While I sympathize with their desire to simplify the tax code, I am mystified by the desire of the proponents of the "fair tax" to continue to promote their program with misleading arguments. It appears that they constantly try to have it both ways. For example, Leo Linkbeck, in his editorial FairTax Facts, points out early on that the cost of the income tax is "embedded" in the price of everything that you buy. By the end of the same essay though, he argues that a benefit of his tax proposal is that it would collect from the underground economy, illegal aliens, and foreign tourists. It already is though, as he pointed out, it is embedded in the price of everything you buy.
Thursday, December 27, 2007
Tuesday, December 11, 2007
This woman certainly has a flair for the dramatic, in the introduction she congratulates the students for being brave enough attend her speech. Yeah, like going to a lecture at Kane Hall is the moral equivilant of storming Omaha Beach under fire. The biggest risk you face there is getting mugged while waiting for your bus on the Ave.
As a Russian and East European studies major at the University of Washington, having taken many a class at Kane Hall, I was particularly annoyed at this speech being full of bad Soviet comparisons. Half the speech was, "Well Stalin did something bad, which has a superficial resemblence to something Bush might do if we let him". Yeah, Stalin murdered 20 million people, Bush had water dumped on Khalid Sheikh Mohammed's head, big difference genius.
This idiotic part pretty much summed it up for me.
When the Berlin Wall fell, the third of the US economy that is defense manufacturing was facing a declining market share because we lost our global enemy. And what do you have to do if you are losing a global enemy and you are the defense industry? Make a new enemy, exactly. They were facing a real economic catastrophe unless they could hype a new enemy. Enter the Global War on Terrorism.
A third of of the economy? In 1989 military spending was only 5.6% of GDP. Given that much of that was salaries for the soldiers themselves, defense manufacturing was only about 2-3% of the economy. Is she just making this crap up?
Saturday, December 08, 2007
To prevent the current problems in the housing market from spreading, shaking confidence in other sectors of the economy, we need to put money in the pockets of middle-class Americans. In September, I proposed a middle-class tax cut that would offset the payroll tax that working Americans are already paying. It would give very working family a tax cut worth up to $1,000. It would also make retirement more secure by eliminating income taxes for any senior making less than $50,000 per year. And over the long term, I've called for an automatic workplace pension enrollment policy, which would include a federal government match for part of the savings of middle-class families so they can count on more savings when they retire.
Tax cuts, coming from a Democrat? I am kind of waiting for the other shoe to drop though.
Friday, December 07, 2007
But for the two million homeowners who face foreclosure over the next year because of the subprime mortgage crisis, their New Year's hopes rest not with themselves, but with policy makers in Washington and the investment community on Wall Street.
Hello, they are not facing foreclosure because of the crisis, they are the cause of the crisis. My sympathy goes out to anyone who loses their home, but this was the result of poor decisions, they are not the passive recipients of over people's actions.
Many of the victims of aggressive mortgage brokers were single women, seniors on fixed income, young couples, Latinos and African Americans. They live in every neighborhood in every one of our major cities, and elsewhere. In one block alone on West Madison Street in Chicago, every one of the homeowners is in default on their current mortgage terms. In neighborhood after neighborhood in Chicago, foreclosures have soared to more than 50 per square mile.
Of course since there are 640 acres to a square mile, we are conservatively talking about thousands of homes, from which those 50 are from. These houses are not going to go empty after their current owners lose them, others, specifically the poor that he is worried about will have to opportunity to pick them up at bargain prices, that they can hopefully actually afford.
Tuesday, December 04, 2007
A taxpayer bailout of distressed homeowners would be expensive, unfair to the vast majority of homeowners and renters who have made prudent financial decisions, and set a troubling precedent that would invite reckless behavior in the future. What's more, a bailout will not stop the inevitable correction in home prices, and is unlikely to prevent the associated economic repercussions.
The primary argument for a taxpayer bailout is based on a myth -- that subprime borrowers are falling behind on their mortgages because interest rates on their adjustable rate mortgages have spiked, making their monthly payments unaffordable. In fact, the vast majority of delinquent subprime borrowers are still paying introductory teaser rates (about 8% on average, a below-market rate for borrowers with checkered credit histories). In other words, for most of these borrowers, their monthly payments have not yet gone up.
Wednesday, November 28, 2007
The history of Newsnight's nightly markets update has not always been a happy one. On Thursday we reported that in New York the "Dow Jones was substantially down amidst more credit crunch fears". That's odd, many of you told us, as - being Thanksgiving - Wall Street's finest were on a day-off. Our economics editor Stephanie Flanders was mortified - "unforgivable and embarrassing" was her verdict.
This is, I am ashamed to say, not the first time we have made such a mistake. The markets information is almost always the last thing we do on Newsnight and in the scramble of a particularly lively programme last night we neglected to notice that the US markets were shut and blithely reported the day before's figure. I'm sorry and I'm determined this won't happen again.
The former chess champion Garry Kasparov was sentenced to five days in jail yesterday after taking part in an anti-Kremlin protest rally in Moscow.
Mr Kasparov, the leader of the opposition Other Russia coalition, was charged with organising an unsanctioned protest "of at least 1,500 people directed against President Vladimir Putin", chanting anti-government slogans and resisting arrest.
His court appearance came only hours after he was arrested by riot police during the protest.
He was one of dozens of people detained during the 3,000-strong demonstration called "the march of the dissenters".
Sunday, November 25, 2007
I am constantly amused about how Barack Obama, a one term senator, and Hillary Clinton, who is just 1 year into her second term, are both attacking each other for being inexperienced. They are both right, geez, the Democrats pilloried Dan Quayle for being young and inexperienced, and he served two terms in both the House and Senate, before assuming the relatively innocous job of the Vice President!
Saturday, November 24, 2007
We now have THREE reports to the effect that the Provost Marshal General was arrested or placed under house arrest at 6.00pm on Tuesday 20th November or on 21st November. We have a fourth report that the Provost Marshal General was 'fired', but as of 24th November, these reports are being backpedalled again, and we now have to advise that they cannot yet be confirmed. It was understood that his Number Two has taken over, but that cannot yet be confirmed either. The purge is thought to be being spearheaded by DOD Internal Affairs.
The Provost Marshal's arrest, if it actually took place (which is now uncertain again) will have reflected the fact that he failed on Tuesday 20th November to impose his will on the situation in accordance with his remit and oath as a commissioned officer, coupled with vigorous outside representations that decisive action along these lines needed to be taken immediately. Since the Provost Marshal General was present at, and a participant in, the corrupt round-table meeting in Washington, DC, at which Ambassador Wanta's unpaid prospective tax windfall payment of $1.575 trillion to the Treasury was being sliced up illegally, he has been in clear and gross dereliction of his duty, certainly warranting his immediate arrest, as we warned earlier. He could not have turned up at Citibank because he was engaged in gross, fraudulent and unconstitutional discussions at the Washington round-table conference. Hence his 'reported' arrest (as we flagged earlier).
I am reminded of the greatest contribution to the world of political science ever achieved in cinema. From the opening credits of Monty Python and the Holy Grail:
The directors of the firm hired to continue the credits after the other people had been sacked, wish it to be known that they have just been sacked.
The credits have been completed in an entirely different style at great expense and at the last minute.
Monday, November 19, 2007
The Pentagon was covering up the real magnitude of the "suicide epidemic". Following an exhaustive investigation of veterans' suicide data collected from 45 states; CBS discovered that in 2005 alone "there were at least 6,256 among those who served in the armed forces. That's 120 each and every week in just one year."
That is not a typo. Active and retired military personnel, mostly young veterans between the ages of 20 to 24, are returning from combat and killing themselves in record numbers. We can assume that "multiple-tours of duty" in a war-zone have precipitated a mental health crisis of which the public is entirely unaware and which the Pentagon is in total denial.If we add the 6,256 suicide victims from 2005 to the "official" 3,865 reported combat casualties; we get a sum of 10,121. Even a low-ball estimate of similar 2004 and 2006 suicide figures, would mean that the total number of US casualties from the Iraq war now exceed 15,000.
To use his own term. Baloney. The logic and math behind this is so bad that it would be laughable if it weren't so tragic. What Mr. Whitney is missing, is that the 6,256 is among all veterans, not just veterans of the Iraq War. In 2005, according to the Census Bureau, there were 24.5 million veterans in America, while the number of Americans who had both managed to serve in Iraq (which just started in 2003), come back and get discharged into the veteran population would have most likely have been in the mere tens of thousands. Even if you counted every single soldier who served, at 120,000 per rotation, two rotations at that time, that would be a mere 1% of all veterans.
The stupid thing is, Mr. Whitney could have actually come up with a reasonably accurate measure. The original CBS article he links to gives the suicide rate for veterans:
It found that veterans were more than twice as likely to commit suicide in 2005 than non-vets. (Veterans committed suicide at the rate of between 18.7 to 20.8 per 100,000, compared to other Americans, who did so at the rate of 8.9 per 100,000.) One age group stood out.
Veterans aged 20 through 24, those who have served during the war on terror. They had the highest suicide rate among all veterans, estimated between two and four times higher than civilians the same age. (The suicide rate for non-veterans is 8.3 per 100,000, while the rate for veterans was found to be between 22.9 and 31.9 per 100,000.)
So using our extremely high end estimate of 240,000, with a rate of 18.7 per 100,000 on the low end, and 31.9 on the high end that gives us between 45 and 93 suicides per year. Of course using the numbers they give us, even the same population of non-veterans would be expected to have around 20 suicides per year. So even for the last 3 years this means that an "excess" of between 75 and 219 suicides among the Iraq veteran population (although the number of vets would also go up too, but it was an extreme high end to begin with). A tragic number no less, but a couple of orders of magnitude below what this quack came up with.
Tuesday, November 13, 2007
THE PROVOST MARSHAL’S TRUMP CARDWhat trump card does Brigadier general Rodney L Johnson, Commanding General United States Army Criminal Investigation Command, have up his sleeve? It can be speculated that he may be ready, and may well have threatened, to impose Martial Law, since he, not George W. Bush Jr., is Commander-in-Chief, even though the criminal President remains in denial concerning this reality. Under Martial Law, the Provost Marshal would be empowered to take into custody anyone who stood in his way, and could control all media outlets through censorship – so that his operations could proceed without the media running along behind getting all confused and destabilising the financial markets in the process. He could presumably close the stock exchange and freeze all suspect bank accounts without recourse.
Tuesday, November 06, 2007
ENTIRE CITIBANK BOARD BELIEVED TO HAVE BEEN ARRESTED PROVOST MARSHAL MAY ARREST THREE U.S. PRESIDENTS TOO
Tuesday 6 November 2007 04:28
U.S. MARINES AND AIR FORCE DRAFTED IN TO ASSIST AS NECESSARYSOME 3,000 BANKERS AND OTHERS BEING TAKEN INTO CUSTODY
NINE AIRCRAFT ARE BEING FILLED WITH PRISONERS
PROVOST MARSHAL TO TAKE OVER CITIBANK AND MAKE THE PAYMENT
BRITISH CITIBANK EMPLOYEES FLYING TO NEW YORK TO ASSIST THE GENERAL WITH BANKING OPERATIONS
Now this does not mean that there are not some sort of environmental externalities involved, but if there are, then that should be handled through some sort of tax system, not silly ways of making people feel guilty for not sorting their garbage, and then forcing them to pay for it to be taken away regardless.
Monday, October 29, 2007
Did Paul Krugman actually write that “the bursting of the housing bubble means that someone, somewhere, has to accept several trillion dollars in losses.”?
Several trillion? Really? Numbers, please!
Here goes: Inside Mortgage Finance reports that total 1-4 family mortgage debt outstanding—prime, subprime, Alt-A, you name it—stands at $10.4 trillion. Let’s say that when he says “several trillion,” Krugman really expects just $2 trillion in mortgage-related losses. But to get to $2 trillion in losses, you have to, after allowing for partial recoveries via foreclosure sales and foregone borrower equity, assume something like $4 trillion in mortgage defaults, or around 40% of all mortgage debt outstanding. I don’t buy that. You shouldn’t buy that. I can’t believe anyone in his right mind would buy that.
Thursday, October 25, 2007
Whether Ms. Plame, an agency expert on weapons of mass destruction, was responsible for his going to Niger is one of the key mysteries in the whole affair. So did she send him? It depends upon which page you read. Page 168: "I neither suggested Joe nor recommended him." Yet on page 109, "a mid-level reports officer" said to her, "What about talking to Joe about it? … The reports officer and I walked over to the office of the [redacted] Chief to discuss our available plans of action. Bob, our boss, listened carefully and then suggested we put together a meeting with Joe and the appropriate Agency and State officers."
And on page 186, Ms. Plame explains she wrote an e-mail that read: "My husband has good relations with both the [Niger] PM and the former Minister of Mines (not to mention lots of French contacts), both of whom could possibly shed light on this sort of activity."
When this e-mail came to light, in a Senate Intelligence Committee report, the high-strung Mr. Wilson once again launched into a temper tantrum. "Midway through the silent meal, Joe abruptly got up, dumped his unfinished plate in the sink, and left the room in a wordless rage. ... Despite my best efforts to explain the innocence of the e-mail, Joe was too upset to listen. He just glared at me."
Monday, October 22, 2007
Paul Krugman is a justly renowned professor of economics and international affairs at Princeton University. His abundant accolades include the John Bates Clark Medal, awarded biannually to an outstanding economist under the age of 40 — a distinction said to be predictive of, and perhaps even more prestigious than, receipt of the Nobel in economic science. His twice-weekly column in The New York Times routinely and authoritatively demystifies complex economic arcana.
And yet maybe Krugman is not really an economist — at least not according to the definition offered more than a century ago by Francis Amasa Walker, the first president of the American Economic Association, who wrote that laissez-faire “was not made the test of economic orthodoxy, merely. It was used to decide whether a man were an economist at all.”
Sunday, October 21, 2007
Nothing to do with you? You were the only reason he went on the trip in the first place! Then she acted all offended that people accused her of nepotism. Hello, he is your husband. That kind of puts the nep in nepotism. It is not like the CIA normally goes around hiring unemployed former ambassadors for overseas investigations. At least I hope they are not normally this stupid. God help us all.
Tuesday, October 16, 2007
The Air Force Reserve may be an unrivaled wingman to the active duty force, but it's also a conflicted one right now, with air reserve technicians angry over a new policy mandating daily uniform wear on the job. And that's prompted some to increasingly talk like the union members many are.
Bristling at the new regs, some reservists intend to pressure the Air Force into scrubbing the new uniform policy - a demand that could have a ripple effect on Air Force missions in Iraq and Afghanistan.
"Stop volunteering for Air Expeditionary Force rotations" is the call rebel Air Force reservists are making.
"We've got to do something to get their attention," said Master Sgt. Jerry Merrill, a KC-135 crew chief at March Air Reserve Base, Calif., and vice president of local 3854 of the American Federation of Government Employees.
Calls to boycott AEFs have been posted in a handful of messages included in an online petition against the policy, and Merrill believes reserve Airmen could begin acting on them.
Given the fact that there are active duty Army brigades getting ready for their third tour in Iraq, and these are year long tours, not the weenie 90 day Air Force stints, I hardly have any sympathy for them. Heck, most of the Army Guard has been deployed more than the average active duty airman. Not to mention they are serving in much more dangerous capacities. According to the site ICasualties, only 38 people in the entire Air Force have been killed in Iraq, less than even the Navy, and only 1/10th that of the Army National Guard. If these guys are too ashamed to wear their uniform, then what are they doing in the military in the first place?
Wednesday, October 10, 2007
This letter is supposedly to William Rhodes, the CEO of Citibank. Of course in the normal Wanta way, letters are always to famous people, not from them. Cottrell also lists the address and contact information of his and Wanta's corporation Ameritrust Groupe, Inc. which I have pointed out previously is so poor that it is in debt to the state of Virginia for $110 in fees.
AMERITRUST GROUPE, INC.
Office of the Treasurer
1157 West 7th Street
Telephone: (814) 455 9218
Telephone: (814) 453 4453
FAX COVERTo: Mr William R. Rhodes
Chairman, President and Chief Executive, Citibank NA
Chairman, President and Chief Executive Office, Citigroup Holdings,
Senior Vice Chairman, Citi
153 E. 53rd Street, New York, NY 10022
Attention: ALMA PADRON
Via: (212) 793 9700; (212) 793 5906
Items: In the matter of: The Agreed Upon Financial Settlement of Four point Five Trillion United States Dollars ($4,500,000,000,000.00 US Dollars): Regarding
Ambassador Leo (Lee) E. Wanta and AmeriTrust Groupe, Inc.:
Cc: Lee E. Wanta, Chairman and Executive Officer
Perhaps he should be a little more discrete, because through a simple Internet search I was able to find out what type of a neighborhood it is, here is a house across the street on a real estate website.
This must be the Erie financial district...
He also lists their e-mail addresses.
From: MICHAEL C. COTTRELL, M.S., email@example.com
Sent: Wednesday, September 26, 2007 9:47 PM
Subject: RE: CONVERSATION TODAY WITH AMBASSADOR LEO E. WANTA
Attachment: 9-26-2007 – LTR – CITI – WMRHODES26sept2007.doc(0.05 MB)
Just a tip there Sir Leo, if you want to impress the head of the world's largest financial institution, you might not want to use your free MSN account....
Fifty years ago today Ayn Rand published her magnum opus, "Atlas Shrugged." It's an enduringly popular novel -- all 1,168 pages of it -- with some 150,000 new copies still sold each year in bookstores alone. And it's always had a special appeal for people in business. The reasons, at least on the surface, are obvious enough.
Businessmen are favorite villains in popular media, routinely featured as polluters, crooks and murderers in network TV dramas and first-run movies, not to mention novels. Oil company CEOs are hauled before congressional committees whenever fuel prices rise, to be harangued and publicly shamed for the sin of high profits. Genuine cases of wrongdoing like Enron set off witch hunts that drag in prominent achievers like Frank Quattrone and Martha Stewart.
By contrast, the heroes in "Atlas Shrugged" are businessmen -- and women. Rand imbues them with heroic, larger-than-life stature in the Romantic mold, for their courage, integrity and ability to create wealth. They are not the exploiters but the exploited: victims of parasites and predators who want to wrap the producers in regulatory chains and expropriate their wealth.
Friday, September 21, 2007
Hmm, so on August 27th, the S & P 500 was at 1466.79, and today it has crashed all the way down to... 1525.75, a gain of over 4%.
One could say that some rich investor lost a whole lot of money on these expired options, except as I already pointed out, this was a box-spread trade, which is not really a bet on the market but a way of borrowing money which is way too complicated for anyone who writes for Prison Planet to understand. So the odds are nobody lost any money. Tune into Alex Jones' radio show though, and I am sure you will hear differently.
Tuesday, September 18, 2007
A month ago 500 Russian leaders signed a letter opposing Jewish supremacism, now 5000 leaders of Russian society have joined in.
Israel has repeatedly demanded that the Russian government ban a number of
organizations that seek to defend Russian interests from the (organized crime) Zionist Jewish Oligarchs who have stolen approximately 65 percent of the natural wealth of Russia. These courageous Russians simply dare to point out the irrefutable fact that many of these criminals are loyal to Israel rather than to Russia and to the Jewish people rather than to the Russian people.
Monday, September 17, 2007
While I agree that, for the most part, it is not intrinsically morally superior to be, say, anti-Muslim than anti-Jewish, I also believe that there is something unique about anti-Semitism. We do not live in a bubble, there is a very specific historical context to anti-Semitism, that is not present in, for example, making fun of Hindus working in convenience stores.
I am in the middle of reading the novel Life and Fate (Zhizn' i sud'ba) by Vasily Grossman, and when I say in the middle, at nearly 900 pages, I really am. Life and Fate, which was written in the 1960s, but only recently published is about the war on the Eastern Front in general, and the battle for Stalingrad in particular. But it is also about the Holocaust and the fate of the Jewish people. Grossman, who was one of the first journalists to report about the Nazi concentration camps, knows about what he talks. In this section, from page 484, he describes the nature of anti-Semitism far better than I ever could.
Anti-Semitism can take many forms - from a mocking, contemptuous ill-will to murderous pogroms.
Anti-Semitism can be met with in the market and in the Presidium of the Academy of Sciences, in the soul of an old man and in the games children play in the yard.
Anti-Semitism has been as strong in the age of atomic reactors and computers as in the age of oil-lamps, sailing boats and spinning-wheels.
Anti-Semitism is always a means rather than and end; it is a measure of the contradictions yet to be resolved. It is a mirror for the failings of individuals, social structures, and State systems. Tell me what you accuse the Jews of - I'll tell you what you're guilty of.
Even Oleinichuk, the peasant fighter for freedom who was imprisoned in Schlusselburg, somehow expressed his hatred for serfdom as a hatred for Poles and Yids. Even a genius like Dostoyevsky saw a Jewish userer where he should have seen the pitiless eyes of a Russian serf-owner, industrialist or contractor. And in accusing the Jews of racism, a desire for world domination and a cosmopolitan indifference towards the German fatherland, National Socialism was merely describing its own features.
Anti-Semitism is also an expression of a lack of talent, an inability to win a contest on equal terms - in science or in commerce, in craftsmanship or painting. States look to the imaginary intrigue of world Jewry for explanations of their own failure.
At the same time anti-Semitism is an expression of the lack of consciousness of the masses, of their inability to understand the true reasons for their sufferings. Ignorant people blame the Jews for their troubles when they should blame the social structure or the State itself. Anti-Semitism is also, of course, a measure of the religious prejudices smouldering in the lower levels of society.
Thursday, August 30, 2007
As if the mortgage-market meltdown wasn't enough to spook investors, some market players expressed concerns about unusual options bets that some observers
have dubbed "Bin Laden Trades."
The blogosphere and options trading desks have been rife with speculation about these trades, which are unusually large bets that the market will make a huge move in the next month. Some entity, or entities, has taken a large position on extremely deep in the money S&P 500 options, both puts and calls, that won't pay off unless the market undergoes an extremely large price move between now and the options' expiration on Sept. 21.
However, Dan Perper, a Partner at Peak 6, one of the largest option market makers and proprietary trading firms, has confirmed that the trades are part of a "box-spread trade."
"This was done as a package in which the box spread was used [as a] means of alternative financing at more attractive interest rates" explained Perper.
Monday, August 27, 2007
CARACAS, Venezuela—Like many people they know in Caracas these days, Alfred and Norma Muñoz are bracing for what they believe is inevitable: a currency crash brought about by President Hugo Chávez's policies.
The middle-class couple plan to borrow as much as they can from a local bank and buy an apartment outside the country. If Venezuela's bolívar plunges against the dollar, they figure, the loan will be cheap to pay off in dollar terms, and the overseas apartment will hold its dollar value. "Plus, it gives you somewhere to flee if things really get bad," says Mr. Muñoz, who runs a small business.
And I must say, this is one of the more creative arbitrage schemes I have heard. They didn't teach this in B-school.
Wealthier Venezuelans have discovered they can use credit cards to exploit the difference between official and black-market currency rates. Some have flown to the nearby island of Aruba and bought $5,000 worth of gambling chips, the maximum overseas credit purchase allowed by the Venezuelan government, according to a person who arranges the trips. They cash in the chips for dollars, then, back at home, buy enough bolívars on the black market to pay off the credit-card debt, this person says. They pocket the rest -- around $2,300 at current rates, more than enough to pay for the trip.
A mystery trader risks losing around $1 billion dollars after placing 245,000 put options on the Dow Jones Eurostoxx 50 index, leading many analysts to speculate that a stock market crash preceded by a new 9/11 style catastrophe could take place within the next month.
These people are so economically illiterate that he then quotes a blogger citing an entirely different alledged series of trades:
"The sales are being referred to by market traders as "bin Laden trades" because only an event on the scale of 9-11 could make these short-sell options valuable," reports financial blogger Marc Parent. Dow Jones Financial News first reported on the story.
Of course if you read the Dow Jones story, which actually does reference the right trades, you will find the explanation has nothing to do with conspiracy theories:
The identity of the investor is unknown but market sources speculated it was either a large hedge fund hedging itself against deepening losses, or a long-only fund manager pressing the panic button to protect its gains.
I cannot find it in any financial source, so I am not sure how these conspiracy theorists come up with "risks losing around $1 billion dollars". That would mean each option, cost over $4000. That is a lot of money for an option that is way out of the money. Any first year finance student will learn about Black-Scholes, which states that the value of an option decreases the farther away from the strike price you are. Nobody is going to risk $1 billion for a remote chance at making a maximum of EUR 6.9 billion, especially when even that is based on the unlikely event that all stocks will go to zero.
Incidently, this idea that they repeat that speculators made a killing off of puts on airline stocks before 9/11 is mostly urban legend. The amounts were actually quite modest, and the trades, although above average were nowhere near unprecendented. Alan Poteshman, from the University of Chicago has an interesting paper on the subject, although I don't agree completely with his methodology or conclusions.
Friday, August 24, 2007
Disclaimer: I don't know this site and I can't confirm what they are saying. But the apparently there were some HUGE amounts of money spent on options by a single trader (individual, company?) totaling about $2 billion. The trade doesn't make sense except if the market crashed big time. Options only start making money if the stock market goes down 30%. Timeframe is between now and Sept.
Here's how a guy summarized the situation:
"1) August 22nd, someone wrote almost$2 billion worth of calls that the market will tank in the next 3-4 weeks. Down by at least 30+%
2) The forum members think it's a hugemistake by someone and it won't"stick" over night.
3) Someone calls in some kind of optionshot line and guy confirms that it's legit,not a mistake. Guy sounds really worried.
4) Aug 23 they confirmed that this huge $2 BILLION CALL had indeed "stuck".
5) So, someone put a hell of a lot of moneyon the line that the market will crash inSeptember. They are either incredibly stupid,or know something we don't."
First of all, someone should point out that a call is an option that pays if the price goes UP, not down. A put option pays if the price goes down. Secondly options are not based on percentages, but on an exercise price that the seller sets. Lastly, even if someone buys a "put", it doesn't necessarily mean they think the market is going down, they could just be buying insurance on a long position that they don't want to unwind. I would be surprised if anyone is even selling this many puts that are so far out of the money anyway, unless one of the large brokerage houses just considers it an easy way to pad their profits.
Thursday, August 16, 2007
In any case, some of their absurdities:
Corsi urged anyone in the position to do so to quickly pay off any mortgages and get out of debt. Secondly he suggests investment in gold, rather than stocks and bonds which are based on fiat money and are going to decline tremendously in value:
Uhh genius, if you believe hyperinflation is coming, then why would you pay of your debt? Borrow more money, use it to buy assets (like gold), and then repay your debt with worthless dollars.
Corsi, who has a degree in political science, not economics, goes on to claim that this recession will last long because of our lack of exports.
"It's going to last several years, it's largely because we've lost so much of the manufacturing to China, even when our currency tanks, there are no exports we are producing anymore that will gain. The currency is gone, it is being sold off very quietly, worldwide, by the oil producing states, by China, the Euro is increasingly becoming our foreign exchange reserve currency.
This is an often repeated myth. We do not have a trade deficit however, because of a lack of exports, but because of an abundance of imports, as data readily available from the Bureau of Economic Analysis indicates:
Wednesday, August 15, 2007
Thus it is quite ironic, that we are now witnessing much of the same thing going on:
Aug. 15 (Bloomberg) -- Goldman Sachs Group Inc. waived fees to draw investors to its Global Equity Opportunities hedge fund after stock-market losses wiped out $1.4 billion of assets this month, according to a person with direct knowledge of the terms.
New participants won't pay the 2 percent management charge and Goldman will cut its performance fee in half, said the person, who declined to be named because the information is private. The New York-based firm and investors including billionaire Maurice ``Hank'' Greenberg agreed to put $3 billion in the fund earlier this week. Goldman spokesman Lucas van Praag confirmed the terms and declined to comment further.
Goldman, the world's most profitable securities firm and second-largest hedge fund manager, needed capital after stock declines worldwide confounded Global Equity's computer-driven bets and threatened to spur withdrawals. The so-called quantitative fund lost 28 percent of its value this month. Other quant funds, including AQR Capital Management LLC and Highbridge Capital Management LLC, also suffered declines.
Presumably Goldman is full of bright young MBAs who know this even better than I do, but people think it can never happen to them, that they are the exception. Incidently, for a great insight into LTCM I suggest When Genius Failed by Roger Lowenstein.
Thursday, August 09, 2007
Along with co-blogger James Bennett of Seattle and SLC allies such as New York City's Mark "Gravy" Roberts, author of the painstakingly detailed Loose Change Second Edition Viewer Guide, Curley patrols a veritable Mos Eisley cantina of conspiracy mavens, kooky celebs, Holocaust deniers, nutty academics, anti-Semites, aged hippies, delusional twentysomethings, and cynical, Elmer Gantry-like opportunists, all of whom are united in their opposition to the official version of what transpired on September 11, 2001: that 19 al-Qaeda members armed with box-cutters and knives pulled off the most daring and destructive surprise attack on American soil in history.
Initially conceived as a rebuttal to the popular Internet documentary Loose Change, which, after its release in April 2005, helped disseminate these paranoid conspiracy fantasies to their largest audience yet, Screw Loose Change has since become the way station for everyone who is seeking sanity when faced with the wild distortions, half-truths, and outright lies of the 9/11 truth movement.
Saturday, August 04, 2007
Bear in mind also that the two International Court of Justice Judges who are supervising this clean-up are joined by Associate Justice of the Supreme Court Sandra Day O’Connor (for the Republican Party) and Associate Justice Ruth Bader Ginsburg (for the Democratic Party). Contrary, therefore, to assertions from British MI5 sources retailed to us last year that ICJ-related arrests could not take place in the United States, the participation of the two US Associate Justices validates relevant ICJ arrest warrants’ application in the United States: hence Dr Alan Greenspan’s incarceration, which immediately followed allegations that Dr Greenspan and others may have inserted a glitch into the codes in mid-June, preventing ‘payment’. It is understood that Dr Greenspan may nevertheless still have a ‘hold harmless’ agreement containing a clause guaranteeing him a Presidential Pardon in the event of his being exposed as implicated in Wantagate (which he has been).
Supreme Court justices of course do not have political affiliations, nor do they supervise such activities. The International Court of Justice, as I have pointed out previously does not handle criminal cases, and thus has no authority to arrest anyone.
Incidently, Alan Greenspan who Story claims was arrested, despite nobody noticing, continues to appear in public:
July 23 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said financial markets are benefiting from a ``one shot'' flow of savings from the developing world that is about half-way over.
Foreign savings have ``created this liquidity we are seeing,'' Greenspan, 81, told the Building Owners and Managers Association's international conference in New York. ``It is not permanent. It is reflective of a one shot thing. I'd say we're about half-way through.''
But other than his story being preposterous, counter to every observable fact, and completely illogical, there is nothing wrong with it...
Wednesday, July 18, 2007
FUTURE OF THE WORLD WITHOUT THE WANTA SETTLEMENT
Such sources of unnecessary delay are being overcome, but there is no time left and the tinkering has to stop. Everything is taking longer than anticipated, and time has run out. Quite simply, either the Wanta Settlement is completed (nearly 14 months late), or:
• The Euro System will disintegrate as:
• The US dollar continues its collapse and the Euro goes through the roof;
• The United States’ de facto world empire will collapse;
• The United States, reliant on ‘just-in-time’ delivery having allowed its industrial sector to be hollowed out, will be unable to manufacture anything much, since it will remain dependent on imported components which, given the collapse of the US dollar, and the refusal of foreigners to continue buying US Treasury securities, it will be unable to afford;
• Foreign predators will buy up remaining US assets at fire-sale prices;
• Foreign predators will buy up remaining UK assets at fire-sale prices;
• The United Kingdom – the underlying macroeconomic numbers of which are worse proportionately in many respects than those of the United States, following the gross mismanagement of Britain’s finances by Gordon Brown – will be reduced to penury: it has virtually no international reserves, a small productive economy, a colossal services economy, a huge parasitical public sector, and depends for its solvency on the City of London, which will be decimated in the crash;
• The British economy will be flattened anyway, as sterling paradoxically goes through the roof, as it is now doing in parallel with the US dollar’s decline, and because Britain’s macroeconomic data have never been worse;
• Householders with excessive debt will suffer excruciating consequences;
• Equity prices will implode worldwide;
• Derivatives values will go to zero (literally);
• The prices of all exotic financial products will follow;
• Financial institutions will disintegrate overnight;
• Central banks will be unable to handle the situation, yet will panic, printing money on a scale with no precedent (if they have time, which is unlikely);
• Unemployment will soar around the world;
• The Chinese economy will collapse, with 40% of its state-owned enterprises currently continuing to make losses and its foreign markets disintegrating;
• The East Asian economies will experience conditions that will be liable to throw some of them back to pre-industrial living standards;
• Germany, with its huge derivatives exposure, will be severely impacted, and has no defence against predatory hedge funds seizing control of vast swathes of the German economy – just as predatory German organisations have acquired strategic holdings amounting almost to a political stranglehold of the British economy in recent years;
• Germany’s secret DVD-driven long-range hegemony strategy will crumble;
• The southern European EU ‘Member States’, decimated by the artificially high Euro, will exit the socialist European Union Collective one after the other;• Africa will be abandoned and will become a continental Zimbabwe;
• Latin America will be able to export more given the linkages of its currencies to the collapsing US dollar, but in the context of global conditions life will not be easy. Very severe financial problems will inevitably overwhelm the entire region;
• Rates of inflation will soar into the 20s, and will rapidly reach hyperinflationary
levels in some countries, with escalating inflation trends liable to be curbed only by declines in Gross Domestic Product, as in Argentina some years ago;
• There will be no bolt-holes for ‘funny money’;
• Holders of stolen gold will probably be 'liquidated’.
• Soup kitchens will sprout everywhere (as we warned on 2nd September last year [see Archive]: no-one was listening).
And on that note, I am going on vacation. Later.
Monday, July 09, 2007
Saturday, June 30, 2007
We stand by what we have posted on the jailing of Dr Alan Greenspan, but we are not yet further informed as to what has happened to him since that event. What we have now been told is that the jailing of Dr Greenspan has been exploited by Cheney-controlled MK-ULTRA-style disinformation specialists as a diversionary ploy to get people running around crazily looking for the wrong fox.
Uhh, but just who is paying attention? Look at a google search for "Alan Greenspan Arrested". Story is getting so few people interested in his article that his World Reports website isn't even on the first page. And in fact the number one hit is... me. No wonder he wanted to sue me.
Wednesday, June 27, 2007
UPDATE: 27 June 2007: The Editor has now received written confirmation that TWO Group of Eight intelligence sources have CONFIRMED the previously reported incarceration of Dr Greenspan. The original sources of this information were Gold Badges who are in contact with the Ambassador and Michael C. Cottrell, M.S. By definition, Gold Badge information cannot be elaborated upon. Be it known, therefore, that the Editor holds TWO written statements concerning the accuracy of our report on the jailing of Dr Greenspan being confirmed by these TWO SEPARATE G-8 intelligence agencies. The second intelligence source confirmation was received by the Editor this morning. We cannot elaborate any further BECAUSE WE HAVE REPORTED ALL THAT WE KNOW.
Well of course, everyone knows Gold Badge information cannot be elaborated upon. How could you even suggest something so silly? Of course the source of this information was Sir Leo Wanta and Michael Cottrell M.S. (as an aside, I now insist that everyone must refer to me in print as James Bennett M.B.A).
One thing I missed before though. Story insists that Greenspan was arrested the week of June 15th "without bail", but before posting that he failed to notice that he made a public speech the following week. He must be using Paris Hilton's lawyer...
Sunday, June 24, 2007
FORMER FED CHAIRMAN GREENSPAN IN JAIL WITHOUT BAIL
During the week ending 15th June 2007, ‘unspecified very senior officials’ in the United States were arrested and jailed without bail, in connection with corrupt financial operations exploiting the financial assets belonging to Ambassador Sir Leo Emil Wanta (1) as sole Principal.
The former Chairman of the Federal Reserve Board, Dr Alan Greenspan, who was in office when these illegal and corrupt financial scandals to the severe detriment of the American people, the US Treasury and the Ambassador were embarked upon, is among those in jail, and has likewise been refused bail. This is only the beginning of the belated sensational consequences of Wantagate.
Odd, anytime Greenspan sneezes the Dow drops 50 points, but somehow the Wall Street Journal and Reuters have missed this.
Friday, June 22, 2007
H/T Hot Air
Thursday, June 14, 2007
Wednesday, June 13, 2007
You have to give Chris Story credit for being persistant though, he keeps trying to come up with creative new ways of running this story, despite no possibility of success. Now he is listing just about every banking executive in the world in connection with this "scandal":
The following is a list of Directors of financial institutions, elected and appointed US and UK officials, Commissioners and others, who may have variously allowed, condoned, accommodated, or whose institutions may have actively participated in, and may continue to participate in, criminal and illegal fiat money financial transactions exploiting the $4.5 trillion compromise financial Settlement agreed for Ambassador Wanta in May and June 2006 and/or circumstances arising therefrom. Typically, this Settlement was negotiated by the duplicitous US intelligence crooks concerned, in bad faith; but the agreement is binding on all parties and has to be implemented. At the very least, each individual listed here may be an Accessory to the Fact of some or all of the felonies under US law listed in Part 3 of this presentation. Many may have been or may be co-conspirators.
I am still waiting for him to serve me with that libel suit he threatened me with. Not like I have ever backed off of my assertion that he is a nutjob.
Tuesday, June 12, 2007
Modern humans first emerged about 100,000 years ago. For the next 99,800 years or so, nothing happened. Well, not quite nothing. There were wars, political intrigue, the invention of agriculture -- but none of that stuff had much effect on the quality of people's lives. Almost everyone lived on the modern equivalent of $400 to $600 a year, just above the subsistence level. True, there were always tiny aristocracies who lived far better, but numerically they were quite insignificant.
Then -- just a couple of hundred years ago, maybe 10 generations -- people started getting richer. And richer and richer still. Per capita income, at least in the West, began to grow at the unprecedented rate of about three quarters of a percent per year. A couple of decades later, the same thing was happening around the world.
Then it got even better. By the 20th century, per capita real incomes, that is, incomes adjusted for inflation, were growing at 1.5% per year, on average, and for the past half century they've been growing at about 2.3%. If you're earning a modest middle-class income of $50,000 a year, and if you expect your children, 25 years from now, to occupy that same modest rung on the economic ladder, then with a 2.3% growth rate, they'll be earning the inflation-adjusted equivalent of $89,000 a year. Their children, another 25 years down the line, will earn $158,000 a year.
Friday, June 08, 2007
Jesse MacBeth stoked opposition to the Iraq war in 2006 when he spoke out about atrocities he committed as a U.S. Army Ranger serving as part of Operation Iraqi Freedom.
MacBeth, 23, of Tacoma, claimed to have killed more than 200 people, many at close range, some as they prayed in a mosque. He spoke at an anti-war rally in Tacoma and appeared in a 20-minute anti-war video that circulated widely on the Internet.
Trouble is, none of MacBeth's claims was true. He made it through only six weeks of Army basic training, was never a Ranger and never set foot in Iraq.
Conservative bloggers exposed MacBeth's lies in May 2006, destroying his credibility and embarrassing the Seattle company that produced the video about his exploits.
Sunday, May 20, 2007
The government bills land reform as a way to make Venezuela self-sufficient in food. But so far, the effect has been to undercut production of beef, sugar and other foods, as productive land is handed to city dwellers with no knowledge of farming. Established farmers and ranchers, fearing their land may be seized next, are cutting investment in their operations to a minimum.
The chaos in the countryside has contributed to shortages in basic items like milk and meat, a paradox in a country enjoying an economic boom traceable to high oil prices. Also spurring the shortages are price controls on certain foods that keep them priced below the cost of production. Meanwhile, 19%-plus inflation -- as oil revenue floods the economy -- spurs panic buying: purchasing price-controlled and other goods the shopper might not immediately need for fear of having higher prices in the future or not finding the items at all.
"You get up at dawn to hunt for a breast of chicken all over town. Housewives are in a foul mood," says Lucylde González, a Caracas homemaker, who says she hasn't seen an egg in a week.
After squatters took part of Mr. Lecuna's land, his bank said he could no longer use what remained as collateral for loans, and asked him to put up a Caracas office building he owns instead. Mr. Lecuna says he can't get financing from state banks, because they now won't lend to farmers with more than 100 acres. He has stopped buying fertilizer and machinery. "I'm afraid of investing," he says. In addition, kidnappings of farmers and ranchers for ransom are on the rise, and scandals have plagued the co-op program.
Mr. Chávez blames the shortages on "speculation" by distributors and producers. Agriculture Minister Elias Jaua recently called a news conference to deny there's been any decline in food production during the eight years of Chávez rule. The central bank stopped publishing agricultural statistics in 2005. A private farm association called Fedeagro estimates Venezuela grew 8% less food last year than the year before, citing factors including the price controls, land seizures and the wave of kidnappings of farmers.
Thursday, May 10, 2007
LONDON -- To understand why economists are increasingly worried about Britain, it helps to look to Adam Smith.
Not the 18th-century Scottish philosopher, but rather a 28-year-old Cheltenham mortgage-debt collector who shares the famous name. Last June, Mr. Smith was in debt to the tune of $50,000. Like many British consumers -- who are even more leveraged than Americans -- he had been borrowing largely to cover his rising living expenses.
Struggling to keep up with credit-card and loan payments on his $1,900 monthly salary, he sought protection from creditors. "I was just trying to live an independent life away
Saturday, April 28, 2007
The advocates of free trade have on their side over 200 years of settled science in economics, going all the way back to Adam Smith. The advocates of protectionism have Lou Dobbs.
An article worth reading.
Wednesday, April 25, 2007
Tuesday, April 10, 2007
ANCHORAGE — An unbudging sheath of sea ice has blocked off the waters where the Alaska Peninsula's sea otters forage, forcing the starving animals inland on a search for food and making them easy prey for wolves and humans.
Some otters have waddled or slid on their bellies for several miles onto the tundra near Port Heiden, where they have been attacked by dogs, killed for their pelts or have died of malnourishment.
Thursday, April 05, 2007
So I was offended, but not suprised to see Paul Rockwell cite accounts of Iraqi war crimes by Jimmy Massey:
For nearly 12 years, Staff Sergeant Jimmy Massey was a hard-core, some say “gung-ho,” Marine. For three years he trained fellow Marines in one of the most grueling indoctrination rituals in military life — Marine boot camp. The Iraqi war changed Massey. The brutality, the sheer carnage of the U.S. invasion, touched his conscience and transformed him forever. He was honorably discharged last December 31 and is now back in his hometown, Waynsville, North Carolina. When I talked with Sergeant Massey last week, he expressed his remorse at the civilian loss of life in incidents in which he himself was involved.
There is just one problem, Massey was exposed as a fake by St. Louis Post reporter Ron Harris, nearly two years ago.
Massey's claims have gained him celebrity. Last month, Massey's book, "Kill, Kill, Kill," was released in France. His allegations have been reported in nationwide publications such as Vanity Fair and USA Today, as well as numerous broadcast reports. Earlier this year, he joined the anti-war bus tour of Cindy Sheehan, and he's spoken at Cornell and Syracuse universities, among others.
News organizations worldwide published or broadcast Massey's claims without any corroboration and in most cases without investigation. Outside of the Marines, almost no one has seriously questioned whether Massey, a 12-year veteran who was honorably discharged, was telling the truth.
Each of his claims is either demonstrably false or exaggerated - according to his fellow Marines, Massey's own admissions, and the five journalists who were embedded with Massey's unit, including a reporter and photographer from the Post-Dispatch and reporters from The Associated Press and The Wall StreetJournal.
Wednesday, April 04, 2007
Monday, April 02, 2007
One of the most interesting visits was to Lenovo, the Chinese computer manufacturer who recently purchased IBM's PC division. They showed us around their new manufacturing facility, including a completely automated warehouse. The warehouse was stacked several floors up, and had aisles just wide enough to accomodate the tracks the robotic forklifts ran on, as they zipped back and forth to pick up the parts needed to fill orders for computers.
The most interesting part came with the explanation from our guide, that when the warehouse was built, they reduced the number of workers required from 100, to just 5. This is in China, the country that built the Great Wall with cheap labor, and has only added to its reputation since. But for them, the way to compete was still to become more efficient, to do more with less, smarter.
Another company that we visited, which will remain nameless, specialized in outsourcing certain data processing activities to China. They recruited a bunch of college graduates, because they needed people who could speak foreign languages, to sit in front of monitors and type in data all day. One of the managers grumbled to us that their only advantage, cheap labor, was being challenged, because wage rates were going up, and so other companies in lesser developed regions of China. The competition for skilled labor in their city was so great it was pushing up wages.
Even in China, you cannot fool with the laws of supply and demand.
Between which of those two companies will succeed, I will put my money on Lenovo.
Thursday, March 29, 2007
Mr. Stephanopoulos remains just as sober when working solo on Sunday mornings as the host of "This Week" or helping out on "Good Morning America." There hasn't been this much stone-faced comedy in circulation since Buster Keaton's heyday.
It's a pity, because Mr. Stephanopoulos might be able to help viewers understand why the firing of eight U.S. attorneys in the Bush administration has been by far the biggest television-news story lately, and yet when dozens of federal prosecutors were fired during the Clinton administration, it was barely noticed by network newscasts. According to the Tyndall Report, which tracks this sort of thing, during the week of March 12-16, the three network evening newscasts spent a total of 45 minutes on the prosecutors story, with the war in Iraq placing second at 16 minutes. "World News with Charles Gibson" logged 13 of those 45 minutes on the prosecutors.
By contrast, in 1993, Attorney General Janet Reno's wholesale firing of U.S. attorneys appointed by George H.W. Bush was a non-story on the ABC evening news -- literally a non-story, according to records kept by the Vanderbilt University Television News Archive, as in zero coverage. CBS also skipped it; NBC gave it 20 seconds.
And yes, I know ironical is not a word.
Friday, March 02, 2007
Thanks to readers (and you know who you are) who supplied new links to valuable information, we find there are more players in the game of weather terror and control than the US with its HAARP system. One prime rival as you might expect is our old Cold War enemy, Russia. And perhaps it is no coincidence that Katrina as well as Ivan are both Russian names.
I almost hate to mention that Katrina is not Russian, the Russian equivilant is Ekaterina. Hmm, maybe that is why it snowed yesterday morning, and I was almost late for class.
Wednesday, February 28, 2007
NOTHING NEW UNDER THE SUN: SEE BELOW
In the meantime, we display below the pertinent quotations from Scripture and other sources that have been appended to these reports recently, augmented by two new Scripture quotations. The point of these citations, self-evidently, is that they are ALL precisely pertinent to the Wanta case. They may also serve as a reminder to those perpetrators of Jewish extraction as to how far they may have strayed from the glorious tradition and enlightenment of their age-old community:'
YE SHALL NOT STEAL, NEITHER DEAL FALSELY, NEITHER LIE TO ONE ANOTHER'. Leviticus, Chapter 19, verse 11.
'THOU SHALT NOT BEAR FALSE WITNESS AGAINST THY EIGHBOUR'.Exodus 20, verse 16.
'THOU SHALT NOT DEFRAUD THY NEIGHBOUR, NEITHER ROB HIM'.Leviticus, Chapter 19, verse 13.
Yeah, OK. You might want to keep that in mind the next time you try spreading a story about being able to pay $24 trillion a year in taxes to the IRS.
Tuesday, February 27, 2007
WASHINGTON, D.C. -An unarmed helicopter pilot from Manchester, Wash., who flew through a hail of bullets to rescue 70 wounded Americans in one of the fiercest battles of the Vietnam War was awarded the Medal of Honor on Monday, 41 years after his heroism.
Lt. Col. (Ret.) Bruce Crandall, now 74, received the nation's highest military honor from President Bush in the White House East Room. The medal recognizes Crandall
for his valor in repeatedly flying into enemy fire to bring in ammunition and supplies and evacuate the wounded.
Crandall, then a 32-year-old major, completed a total of 22 flights in a 14-hour period on Nov. 14, 1965, most under intense enemy fire. His actions in the Battle at Ia Drang Valley were depicted in the 2002 movie "We Were Soldiers," adapted from the book "We Were Soldiers Once ... And Young."
It was a long time coming, but you deserve it Colonel.
Yesterday's plunge in stock prices around the world, including the steepest percentage decline in the Dow Jones Industrial Average in nearly four years, signals that investors may finally be re-evaluating their insatiable appetite for risky investments.
The catalyst was Tuesday's nearly 9% fall in stock prices in Shanghai, one of the hottest and most volatile markets in the world. That helped send U.S. stocks on a roller coaster that ended with the DJIA down 416.02 points, or 3.3%, to 12216.24.
While China has had phenomenal industrial growth over the last two decades, their financial and regulator systems are still rather backwards, so get ready for a rough ride. Many companies are poorly managed, and accounting systems tend to be rather... uh... loose. Hopefully things will shake themselves out over the next two decades, and not disrupt the world markets.
I am actually visiting China for a couple of weeks on a study tour, starting next week, including visiting the Shanghai Stock Exchange. Maybe I can get some tips?
Sunday, February 25, 2007
Wednesday, February 21, 2007
Wednesday, February 14, 2007
The book as a whole covers the world of global organized crime, in fact the whole title is "A Thieve's World: Threat of the New Global Network of Organized Crime". Wanta is specifically mentioned in a section of the book, titled "The Great Ruble Scam", extending from page 169 to 225.
While the book can be rather speculative and maddenly vague at times, the author, Claire Sterling, suggests that Leo Wanta actually did participate in the ruble trade, as Wanta himself insists. Although she did not have him connected to the the US government, as Wanta claims he was a Secret Service agent, but tied to a shadowy group of mafia figures.
Wanta apparently did try to buy rubles at discount rates, at one point 140 billion rubles, but the deal fell through, ironically because of the US government. From page 180:
Whether or not Yeltsin consented personally, his closest adviser, Gennady Burbulis, did so implicityly: the proposal was referred to him, and he did not object. In fact, the Comission of Inquiry found an agreement already drawn up by Silaev's cabinet, accepting Wanta's offer. The agreement fell through, or seemed to, when the U.S. State Department warned that Wanta "had major debts and some credit card problems." ("I confronted him in November 1990, and he fled," said the chief investigator, Kalinichenko.)
It is also interesting the earliest mention of Wanta's involvement was in October 1990, because Wanta himself insists that then President Reagan sent him on this mission. Reagan of course left office in January of 1989.
There were evidently several attempts by various organized crime figures to buy up Russian rubles on the cheap, either as part of their crime business, such as money laundering, or an attempt to then get Russian resources, such as oil or gold at a discount. Most of these attempts failed, but some apparently succeeded, thus the title "The Great Ruble Scam". The author found no evidence that Wanta ever accomplished this though, and certainly not on the scale he has boasted about, in the hundreds of billions, or even trillions of dollars. In fact the entire value of Russian Rubles in 1990 was cited as $10 billion, hardly enough to for one person to make trillions of off trading.
The one trade which Wanta apparently was successful at was getting, was a contract to export petroleum, and import food, although no amount of money is cited. Sterling also speculates that Wanta may have been connected to a considerable amount of missing Russian gold, 2000 tons, although the only proof she gives for that is Wanta claiming that he was trying to sell large amounts of gold. It is odd that she just believes him, considering she spends the rest of the section, saying what a con man he is. From page 186:
Leo Emil Wanta, born in Appleton, Wisconsin, was a fifty-year-old, heavyset snake oil salesman, as Mr. X described him. Starting in out in the pinball machine business in Menomonee Falls, he had gone on to "work credit card and many, many other scam," said a senior FBI official.
For the U.S. Secret Service, where the files on him are a yard long, he is a "flim-flam artist," convicted in Switzerland for money laundering involving the Charleston Bank in Panama, deported to the United States to stand trial for tax evasion and wanted in Austria for aggravated fraud arising out of events going back to September 1990, just as he was moving in on the Russian government.
An eclectic trader, Wanta faxed offers to a worldwide clientele in the summer of 1990, including atropine tablets from Germany; ten million jute sandbags from Saudi Arabia; twenty million cartons a month of tax-free Marlboros from the Ukranian capital of Kiev; and two million gas masks from the U.S.S.R. "while the supply lasts." Apart from miscellaneous goods, Wanta was trading not just in rubles but in lire, yen, pesetas, deutche markes, Swiss francs, pounds sterling, and Singapore dollars for commissions up to 14 percent - the clear mark of a money launderer.
All in all, it appears he was up to something, but the line between fantasy and reality, becomes quite blurred.