That Didn't Take Long (Gaming PPIP)

[petertribo]

If you can sell TRASH for CASH then you need lots of TRASH:

I told you so.....

The huge subsidy to banks hidden inside of Tim Geithner's public-private partnership program may already be leading banks to load up on securities they plan to sell at inflated prices.

According to the New York Post, Citi and Bank of America have been aggressively buying up Alt-A and ARM mortgage backed securities, sometimes paying more than the going rate of around 30 cents on the dollar.

....

Recently, securities rated AAA have changed hands for roughly 30 cents on the dollar, and most of the buyers have been hedge funds acting opportunistically on a bet that prices will rise over time. However, sources said Citi and BofA have trumped those bids.

There's nothing complicated about this at all.

Buy for 30 cents, sell to the PPIP for 50 cents, pocket a quick (and huge) profit immediately and nobody's the wiser.

Oops - now someone is the wiser.

Oh darn.

Some are suggesting that Timmie is a PIPPsqueak.

http://market-ticker.org/archives/90...ming-PPIP.html

Original link at:
http://ml-implode.com/staticnews/200...amingPPIP.html

Maybe you could even counterfeit some TRASH....Wow, Financial Engineering, what a career!

[lead_duck]

Re: That Didn't Take Long (Gaming PPIP)

Not unlike Hamilton's plan to consolidate the nation's debt with the states' debt in 1791, pay-off the original notes at face-value and then tipping-off his friends who went scurrying off down the eastern seaboard buying up the old notes from unsuspecting note holders at 10-20 cents on the dollar.

Who said Geithner was no Alexander Hamilton?

[blazespinnaker]

Re: That Didn't Take Long (Gaming PPIP)

This is why monetary policy frequently fails, is because all that money usually just ends up in the pockets of big finance.

Bernanke has suggested that we need more banks .. I agree with this. More, smaller banks to compete for the monetary policy money, especially to compete in terms of compensation for its workers.

[charliebrown]

Re: That Didn't Take Long (Gaming PPIP)



Yup, I'm seeing what you're seeing. I used to use this as a leading indicator, it may now be being perverted.

[Glenn Black]

Re: That Didn't Take Long (Gaming PPIP)

Didn't a similar thing happen with Continental dollars during and after the US Revolutionary war. It was so worthless, debtors loved paying off their creditors.

This paper money provoked all manner of economic chaos and dislocation. According to John Witherspoon, the New Jersey clergyman who signed the Declaration of Independence, "For two or three years we constantly saw and were informed of creditors running away from their debtors, and the debtors pursuing them in triumph, and paying them without mercy."
In Rhode Island, sources tell us of creditors "leaping from rear windows of their houses or hiding themselves in their attics" in order to avoid debtors. The most vulnerable in society also felt its effects, with widows and orphans finding the guardians of their trust funds paying them in currency that was worth but a fraction of its face value.

http://www.wealthdaily.com/articles/...ion-dollar/972

War fighting may be tough on boots, but it's murder on the wallet. Unfortunately, that's a lesson that Captain Allan McClain needed to learn the hard way.Incredibly, he had to lay out $600 for new a set of footwear. And to add insult to injury he was charged a whopping $10 for a simple spool of thread.


And while that hardly seems like a fair deal for an American fighting man, it really did happen. The year was January 1781.


Captain McClain wasn't fighting terrorists but chasing the Redcoats around a new nation. He was a soldier in the Continental Army and he was paid in Continental Dollars. Needless to say, he probably deserved better.

While most sources believe the Continental devalued so badly that they were never redeemed. Others state that sly persons bought them for cents on the dollar, or were given the worthless Continentals, in the secret knowledge that Congress was to secretly redeem them in the near future; thereby cheating many and became rich in the process at the misfortune of many.


Here is an interesting description of the first time the US government got carried away by printing too much money, and the consequences for the ordinary people.


http://www.mises.org/story/2340

[charliebrown]

Re: That Didn't Take Long (Gaming PPIP)

Hmmm interesting .... flash in the pan?

I'm not an expert, but I assume that this index tracks stuff that is in the toxic asset pool. (Index of securities based upon home equity loans) After turbo timmy's announcement we see the price starting to climb, what happened today? Party over?