CNBC is asking people to come up with an acronym for the new debt recepticle. Wonder where they got that idea?

Step one: government buys everything.
Step two: ban all shorts
Step three: Profit!

Thouht: How much of this is being driven by China and Japan? Aren't they the defacto owners of all our (worthless) paper?

This is a big nothingburger. Just write them a check. Who gives a f***?

The Asians are paying.

CNBC is asking people to come up with an acronym for the new debt recepticle. Wonder where they got that idea?

Commercial
Equity
Structured
Solution
Providing
Obscene
Outrageous
Liquidity

we're all comrades now

B end
O ver
H ere
I t
C omes
A gai

F inancial
E xchange
L iquidity
C ushion
H elper

Oh Anonymouse, please no.

The first rule of this has to be: for the owners, nothing. Except in many cases time in prison. If any of the pigmen escape penalty, you'll see mass turnover in the House in November.

John Bogle, who created the $106 billion Vanguard 500 Index Fund in 1976, said the U.S. government is ``punch drunk'' with proposals to rescue the financial system.

We're playing a game of casino capitalism, interfering with the way the market is working,'' Bogle, 79, said in a telephone interview today from Valley Forge, Pennsylvania.The government seems punch drunk. It doesn't seem systematic.''

John Bogle Says U.S. Government Seems `Punch Drunk' (Update3) - Bloomberg.com

Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, Governments can confiscate, secretly and unobserved an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity (or fairness) of the existing distribution of wealth.

As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

Uh-Huh

A nother
N ew
A amount of
L iquidity

J ammed
O ntop of
B illions

What does all of this mean for Alex Rodriguez's 10-year contract with the Yankees?

BB,

That's funny about banning the rating agencies, because one of the talking heads on television actually suggested that earlier.
Except they were being serious.

Pizza's too expensive. Try a half-serving of Ramen noodles.

Way to go Moody's - you're really on top of things. I guess Ambac and MBIA only recently went bad - right?

Why are Moody's (and S&P's) ratings even published?

Did you see the shit-eating grin on Bill Gross's face when he said that PIMCO wanted to manage the government assets?

Komrade Clyde writes:
Did you see the shit-eating grin on Bill Gross's face when he said that PIMCO wanted to manage the government assets?

Komrade Clyde | 09.19.08 - 3:13 pm | #

I wanted to totally sock him in the nose.

Whatever it's called, the solution will probably look something like this:

Redeem
Assets at
Public
Expense

Operate
Unaccountably
Regardless

Adopt
Stupid
Solutions
Enriching
Supporters

They are now thinking of downgrading?

There is a kick ass cartoon just dying to be created here by somebody with talent.

SKF creeping up - is there going to be a rush to the exits in the markets in general to clear weekend positions?

SKF back to $100 - woops! Better instate death penalty to SKF holders

Bailouts of
All
Sick
Tarnished
Assets
Resulting in
Damaged
Sanity

Insane
National
Spending
Allowed
No
Exceptions

I thought Paulson, Bernanke, Cox, Bush, Schumer, and Cox outlawed downgrades of financials?

Jail the bums at Moody's and S&P for being late initially and out-of-line, now!

It's time to rename this blog. There is NO need for calculated risk. Cause there is No risk. Everytime you run into problems,tax payers bailout. problems solved.

I called congress this morning as soon as the lines opened.

(202) 224-3121

Rally fizzling.

Financial
Underwriters
Liquidity
Drop
Birthing
All
Republicans

Note to mainstream media: remove SOAR from your headlines.

(Replace with SORE, as in nation)

But but but GAPS never get filled ...

Someone needs to remake "My Debt."

My debt bigger than a bridge
Your debt look like a little kids
My debt rush like the chargers (the whole team)
Your debt look like you fourteen
YouTube - Dj Kris P. - My Dick - Mickey Avalon

They'll fail. Pretty soon and without short-sellers. Are they gonna bail out insurance companies, too?

What's AIG, Alex?

Cannabis 3:16 wins the contest.... Laughed so hard I started to choke.

Now if I can only unload my SRS...

and TEDs are narrowing as tresuries sell off more than LIBOR going up so its not a constructive narrowing as money moves into risk - its just an unwinding of fed cut expectations.

so bloomberg reports they will revise options shorting to help out hedge funds

CR:
In an earlier post on TARP, you say that "it appears the current shareholders face massive dilution". If so shouldn't the stock price of banks go down? Why is it going up?

M assive
I njection of
L iquid
F unds

he he

commisar giacutter writes:
Just a reminder that this is a great time to buy or sell a home.

Shaddup Freddie.

They'll fail. Pretty soon and without short-sellers. Are they gonna bail out insurance companies, too?

Yes. Yes they, and by they I mean we, are.

From the "Dear Christ, What Took So Long???" Department:

Colleges Teaching Students About Dangers of Credit Card Debt 
By MEGAN A. CONLAN Ž
Capital News Service Ž

\tANNAPOLIS - Much of what University of Maryland sophomore Samantha Link, 19, knows about the risks of getting into credit card debt she learned by watching “The Oprah Winfrey Show.”
\t“I wish I could be more knowledgeable about it,” said Link, who has a debit card and two credit cards, one of which she shares with her father, who manages their accounts.
\tAs the level of debt among college students rises, even Congress is paying more attention to the credit card companies that market to this demographic, introducing legislation that would both make it harder for the companies to access students and for the students to qualify for credit.
\tIn an attempt to reduce the financial dangers of acquiring too much plastic, some Maryland universities are taking a more active role in teaching students how to manage their credit before it becomes an issue. Optional or mandatory classes on financial literacy are being incorporated into their curricula and orientations.
\tThe University of Maryland, College Park has recently added an instructional session on finances to its introductory college course for freshmen and transfer students.
\t“We are embarking this semester on a plan to begin talking to students about that whole financial responsibility,” said Dr. Gerry Strumpf, the director of orientation at Maryland. “They need to think about saving - even if they don’t make a lot of money.”
\tAlthough most colleges at the university do not require their students to take the course, many freshmen opt to enroll in the class anyway.
\t“It’s a very well-utilized course at the university,” said Strumpf. “We’ve geared it to where students are developmentally right now.”
\tThe financial literacy portions of the class discuss credit scores and student budgets.
\t“The purpose is for them to know where to go should they get into financial trouble, or just to plan ahead,” said Sarah Bauder, the university’s director of financial aid. Bauder is one of the speakers leading the discussions on finances in the course.
\tSome students from past semesters experienced a taste of the financial literacy portion of the class during its development.
\t“We talked about how you can look up your name and see what your credit looks like,” said Maryland sophomore Jessica Seaman, 18, who does not have a credit card yet but plans on acquiring one to pay for gas. “Then we just talked about the consequences of being in debt and the positives of staying out of debt.”
\tCredit card companies find creative tactics to lure students into signing up for cards, such as contests and free T-shirt giveaways.
\tThe University of Maryland restricts companies from soliciting students on its campus, except at sporting events. Frostburg State University and Towson University have banned companies from marketing on campus entirely.
\tAt least one large credit card company said marketing on campus is not an issue.
\t“We restrict our marketing activity to students off campus and online,” said Samuel Wang, a Citi spokesman. “We maintain no direct affinity relationships with the universities, either.”
\tIn 2004, more than 70 percent of students used a credit card to pay for textbooks, general school supplies, and food, said a 2005 study published by Nellie Mae, a student loan company. Clothing was another frequently charged expense.
\t“You know, it’s just easier than carrying cash around,” said Maryland junior Jeremy Messersmith, 19, who has two credit cards to pay for school supplies and other necessities.
\tNellie Mae reported that in 2004, the average number of credit cards held by students was 4.09, with 43 percent of students having four or more cards to their name. That same year, the average student credit card debt was $2,169, up from $1,879 in 1998, said Nellie Mae.
\t“They leave with this incredible debt that they don’t think about,” said Strumpf, who believes that more education can help reduce these figures.
\tOther area schools offer programs similar to the one at Maryland.
\tSalisbury University requires freshmen to take a six-week course that discusses financial responsibility with regard to credit cards and student loans. Loyola College of Maryland also includes some financial education sessions in its orientation.
\tTowson University does not include any instructional sessions on managing credit during its orientation classes, but does host a fall program series which includes an educational event on building and managing student wealth and working on a budget.
\t“There’s so much that students need to know,” said Strumpf. “We have begun that process and it’s very important.”

Beginning Monday there will be a $2.00 surcharge on all blog comments.

Who's gonna stop me?

Beginning Monday there will be a $2.00 surcharge on all blog comments.

Who's gonna stop me?
Comrade Paulson | 09.19.08 - 3:47 pm

Just deduct it from my next stimulus check there, Herr Caesar.

I always suspected that Moody's was a part of the terrorist plot to undermine America's financial well being.

Hank,
You can't do that. I've already set the price at $3.00 per comment. The IRS is on board.

Seize it or Freeze it.

Anyone short ETF favorites around here besides SKF and SRS?

@Ah to be at Nobu tonight...

couple a fist fights for sure.

LAMO.

I am seething over this mess and bailout. No help until all assets of those responsible are confisicated and the parasites prosecuted. If any of the commentors on this site know of any organized protest march or organization that is planning protest, please share the information. ( From a previous comment:We have sold our children into slavery.) Amen brother.

TBG...at the same time colleges keep raising prices and tell kids they'll be failures in life if they don't get that sheepskin. The educational cartel is one that needs a beat-down.

I earned a BA and MBA from selective nationally known universities; and I'm thinking about taking a welding class at my local community college. I have a good job at the moment, but having a diverse range of skills is a good buffer against job market shifts.

There aren't enough savings in the world for us to borrow. TARP will have to absorb trillions, not a mere "hundreds of billions."
...
It's mathematically impossible to borrow more than 100% of what other countries have to loan.

It's worse than that. Foreigners must first have dollars; China/Jap/P. Gulf have no dollars at all... they have treasuries they bought with dollars earned in the past. To buy more treasuries they must first earn more dollars, and the trade deficit is falling just as our fiscal deficit is exploding. We will have to buy some of these treasuries ourselves... for the first time in decades this means interest rates must rise sufficient to attract all US savings (small, but growing) in addition to foreign savings. Of course, gov can cut other spending, or (fate worse than death) raise taxes.

There is no danger foreigners will lose patience and stop funding our deficit with every dollar earned - there is nothing else they can do with them - the problem is that they aren't earning enough to fund our growing gov.

dk writes:

Debt in a box!

GENIUS!!!!

I'll play.

Financial
Assessment and
Reallocation
Team

Hank: "F.A.R.T must be big enough and effective enough to clear the waste out of the financial system and get things moving again."

Capitalisms
Ugly
New
Turds
Socialised

LEHMQ.PK +342%.

jkiss writes

It's worse than that. Foreigners must first have dollars; China/Jap/P. Gulf have no dollars at all... they have treasuries they bought with dollars earned in the past. To buy more treasuries they must first earn more dollars, and the trade deficit is falling just as our fiscal deficit is exploding. We will have to buy some of these treasuries ourselves... for the first time in decades this means interest rates must rise sufficient to attract all US savings (small, but growing) in addition to foreign savings. Of course, gov can cut other spending, or (fate worse than death) raise taxes.

youre missing the point as well. the treasury spends by debiting its account at the fed abd crediting a members account. they do not spend by issuing bonds and collecting the money from bond issuance, nor do they need taxes to spend. all savings comes from govenment spending - not the other way around. in order to hvae private sector savings you have to have a public sector deficit. think of the deficit as an increase in private sector savings. there is never a funding problem for the federal government.

After a week like this, I'm going to sleep hard. I think I got about 5 hours a sleep per night.

Appears CR and the regulars here probably got less.

Gareth G writes:
Food for thought: we have just had the biggest two day rally since 1929.

And what, precisely, did it come on the heels of in the previous month?

i've done some preliminary calculations, and if some of the larger banks are able to shuffle their obligations to the supa-mlec tarp then

BAC 2009 eps

should be roughly $352,145,791/share

C about 301,623,004/share

so, buy fin's!

CNBC chyron "Largest two day gain in YEARS"

I guess they don't won't to tell anyone that it's the best two day rally since 1929.

Alan Greenspan is speaking against the ban on short selling, calling it a "terrible idea". Who thinks it won't survive the weekend?

Heh...I had a 69 limit on SDS going into today for 120 shares and woke up to find it got filled at $64.01. Crazy.

OT--Any volunteers to send Fuld a jar of the Vaseline that gets mentioned so often here?
"Lehman Creditors May Be Able to Recover Fuld's Pay, Lawyers Say"
Lehman Creditors Can Try to Recover Fuld's Pay (Update1) - Bloomberg.com

Gareth G writes:
Pimco's Pigman wants in on financial rescue package:

Revised Transcript:

"We have interest in managing this giant pool of assets, and we expect to be called," Gross said on CNBC television as he calmly wiped large globs of an unidentified milky substance from his chin and mouth. Meanwhile Paulson and Bernanke responded, "no comment," as they were spotted hastily zipping up their trousers and escaped through the rear door.

Due to the above new SEC regulation on short sales, certain options positions on these underlying securities expiring September 20, 2008 (long uncovered puts and short uncovered calls) that were entered into after September 18, 2008 may be subject to being closedat or before expiration. We may also take action to close the assigned/exercised underlying security in the event that the options are assigned or exercised. Please note that options positions entered into prior to September 19, 2008 are not subject to this action.

ohhh boy

Comrade mock tutle,

Arrrrrrrrrrrr!

"Dear Honorable________"

Should be

Dear Horrible Asshat___________

Just sayin'

Arrrrrrrr!

Nostrovia

"Global Systemic Financial Meltdown" is mentioned a lot. It does sound cool, but nobody has yet told me what it implies in real life.

No inflation here folks.... move along.

BTW, can we haz ur gold?

etrade website

Rich,

Maybe I wasn't clear. What I mean is that if the "bailout" is for the owners and management of the company to be wiped out (a la AIG), and the taxpayer gets stuck at $0.30 on the $1.00 (rather than at $0.80 or par), then I think it's as good an outcome as we peons can hope for.

But from a shareholder perspective, the actions aren't bailouts.

client

not many people Bot puts today, that's for sure

Umm, yeah lot's of folks bought puts today.

F: Federal
U: Universal
B: Bailout
A: Asset
R: Reserve

Umm, yeah lot's of folks bought puts today.
El Scorcho

sorry, sep puts that is,--you did'nt , did you?

It's BFF! Where's my bank failure(s)? Have those been outlawed too?

did they really rescind the ban or is this just another capitalist pig rumor?

SEC Considers Revising Shorting Ban in Options Market

Cant... stop... laughing...

Cox clearly doesn't understand the operation of the market (why else would you ban shorting?),
so they're taking advantage of him by telling him that options are not shorting. And the idiot is buying it!

ROTFLMAO

sorry, sep puts that is,--you did'nt , did you?

Ok, on the same page with you now. No, don't have any Sep. expiration puts. I'm just a little freaked about the next shoe to drop - like them outright banning buying puts and other options strategies altogether.

@TradingStats: Were they referring to the financials list, or to positions in general? And the quote seems to apply only to Sep's. What's the etrade position on clients' writing of in general today. Any changes?

fin list only.
y, only sep's, expiring today.

it really is a nothingburger.
if you bought fin puts today for sep20 expiration, you'll probably get a cash settlement. as you can't be short the name(guess)

but who bout sep puts in the fins for today's expiration?

anyone, ???

What's the etrade position on clients' writing of in general today. Any changes?

did'nt understand this ?,sorry

No. Ambac and MBIA have already had their 15 minutes of fame. They need to go away and stay away.

I have SRS and am sticking with it, even thinking of adding to it. Even this likely massive bailout changes none of the fundamentals in the economy- stagnant wages, fewer jobs, higher costs of essentials, overbuilt strip malls, etc. The bailout will not return Wall Street to business as usual, and the valuations are still tied to past results.

y the mid 1700's Britain was at its height of power, but was also heavily in debt.

Since the creation of the Bank of England, they had suffered four costly wars and the total debt now stood at £140,000,000, (which in those days was a lot of money).

In order to make their interest payments to the bank, the British government set about a programme to try to raise revenues from their American colonies, largely through an extensive programme of taxation.

There was a shortage of material for minting coins in the colonies, so they began to print their own paper money, which they called Colonial Script. This provided a very successful means of exchange and also gave the colonies a sense of identity. Colonial Script was money provided to help the exchange of goods. It was debt free paper money not backed by gold or silver.

During a visit to Britain in 1763, The Bank of England asked Benjamin Franklin how he would account for the new found prosperity in the colonies. Franklin replied.

"That is simple. In the colonies we issue our own money. It is called Colonial Script. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers.

In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to no one."
Benjamin Franklin ....

Comrade REBear,

Arrr!

"Without the change, the $1.6 trillion U.S. options market may be ``dead in the water'"

This is a good thing I take it.

Arrr!

Nostrovia,

Dryfly,

In national income accounting:

Saving = Investment.

Like all accounting, it has its flaws. For instance, some economic activity is not measured - growing your own food for instance.

Pilgrim writes:
I have SRS and am sticking with it, even thinking of adding to it. Even this likely massive bailout changes none of the fundamentals in the economy- stagnant wages, fewer jobs, higher costs of essentials, overbuilt strip malls, etc. The bailout will not return Wall Street to business as usual, and the valuations are still tied to past results.
Pilgrim | 09.19.08 - 4:54 pm | #

I am with you Pilgrim. I think this will be a good trade...unless, of course, there is a commercial real estate bailout announced over the weekend. Wouldn't surprise me at this point.

Did those SRS holders notice the "bad tick" on IYR - similar to the "bad tick" on IWM; I can't confirm that those are bad ticks - someone may have bought those funds for twice their current price