Wednesday, December 16, 2009

Like the Patriots, I Cannot Close the Deal!

I apologise to all the readers once again. I had an entire piece lined up and had sent home all the relevant articles but I had so much to do tonight I could not get a post up. Instead I will show the collection I had and maybe you can figure out what I was going to write about! See if you can read the mind of Economic Disconnect! I may do the piece tomorrow if I think it is my best thought for the night.

My Post Inspirations/References
Plenty of Citi (C) action today with even more questions as news came out. My items to use:
Citigroup Gets Huge New $38 Billion Bailout, Wiping Out All Of The Taxpayer's "Profits"

Yahoo Message board reaction to said news:
This is SWEEEEEEEET!! Read!

The Rumor:
Citi Price Rumored At $3.15, $20.5 Billion In New Securities, Government To Keep $5 Billion In Common Stake As Below Cost-Basis
Becomes news:
Citi's Secondary Prices Weak, Treasury Holds Back On Dumping Stake To Avoid Flooding The Market

I had a few bones to pick with Calculated Risk today as it seemed he was inconsistent:
Citigroup's "Massive" Tax Break
CR was moved to add:
"Who benefits? The value of the shares the U.S. owns should increase, but only 34% of the share price increase accrues to U.S. taxpayers The other current shareholders receive the rest. So this doesn't seem to make sense ..."

Later concerning the FOMC statement, CR was quick to get behind the FED line about sticking to their exit timelines:
FOMC Statement: No Change
CR adds:
The Fed is also making it clear they intend to stick to their deadlines.
He reiterated this point several times in the comments section.

Of course he may have missed the closing section of the FOMC release, which of course Mish did not:
Bernanke Trots Out the Boy Scout Motto
Boy Scout Motto

In case you missed the key paragraph, it has nothing to do with "anticipation", "appears", or "expect" and has everything to do with the Boy Scout Motto, "Be Prepared".

"The Federal Reserve is prepared to modify these plans if necessary to support financial stability and economic growth."

I suggest you forget about expectations and plan on Bernanke acting in accordance with the Boy Scout Motto.


I also was going to include a great Gold article as I am apt to do:
Paper Currencies - Trampoline Jumping
Great section:
"Gold is a great hedge against government insanity and instability and we are in a secular cycle of government insanity and instability right now. Gold is not a simple asset class (as the ignorant commentators shouting "barbarous relic" would have you believe), it is not a consistent inflation or deflation hedge, and it is not just an anti-Dollar play."
I like it.

Have at it and I will be back tomorrow.

Have a good night.

5 comments:

getyourselfconnected said...

More Citi news all the time, now the US cannot sell any of their shares for 90 days and can only do so gradually. Just who the hell is in charge here? Oh that's right, not the government. Confident much??

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Rob Dawg said...

Citi and in short order Wells Fargo.

Anyway, I ripped into CR for the same thing. Pure posturing.

THere is no cold turkey for this addict.

Tax breaks = stealth bailouts. I said this in Sept 2008. Who is surprised?

Dave in Denver said...

R.I.P. Chris Henry. What a shame.

gyc, are you still being harrassed by cockroaches? I want to take the comment moderator off on my blog but I can't have every person's address in Colorado with my same last name pasted all over my comment section LOL.

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