Monday, October 25, 2010

Bill Black: Fire Bernanke and Geithner

Former banking regulator Bill Black was on fire today on Dylan Ratigan's show.  Kudos for Dylan for providing a platform for people who speak the truth.

In case you are not familiar with Bill Black, he was one of the stiff regulators that ripped apart the last housing bubble back(Savings and Loan Crisis) in the early 1990's.

Over 1000 bankers were prosecuted during this investigation as the regulators cleaned up Wall St. 

Some op the data points Bill shares below are shocking(His interview starts at the 5:30 mark on the video if you are short on time).  Liar loans are reported to have around a 80% failure rate, and 97% of Countrywide's loans contained some form of fraud.

Here is the Barofsky report that Mr. Black brings up below which revealed more shocking alegations around the Fed's shenanigans.

It's time to take out the trash once again, and we should start with Geithner and Bernanke.

This is must watch stuff:

A Warning To The Day Traders

Just a heads up to all you daily grinders out there from Joe Saluzzi who is one of the best out there when it comes to discussing trading and market making.

Towards the end of the video he sends a clear message to any retail investors that are daytrading and competing with the HFT's:  "You cannot beat these guys".  Food for thought.

Today's erratic tape supports these thoughts IMO.  As I said earlier today:  Nothing makes sense, and I believe a lot of it has to do with the robot trading that Joe describes below.

He also does a nice job explaining why we all should be concerned that the HFT's are now the ones creating today's market liquidity versus the specialists in the past.

The HFT's have no mandate that forces them to stay involved if the market crashes.  They can legally run for the hills like they did during the infamous May "Flash Crash".

In the older days there was a "code" among the specialists where they would try and prevent crashes by supplying liquidity(to a point of course) in an attempt to make the markets trade orderly. 

Joe explains that since the HFT's have no obligations to remain there, it makes today's market liquidity much more risky.  He also adds that because of this, it's just a matter of time before we see Flash Crash Part 2:

Be careful when swimming with the sharks!

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