Quantcast

Holy S**T! SEC is talking about banning ALL short Sales

Austin Bike

Turbo Monkey
Jan 26, 2003
1,558
0
Duh, Austin
I particularly like this part:

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.


...
Yeah, how many people in this administration believe they are above the law?

When you are asking for a $700B favor, you should be a little more gracious.
 

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,830
7,615
Colorado
based upon this guy's reading of the tea leaves we sure look screwed.

i encourage you to call or email your congressional representatives and tell them what parts of the bill you think are flawed.

EDIT: i re-read this, watched the 2nd video, and yeah this guy seems to have his head screwed on straight. i've contacted both of my senators and our House of Representatives person and it took less than 10 minutes. i encourage the rest of you to get informed on this topic and do the same.
Yep. Totally right on.
This crisis was entirely manufactured by the govt (lax lending standards), and the big investment banks.

This guy, Patrick Byrne (www.deepcapture.com), Bill Casey (the casey report), etc are completely right. The market needs to be allowed to fall naturally, or it will be far, far worse.

This bailout will destroy the US.
 

pigboy

in a galaxy far, far away
my favorite piece of this folly is that Paulson used to run one of the large investment banks so he's in some part responsible for the mess.

and now he wants a $700billion dollar credit card and no oversight on how he uses it.

And with Barney Frank at the head of the House of Representatives committee that is responsible for getting a bill out there to "save us all" i'm guessing we're all fooooooked.
 

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,830
7,615
Colorado
My Letter:

Dear Senator,

Thank you for realizing that Paulson's plan is overtly vague and dangerous. His colleague's and counterparts at Goldman, Lehman, Morgan Stanley, etc. Have created the situation that we are currently in. Their intense greed and willingness to forsake common sense for profits is not our (US tax payers) problem.
Although I do understand that there are many Americas suffering because they have mortgages they can not afford, what about the rest of us that used the good judgment and restrained from over extending ourselves in bad loans and credit?

Why do we have to pay for the excesses of others?

Please look at the long-term effects of any bailout and the costs to future generations. A bailout will only prolong the pain. Let the market settle on it's own.

Enforce the current regulations relating to naked short selling and the failure to deliver shares permeating the markets. This alone will slow much of the market's collapse.

But on to Paulson's plan to rape the American tax payer...

--Sec. 6. Maximum Amount of Authorized Purchases.

The Secretarys authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time--

Does this mean that he can bailout ALL of the banks, because the "outstanding at any one time" part leads one to believe that it is not a set dollar amount, but a blank check that allows for up to $700billion.

---Sec. 8. Review.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.---

Really? Is this administration above the law? Start getting rid of these criminals.

Please look to have SEC Chairman Cox removed. His complacency has led us to this cliff by not constraining rampant speculation and greed in the markets. Try Patrick Byrne, he has a sole goal and has for years of preventing this financial crisis for consuming the US.

Please look outside of Wall St. and Washington for answers. Delay will lead to the collapse of the US economy.

Thank you,
 

Reactor

Turbo Monkey
Apr 5, 2005
3,976
1
Chandler, AZ, USA
I particularly like this part:



:shocked:

I like Dodd's version better...
Yeah, that Blatantly violates the separation of powers provided by the constitution, but since were going to incur $2500+ of debt for every man woman and child in America to bail out bad decisions by people with 6,7,8 and 9 figure salaries why not throw it in anyway.
 

Reactor

Turbo Monkey
Apr 5, 2005
3,976
1
Chandler, AZ, USA
Yep. Totally right on.
This crisis was entirely manufactured by the govt (lax lending standards), and the big investment banks.

This guy, Patrick Byrne (www.deepcapture.com), Bill Casey (the casey report), etc are completely right. The market needs to be allowed to fall naturally, or it will be far, far worse.

This bailout will destroy the US.
When you vote, consider if your congressman/senator/presidental candidate has been pushing for DEREGULATION of the industry for the last decade. Many of the people spouting off about increasing regulation NOW, are the same ones who wanted to deregulate it for the last ten plus years.

Seriously our government has been asleep at the wheel and pushing for more regulation of personal behavior, while turning a blind eye to corporate bad behavior.
 

ridiculous

Turbo Monkey
Jan 18, 2005
2,907
1
MD / NoVA
My Letter:


Please look at the long-term effects of any bailout and the costs to future generations. A bailout will only prolong the pain. Let the market settle on it's own.

Enforce the current regulations relating to naked short selling and the failure to deliver shares permeating the markets. This alone will slow much of the market's collapse.

Quick question, why do you think this ban will slow or create a bottom, isnt it the liquidity from the short selling that can really drive the market?
 

dante

Unabomber
Feb 13, 2004
8,807
9
looking for classic NE singletrack
My Letter:

Dear Senator,
CALL THEM! A phone call is far more effective than an email... If the office looks at their inbox and has 50 messages (or however) that's easily ignored. If they get in in the morning and have 50 voice mail messages, that's a little harder to ignore.

edit: So there's apparently been wrangling (no pun intended... ;)) going on behind the scenes about this, with Congress and the Administration in heated debates. My question is, why is there even a debate? If all of congress can get behind something, what's Bush going to do, veto it? No, it's not going to be a blank check with no oversight handed to Paulson. Too bad, get over it. If Wall Street wants to get bailed out to the tune of $700b worth of taxpayer funds, they're going to have to accept some things that they may not like...
 
Last edited:

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,830
7,615
Colorado
The ban will create an artificial bottom as there is no "counter" to positive news. Although I do not feel there is really an need for short sales, as it artificially adds supply. The price spike shows this.

Also, short selling does not create liquidity. In a balanced market, there is no need for liquidity. Think about it, if a stock is hard to buy the price increases for a reason. Short selling allows people who do not own shares, to sell them in the open market adding extra shares to the market, dropping prices. Short selling on a large scale is a self-fulfiling property.

The threats that the removal of short selling will limit liquidity is BS. Australia banned shorting years ago and it has not negatively effected their market.
 

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,830
7,615
Colorado
$700bil revolving line of credit... There is currently and outstanding debt of under funded promises to the tune of $475,000 per US citizen. What do you think the $700b addition is going to do?
Alleviating debt, with more debt is not the answer. For this debt to "disolve", these companies need to fail and take their debt with them.
Private profits, private losses.
 

dante

Unabomber
Feb 13, 2004
8,807
9
looking for classic NE singletrack
$700bil revolving line of credit... There is currently and outstanding debt of under funded promises to the tune of $475,000 per US citizen. What do you think the $700b addition is going to do?
Alleviating debt, with more debt is not the answer. For this debt to "disolve", these companies need to fail and take their debt with them.
Private profits, private losses.
yup, the more I hear about this program, the more I think it's something along the lines of tossing a pebble (a very, very VERY expensive pebble) into the Mississippi and hoping that it stops the flow of water. I'm guessing that even if something passes, after the celebratory bump in the market there'll be a moment of clarification where the street says "wait, there's how much bad debt out there?" At the end of the day, there is not a liquidity crisis going on here. The government has been freely giving out short-term loans to keep all of this going to the tune of hundreds of billions of dollars.

The problem is that some of these banks are probably upside down with regards to (worthless) assets vs liabilities, and probably should just go out of business. The famous scenario I've heard from pundits is that if an institution has $600b in illiquid assets (street value) and $580b in liabilities, the company is still "worth" $20b, but it's in trouble because the $600b in assets is hard to move, as no one wants to buy it. So they want the fed to come in and buy those assets, so they get $600b in cash, can pay off their $580b in liabilities, and keep on existing. The fed can therefore sit on their $600b in assets and slowly sell them into the market at a profit.

However. What if the bank's "assets" are only worth $500b (or less)? If the Treasury pays market rate, the bank goes under anyway. The only "solution" is to have the Treasury overpay (pays $600b for something that's only worth $500b) and have the taxpayer cough up the extra dough. So the Treasury does that 7 times for the major banks, rescues the stockholders and banks that *should* have gone underwater, and we're left with a massive, MASSIVE debt problem. It's no wonder Paulson wanted zero oversight from legislative OR LEGAL! He could've handed $700b to his buddies at Goldman, and walked off the stage, and there wouldn't have been anything anyone could've done about it.
 
Last edited:

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,830
7,615
Colorado
Why are the banks not pricing the securities a hold to maturity? Oh that's right, because congress told them to price to market...
isht show.
 

Nick

My name is Nick
Sep 21, 2001
24,368
15,385
where the trails are
I've been watching the hearings and Paulson isn't fairing well under questioning.
Bernanke had a shaky upper lip as he spoke.

Yea, totally inspiring confidence in me. :disgust1: They can't even fake their own belief in their plan.
 

dante

Unabomber
Feb 13, 2004
8,807
9
looking for classic NE singletrack
poached from another board:

Dear American:

I need to ask you to support an urgent secret business relationship with a transfer of funds of great magnitude.

I am Ministry of the Treasury of the Republic of America. My country has had crisis that has caused the need for large transfer of funds of 800 billion USD. If you would assist me in this transfer, it would be most profitable to you.

I am working with Mr. Phil Gramm, lobbyist for UBS, who (God willing) will be my replacement as Ministry of the Treasury in January. As a former U.S. congressional leader and the architect of the PALIN / McCain Financial Doctrine, you may know him as the leader of the American banking deregulation movement in the 1990s. As such, you can be assured that this transaction is 100% safe.

This is a matter of great urgency. We need a blank check. We need the funds as quickly as possible. We cannot directly transfer these funds in the names of our close friends because we are constantly under surveillance. My family lawyer advised me that I should look for a reliable and trustworthy person who will act as a next of kin so the funds can be transferred.

Please reply with all of your bank account, IRA and college fund account numbers and those of your children and grandchildren to wallstreetbailout@treasury.gov so that we may transfer your commission for this transaction. After I receive that information, I will respond with detailed information about safeguards that will be used to protect the funds.

Yours Faithfully Minister of Treasury Paulson
 

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,830
7,615
Colorado
Joker, et. al.

Ive read the following article 3 times and am messing my pants over it... thinking about taking out all my cash to buy gold/silver lol...

Plese read and let us know what you think of this next nightmare...

http://www.freerepublic.com/focus/f-news/2084907/posts
I'll look at it tonight. As for markets... I'm not even sure what is safe right now. I was looking into the double-leverage short indices (make 2x the loss of underlying index), but with the new govt ban, they have an uncertain future.
I'm thinking about going back into Gold, but it's not really a true counter to inflation... Then again, it isn't that bad.