Monday, April 13, 2009

Be careful out there!

It's time to be working in the yard. Here's a pic to think about.

Find the copperhead snake.

Did you? Here's a hint.

These were sent to me by a friend last fall who has since been bit by that final snake and has gone into that night that awaits us all. He meant people to be reminded to be careful working outside and now is the time we start over.

He was that kind of person.

Rest in peace, Everett.

Understanding Derivative Markets

I don't know about you but I've been trying to get a grasp on this really confusing and difficult subject. Finally, an understandable explanation.

This explains everything. At last, what we've all been waiting for, an understandable explanation of derivative markets...

Heidi is the proprietor of a bar in Detroit . In order to increase sales, she decides to allow her loyal customers - most of whom are unemployed alcoholics - to drink now but pay later. She keeps track of the drinks consumed on a ledger (thereby granting the customers loans).

Word gets around about Heidi's drink now pay later marketing strategy and as a result, increasing numbers of customers flood into Heidi's bar and soon she has the largest sale volume for any bar in Detroit . By providing her customers' freedom from immediate payment demands, Heidi gets no resistance when she substantially increases her prices for wine and beer, the most consumed beverages. Her sales volume increases massively.

A young and dynamic vice-president at the local bank recognizes these customer debts as valuable future asset and increases Heidi's borrowing limit. He sees no reason for undue concern since he has the debts of the alcoholics as collateral.

At the bank's corporate headquarters, expert traders transform these customer loans into DRINKBONDS, ALKIBONDS and PUKEBONDS. These securities are then traded on security markets worldwide.

Naive investors don't really understand the securities being sold to them as AAA secured bonds are really the debts of unemployed alcoholics. Nevertheless, their prices continuously climb, and the securities become the top-selling items for some of the nation's leading brokerage houses who collect enormous fees on their sales, pay extravagant bonuses to their sales force, and who in turn purchase exotic sports cars and multimillion dollar condominiums.

One day, although the bond prices are still climbing, a risk manager at the bank (subsequently fired due his negativity), decides that the time has come to demand payment on the debts incurred by the drinkers at Heidi's bar.

Heidi demands payment from her alcoholic patrons, but being unemployed they cannot pay back their drinking debts. Therefore, Heidi cannot fulfill her loan obligations and claims bankruptcy.

DRINKBOND and ALKIBOND drop in price by 90 %. PUKEBOND performs better, stabilizing in price after dropping by 80 %. The decreased bond asset value destroys the banks liquidity and prevents it from issuing new loans.

The suppliers of Heidi's bar, having granted her generous payment extensions and having invested in the securities are faced with writing off her debt and losing over 80% on her bonds.

Her wine supplier claims bankruptcy, her beer supplier is taken over by a competitor, who immediately closes the local plant and lays off 50 workers.

The bank and brokerage houses are saved by the Government following dramatic round-the-clock negotiations by leaders from both political parties. The funds required for this bailout are obtained by a tax levied on employed middle-class non-drinkers

I trust that answers all of your questions.

Hat Tip to Mack E!

It's all over.... or is it?

Well the Lame Stream Media have been heralding Obamies masterful handling of the terrorist attacks all day, so there isn't much I can add, but I will try.

Let's start off by noting that a US flagged ship hasn't been attacked by pirates for 200 years and we haven't had an attack on US property, leaving Iraq and Afghanistan out of the picture where we are fighting a war, since 9/11.

Yet in not quite three months after we had Obamie pandering and groveling over Arab TV, pandering to the Europeans and the Turks and kissing SA's kings hand... guess what?

We had an attack.

You can call me suspicious, but I see a connection there.

Now I suppose I could mention that Obamie, after hiding out for three days didn't actually give the order to attack... But I wouldn't want to be accused of being ungrateful. But what do you think?

A top military official, Vice Adm. William E. Gortney, commander of the Fifth Fleet, explained that Obama issued a standing order that the military was to act ***if*** the captain's life was in ***immediate danger.***

Now you can call me suspicious, again.... But that looks like a CYA to me. If the results are good, Obamie is a hero. If the results are bad we have Obamie issuing "regrets" and "unnamed officials" noting how poor the Captain of the USS Bainbridge's judgement was. (And scratch one career.)

Of course things worked out fine and Obamie can bask in the glow of a naval Captain doing Obamie's job..... But the terrorists must have noted a few things.

Obamie did nothing until he had a chance to read pubic opinion.

His first move wasn't military but negotiation and he stuck with that. It was the military who actually took command and won under the belief that the Alabama's Captain was in harm's way.

So the next time they will...

Make sure that there can be no excuse for military action by the military. The fate and condition of the hostages will not be known until after the terrorists get what they want.

Obamie will fold up like yesterday's newspaper around garbage. He has taught the terrorists that and this incident hasn't changed their minds.