Janet Tavakoli, Tavakoli Structured Finance
On the Fourth of July, comedian Chris Rock tweeted: “Happy white peoples independence day the slaves weren’t free but I’m sure they enjoyed fireworks.” Chris Rock disowns the holiday with tongue-in-cheek.
Well right back at you Mr. Rock. My continental European ancestors weren’t in the USA when colonists won their independence from England. My grandparents didn’t even speak English when they arrived in the U.S., but according to [...]
Private equity leveraged buyouts (P.E. LBOs) typically put up 10% of their own collateral (although Romney would sometimes only put up 5% to 6%) with the remaining 90% from bank loans taken out against the buyout target company. This loads the company with extreme amounts of debt, which greatly reduces their taxes due to the greater tax deductibility from debt interest payments. (Equity dividends are always taxed higher than debt [...]
Reposting by popular demand, and because everyone has to understand the embedded risks in this market, courtesy of the shadow banking system.
In an oddly prescient turn of events, yesterday we penned a post titled “Has The Imploding European Shadow Banking System Forced The Bundesbank To Prepare For Plan B?” in which we explained how it was not only the repo market, but the far broader and massively unregulated shadow banking [...]
(ZH) In an oddly prescient turn of events, yesterday we penned a post titled “Has The Imploding European Shadow Banking System Forced The Bundesbank To Prepare For Plan B?” in which we explained how it was not only the repo market, but the far broader and massively unregulated shadow banking system in Europe that was becoming thoroughly unhinged, and was manifesting itself in a complete “lock up in interbank liquidity” and [...]
A rather sobering report out from S&P, which has no other function than to tighten the screws even more on those who prudently are holding out against extending the debt ceiling. As for S&P: please explain to US how 120% debt/GDP is better than 100% debt/GDP, and thus more worthy of a AAA rating? Please. Because we must be bloody stupid.
The U.S. Debt Ceiling Standoff [...]
We already know, of course, that our government moved mountains to help the banks during the crisis. But the report adds to our understanding of events by describing how the Treasury Department changed the tax code to benefit banks acquiring weaker institutions. Never mind that the Constitution allows only Congress to write tax rules.
I.R.S. Notice 2008-83 came out of nowhere on Sept. 30, 2008, [...]
by Vega Strategies
With ‘Synthetic Banking’ Just Around the Corner Enjoy ‘The Liechtensteiner’ on ‘Fed Monday’
Swiss bankers know that the sharpest pencils in the business are wielded by the quaint and humble Liechtensteiners who run the choicest billions of the trillions of global HNW money out of their storybook village of Vaduz nestled splendidly amidst the Alps. And, lest anyone confuse such a pristine setting with [...]
by Janet Tavakoli, President, Tavakoli Structured Finance
“Speculators Want U.S. CDS Payoffs in Gold
Remember AIG? When prices moved against AIG on its credit default swap contracts, AIG owed cash (collateral) to its trading partners. AIG paid billions of dollars and owed billions more when U.S. taxpayers bailed it out in September 2008.
U.S. credit default swaps currently trade in euros. After all, if the U.S. defaults, [...]
“Keynesian Economics (US definition): the science of propaganda to justify the elite theft of public and worker wealth by fraudulent means, reinforced by manufactured lies and nonsensical forecasts to perpetuate a corrupt system, furthered by a stream of pathetic justifications of why past failed policy must be continued, aided by doctored data to cover up the latticework of falsity, all intended to maintain a power structure led by [...]
More than Â£20bn of defence contracts structured as private finance initiatives (PFIs) face the axe as the Ministry of Defence undertakes radical cuts to address a Â£35bn deficit.
UK Government plan to cut the size of the RAF to WW1 levels:
Ex Afghanistan chief urges the end of Army, and Air Force in UK:
1. In 2007 Go1dman created a $2 Billion Package of Mortgage Loans called ABACUS, one of many.
2. Goldman invited clients to BUY Abacus Package of subprime loans made the last 18 months.
3. If people paid those mortgages house payments, then Abacus Long Investors would make money.
4. Go1dman told investors Abacus loans were chosen by ACA Management LLC but that was a G0LDMAN L1E as Hedge Fundster John Paulson hand picked [...]