Thursday, December 8, 2011

@10:07, 12/07/11 2

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http://www.calculatedriskblog.com/2011/12/ft-we-cannot-afford-another-half-baked.html

http://www.nakedcapitalism.com/2011/12/central-banks-plan-for-possible-euro-breakup-as-merkel-focuses-on-wrong-issues.html


http://www.zerohedge.com/

Why The UK Trail Of The MF Global Collapse May Have "Apocalyptic" Consequences For The Eurozone, Canadian Banks, Jefferies And Everyone Else

Submitted by Tyler Durden on 12/07/2011 - 23:06 AIG American International Group Bond CDO CDS Central Banks Collateralized Debt Obligations Counterparties Credit Suisse default European Central Bank Eurozone Fail Federal Reserve Financial Regulation Goldman Sachs goldman sachs Greece Ian Cumming International Monetary Fund Ireland Italy Joe Cassano Lehman Lehman Brothers Leucadia MF Global Morgan Stanley Mortgage Backed Securities Portugal Repo Market Reuters Sean Egan Shadow Banking Shadow Chancellor Sovereign Debt Sovereign Default Structured Finance United Kingdom Wells Fargo 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 which, we speculated, is pressuring the Bundesbank, which is well aware of what is going on behind the scenes, to slowly back away from what will soon be an "apocalyptic" event (not our words... read on). Why was this prescient? Because today, Reuters' Christopher Elias has written the logical follow up analysis to our post, in which he explains in layman's terms not only how but why the lock up has occurred and will get far more acute, but also why the MF Global bankruptcy, much more than merely a one-off instance of "repo-to-maturity" of sovereign bonds gone horribly wrong is a symptom of two things: i) the lax London-based unregulated and unsupervised system which has allowed such unprecedented, leveraged monsters as AIG, Lehman and now as it turns out MF Global, to flourish until they end up imploding and threatening the world's entire financial system, and ii) an implicit construct embedded within the shadow banking model which permitted the heaping of leverage upon leverage upon leverage, probably more so than any structured finance product in the past (up to and including synthetic CDO cubeds), and certainly on par with the AIG cataclysm which saw $2.7 trillion of CDS notional sold with virtually zero margin. Simply said: when one truly digs in, MF Global exposes the 2011 equivalent of the 2008 AIG: virtually unlimited leverage via the shadow banking system, in which there are practically no hard assets backing the infinite layers of debt created above, and which when finally unwound, will create a cataclysmic collapse of all financial institutions, where every bank is daisy-chained to each other courtesy of multiple layers of "hypothecation, and re-hypothecation." In fact, it is a link so sinister it touches every corner of modern finance up to and including such supposedly "stable" institutions as Jefferies, which as it turns out has spent weeks defending itself, however against all the wrong things,  and Canadian banks, which as it also turns out, defended themselves against Zero Hedge allegations they may well be the next shoes to drop, as being strong and vibrant (and in fact just announced soaring profits and bonuses), yet which have all the same if not far greater risk factors as MF Global. Yet nobody has called them out on it. Until now.
Scholars Return to ‘Culture of Poverty’ Ideas
“Scholars Return to ‘Culture of Poverty’ Ideas - http://nyti.ms/bjH3HF”

Here is a link to the Moynihan report:
http://www.dol.gov/oasam/programs/history/webid-meynihan.htm
Entitled:     
The Negro Family:
The Case For National Action
In 1965 this was a live flame in a hay loft.
No activist could read beyond the introduction.
Forty six years later the language is still "Why the riot started".
The application of the ideas is still deeply offensive.
The perceptions and ideas that are the body of this notorious report are simple truth.
If "The black family in America" needs fixing it is not for a white Massachusetts Irish intellectual to point it out.  That he was a native New Yorker is beside the point.
http://topics.nytimes.com/topics/reference/timestopics/people/m/daniel_patrick_moynihan/index.html?inline=nyt-per
The Wikipedia has a bit less noise:
http://en.wikipedia.org/wiki/Daniel_Patrick_Moynihan
The article links here:  http://www.blacksacademy.net/content/3253.html
A nice academic consideration of theories of poverty.
http://en.wikipedia.org/wiki/Oscar_Lewis
http://en.wikipedia.org/wiki/Culture_of_poverty
The shuck and jive content of this view is not what I want.
http://en.wikipedia.org/wiki/Culture

"Culture (Latin: cultura, lit. "cultivation")[1] is a term that has many different inter-related meanings. For example, in 1952, Alfred Kroeber and Clyde Kluckhohn compiled a list of 164 definitions of "culture" in Culture: A Critical Review of Concepts and Definitions.[2] However, the word "culture" is most commonly used in three basic senses:
  • Excellence of taste in the fine arts and humanities, also known as high culture
  • An integrated pattern of human knowledge, belief, and behavior that depends upon the capacity for symbolic thought and social learning
  • The set of shared attitudes, values, goals, and practices that characterizes an institution, organization, or group"
I am having a hard time distinguishing the latter two.  The third is a bit more broad and so useful to me.
Many of these characterizing systems are not structured around financial gain or social interaction.
A culture can and often does exist independent of the constraint of financial gain.  A business cannot.





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OK.    "I have been rich
            I have been poor
            Rich is better."
                      Dorothy Parker




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