Wednesday, June 22, 2011

James Rickards explains why our politicians suck

Jim Rickards, a Managing Director @ Omnis, was on CNBC this morning. This guy is one of the very most brilliant at cutting through bullshit, and telling investors exactly what's going on in the world's financial markets. When Jim comes on CNBC, everything stops behind my trading screens. My eyes are glued to Jim and my ears are soaking up everything he says. And it was worth the effort this morning.

Jim did the most brilliant job I've ever heard in explaining why Credit Default Swaps are so very dangerous:

"You have the potential for the Lehman moment. The fall of the bonds, the credit default swap market, and the the derivatives. But the problem is like saying there's a mine field, I want you to walk across it. There's two mines. If I don't know where they are, I'm not going to go. If Greek debt falls, technically they're nontransparent, hedge funds, all over the place. So I'm going to withdraw from the bank market and the money market. That's what causes the Lehman moment. It's not that it's so big, it's fear and uncertainty."

Let's stop right here and remind ourselves of a few things:

  • It was 3 full years ago that these dangerous CDS derivative securities almost brought down our entire world financial market, and yet we've done absolutely nothing to rein them in.
  • In 3 years we've made zero progress in making this market transparent.
  • In 3 years we've done nothing to move these dangerous financial instruments onto exchanges.
  • In 3 years we're in the same damn situation with Greek Debt and CDS that we were in with Sub-prime housing debt and CDS in the fall of 2008.
  • Republicans are to blame - those 'effing assholes fight tooth and nail to give our Bankers the ability to keep these dangerous securities in the dark.
Why do we even allow these POS, worthless, good for nothing securities to exist? According to our esteemed former Chairman of the Federal Reserve Board, Alan Greenspan, a laissez-faire Republican, these instruments exist in order to spread risk across the entire financial system. That is nothing but pure T crap. These things don't spread risk. They make the entire system one giant RISK ! Without transparency and knowledge of who holds what in the way of risk, everyone runs for the exit at the whiff of any danger, thereby RISKING bringing down our entire world economy. Greenspan was wrong. Republicans who stand behind allowing banks to trade these damn things are idiots.

Republicans, like my good for nothing, POS, worthless Republican Senator Richard Burr better get off their ass and address this problem soon. If they continue to kiss bankers tails and fail to clean this mess up, then we are at risk of watching a horror show in our world financial markets that will put 2008 and The Great Depression to shame.

Our Republican Senator, Richard Burr, is an idiot. This man sits on the powerful Senator Finance Committee. But I guarantee you, our idiot Senator wouldn't know a CDS if it reached up and bit the moron in the ass. He'll do nothing, until after its too late. Richard Burr is a wasted suit, and his ignorance is going to contribute to crashing our world financial markets. Bank on it.

North Carolina deserves better than Republican Senator Richard Burr.

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