest them all, I say. Now. At night. Raid those hotels with high priced prostitutes. Easy as pie.

Now Wall Street may shun $700bn bail-out

Fears are mounting that many Wall Street banks and financial firms will refuse to participate in the US government's $700bn bail-out package, leaving global markets and world economies in a perilous state for months to come.

'There is a growing feeling that banks ... might instead decide to tough it out,' said Thomas Caldwell, chairman and CEO of Caldwell Financial, a $1bn-plus fund manager.
*snip*
One of the least attractive elements is a section designed to curb executive pay at banks that participate in the bail-out package. These include limiting stock-related pay and banning 'golden parachutes' for executives.

'I think this hodge-podge of regulations and rules will be enough to put many [chief executives] off participating,' Caldwell said.

Sources close to Goldman Sachs and Merrill Lynch indicated the banks might choose not to participate in the bail-out as there is a growing view on Wall Street that the market may be bottoming out.

Analysts also believe that the mere presence of the government as buyer of last resort will be enough to get credit markets moving again, and that a large number of banks would not need to take part for the legislation to succeed.

OK: time for something big here! I did this so loud, my cats jumped. The dogs barked. The cow jumped over the damn moon. HAHAHAHAHAHAHAHA, Sigh. HAHAHAHA with tears running down my face. Good barking grief! The Sunday Dish just ran off with the silver spoon! Hey, diddle diddle dandy.

Wow. Thanks to all the very wonderful readers here, I ran down to DC, braving a nasty storm brewing offshore, I sat for over 7 hours without going to the toilet, all so I could hammer away at the Congress so they would not dare pass that stupid bill. They didn't pass Gollum's Ring of Power bill which was three pages long and gave him total dictatorial power over our entire economy and banking systems.

No, the bill that passed was decked out with every toy the pixies and elves working for Santa could hammer together. This bill had tax cuts and spending sprees spread all over kingdom come and into hell itself.

BUT it also had LIMITS ON WEALTH FOR THE GNOMES!!!! How on earth can these guys hire prostitutes like the ones in DC that poor faux reformer, Spitzer, humped at night? Some readers suggested I should have stayed at the Mayflower Hotel. I probably would have met more politicians there than in the Halls of Congress. Too bad I am too old and obviously a crone to pass as a Lady of les Nuites. So I only got to be slightly annoying there.

But I did note that Bernanke was dead set against any tax cuts in this Bank bail out bill. This was not reported by anyone, I believe. And I know that Paulson was aching to save only his fellow gnomes and had zero interest in saving this nation or anyone living here outside of the most opulent jerks on Wall Street.

This bail bill is now pure poison to them! I figured they would run away from being rescued! HAHAHA. I even laid down on the floor and pretended to be dying and then told a Congressman to pull me up. As soon as he touched my hand, I sprang up and pretended to punch him out.

These pathetic sons of a poor clone of Sarah Bernhardt did a passable job at pretending to die. But this was pure summer stock Hamlet. They certainly hammed it up. They had their buddy, the crazed Cramer running about the TV studios last year at this time, shrieking 'There is BLOOD in the STREETS! My friends are losing their JOBS!' But this was all theater of the absurd. The minute a rescue was proposed that cut these goofy gnomes off from their beloved flow of instant wealth, their little jonny walkers in their pants shriveled up.

'Hey, we can't pump prostitutes unless we get lots and lots of loot!' yelled the infuriated gnomes. So tonight, they are huddling. They must find some way of unloading their toilet stuff onto someone with no strings attached. They must find someone who will do this for them! How, how can they pull a scam this huge? Ah!

Well, TV and the mainstream newspapers can come to the rescue. These are all run by gnomes and they are all very, very close to each other and have hands in each other's pockets as well as sharing the same goddesses, etc. at the same DC hotel. They kiss each other at Bilderberger Meetings! Crimmeny! They have to have some way of foisting this on the US public.

They are a tad scared, of course. The bail out bill was, even as amended, still extremely unpopular. They know that if the US public learns that they are going to REJECT this bill because it won't make them even richer, this is a real kicker! The fury of the public will be, I hope, immense. Even people who were stampeded into supporting this bill after the jokers pulled a 777.7 point decline in the DOW....HAHAHA. I said right away, this was a game, a foil, a trick! It was far too neat to be accidental.

Let them all die of starvation. Don't give any of these CRIMINAL CLOWNS a damn penny! Put them in prison! We can declare their banks to be 'outlaw' for extending too much credit and playing too many risky games and for creating the Derivatives Beast. Then lock them all in the Cave of Death and Wealth with this Beast and the two goddesses who are Inflation and Depression. Let them learn what real torture is. Maybe we could televise this somehow. Like 'Survivor' or 'Big Brother'. Watch them all flip out. Demon Network News can arrange a feed.

Hypo Real Gets EU50 Billion Government-Led Bailout

(Bloomberg) -- The German government and the country's banks and insurers agreed on a 50 billion euro ($68 billion) rescue package for commercial property lender Hypo Real Estate Holding AG after an earlier bailout faltered.

Germany's financial industry agreed to double a credit line for Hypo Real Estate to 30 billion euros, Torsten Albig, a spokesman for Finance Minister Peer Steinbrueck, said late yesterday in an e-mailed statement. The federal government's guarantee for the credit line remains unchanged, Albig said.

Arrest the Hypocrites of Hypo. Haul them into prison. Bail outs of banks should accompany pictures of the presidents of these goofy banks being led away in handcuffs. No bail outs if the guys who engineered these crashes get paid or worse, profit! This is the MORAL IMPERATIVE. If no one pays for these economic crimes, no one will stop. And if someone cries, 'Wolf' and screams, 'This is the END of the WORLD' and then, when learning they won't get millions of dollars in pay, turn tail and say, 'We don't want this, go away.' They should be arrested just like anyone joking about hijacking on a plane is arrested and put in prison! Arrest them ALL. GADS. I will assist if necessary.

LIBOR Gone Crazy as Commercial Paper Market Implodes By: John_Mauldin

As I have said repeatedly for months, the problem is that financial institutions are having to deleverage. They have massive losses and simply have to raise capital in order to survive. If you can't raise equity capital (and most can't), one of the ways you do that is to make fewer loans and to take less risk. You also charge more for the loans you do make.

Larger institutions cannot raise capital on competitive terms. GE is an AAA-rated company. Yet they had to pay Warren Buffett 10% to get $5 billion, plus in-the-money warrants worth at least another 10%. Buffett is likely to double his money on this deal over 4-5 years. A short while ago, GE could get short-term commercial paper for a few percentage points. That difference is going to significantly impact GE's bottom line. But they had no real choice. They took the money.
*snip*
Sidebar: taxpayers really must demand that someone like Bill Gross of PIMCO and/or other savvy market specialists run this new government operation. He offered to do it, and I think we should take him up on his offer. Taxpayer losses should be kept to a minimum, and I believe someone like Gross would do his best to see that would be the case. The point of this exercise is to restart the frozen credit markets, NOT to bail out banks. Some banks may get bailed out in the process, but it should be at a cost to their shareholders and management, not to the taxpayer.

I am asked, why can't private money solve the problem? Because there is simply not enough private money. Buffett offered to take 1% of the new government pool. If that is all the largest pile of free money in the world can take, why does anyone think there is enough private capital to take the other 99%? Insuring the mortgage bonds is not sufficient, because there is not enough money to buy them in this market. When things have sorted themselves out in a few years, I think the bonds can be insured and sold, and likely at a profit if bought correctly. But we do not have the luxury of waiting a few years.

This guy just got hired by a big magazine with many thousands of readers. He is utterly stupid. So of course, he gets elevated. He is a gnome, of course. And has no morals nor can he see the obvious. Here are two graphs he published:

The commercial paper outstanding has shot up twice in the last 20 years. The Dot Com bubble and then the Housing Bubble. It is painfully obvious that these are bubbles. It is also painfully obvious that the proper decline to normalcy after the Dot Com stupidity was cut short by Greenspan. IT BARELY DECLINED AT ALL! And everyone was so proud to see a second bubble right on the heels of the big first stock market bubble!

Whoopee. I was aghast back when Greenspan dropped rates far below the rate of inflation. My savings gave me nearly no return at all. I was lucky to get even 1%. And inflation took off immediately. Gas cost me $.86 a gallon in 2000. It costs me still over $4 a gallon today. All the necessities shot upwards. Housing did, too, for a critical 3 years. Then it all crashed to earth, stocks, banking and housing, industry, everything, in tandem. The price we are paying is obvious!

The solution the Fed cooked up was the same hash the cooked in 2002: sub-inflation interest rates! But hark! That isn't working. For it is NOT translating into easy credit for all the leverage queens out there in Sarah Bernhardtland. All the shrieking ninnies are charging each other huge interest rates for any money that leaves their hot little gnome hands! NONE of them want to lend at sub-inflation rates. HAHAHA. What a shocker.

Bernanke killed the publication of M3. But if we look at the growth of M3 since the dawn of the Floating Currency regime, we learn that M3 was at $1 trillion, January, 1974. It swelled to over $10 trillion in 2006. A queer thought here: the US national budget deficit was around $1 trillion by 1978 and is now over $10 trillion today. Now, when we look at mirror images we have to suspect they are connected, eh? Right! Is 100% of US monetary growth really just our budget deficit feeding inflation into our economic systems?

How obvious does this have to be? I don't need any fancy Fibonacci convex or concave triangles to figure out that these hypotenuse opposite the right side of this equation is equal to the sum of the Federal Deficit! And I get to make fun of Hypo AG again! Its losses are mirrored in the US and UK and all are in the same boat, too.

LIBOR seems to have 'gone crazy' only because the central banks keep pulling down the LIBOR only to see it bob back to the surface again. This is like dunking a basketball. I used to do this as a kid, for fun. I would shove the ball under my feet in the swimming pool and stand on it. But this was very unstable and eventually the ball would slip from under my feet and shoot to the surface and then right out of the water, throwing water all over the place in a huge geyser! I loved to shock visiting children with this game.

Well, we are playing this game with money. And so each time the central bankers of the G7 shove down rates, the LIBOR ends up, less than three months later, shooting upwards just like the basketball! What this means is, the LIBOR is being set TOO LOW! It MUST rise or else! And if it is artificially suppressed, it will overshoot greatly. The more it is suppressed, the more it will overshoot. Now we see these stupid, irresponsible bankers shoving rates to Japanese levels which is 0%. Lord! That basketball is going to the MOON.

And we know this because the last time this stupid, idiotic trick was tried, LIBOR rates nearly hit 20%. After pretty much killing global trade and the US business landscape, they gave up and let rates rise to a natural level. And never, never, NEVER is the natural level 0%. Got that?

Mauldin:

I think it is about an even chance that the government will have to guarantee for a period of time (say 6 months to a year) every bank deposit, regardless of size, in the US.

That is a staggering thought. The potential will be large for almost-insolvent banks to pursue risky behavior to try and work their way through problems. If such a policy is pursued, tight controls must be administered so risky banks do not offer high CD rates in order to garner assets. The FDIC must closely monitor such activity. Perhaps such guarantees should be for existing depositors and not new customers. Insolvent banks and those on the edge must be shut down quickly in such an event, to prevent risky behavior.

Unthinkable? I bet you there is a working committee of government and Fed officials thinking about just that very thing and how to do it. It would be even more scary if there is not one. We are in completely uncharted waters, and every contingency needs to be thought through well in advance. We simply don't need more last-minute Paulson plans.

HAHAHA. Mauldin thinks the gnomes want restrictions? Of course not! They would rather saw off their reproductive organs with a blunt buzz saw, first! They want the government to insure against all their risks while they reap the profits of risky ventures. Everyone of these gnomes know that if there is no risk, there is no profit. So they NEED risks! And the greater, the better. So they can't have the government clipping their wings when they fly off to play risky games. Nor do they want to pay taxes. Or be responsible citizens. Or do anything but be outright PIRATES. So again, why rescue them?

If they can't run a simple bank, then shut the doors and start over, fresh, with non-gnomes running sane banks based on the old rules. And have huge signs warning people about gnomes. 'DANGER! GNOME DOUBLE CROSSING!' at various intersections like Wall and Broad Streets in Manhattan.

And here is a very good story I wrote last year. It is all about charts, graphs and international trade, as usual. The charts alone are worth looking at:

October 6, 2007 one year ago: Peering Into The Future And Seeing Dragons

A reader in Singapore kindly sent me a link to a PDF page which is very long and very enlightening. The charts and data in this document are astonishing and also shows how fast Asia had evolved in the last 5 years from being US-centric and dependent to interlocking economies within their own sphere. Also, economics professor, Kuttner, testifies before Congress and as usual, I throw up my hands in despair at his inability to see the obvious. And I am invited to go to a forecasting/prediction conference where world business leaders and important professors can tell me how to see into the future...hahahaha. I am not being paid to go there so they will have to hoof it alone without me.

Things are changing. The status quo is dead. Long live the new status quo! Let us change with it! I look forwards to a new America, one that isn't up to its eyeballs in debt. The US as the world's top creditor nation, not top debtor nation. Arrest the banking gnomes and start over again. We can do it.

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