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Suusi M-B

Have you seen this up to 100 banks set to go bust CNN - What bad banking news means to you


I just read chat today that if we break $102 a barrel for oil then we will hit $120. April crude closed today at $102.59.


Hi Elaine, wow, to live in your brilliant head for a day!

This article started off sounds like the boyz in charge expanded all this debt/money/inflation by 'accident' and did not know what was going to happen, but by the end I was glad to see you focused on the criminal looting involved.

I am currently operating under the assumption that the derivatives beast is a way to mask transfer of profits from taxable to non-taxable areas.

The Joy of Looting, by Julia
1. Take $1billion in profits in country account A.

2. Write derivatives that you know are going to lose money there like a bet the USD will go up. (HAHA!)

3. Buy the opposite side of the transaction in account B in Caymans/China wherever.

4. Bake several months.

5. Poof! Profits (and potential tax payments to the government - they are for looting silly!) magically vanish!

6. Open up your Caymans/China oven and voila a nice fluffy Looting Souffle.

Or maybe it is just a new way to create 'money' without having to get some stupid peasant to sign on a loan.

You just create a piece of paper saying 'I Bet $10 billion the USD will go up' and another saying 'I bet $10 billion the USD will go down', collect a 1% fee, and then have fun playing with these mountains of 'money?' in your trading rooms.

Hey, you should create SNOW-PLOWING derivatives! I promise to plow snow for 10 years, and sell them off for $20,000. Get everyone to create and sell them, and then take your 2% fee and after you have 50 neighbors doing this, you can use your fees to get snow plowing for FREE as you can just buy snow plowing derivatives from someone else. Oh yah, until they go broke from Diesel prices and cannot deliver on the contract.

But wait! You can lobby for a Federal Snowplowing Trust agency, say Snowie Mae, and get them to back all the Snow Plow derivatives with Government snow plows! You are rich in luxury leisure again since the IRS can now tax everyone to make sure you get your driveway plowed.


Excellent stuff Elaine. Your best post for a while. No mention of pirates, dragons and magic!

Elaine Meinel Supkis

Aye, matey! Lost my magic wand! Are you a newt yet? No? Ack! Lost my touch!

Heh. Look, I do love to talk about the underbelly and then go topsides. After all, there is a hundred ways to describe all this. I aim to amuse as well as educate.

About the snowplowing derivative trust fund: the minute we launch the IPO, global warming will kill the industry! See? So we need monoline insurance for heat waves. And one for blizzards. Want to make a prospectus?


We at the Last Local Bank of Cynicism stand ready to market your derivatives to the willing world for only a small management fee, variable rate dispersal fees, and a small rip off of value. All transactions will be done through our offices on the Island of Kergulen and our Tasmanian subsidiaries. For further information please contact our laywers at Nastie, Brutish and Short and our accounting firm of Goniff Goniff Finagle and Steele.

Elaine Meinel Supkis

At last, an investment I can trust!


"Buying gold doesn't expand commerce, it kills commerce since it isn't part of a value-added system like manufacturing is, for example. But it is a good hedge against reckless inflation caused by government misallocation of money or wars."

I was pleased that you put Gold in it's correct position/ Status. I always disagreed with your previous posts regarding gold because I believe it is Money in the correct sense of the word and a way to preserve wealth. Sure, the gov't can confiscate it but so can they with any other form of wealth.

Elaine Supkis

It tis a tangled web. And confiscating guns is problematic, people with guns can fight back, confiscating property via taxes can trigger tax revolts with guns but confiscating gold is fairly easy. Which is why they do it all the time.


Elaine, While mentioned last, but not least, I'm glad you continue to revisit the Derivative Beast. This is the elephant in the living room that "the players" are ordered not to talk about under threat of excommunication. Jim Willie's current post is enlightening and suggests only one bank is getting setup as too big to fail. But, how are they going to come up with the $200 trillion? This is drip, drip, drip ...


Correct. It is supposed to stay as invisible as the carry trade. Which is why I like to talk about both.

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