Friday, July 13, 2012

Fight the Power

'How low can you go? we go again... They'll never care for the brothers and sisters'.
-Public Enemy, Bring the Noise

'You know, we always called each other good fellas. Like you said to, uh, somebody, :You're gonna like this guy. He's all right. He's a good fella. He's one of us.: You understand?... It's like a license to steal. It's a license to do anything.'
-Henry Hill, Goodfellas

'U.S. futures industry investigators are looking into why Iowa-based collapsed brokerage PFGBest used a tiny accounting firm that appears to be operating from inside a suburban Chicago home to audit its books...'
- Chicago Tribune 07/12

'All I know is that first, you've got to get mad.'
-Howard Beale, Network

As the latest Ponzi within a Ponzi unravels within the comics perhaps a moment should be taken to focus on the bigger picture.

A progressive reading the FT and WSJ on a daily basis for years may seem to epitomize the duality of life but in truth how can one fight the power lest one at least stay acquainted with the outtake of said propaganda mills?

To wit, a young turk with most certainly an unabashedly bright future of the name Matthew Schoenfeld ( with CV of  'recent graduate of Harvard Law School'), penned a piece in the WSJ two or 'tree' days ago that was most certainly received fondly by the the proponents of the 'ideology of the rich' and their assorted sycophants. 

He used the example of 'Micheal Jordan's exorbitant salary as making the Bulls better overall and by extension the league' to exclaim that income equality ain't what your lyin' eyes record. Quoting the Grand Poobah of Unintended Consequences, Larry Summers, "From the time of Pericles until the end of the 18th century in London-2300 years, standards of living increased perhaps 100%." ; Schoenfeld continues with, 'In the U.S. since 1790, by contrast, real per capita gross domestic product has increased nearly 4000%. Quality of life, in other words, increased 40 times more in 220 years of American history than it had globally over two millenia.'

He concludes with, 'perhaps a century from now low-income Americans will pity the living standards of today's 1%'. 

Golly gee so I guess the surplus eaters stricken by the failure to liquidate the insolvent criminal syndicate and suffering from the greatest level of income inequality (give or take a few percentage points) since I don't know... the Tyler Rebellion of 1381... should count their blessings that they have indoor plumbing, and neither have to worry about the plague nor the fixing of maximum wages?... (they only fix minimum now).

Well done liege Schoenfeld, well done... verily though...

Let me retort.

It is obvious Matthew that your time at Goldman Sachs , Lehman Brothers, 3GCapital, and your upcoming stint at Morgan Stanley after graduation has and will give you a robust appreciation of the 'little people'.

Perhaps you might though be interested  in what some of your fellow students (admittedly  from a much lower caste) have to say on the troubles of the 99%.  ...  has been compiling a metric for 5 years now that calculates the defacto unemployment rate.

It is of interest to discerning folk for it closely mirrors the methodology employed to calculate unemployment during the First Great Depression.

The last tabulation was performed in January of 2012:
Unemployed ...8.3%
Marginally Attached...1.8%
Excess Disability...6% (est)
Government Programs 4% (est)

Total 26.1% (looks like there is a typo on their site on the discouraged total).

Again their methodology is similar to GD1, where they basically counted up folks that were able, and had worked in the past,and were not working now. Yes I know that  the Jan '12 defacto total includes disability but gentle reader we all know folks on disability... need I say more?

Another adjustment when comparing to GD1 is that given the Keating-Owen Act there were industries where it was legal to hire 'em on their 14th birthday.

Lastly, the unemployment rates in 1932, 1933 and 1934 were 23.53%, 24.75%,  and 21.60%

So gentle reader forget about income inequality, forget about the defacto unemployment rate, cause the top1% back in GD1 should be pitied by today's huddled masses where the intertubes are free and the check is in the mail.

To each according to their eligibility ...for each according to their greed.

Fight the Power.

So Long, and thanks for all the fish Matthew.

Wednesday, July 11, 2012

Nuke 'em. Let's nuke the bastards.

' I saw... its thoughts. I saw what they're planning to do. They're like locusts...  After they've consumed every natural resource they move on ...'
-President Thomas Whitmore (Independence Day)

The same "Senior Compliance Manager" who signed off on the PFGBest affadavit and who is listed on the NFA website as both the "Director of Audits/Investigations" and the "Director of FOREX Compliance", Lauren Brinati, is the same woman whom I and my attorneys dealt with two years ago. {Brinati told my lawyer...}
"I don't actually understand any of this stuff. I just sign whatever comes across my desk." 
Lauren Brinati, June 2010

'Outside theft is even harder to stop in advance than foolish risk-taking. No reform proposal  should adopt the impossible goal of eliminating the need for trust and integrity. The cost of any proposed remedy will ultimately be passed on to brokerage customers.'
-Financial Times 7/11/12

'Client funds held by PFG Canada are also covered by the Canadian Investor Protection Fund, which puts them at an advantage over U.S. clients. The U.S. equivalent to the CIPF, the Securities Investor Protection Corp. doesn’t cover futures accounts, while CIPF covers all investment accounts, from stock to futures to currencies.
CIPF was apprised of the situation late Monday afternoon but does not believe it will be called upon to cover any losses, said vice-president Barbara Love.
Regulators are working “very quickly. There’s a lot more knowledge in Canada about the futures industry after MF Global.” 7/10/12

Bad people do bad things.
Clearly, mistakes were made.
Madoff? Lone wolf. MFG? Market turned against them...whoops! PFG? How were we supposed to know that P.O. Box was a fake? He was such a nice man.

The second time this fella has missed a ponzi by whiskers. The first saw overseas institutions take a hit. Caveat Emptor Deutschland!

This time its' personal. Good folks, some known to me, who through no fault of their own...wiped out. Financial detritus strewn about with the skidmarks of another clown car.

This morning whilst grabbing the normal cup of joe got into a conversation with a MF Global refugee. A stranger who overheard my riffin' on the PFG headline in today's comics.
Everytime he reads how 'most' have received 70-80% back he wants to grab a pitchfork... he has seen nada and knows many that have garnered just as much.

'When you tell folks that it is a criminal syndicate they roll their eyes', I opined.

'They have no idea', he replied.

Let me though gentle reader, fan such a thought, provide perhaps a gentle breeze to just such an ember in your mind....  

' The disability ranks have outpaced job growth throughout President Obama's economic recovery.  While the economy has created 2.6 million jobs since June 2009, fully 3.1 million workers signed up for disability benefits…     After adjusting for inflation, median annual household income dropped 5.3% between June 2009 and May 2012. In contrast, median incomes dropped 2.6% during the 18-month recession, Sentier found.  "The recession was bad enough," said Sentier's Gordon Green, "but what's extraordinary is the even larger decline during this so-called economic recovery."…  7/6/12

Oh and the situation is much much worse if you exclude entitlement payments.

Clearly the Band of the Hand can only create a Potemkin demand. This so-called recovery, with so-called free markets, and so-called regulators, should be called for what it is ...a Ponzi reliant upon the charisma of the schemer. 

Tuesday, July 10, 2012

The criminal syndicate strikes again ...Quis custodiet ipsos custodes?

'History repeats itself, first as tragedy, second as farce..'
-Karl Marx 

I have spoken to the heads of various Wall Street equity derivative trading desks and every single one of the senior managers told me that Bernie Madoff was a fraud. Of course no one wants undue career risk by sticking their head up and saying that the emperor isn't wearing any clothes. As a result of this case several careers on Wall Street and in Europe will be ruined. Therefore, I have not signed nor put my name on this report. I am worried about the personal safety of myself and my family.'
-Harry Markopolos in 2005. 

'No one at MF Global ... has been accused of any wrongdoing....The CME Group...has not been accused of any wrongdoing.' - New York Times

'A “spot check” performed on US futures brokers’ customer accounts in the wake of the MF Global failure found all, including PFG, were in compliance, CFTC said in January.The Chicago-based NFA had responsibility for auditing the broker’s accounts. 
After contacting US Bank on Monday, the NFA found that PFG had only $5m on deposit there, NFA said. Further, NFA found that two balances of $207m and $218m reported by PFG for February 2010 and March 2011 respectively at US Bank were false. PFG only had less than $10m for each of those months, the NFA said.' - Financial Times

 'Only now at the end do you understand. Your feeble skills are no match for the power of the dark side...'
-Emperor Palpatine

'We have to show these men and women freedom by enslaving them, and show them courage by frightening them.' - Fight Club

"FCM's should be required to develop automated daily reports that divulge their segregated customer account balances and holdings to exchanges.  Appropriate information such as compliance to guidelines need to be made public," Alex Kins, CEO, AlphaMetrix

The criminal syndicate strikes again.

The NFA, National Futures Association (NFA) is the industrywide, self (er scratch that) stealth-regulatory organization for the U.S. futures industry. NFA strives every day to safequard market integrity, protect investors and blah blah blah (insert your derision here).

Obviously the (smurfs at the) NFA's  spot-check of PFG, the most recent happening 'that could never happen'  involved making sure that the officious document asserting  a couple hundred million at US Bank was  uh.... officious looking.  Hold it up to the light to see a watermark perhaps? Check the PFG website to make sure it was the correct company letterhead? Did the fella sign it? OK!! Put it in the official file.

Of course actually contacting the institution to confirm funds was too obtrusive and outside the NFA's striving mandate to safeguard and protect the criminal syndicate and its' associated sycophants.

Golly gee, they will no doubt exclaim we don't have a mandate or the manpower (er scratch that) willpower to police the thousands of FCMs ( er scratch that...  less than 100!... see  and besides that responsibility if it were to exist would rightfully need to be explained away by one of our brethren regulators (er scratch that... wolves).

Today's 'hen special' of two or 'tree' hundred million vaporized will quickly cycle through the pablum narrative... the 'regulators' even now divining what mitigating action need be taken to turn the page , to start afresh, to restore confidence and integrity to the folks who serve as the necessary fodder for the armaments of the more equal brainworkers.

The only hope for the good people, which I can assert since they include friends and acquaintances, who now stand victimized and vulnerable, is that the dollar cost to the Cosa Nostra of the hit to whatever these solons desire their 'reputation' to be is greater than the dollar cost of making clients of PFG whole.

The 1st rule of Fight Club is that you do not talk about FIGHT CLUB. The 2nd rule of Fight Club is that you DO NOT talk about FIGHT CLUB.

Watch as they try to change the conversation again.

Quis custodiet ipsos custodes?

@$#%@#$%@#$ Honey! Where is my scotch?