Posted by: tristar3research | May 11, 2009

$3.8T Budget w/Supplementals- $1.8T Deficit = Prudent?

White House: Budget deficit to top $1.84 trillion, 4 times 2008’s record is the hot news. But, get this, their forecast is: a $7.1 trillion deficit over 2010-2019″. Yeah, but the Congressional Budget Office ALREADY predicted this deficit in March, and a worse 10 year compound deficit!

Faux Trillion: The Congressional Budget Office figures, released Friday, predict Obama’s budget will produce $9.3 trillion worth of red ink over 2010-2019. That’s $2.3 trillion worse than the White House predicted in its budget. Worst of all, CBO says the deficit under Obama’s policies would never go below 4 percent of the size of the economy, figures that economists agree are unsustainable.The CBO’s estimate for 2010 is worse as well, with a deficit of almost $1.4 trillion expected under administration policies, about $200 billion more than predicted by Obama.

Excuuuuse me, but we already have a $13T debt without the Medicare and Social Security ummm “shortfall”- and so this means we propose to go from a $35-55T debt now to $60Tplus by the end of the next decade. This is Weimar money if you believe these pronouncements.

The S&P Outlook is Worse Than Hoped

The S&P Outlook is "Worse Than Hoped"

Reuters spams: With the economy performing worse than “hoped”, revised White House figures point to deepening budget deficits, with the government borrowing almost 50 cents for every dollar it spends this year. The deficit for the current budget year will rise by $89 billion to above $1.8 trillion — about four times the record set just last year. The unprecedented red ink flows from the deep recession, the Wall Street bailout, the cost of President Barack Obama’s economic stimulus bill, as well as a structural imbalance between what the government spends and what it takes in. ~snip (The deficits will) total $7.1 trillion over 2010-2019.

The Middle Class investors commisserate

The Middle Class investors commisserate

Treasury 10-year yields have risen for seven consecutive weeks, the longest advance in five years, as President Obama borrows record amounts to stimulate the economy and service a widening budget deficit. The government will sell $3.25 trillion of debt in the fiscal year ending Sept. 30, according to Goldman Sachs Group Inc., one of 16 primary dealers required to bid at Treasury auctions, Bloomberg spoofs as it is the only one that matters.

Senator Kent Conrad (D-ND)
Senator Kent Conrad (D-ND) – “I just don’t get it-any of it!”

And proof of alien life on earth: Sen. Kent Conrad, D-N.D., chairman of the Budget Committee, said the estimates are “further evidence of the mess that has been handed the Obama administration.” “The reality is we are going to have to make adjustments to the president’s budget if we want to keep the deficit on a downward trajectory,” he said in a statement, adding that lawmakers would still adopt a budget resolution that reflected the key priorities of the president’s agenda.

Posted by: tristar3research | May 7, 2009

Carbon Nanotubes – “the Next Plastics”

CNT’s the next “Plastics” “Nature” report about CNT’s being great for ultrafast charging batteries, also

Mrs. Robinson: Have you heard about carbon nanotubes?

Mrs. Robinson: "Have you heard about carbon nanotubes?"

According to George Ure at Urban Survival: “You ought to be keeping an extremely sharp eye on Carbon Nanotubes (CNT’s) because it turns out that CNT’s may replace copper wire in some applications. Of course, if you’re into electronics, you caught the bit about transmitting  ‘both AM and FM radio signals” which is akin to saying a straw can carry water or milk, but they key thing is that CNT’s are the future. We’re right now in the dawning of a period called ‘the New Electrics”,  CNT’s are where to place your bets. IBM has been very active in the field: Nanotubes, depending on their structure, can be metals or semiconductors.  They are also extremely strong materials and have good thermal conductivity.  The above characteristics have generated strong interest in their possible use in nano-electronic and nano-mechanical devices.  For example, they can be used as nano-wires or as active components in electronic devices such as the field-effect transistor shown in this site.

Lodestone: Natures Magnet

Lodestone: Nature's Magnet

There’s a second reason to invest in outfits that show high promise in CNT’s.  It comes from recent work suggesting that CNT’s may actually be able to get at some of that rumored “free energy”.  I assume you caught that “Carbon nanotubes can cut down motor commutator energy loss by 90%” ? The engineering can be patented to get at these ‘idler wheels’.  The wheels themselves?  Sorry, already in the public domain and hanging around a magnet near you.  Lodestone the next uranium?  Who knows?

Support HR 1207- An audit of the Federal Reserve is long overdue- it’s not Federal, it’s privately owned. On the lack of transparency: Bubble Ben claims that the Fed is compliant with Sarbanes-Oxley and has an independent auditor at the GAO- HAHAHA – they are ignored. Third Party auditor? SURE, like a credit rating bureau like Moody’s?

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more about “Ron Paul to Bernanke: Continue Down P…“, posted with vodpod

Posted by: tristar3research | May 4, 2009

SEC: No Intregrated Ability to Cross-reference Fraud Cases! UFB!

Hat Tip to buddy Michele Leder for an amazing revelation last week about the modern ?? SEC- no integrated database analysis of where leads come from and who they repeatedly finger!! Hello, Bernie Madoff wet dream!! It’s absurd for hedge fund and intelligence types like me to assume that all the current IT technologies and software have been adopted by the public sector, but come on!! Look at Onvia, i2 Analyst, IFS, bCisive- any of the great business intelligence tools and apply them!!

Monday, Apr 27, 2009 at 1:09 pm by Michelle Leder
Live blogging Mary Schapiro speech at SABEW

mary schapiroMary Schapiro just started speaking to the Society of American Business Editors and Writers convention in Denver.  12:54: Final question on what SEC is doing to make sure that those thousands of complaints are winding up on the right desk and how that’s being coordinated with regional offices.

Says she asked the staff to give her a catalog of where tips come in from. They come in about 40 different ways and no master database to track them (really????). No ability to mine the data and see that there’s a complaint in Boston, in Miami. Says she hired a contractor to build system.

$700T in toxic assets

$700T in toxic assets-Get Busy!

Last year SEC got 750,000 tips and will never be able to follow up on all. Need to be able to connect the dots to be more effective. Going to ask Congress for Whistle Blower authority. “If we can reward people who bring us well-thought through cases where we can prosecute the case and get a fine” like IRS and others, will help us separate the wheat from the chaff. Only available now for insider trading and hasn’t been very successful.  “My goal is to ensure that we don’t miss the next Bernie Madoff.”

You have got to be kidding me! 750K of traffic is nothing compared to any robust BI system input volume. How about a lack of policital will to tackle the problems?

Michele correctly points out and check out her great site: Here’s a link to Schapiro’s speech to the group. But as with any conference call, the Q&A is always much more interesting.

Posted by: tristar3research | May 4, 2009

Bubble Dynamics – A Systemic Problem

Well respected Financial Times columnist Gillian Tett released an excerpt from her upcoming assessment of the roots of the financial crisis called “Fool’s Gold.”

Backstopped- or NOT?

Backstopped- or NOT?

Entitled “Genesis of the Debt Disaster”, the article details JP Morgan’s hell bent rush into the derivatives markets in late 1990s. It was all about leverage: These pioneering structures were known as “Bistro” deals (short for Broad Index Secured Trust Offering). Masters and Demchak had done the first couple of Bistro deals on behalf of their own bank without knowing the answer to their question for sure. But when they were doing these deals for other banks, the question of reserve capital became more important – the others were mainly interested in cutting their reserve requirements.

Watch out below!

Watch out below!

Call it a house of cards or a stack of dominoes, this is a mess that just kept getting bigger and biggerer and biggerer with no adult supervision. There were warning signs a decade ago! Gillian reports, “The first sign that there might be a structural problem with the innovative bundles of credit derivatives that bankers at JP Morgan had dreamed up emerged in the second half of 1998.”Aha, the regulators were told to approve the deals since they would be backstopped – YES COVERED- by the issuer is anything went wrong!

When the team did their first Bistro deal, they pooled more than 300 of JP Morgan’s loans, worth a total of $9.7bn, and issued securities based on the income streams from these loans. The lure of the idea was clear: the team had calculated that they only needed to set aside $700m – a strikingly small sum – against the risk of defaults among the 300-plus loans. After much debate, the credit rating agencies had agreed with the team’s assessment of the risks, and the deal had gone ahead on the basis that if financial Armageddon wiped out the $700m funding cushion, JP Morgan would absorb the additional losses itself. To Masters and Demchak, the chance that losses would ever eat through $700m were minuscule.

The sad truth is that this is a systemic problem that has spread from corporate finance to government finance and finally to household finance, with the greatest toll being taken on by households. Take a little time to see how the credit card reform bill of 2009 and the bankruptcy reform bill of 2009 have been handled. MIDDLE CLASS SCREWED AGAIN!

Note that 12% two day Taiwan rally? Driven by mainland speculation

Note that 12% two day Taiwan rally? Driven by mainland speculation

Doug Noland at Federated nails it: Bubble Dynamics have taken root throughout government finance. This unprecedented inflation includes Federal Reserve Credit, Treasury borrowings, agency debt, mortgage-backed securities issued by government-sponsored enterprises (GSEs) such as home-loan guarantors Fannie Mae and Freddie Mac, Federal Housing Administration and Federal Deposit Insurance Corporation insurance, massive pension and healthcare obligations, the myriad new market support programs, and so forth. This government finance bubble is domestic as well as global. Amazingly, the scope of the unfolding bubble dwarfs even the mortgage finance bubble. And, importantly, it is reasonable to presume that the Federal Reserve will find itself in the familiar position of being trapped by the risk of bursting a historic bubble…I fear the government finance bubble is on track to destroy the creditworthiness of the entire economy. And this Ponzi dynamic is the greatest cost to what I fear is a continuation of unsound policymaking.

Posted by: tristar3research | April 26, 2009

Partitioned from the Internet? Just Plain Cut-Off

How an infrastructure attack provided an early warning signal regarding our information technology vulnerability. Maybe Senator Rockefeller and other sponsors of the ill-advised “CyberSecurity Bill” should be warned that a further centralization broadens the vulnerability.

Getting Cutoff from Your Network

Getting Cutoff from Your Network

Bruce Perens reported: Just after midnight on Thursday, April 9, unidentified attackers climbed down four manholes serving the Northern California city of Morgan Hill and cut eight fiber cables in what appears to have been an organized attack on the electronic infrastructure of an American city. Its implications, though startling, have gone almost un-reported.  That attack demonstrated a severe fault in American infrastructure: its centralization.

The city of Morgan Hill and parts of three counties lost 911 service, cellular mobile telephone communications, land-line telephone, DSL internet and private networks, central station fire and burglar alarms, ATMs, credit card terminals, and monitoring of critical utilities. In addition, resources that should not have failed, like the local hospital’s internal computer network, proved to be dependent on external resources, leaving the hospital with a “paper system” for the day. Commerce was disrupted in a 100-mile swath around the community, from San Jose to Gilroy and Monterey. Cash was king for the day as ATMs and credit card systems were down, and many found they didn’t have sufficient cash on hand. Services employees dependent on communication were sent home. The many businesses providing just-in-time operations to agriculture could not communicate.

At least Bruce is an Open Source champion…

Harvard neo-imperialist economic historian Niall Ferguson argues for bank nationalization as Citigroup and Bank of America are insolvent- He points out that there is NO DIFFERENCE BETWEEN THE BUSH AND OBAMA ADMINISTRATIONS– no kidding, professor, Goldman has been running the U.S. since the early 1990s. “What if” we didn’t bail out the mega banks???

Wiki: Niall Ferguson (born April 18, 1964, in Glasgow) is a British historian. He specializes in financial and economic history as well as the history of empire. He is the Laurence A. Tisch Professor of History at Harvard University and the William Ziegler Professor of Business Administration at Harvard Business School. He was educated at the famous independent school The Glasgow Academy in Scotland, and at Magdalen College, Oxford.He is best known outside academia for his revisionist views rehabilitating imperialism and colonialism; within academia, his championing of counterfactual history is a subject of some considerable controversy. In 2008, Allen Lane published his most recent book, The Ascent of Money: A Financial History of the World[1] which he also presented as a Channel 4 television series.

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Posted by: tristar3research | April 23, 2009

Torture: Getting Headlines After Five Lost Years

Gee, this torture investigation gets uglier and uglier, odd that it this is the conduit for finally exposing the criminality of the Bush Adminstration (what Geneva Convention?) is a lot of other arenas. Torture encouraged months before the illegal memos this was all fastpiped.  In the most recent instance, Director of National Intelligence Dennis Blair acknowledged in a memo to the intelligence community that Bush-era interrogation practices yielded had “high-value information,” then omitted that admission from a public version of his assessment.

This is not what our country is all about!
TORTURE- This is not what our country is all about!

It turns out that Condi Rice lied to the Senate Armed Services CommiteeRice approved the torture techniques used by the CIA as early as 2002 according to a memo released by Holder’s DOJ yesterday. last fall.  That shouldn’t surprise anyone after her classic “Smoking gun/mushroom cloud” whopper. Which basically makes Philip Zelikow’s last little whirl-wind tour of the progressive media tools, just the kind of lie I thought it was since he was saying that he wrote his supposed “memo of dissent on torture” in 2005 FOR Condi Rice (because of her opposition to torture (?)… the same torture we now know she approved 3 years earlier).  But after Zelikows performance on the lie-fest that is the 9/11 Commission Report, again, who the hell can be surprised?

Hardly a guy with 9-11 credibility. just a Condi friend and agenda driven apparatchik for the PTB over the last two decades.

U.S. torture dates to the Spanish Inquisition
U.S. torture dates to the Spanish Inquisition, Nazi Germany…

Zelikow’s memo, if it existed at all back then, was just to cover their (his and Rices) asses for the eventual day that would come when they would have to answer for their crimes.  That’s the same reason the other memos and legal briefs were created since we now know that the torture started months before they were even written.  Fact is, they tortured people in an effort to create justification for war with Iraq.

It wasn’t about saving the nation or protecting us from another 9/11 (ever wonder why they didn’t fear another 9/11?). It was about creating even more lies that the complicit media could use to convince the public we had to go to war with Iraq. In short, they tortured people … for profit.

Posted by: tristar3research | April 23, 2009

Taliban Advance into Buner District, Prelude to Islamabad Takeover

Okay, so it’s underway as predicted. The collapse of Pakistan will seriously complicate the situation in Afghanistan where, get this, troops levels will rise by 15K over the next two years.  For you Vietnam War historians, the first ones in are mainly “advisors”.  God, there is going to be a lot of unnecessary bloodshed there over the next three years. Why have we coddled the poppy cultivating warlords there over the last decade???

Im in no hurry, send your troops!

I'm in no hurry, send your troops!

Taliban militants in Pakistan’s Swat Valley have moved into another district in a bid to broaden their control despite a deal designed to end extremist violence, officials said Wednesday.  Hundreds of armed Taliban from the scenic northwestern valley have entered Buner district, only 110 kilometres (68 miles) from the capital Islamabad. The militants have set up checkpoints, occupied mosques and ransacked the offices of non-governmental organisations, a local official said.

Not surprisingly, Bill Roggio called this on April 7 and nailed it. Odd, that SecState Clinton just realized the threat yesterday? This has not been a real secret- Last summer, the Taliban ramped up pressure in Buner after members of a tribe surrounded six Taliban fighters who had been involved in attacks on policemen and killed the Taliban fighters after they attempted to flee. Two weeks after the incident, the Taliban bombed four video centers at a bazaar and sent night letters to shop owners ordering them to shutter their businesses.

Of course, the Talis are being welcomed as liberating conquerers- NOT!

Of course, the Talis are being welcomed as liberating conquerors- NOT! In fact, there's panic!

A Taliban commander said they would set up strict Islamic sharia courts in Buner as they have already done in Swat but would not interfere with police work. Indications of a spread of Taliban activism has fuelled criticism of an accord agreed by Pakistani President Asif Ali Zardari earlier this month to allow sharia courts in Swat, which the United States said amounted to capitulation.

From the “Nothing to See” Department (kinda busy lately):Talking to Geo News, leader of Tahreek-e-Taliban Pakistan Mufti Bashir said they don’t want to create panic or fear among the locals by exhibiting weapons. They are in these areas for implementation of Shariat-e-Mohammadi and spread jihadi mission. Taliban are on Tableeghi mission and not interfering in administrative issues.

Posted by: tristar3research | April 23, 2009

Gold ETF Purchases Up 6X in Q1 Annualized over 2008

Gold purchases through ETFs are up six fold!! in Q1 (annualized) versus 2008. Nothing to see, move along…. Okay, somebody thinks that hyperinflation will be the outcome from the shameless money printing operations being conducted by the U.S., U.K., Japan and Switzerland? (The latter confounds me- they have a sound currency and a national surplus).

The U.S. Mint will let you know when we decide to restart operations..

The U.S. Mint will let you know when we decide to restart operations..

Gold-backed exchange-traded funds saw inflows of 456 tonnes worldwide in the first quarter of 2009, against a total 321 tonnes for the whole of the previous year, the World Gold Council said (to Reuters). Marcus Grubb, managing director of investment research and marketing at the WGC, said he expected investment as a proportion of total demand to reach a new high in the quarter. “You are seeing a shift in the dynamic of the gold market,” he said. “ETF investment is in its infancy, and so is gold investment,” he said. “Most allocations of gold are zero.” WGC Supply & Demand stats here.

But a really smart investor also loaded up on gold in Q1- Billionaire hedge fund manager John Paulson, noted DealBook:

Hey, I dont trust the fiat currencies!

Hey, I don't trust the fiat currencies, especially $s!

The billionaire hedge fund manager John Paulson is bullish on gold. His investment firm, Paulson & Company, bought an 11.3 percent stake in the South Africa-based gold mining company AngloGold Ashanti from Anglo American for $1.28 billion. Anglo American said Tuesday that the Paulson funds paid $32 a share for its stake in AngloGold. “We believe AngloGold Ashanti is one of the best-managed and undervalued of the major global gold-mining companies,” Mr. Paulson said in a statement given to Bloomberg News. “We look forward to the implementation of their global expansion strategy.” FT AlphaVille nails it.


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