Tuesday, September 23, 2008

The Market is Scared S%^#less of the Senate... and I Am Too

Watching the senate finance committee grill Bernanke, Paulson, and Cox today most certainly did not make me all warm and fuzzy inside. First of all, the market has tanked ever since Cox and crew led a pogrom against the shorts and forced everyone to buy it all back last friday. You can't make money off that however, because (sorry to belabor the point) they outlawed shorts in financials!!! I thought they banned shorting to manipulate stocks upward. Great job there guys, turning our market upside down just to put the shorts out of business. Now we have prices that mean f$@# all.

Add to this sour mood the image today of the senate finance committee burned into everybody's retina: seemingly BALKING at the rescue plan set forth by the treasury, fed, and sec. On one side of the desk you have the most powerful banker in the world saying that the market cannot recover unless we enact this 700 billion dollar rescue and on the other you have sen. D0dd stumping. GET YOUR F#$KING CAMPAIGN OFF THE TRADING FLOOR YOU DIRTY CRIMINAL. This guy is an idiot anyway: he's from connecticut, which last time I checked was the center of the hedge fund universe. Who does he think this bailout is for? The public? Main Street? This is welfare for the rich, plain and simple.

The fact is if the senate harpoons this deal we don't know what kind of hell will ensue. Its no wonder this market can't hold a bid into the close. Keep in mind that my earlier optimism is completely dependent on government intervention in the markets. Without them we would have a good ol' fashion credit starved depression. The drop would have been spectacular. It could still happen, you just wouldn't be able to short it.

Suppose you are a tax collector and you have two types of people to make money off of: bulls and bears. Would you, while the bulls are getting killed and not paying any taxes, shoot all of the bears in the head? Why NO, because then you would have no tax revenue. Then you would be smarter than our government.


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