Posted on | Tuesday, April 20, 2010 | No Comments

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I keep this thing around for the archives!

Someone please explain this to me

Posted on | Sunday, April 18, 2010 | 1 Comment

A day before the GS news broke, we pointed out that the market is poised for a correction at least based on Fib. Sure enough, the ludicrous non-stop rally from the February lows topped at exactly a 61.8% extension of the previous sell-off (1211.6)). Was the Goldman news predicated by the SEC's religious following of Fibonacci signals? Is the 100% Fib retracement next (1144)?

So then we go to the post they're taking about and see this:
The Fib retracement from the highs to the lows in the cycle is now nearly 61.8 (at 1,228). The retracement from the highs to the lows in the first wave of the Great Depression peaked just below 61.8.Does history repeat itself, or come in tidy little Fibonacci packages? Are today's math Ph.D.'s even aware of retracements, or do they just know how to buy, buy, buy on ever declining volume? 1,228 is the magical number on the S&P. We'll find out soon enough.

I'm not too good with numbers but how does 1211.6 = 1228? Maybe someone could help out this product of public schools.

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Charlie Gasparino on GS

Posted on | Friday, April 16, 2010 | No Comments

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GS Official statement

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NEW YORK--(Business Wire)--
The Goldman Sachs Group, Inc. (NYSE: GS) said today:
We are disappointed that the SEC would bring this action related to a single
transaction in the face of an extensive record which establishes that the
accusations are unfounded in law and fact.
We want to emphasize the following four critical points which were missing from
the SEC`s complaint.

* Goldman Sachs Lost Money On The Transaction. Goldman Sachs, itself, lost more
than $90 million. Our fee was $15 million.We were subject to losses and we did
not structure a portfolio that was designed to lose money.
* Extensive Disclosure Was Provided. IKB, a large German Bank and sophisticated
CDO market participant and ACA Capital Management, the two investors, were
provided extensive information about the underlying mortgage securities. The
risk associated with the securities was known to these investors, who were among
the most sophisticated mortgage investors in the world. These investors also
understood that a synthetic CDO transaction necessarily included both a long and
short side.
* ACA, the Largest Investor, Selected The Portfolio. The portfolio of mortgage
backed securities in this investment was selected by an independent and
experienced portfolio selection agent after a series of discussions, including
with Paulson & Co., which were entirely typical of these types of transactions.
ACA had the largest exposure to the transaction, investing $951 million. It had
an obligation and every incentive to select appropriate securities.
* Goldman Sachs Never Represented to ACA That Paulson Was Going To Be A Long
Investor. The SEC`s complaint accuses the firm of fraud because it didn`t
disclose to one party of the transaction who was on the other side of that
transaction. As normal business practice, market makers do not disclose the
identities of a buyer to a seller and vice versa. Goldman Sachs never
represented to ACA that Paulson was going to be a long investor.

In 2006, Paulson & Co. indicated its interest in positioning itself for a
decline in housing prices. The firm structured a synthetic CDO through which
Paulson benefitted from a decline in the value of the underlying securities.
Those on the other side of the transaction, IKB and ACA Capital Management, the
portfolio selection agent, would benefit from an increase in the value of the
securities. ACA had a long established track record as a CDO manager, having 26
separate transactions before the transaction. Goldman Sachs retained a
significant residual long risk position in the transaction
IKB, ACA and Paulson all provided their input regarding the composition of the
underlying securities. ACA ultimately and independently approved the selection
of 90 Residential Mortgage Backed Securities, which it stood behind as the
portfolio selection agent and the largest investor in the transaction.
The offering documents for the transaction included every underlying mortgage
security. The offering documents for each of these RMBS in turn disclosed the
various categories of information required by the SEC, including detailed
information concerning the mortgages held by the trust that issued the RMBS.
Any investor losses result from the overall negative performance of the entire
sector, not because of which particular securities ended in the reference
portfolio or how they were selected.
The transaction was not created as a way for Goldman Sachs to short the subprime
market. To the contrary, Goldman Sachs`s substantial longposition in the
transaction lost money for the firm.
The Goldman Sachs Group, Inc. is a leading global investment banking, securities
and investment management firm that provides a wide range of financial services
to a substantial and diversified client base that includes corporations,
financial institutions, governments and high-net-worth individuals. Founded in
1869, the firm is headquartered in New York and maintains offices in London,
Frankfurt, Tokyo, Hong Kong and other major financial centers around the world.

The Goldman Sachs Group, Inc.
Lucas van Praag, 212-902-5400
Dane Holmes, 212-902-0300
Copyright Business Wire 2010

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More Irony from ZH

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Cramer "Breaks" News About Goldman Being Long Abacus, No Disclosure On Goldman's Short Exposure In The Structured Product
Creamer has just come to the rescue of this former co-workers at Goldman, claiming a "source" has notified him that Goldman was "long" Abacus. Well, duh - that's how structured finance works. They are long one tranche and short another. Cramer should also immediately provide "factual" information to all those who may have bought Goldman on his BS, whether Goldman wasin fact net short via CDS with AIG... Yeah, remember that whole thing about Goldman being short CDOs via CDS underwritten by AIG? Apparently it slipped the mind of Cramer's source. This is yet another semantic loophole abused by the world's greatest wealth destroying stock pumper. And by the way, Jim, take a look at the CDOs that Goldman had protection on AIG with before you "break" any more news, and find out what Goldman's exposure really was: because our sources tell us Goldman was short. Also, this is not even remotely a "game changer" at all, because the SEC's contention has nothing do with whether Goldman was shorting the CDO, but how the CDO was designed in the first place, with the explicit purpose of benefiting one party whose material involvement was not disclosed, and in fact was misrepresented!

Is Zerohedge in any position to demand someone provide factual information when they admit they cannot even provide factual info themselves? Please see ZeroHedges new justification for spewing falsehoods

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Zero Hedge back to its bullshit ways

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Goldman sold 1,000 big SP today over 1,200.00. Was it just a hedge because they KNEW the SEC would do nail them to the cross? Is that insider trading? Who knows how many tens of thousands they sold in the ES?

Mkt is up how many fkn % off the low? Today ops ex? what a bunch of horse shit.

POP quiz kiddies! When mkts drop 1%, whose selling????? EVERYONE YAY!!!!!!!!

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Here watch

Posted on | Monday, April 5, 2010 | No Comments

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Video Recap week ending 4/2/2010

Posted on | Friday, April 2, 2010 | No Comments

We have a guest market recapper for this week! First a couple of observations:

S&P 500: The mini closed at 78 even today, breaking out of our two week range. Paper still very active scooping up contracts at discounted prices when they sell off. Bias is still long.

CL: GS upgraded entire energy sector on Monday, naturally that only works if CL catches a bid so paper also came through with a bid at about the same time. I posted on twitter that our short term bias had to change from bear to bull. Note: loooong term bias for CL has always been bullish for reasons outlined in previous vids. We have yet to beak the high from mid Oct 09, watch your price levels but no reason why we won't go higher. Cap and trade is still coming whether you like it or not.

EURUSD: Caught a bid like we thought. ZH is johnny on the spot with their posts trying to mock GS's markets calls. However, I think that the GS calls are deliberately incorrect... We're on the right side every time. There is no reason why they wouldn't be as well unless it's some type of PR campaign to demonstrate/generate sympathy, maybe. I prefer to think they did it to fuck with ZeroHedge. They clearly took the bait, as they would. They're not very smart. Paper came through again 3/31 and they were buyers, the same happened on 4/1. Today price declined, along with everything else that was open except for the S&P. I can't make a case to get or bullish or bearish until we see Monday. Today is simply too hard to interpret because of the lack of action.

Here is this weeks video recap from my girl GloZell! Be sure to check her out on youtube

Guest from Walter Sobchak on Vimeo.

Related posts:
Recap vid week ending 3/26
Play now at

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