Taped Cell Phone Calls

    Bloomberg TV reports that England will start taping trader’s cell phone calls soon.  The new regulatory policy is aimed at stopping insider trading, and easily evaded, but, hey, a win is a win, and we‘ll take it.  Coming on the heels of Germany’s outright ban of short sales, we find ourselves approaching joyous delerium here at The MacDougal Post.

    So much so our blogger’s decided to cut you a break.  That’s it for today.

    He’ll get back to ragging on next time.

    Experience shows that an Oracle needs two martinis a week to see everything.  This week it’s going to be three, and The Guru’s already started on that extra.

    Party on, valued readers.  It’s a gala time to be one of the good guys.  Throw a Taped Trader Hoedown yourselves this weekend.

  Investor Aside:  Lately, an energetic white plume has been rising above Jupiter's cloud tops, possibly heralding the return of the giant planet's missing stripe.  We are proud to observe that The MacDougal Post is the first financial blog to chronicle this fortuitous omen.  All may be well again soon.

Soldier Hedge Funds

    Back in the day, Filch & Finagle was an over-the-counter (OTC) house, meaning F & F didn’t make markets in issues traded on the various stock exchanges, only in unlisted securities of large or mid-sized publicly held corporations.  Banks and insurance companies were all unlisted in those days, and two of the Crime Family’s five traders manipulated stock quotes in those industries.  A third handled arbitrage, mostly in listed names, so there were only two traders gaming the rest of the OTC marketplace and one of them spent much of his time helping the arbitrageur mess with preferred stocks.

    OTC houses charged no commissions on stock trades, getting paid through a spread between the price they’d bid to buy 100 shares of something and what they’d ask to sell 100.  On internal reports, income within those spreads got booked under “fees and commissions”, and pencil pushers classified large amounts garnered outside the bid-and-asked as “trading profits”.

    Trading profits swelled when wise guys convinced big institutions to discount large sell programs because distribution would “flood” the market.  Filch & Finagle could get one of those block trades at a 15% discount, or whatever, then spend a few weeks touting the premium wise guys now claimed these shares deserved to smaller institutions because such quantities weren't always available, and ultimately unload slimmed-down blocks at quotes maybe 15% over where the price had been before the hoedown started.

    The trading desk's target profit happened to be 30% per caper, and you can see why the crooks hit it time after time.  A little off here, a little on there adds up fast when you‘re swindling everybody.  There were plenty of other stings too, often pulled down in concert with complicitous Families.

    We rob your customers and you rob ours was a particular favorite of our mom's.  It always got her leaving the room whenever one of those deals came up.  Sometimes she'd even take a drive.

    Mom had a '55 Chevy for a while, so we'd go too if she let us, and the Irving family's mob connection dropped the subject after a couple of those conversations.  Apartment got real empty, we guess.

     Our mob connection, a man with close matrimonial ties to our mother, who was a Saint, claimed the trading desk made money every month he ran the Filch & Finagle back office, even in the depths of The Great Depression back in the 1930’s.  We asked him to prove it and he showed us the statements, and it was true.  Every single month in the worst of the worst of times, trading profit or loss at F & F always printed black.

    That kind of success has everything to do with the mob definition of trading.

    Bloodsucking thieves dancing around our orders is what it is.  There are two sides to every transaction.  Somebody’s buying and somebody’s selling.  Generally, we give Family soldiers one side and the racketeers go out and find a mark to beat on the other, stuffing the mob’s own pockets with the difference.  Like the gangs were rigging a curling match, you go first so they always get to wield the hammer.  Sometimes offsetting orders come in simultaneously and racketeers take multiple suckers down in one caboodle.  At their most devious, wise guys from all the Families get together and pull the fleecing rug out from under the rest of us through massive short-selling.

    That’s how this ridiculous “trading” racket works.  It's all “proprietary”.  A fancy two-step inside the spread or out.  Nobody at the desk knows where the market’s going.  Nobody even cares.  Thugs simply rip off clients one transaction at a time, every transaction, every time.  When the Dons are ready to move markets, a Kingpin passes the word down.  That’s their business, not the trader’s.

  Those notorious “rogue” traders you read about are silly civilians who don’t understand that price swings happen when Dons make price swings happen.  By getting all the Families together and bullying markets in some direction.

    Rogues are never made men.

    Lately, according to Corporate TV, there’s been an exodus of trading desk soldiers leaving the Families for brand new billion dollar hedge fund start-ups, presumably to comply with new financial regulations.

    It’s our guess that Dons are simply shifting their own billions out of mob brokerage trading desks in order to back mob hedge fund trading desks, and in a way that we’ll never get close to uncovering, making sure their soldiers take the Family’s order book along with them.

    We’ll venture a guess that this way is electronic.  If you’re an SEC hotshot following our blog with regulatory diligence, I’d avoid looking there for sure.

   Chances are good you might find something.*





* Hedge fund trading items matched with brokerage firm fees and commissions. (We’d let the Don thing slide through. They’re way smarter than you.  Too smart to keep a hotshot on the Agency payroll if it looks like he’s close to nabbing them.  Or worse.)

News v Propaganda

    Last night, talking heads on GE TV told us that all those jobs we lost in recent decades went overseas because students in something like 40 countries graduate smarter than ours.

    Maybe a month ago, Chinese officials explained that they couldn’t seriously weaken the Renminbi, or the Yuan, or whatever that currency is called, because all their rural poor emigrating into the exploding urban job markets in recent decades would be put out of work.  Officials even showed how big the Chinese manufacturing centers had gotten, and discussed some of the problems caused by the massive relocation of their semi-illiterate, who apparently had to semi-skip their studies to frolic in the family rice paddy before Capitalism showed up.

    Big manufacturing centers.  Really, really big.  Big and cram packed with semi-illiterate rural poor.

    Why do we find ourselves 1) believing what looks, sounds, and feels like actual news coming from a Communist regime dealing with reality in an honest and forthright manner, and 2) rejecting what then becomes corporate propaganda from mob Crime Lords stuffing 75% of the nation’s wealth into their own pockets, up from 35% when those above decades started, while continuing to transfer as much as they can of the rest, in part by leaning on what used to be our media?

    And why isn’t anybody else ranting about this?  Talking heads claimed the education gap is a long term problem and we’d be even more decades catching up.  AND WE’D NOT BE GETTING ANY OF THOSE JOBS BACK until then.

    Guess they are broadcasting to some of the dumbest people in the world.  At least, the gangsters themselves must think so.

    I worked in a plant once.  Sometimes I stood on one side of the furnace plucking powdered-metal gun parts out of a bunch of small boxes and setting them onto the conveyer belt.  Other times I stood on the other side plucking really hot solidified metal gun parts off the conveyer belt and packing them into these great big boxes.

    Face it, that’s what we’re talking about here.  They even had somebody else taking care of the boxes so I couldn’t screw that part up.

    Education gap.  When the gun parts came out of the furnace, I had to remember to wear mittens.  Wasn’t anything else to it.

    How smart does a semi-literate rural poor Chinaman have to be?

The Oracle is in the Building

    Financial companies often hold bonds from issue to maturity.  Traditionally, to keep market manipulators from shredding their books, accountants had always carried these securities at cost, not adjusting for interim price swings.  That’s appropriate.  In a well-run insurance operation, for example, amounts recorded this way make actuarial assumptions possible, rendering market gyrations a sideshow, having nothing to do with anything really, as nature intended.

    For the Apocalypse however, short-sellers got our scribes to throw all that out, forcing the financial sector to mark bonds to market quotes gamed by short-sellers.  An appropriate principle sheltering balance sheets from bear attack was dropped, driving an already precipitous crash into the murky abyss we probed during the Godless years of 2008 and 2009.

    Thanks to fractious deregulation, investors had no chance to see it coming.

    Pencil-pushers have been herded back to reality since then, dumping the bond “mark-to-market” shinola into the trash bin of history, but unfortunately not in time to stop investors from losing a bundle on financials in the horrific final demolition caused by massive short-selling that the Securities and Excuses Commission tells us wasn’t caused by massive short-selling.

    If not, it was a bottomless pit needlessly carved out by bookkeeping demon spawn in some kind of undisclosed satanic SEC lair our own CPA had not been told of before.

    Today, one hears here and there that persons of interest are scheming to bring “mark-to-market” devastation back again, and, as we interpret a recent Bloomberg TV heads-up, even got the SEC to investigate Warren Buffett over the issue.

    The Oracle of Omaha had to face the holocaust head on himself, running a company with major holdings in the financial arena, then bottom fishing for more at the absolute nadir.  The SEC wanted to know why his Berkshire Hathaway carried common stocks at cost that he’d bought kind of high back in the glory days, values now above current market prices.

    Under standard accounting procedure, common stocks have always been marked to current, what I’ll call, “free market” prices, but what about the gamed market conditions we now have to live with?  Gurus at The MacDougal Post have been wondering whether it isn’t time to start valuing all securities at cost, given the huge increase in hedge fund assets earlier this century, pouring Godzillions into a broken short-selling based business model that's hell bent on the ruination of fair market principles through coordinated mass manipulation to a degree Mother Capitalism never anticipated, let alone encountered before.

    These short-selling vehicles are the playthings of careless people retreating into their vast carelessness, to shamelessly butcher F. Scott Fitzgerald in a time and place where his niche grasp is sorely needed.  A rotten crowd.  Our readers are worth the whole damn bunch put together.  With the super careless now holding 75% of the nation’s wealth, up from 35% just a piddling time ago and still growing, it’s terrifying to contemplate where the new high-speed computerized stock market pricing mechanism could be flash crashing us to.  If you and I have to indulge the vastness of this careless bear participation, perhaps ignoring their interim impact on everyone’s reported financial position is the only way to go.

    Kudos to the Oracle for dropping this segue in our laptop.

    Bloomberg didn’t say how the Buffett inquiry turned out, but to paraphrase their talking head, the country’s leading investor oracled that he was in his stocks for the long haul, believing Kraft and whatever to be great companies, and Berkshire wouldn’t be selling them here, hence had no inclination to price them here either.

    God on High, praise be Warren Buffett.

    In the earliest days of accounts keeping, when crooks were crooks and half of them got nabbed skulking around in Government positions, books were maintained at transaction values.  The true historical record was the only thing stopping the felonious from running paper swindles.  We may well be back there again.

    One wishes the accounting profession would apply Mr. Buffett’s well-reasoned approach to our reported financial position too, helping insulate all long term investors from ursine maulings.  Pricing assets with stock quotes that mobsters control is madness, and that’s what you find at every short-selling crime scene, be it a marketplace, sector, industry, or just one gangbanged issue on a particularly careless afternoon.

    Remember, during the Apocalypse it was short-sellers who stuffed their own pockets at what became, in fact, all mankind’s expense, creating fraudulent paper for mass distribution and betting against clients buying it, then exacerbating the widespread human suffering that this caused with a mark-to-market scam misrepresenting the financials of public companies.  Viewed in the context of their catastrophic global bloodletting, these are thrill killers, serial murderers seeking out the countless deaths they cause as well as all the collateral illness, homelessness, poverty, and despair still menacing God’s children in the misbegotten misery and hopelessness that continues, by their hand, to smother the civilized world and Iceland to this day.

    Furthermore, who got the SEC to make the Buffett inquiry anyway, and how much time do our regulatory hotshots spend doing the short-seller’s bidding?

    Why can’t we put this ridiculous agency down.  Clearly, the small investor would be better off without it.


    Just hearing about that rotten crowd at play is a damn waste of time.

Where?

    Where do short-sold shares come from?


    Securities lending is the new media explanation, replacing "locating", which was cited by the SEC fairly recently as the actual business practice since short-sellers weren't really "borrowing" like they said they were.  In "locating", a Crime Family simply tells each inquiring short-seller its wise guys have enough shares in inventory to meet his need, and mobsters keep no running total, so all the inquiries can accumulate into many more shares than actually exist.  In securities lending, racketeers muscle pension fund managers and them into “loaning” shares to short-sellers or else getting slammed with higher custodial fees, all the while threatening to levy killer exit fees if managers freak and want to find a new Crime Family to get swindled by.

    Getting a handle on all the explanations is like listening to the party of her part frolic through world class divorce high jinks.  All one can do is try and keep up.  In reality, despite what they try to say, short-sellers create brand new phony shares.  It’s the same old bookkeeping entry.  Credit bogus shares and debit short-seller’s cash with booty swindled from an uninformed investor.  They just try and throw a second and misleading entry in too, pretending to cover up bogus with real ones short-sellers don‘t even own until the cons fold up their sting and clear out of town.

    With securities lending, we’re thinking that the mob has just been collecting inquiry fees without actually getting to the part about the securities lending.  We can't make sense of the "locating" explanation otherwise.

    Whatever, the NY Times, which recently broke the story maybe 16 months after Forbes did, followed up with a 10/22/10 editorial. Editors only focused on losses incurred when pension fund managers “lending” shares invested the charges they collected from short-sellers “borrowing” them.  Totally overlooked was the hit their pensioners took after their Bank of America shares were handed over to short-sellers at 55 and taken back at 3.

    At times like this, we’re half convinced the media caused the financial meltdown all by itself.  They’ve had since at least October 1929 to figure this stuff out.  I mean, how difficult is it to subtract 3 from 55, and then look around for the real loss here.

    The catastrophic, worldwide apocalypse rendering loss.

    Concurrently, our own brokerage account was switched from one arm of a gargantuan financial institution to another arm this month, and in the process morphed from cash to margin.  Without notice.  Apparently margin is the default in the land of the megaliths.  Margin accounts are also where the bloodsucking thieves go when they want to lend shares to short-sellers, and we called yet another of Gargantua’s countless arms to get our cash account back as soon as we saw what arm 2 was doing to us.

    Anyone not trading uncovered options or selling short himself might want to make sure he has a cash account.  The Forbes piece says there’s little chance of your Crime Family passing their loss along to your margin account if their securities lending business goes awry, but little is hardly no chance at all, which is where cash accounts stand, and you do agree to let the Family itself put your investments at risk by signing up for a margin account.

    Besides, folks still reading our blog after all these months may not want to help short-selling thugs bludgeon their investments into smithereens.

    55 down to 3. For some of us, that part is hard to forget.

    “Welcome, valued customer.  My name is David.  How can I help you today.“

    “Hi David, is my account margin or cash?”

    “Margin.”

    “Change it. I want a cash account, David.”

    “Just takes a moment, Sir.”

    That, valued readers, is all you’d have to do.

Whistleblower Project

    Are you a former wise guy?  Somebody the mob laid off during the financial apocalypse?  If so, you could square things and pull down a bundle ratting out Wall Street under the Federal whistleblower program.  The Post has prepared a submission you can use.  Just go to the link below, find the online form, and fill it out using the statement printed here.

    We’re not asking you to touch base with us or anything.  When the story hits the airwaves, we’ll know our whistleblower project has been successful.

    Just note the size of your Federal whistleblower reward before making a decision.



U.S. Office of Special Counsel
http://www.osc.gov/

    Wall Street racketeering assisted by malfeasance within the Securities and Exchange Commission has defrauded investors for generations, using the same scam over and over again.  Their swindle works like this:

    Investors value equities largely by comparing stock prices to earnings per share estimates (EPS) that security analysts at Wall Street firms calculate and publish.  EPS is based on the number of shares issued by a public corporation as reported in its audited financial statements, adjusted to reflect various corporate transactions.

    Meanwhile, when the time is right, traders in another department of those same Wall Street firms coordinate attacks with others in the financial community to issue counterfeit shares to themselves and sell them to the public, adding more and more and more of these phony shares to the number of real shares in those audited financial statements, driving EPS lower and lower and lower.  Investors who are being sold fake shares are never told that somebody's being hoodwinked into holding bookkeeping transactions here, not real company stock recorded with the corporate registrar.  The public doesn’t know that published EPS estimates are made a fiction by this clever racket.  As part of the sting, sellers of the bogus shares even pay, out of their own pockets, dividends on the fake stock that they issue to themselves and then dump into public hands, filling out the deception.

    At market bottoms, there can be a hundred phony shares being offered for sale for every one real share looking to be bought, in effect, bringing an EPS estimate of, say, $4.00 down to $0.04.  That stock price really should fall from 40, or whatever, to 40 cents because its value has been gamed by financial racketeers flooding the point of purchase/sale with illicit faux paper that doesn’t belong there.

    To drop EPS that much, financial wise guys don’t have to mix 100 times as many bogus shares in with real ones.  Just keep that 100:1 ratio going at the intersection where buyers and sellers meet, which becomes easy to do when your criminal activities bully buyers into fleeing the marketplace.

    In Vegas parlance, the balance between buyer and seller, which determines the price, gets fixed.

    This is called short-selling, and the racket has been covered up for generations by the Securities and Exchanges Commission, whose sole role appears to be focused on explaining everything away.  Public investors buying phony shares aren’t told that somebody's stock isn’t recorded in the registrar’s books here, so victims only buying a bookkeeping transaction never know they‘re not paying for a genuine transfer of real shares of stock.  SEC staffers flat out ignore the effect fraudulent shares have on EPS, and they themselves join perps in making and restating excuses for counterfeit shares, sometimes saying phony shares are “borrowed“ from some undisclosed party or place, other times that they are “located“ there, wherever there is and whatever “located” means.  Fraudulent dividends are labeled “payments in lieu of dividends” and allowed to look like the real thing when paid into victims‘ accounts.

    Fact is, short-sellers get to use their own play shares and can issue themselves as many as they want.  Play shares against real shares held by real investors duped by not being told what’s really going on.  Wall Street firms are treated by the SEC as if these wise guys are entitled to rip off everyone’s savings.

    Who loaned short-sellers Bank of America stock at 50 in 2008 and took it back at 3 in 2009?  Why hasn’t he gone postal on my TV?  Is he the beneficiary of a pension fund not telling him they are putting his benefits at risk?  Has he simply been conned into keeping securities in a margin account without knowing what that means?  Or whose stock was “located” then, and why does “located” even change anything?  When were these victims told their investments were being used by somebody else?  And who told them what their holdings were being used for?  Especially the suckers whose purchases had only been bogus bookkeeping transactions to begin with.  Everything about this swindle defrauds the public, and was purposely designed that way.

    By Wall Street firms I include major financial service companies with investment research departments and stock trading operations as well as all the hedge funds rubbing our noses in their criminal business model blatantly based on the short-selling swindle.  As for public investors, we’re looking at every shareholder in America who’s been menaced or fleeced by the racketeers since markets developed for stocks in the 1800‘s, including market crashes as well as short-selling attacks on market sectors or individual stocks during this period of time.

    The misinformation campaign tries to draw a distinction between short-sales held overnight and day trades, which are short-sales closed out in the same market session.  There’s no difference to the people being swindled, or in the effect on EPS.  This obfuscation just makes it possible for racketeers to claim that shares sold short and bought back the same day aren’t bogus, feeling they can get away with this lie because day trade audit trails aren’t run through a transfer agent’s ledger.

    Financial firms account for customer shares as a pool, registering them as owned by some entity that the firm controls.  This is done to hide transactions when short-sellers issue fraudulent shares to themselves.  If every real owners’ name were printed on stock certificates or registered with the company they‘ve invested in, bogus sales would be segregated and readily classifiable by accountants as illegal.

    Furthermore, if these racketeers short-sell somebody else’s stock without telling them, where is the line between borrowed and stolen shares?  Employees and retirees included in pension funds, for example, are never told Wall Street racketeers borrow (or locate) shares held in those funds and drub the market with them, and are certainly not asked to let this jeopardize their benefits.

    Wall Street racketeering and SEC malfeasance have defrauded investors and crippled world economies to the tune of trillions and trillions of dollars since the the agency was established in the 1930’s to prevent such scams from taking place.  I hereby claim the appropriate reward as an outside whistleblower.

    Based on conservative assumptions, an accountant at The MacDougal Post says my reward works out to 347 billion dollars.

The Other Wall Street

    A lot of dads come out to watch their kid play ball, and Wall Street CEO’s are no exception.  Years ago, I met one with no Gangland affiliation.  My mob connection, who had close matrimonial ties to my mother, who was a saint, called this guy a straight arrow.

    Turned out the man proved to be an investor pulling clients in on deals that actually financed America, what wise guys said they were doing while financing themselves.  His firm never joined in with the bloodsucking thieves around The Street to gangbang markets or sectors or even individual stocks, nor pulled off any nefarious schemes my mob connection could finger him for.

    They didn’t have any bloodsucking thieves in the office.

    In reading what’s been blogged on our website so far, we realized this part's been left out.  Back in the day they weren’t all crooks down there.

    Just pretty much everyone doing business with Filch & Finagle.

    At least this one firm was the real deal.  And still is, we assure you.