Tag Archive for Wall Street shenanigans

Bonds Bleed: Largest Bubble In History Unwinds, But The “Great Rotation” Into Stocks Is Deceptive Wall Street Hype – Wolf Richter

The bond-fund massacre is spectacular. Antsy investors yanked $7.7 billion in August out of the world’s largest bond fund, Pimco’s Total Return Fund. In July, they’d yanked out $7.5 billion, in June $14.5 billion. From May 1 through August …

David Stockman: How The Fed Helped Bushwhack TXU – Wolf Richter- Testosterone Pit

David Stockman, Budget Director under President Reagan and then a partner at private-equity firm Blackstone Group, has graciously permitted me to post excerpts from his bestseller, THE GREAT DEFORMATION: THE CORRUPTION OF CAPITALISM IN AMERICA. This is the second installment from Chapter 25, “DEALS GONE WILD: Rise of the Debt Zombies.” In this chapter, he vivisects…

David Stockman: Hedge Funds And The Rule Of Rips And Wrecks – Wolf Richter- Testosterone Pit

“At junctures of extreme financial stress, the high level of carry trade funding” that hedge funds use during bubbles “results in violent market reversals,” David Stockman writes. “Wholesale funding evaporates and involuntary asset sales cascade into a bidless abyss.” Hence the collapse of 2000–2003 (45%) and 2008–2009 (55%). Now they’re doing it again.

David Stockman: Hedge Funds And The Regime Of Insider Trading – Wolf Richter- Testosterone Pit

“As the Fed transformed Wall Street into a casino,” wrote David Stockman, “arrangements for insider speculation took on massive size,” with “hedge fund footings” soaring from $150 billion in 1990 to $3 trillion by the 2007–2008 peak. Trading books of Wall Street banks grew even more explosively. Together, they formed “the fast money complex.”

Verdict Is In: “The Banking Lobby Is Simply Too Strong To Allow It To Happen” – Wolf Richter- Testosterone Pit

“A culture of dangerous greed and excessive risk-taking has taken root in the banking world,” said Senator McCain last week. Senator Warren told Wall Street, where failure has been rewarded with bailouts and record bonuses, that “Banking should be boring.” They were pitching the “21st Century Glass-Steagall Act.” Wall Street must have gotten the willies.

Mother Of All Bubbles Pops, Mess Ensues – Wolf Richter- Testosterone Pit

The asset bubbles the Fed’s money-printing and bond-buying binge has created are spectacular, the risk-taking on Wall Street with other people’s money a sight to behold. Among the big winners were mortgage Real Estate Investment Trusts – and those who got fat on extracting fees. But now the pendulum is swinging back, and the bloodletting has started.