Comments on: Marc Faber Disses the Bailout Plan, Likes the Dollar http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html Sun, 22 Nov 2009 11:45:14 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: jeff65 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18778 jeff65 Wed, 01 Oct 2008 21:17:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18778 In addition to Richard Smith's comments, consider that GLD and SLV have NOTHING in their prospectus' specifically disallowing that the metal in the ETF can be loaned or leased to a third party. It's also likely stored at an exchange or exchanges (no one will say) where it might come in handy for money making purposes. If you were a bank (look at the banks named in the prospectus) could you resist putting to work all that money sitting there "doing nothing"?<br/><br/>And finally, if you were going to confiscate gold from citizens, what would be easier than drawing it all to one place?<br/><br/>GLD and SLV are great for trading, but lousy substitutes for physical metal. In addition to Richard Smith’s comments, consider that GLD and SLV have NOTHING in their prospectus’ specifically disallowing that the metal in the ETF can be loaned or leased to a third party. It’s also likely stored at an exchange or exchanges (no one will say) where it might come in handy for money making purposes. If you were a bank (look at the banks named in the prospectus) could you resist putting to work all that money sitting there “doing nothing”?

And finally, if you were going to confiscate gold from citizens, what would be easier than drawing it all to one place?

GLD and SLV are great for trading, but lousy substitutes for physical metal.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18757 Anonymous Wed, 01 Oct 2008 20:00:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18757 The indentation threw me off too.<br/><br/>Anyway, Marc Faber doesn't like the dollar. He just thinks it's probably the best of the worst at the moment, and it's time for a momentary bounce.<br/><br/>Also his statement about the stock market wasn't a call. He was just stating something that could happen. The indentation threw me off too.

Anyway, Marc Faber doesn’t like the dollar. He just thinks it’s probably the best of the worst at the moment, and it’s time for a momentary bounce.

Also his statement about the stock market wasn’t a call. He was just stating something that could happen.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18735 Anonymous Wed, 01 Oct 2008 17:16:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18735 SEC. 132. AUTHORITY TO SUSPEND MARK-TO-MARKET AC19<br/>COUNTING.<br/>20 (a) AUTHORITY.—The Securities and Exchange Com21<br/>mission shall have the authority under the securities laws<br/>22 (as such term is defined in section 3(a)(47) of the Securi23<br/>ties Exchange Act of 1934 (15 U.S.C. 78c(a)(47)) to sus24<br/>pend, by rule, regulation, or order, the application of<br/>25 Statement Number 157 of the Financial Accounting....... SEC. 132. AUTHORITY TO SUSPEND MARK-TO-MARKET AC19
COUNTING.
20 (a) AUTHORITY.—The Securities and Exchange Com21
mission shall have the authority under the securities laws
22 (as such term is defined in section 3(a)(47) of the Securi23
ties Exchange Act of 1934 (15 U.S.C. 78c(a)(47)) to sus24
pend, by rule, regulation, or order, the application of
25 Statement Number 157 of the Financial Accounting…….

]]> By: Max http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18731 Max Wed, 01 Oct 2008 16:41:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18731 baychev,<br/><br/>can't the same logic be applied lest the liquidity squeeze spreads in the EU? Again, why the thinking that if banks start tanking in the EU, it will be bad for Euro, while at the same time arguing for dollar strength because of the US banking crisis? baychev,

can’t the same logic be applied lest the liquidity squeeze spreads in the EU? Again, why the thinking that if banks start tanking in the EU, it will be bad for Euro, while at the same time arguing for dollar strength because of the US banking crisis?

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18730 Anonymous Wed, 01 Oct 2008 16:23:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18730 If I'm not mistaken, the Treasury 'core' plan pending before Congress is intact. It specifically addresses the damage over-leverage has done by allowing entities to mark their worthless paper as any value they please. I can see the need to obfuscate worth so as to pretend insolvency doesn't exist (that's what the President is trying to tell you but can't) but the proposed bill is still cherries (AMT fix) and ice cream (business tax reduction) circling the black hole of debt.<br/><br/>Lowering the value of the dollar to somehow repair the trade deficit is just an accounting gimmick. <br/><br/>Short term the markets go up and long term the markets go down is not as asinine as it sounds esp. if (monetary, credit, whatever)inflation is rampant and causing price inflation. SOW at 15,000 again? Footnote: Zimbabwe If I’m not mistaken, the Treasury ‘core’ plan pending before Congress is intact. It specifically addresses the damage over-leverage has done by allowing entities to mark their worthless paper as any value they please. I can see the need to obfuscate worth so as to pretend insolvency doesn’t exist (that’s what the President is trying to tell you but can’t) but the proposed bill is still cherries (AMT fix) and ice cream (business tax reduction) circling the black hole of debt.

Lowering the value of the dollar to somehow repair the trade deficit is just an accounting gimmick.

Short term the markets go up and long term the markets go down is not as asinine as it sounds esp. if (monetary, credit, whatever)inflation is rampant and causing price inflation. SOW at 15,000 again? Footnote: Zimbabwe

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18727 Anonymous Wed, 01 Oct 2008 15:39:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18727 Matt Dubuque<br/><br/>Yes, I relied on the indents. I was surprised at the call.<br/><br/>Those auctions, in my view, should be factored into any stock market forecasts.<br/><br/>Matt Matt Dubuque

Yes, I relied on the indents. I was surprised at the call.

Those auctions, in my view, should be factored into any stock market forecasts.

Matt

]]> By: baychev http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18719 baychev Wed, 01 Oct 2008 15:21:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18719 max,<br/>it aint quite so when there is a liquidity squeeze. banks are scrambling for every buck to post as additional collateral, there EMEA stock was sold big time and dollars repatriated over the past few months. in such environment banks frontrun the real money and make sure that the 'diversified investors' get less bucks. simple as that and quite reminiscent to the dollar rally of 2005 that was driven by special tax break for corporates. max,
it aint quite so when there is a liquidity squeeze. banks are scrambling for every buck to post as additional collateral, there EMEA stock was sold big time and dollars repatriated over the past few months. in such environment banks frontrun the real money and make sure that the ‘diversified investors’ get less bucks. simple as that and quite reminiscent to the dollar rally of 2005 that was driven by special tax break for corporates.

]]> By: doc holiday http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18718 doc holiday Wed, 01 Oct 2008 15:20:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18718 Amen Sister, tell it, tell it:<br/><br/>1. Any proposal to rescue the US financial system will fail to avert a recession<br/><br/>2. the huge leverage that is the problem<br/><br/>3. false sense of security<br/><br/>Oh wait Sister, I'm against this part: "Stop paying dividends to their shareholders".<br/><br/>In theory, I agree with the amount of cash that could be diverted from dividends to loan loss reserves seems like a good idea, but dividends, IMHO are dilutive to insider/employee option grants, thus taking away future value for shareholders is a bad idea, because insiders will still siphon off cash for themselves, and leave common shares diluted in this shuffle (one way or another). Hence, I think a reduction in option grants which "should" be obviously linked to performance, which would give the fat cats an opportunity to actually work for compensation.<br/><br/> Taking away the dividend from shareholders hurts the long-term investor that wants cash-flow; if you take away cash flow, these people will bail and insiders will still steal cash; thus this is a structural problem where shareholders should restructure corporations to become more efficient and put pressure on the people that have caused this panic! Amen Sister, tell it, tell it:

1. Any proposal to rescue the US financial system will fail to avert a recession

2. the huge leverage that is the problem

3. false sense of security

Oh wait Sister, I’m against this part: “Stop paying dividends to their shareholders”.

In theory, I agree with the amount of cash that could be diverted from dividends to loan loss reserves seems like a good idea, but dividends, IMHO are dilutive to insider/employee option grants, thus taking away future value for shareholders is a bad idea, because insiders will still siphon off cash for themselves, and leave common shares diluted in this shuffle (one way or another). Hence, I think a reduction in option grants which “should” be obviously linked to performance, which would give the fat cats an opportunity to actually work for compensation.

Taking away the dividend from shareholders hurts the long-term investor that wants cash-flow; if you take away cash flow, these people will bail and insiders will still steal cash; thus this is a structural problem where shareholders should restructure corporations to become more efficient and put pressure on the people that have caused this panic!

]]> By: Yves Smith http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18714 Yves Smith Wed, 01 Oct 2008 15:09:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18714 Matt,<br/><br/>I suggest you learn to read more carefully, I do not make stock market forecasts. That is Faber's point of view. The text is clearly from him. <br/><br/>I warned you again Matt, and you have failed to behave impeccably. You attribute a position to me that I did not take. Matt,

I suggest you learn to read more carefully, I do not make stock market forecasts. That is Faber’s point of view. The text is clearly from him.

I warned you again Matt, and you have failed to behave impeccably. You attribute a position to me that I did not take.

]]> By: Richard Smith http://www.nakedcapitalism.com/2008/10/marc-faber-disses-bailout-plan-likes.html#comment-18715 Richard Smith Wed, 01 Oct 2008 15:09:00 +0000 http://www.nakedcapitalism.com/2008/10/marc-faber-disses-the-bailout-plan-likes-the-dollar/#comment-18715 Twas Faber's forecast, Matt, not Yves's. Those indents can be a bit hard to follow...however you will find Yves doesn't do much in the way of market calls. Twas Faber’s forecast, Matt, not Yves’s. Those indents can be a bit hard to follow…however you will find Yves doesn’t do much in the way of market calls.

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