Madoff Parody...

Sick and twisted but oddly funny...

Flexing financial muscle and why we are in deep sh*t...

In the mid 20th century we the people, through our elected officials, managed through what is historically referred to as the Suez Crisis.  In July of 1956 Eqypt, in response to the withdrawal of an offer by the US and Britian to build the Aswan Dam, decided to nationalize the Suez Canal, which had been built with French and Egyptian funds.

For a variety of reasons, which can explored at a different time in a different post, Britian, France, and Israel attacked Egypt in response to the nationalization of the Canal.  The military operation was a sterling success and a political disaster, specifically for the US.  So why are we talking about this and what does it have to do with debt?  Simple, the US felt that the hositilites needed to end quickly for political reasons.  The strongest weapon we had at our disposal was our economic strength.  So...

The United States also put financial pressure on Great Britain to end the invasion. President Eisenhower warned the British that unless they withdrew, he would order the sale of the United States' currency reserves of British Pounds and Sterling Bonds; thereby precipitating a collapse of the British currencies' exchange rate. Eisenhower in fact ordered his Secretary of the Treasury, George M. Humphrey to prepare to sell part of the US Government's Sterling Bond holdings.

The above is an excerpt from a great Wikipedia article on the Suez Crisis for thos interested.  I would also suggest this posting on Greenewable's Blog for some additional perspecitve.  

Bottom line, economics matters to national security.  In a very big way.  Don't kid yourself or let elected officials convince you otherwise.   The stimilus package currently under debate in Congress needs to be done but lets not lose sight of the potential long term ramifications.

Gotta Love Duff, Guns & Finance...

Kudos to The Credit Crunch Times for bringing this to my attention.  It appears that according to a recent NY Post article Duff McKagan, former Guns N' Roses bassist, is now authoring a finance column for Playboy.

 McKagan admits, however, he doesn't understand all the technical ins and outs of high finance, but says TV's talking heads don't, either.

"Those boneheads on TV just want to make themselves come off as smart . . . I hope to shed some no-nonsense light on day-to-day money issues," he wrote, closing his salty commentary with a promise: "I will do my best to expose frauds and criminals, one at a time." 

Seriously, how much worse could he do then the current cast of characters...maybe we should give him a quick shot at a TARP suggestion...

Uh...Who wants to argue about infrastructure spending?

The American Society of Civil Engineers recently issued their 2009 Report Card for America's Infrastructure. If your kids got this report card you would lock them in their room with the entire St. John's College reading list and wouldn't let them out until they could recite it verse by verse.

Some of the highlights:

America's Infrastructure G.P.A. = D
Total Investment Needs = $2.2 Trillion, (estimated 5 year need)
A = Exceptional
B = Good
C = Mediocre
D = Poor
F = Failing

The actual report card, with definitions, is here.

If you want to entertain yourself I suggest writing a note to your congressional reps daring them to explain to you how we cannot afford infrastructure spending if we want to remain just a wee bit competitive. Just for fun of course, y'know, only if you have nothing else to do.

Dear Mr. Buffett

It's unlike me to recommend a book before reading it but Janet Tavakoli's new book, Dear Mr. Buffett: What An Investor Learns 1,269 Miles From Wall Street, has come highly recommended from a couple of well regarded sources.

Review to follow after my copy arrives.

More on QGRI

A who's  who of the government's "welfare" roll....

Nasdaq Government Relief Index, no they are not kidding

In their words:

"This Index allows taxpayers and other investors to measure the performance of U.S. companies that are participating in the government's financial relief plan," said NASDAQ OMX Executive Vice President John Jacobs. "We believe the NASDAQ OMX Government Relief Index will be useful in helping investors evaluate the government's investments and the impact of the relief plan on the economy during this period of historical significance."

The NASDAQ OMX Government Relief Index consists of companies across multiple industry groups that have received a direct investment from the U.S. Government greater than $1 billion. The Index is the first of the Government Relief Index Series that NASDAQ OMX will be launching in the coming weeks.

I generally hate rhetorical questions but seriously? Is this for real? Yup and it's quoted right here.

I'm grateful and perturbed at the same time. I mean, could there be an easier way to short the government's screw ups right before they kill all the equity? However, I feel obligated to be perturbed by its mere existence.

Once again, props to Greenewable for bringing this to my attention.

Uh...yea...thanks for the wishes John..

The lovely chaps at FT.com have posted John Thain's email to employees of Merrill Lynch here. So kind of him to begin with:

"It's been an honor..."

It sort of reminds me of the constant email postings from F*cked Company at the start of this century. Fortunately there are just not enough f*cked banks to support a website as there were dot coms.

A point that is not made often enough....

I was going through some old notes and found an article from a few years ago which makes a fantastic point, especially as it applies to investment management.  Remy Trafelet, manager of The Trafelet Delta funds, is quoted in the Financial Times:

"I recently interviewed a candidate who asked what my policy on 'face time' is," he says.  "I told him: 'If I see your face too much in the office, you're in trouble."

The complete article is here.

A Modest Proposal, Part Two: Stockades

I don't know that I want to get in the habit of quoting Paul Begala but you have to give it to him when he is dead on.  In his commentary today on the Huffington Post he seems to have one hell of a modest proposal.

The first Modest Proposal post is here.