Who caused San Diego's massive power failure September 8?

But Don, You obviously didn't look to see how many banks went to the Fed window in the first place. If you would have bothered to read the balance sheet, you would have seen only 9 small to mid-sized banks at the trough. You say...giving away, I see collateralized transactions. You say they're giving away to large institutions, yet there is no evidence of those gifts, or any transactions beyond the normal daily clearing actions. Plus, the Fed earned over 82 billion dollars in 2010 which strongly suggests that they weren't putting too much money out at 0.25%. They sure didn't make it off of check clearing and Fedwire. They made that profit from their treasuries and loaning to banks(US and offshore). And, although GS amd MS did convert to banks under the emergency order, look at the percentage of their base vs that of the commercial banks. BofA has a bigger portfolio than both GS and MS combined. None of the aforementioned banks are at the Fed window by the way. Money is cheap because the Fed is pushing it out the door right now. Look at the M2 since 2007 and you'll see what I mean.http://research.stlouisfed.org/fred2/series/… Notice that the M2 supply is 45% less than the government debt? That does not bode well for the future. And so what if Stockman says something. That authority argument you are making is just another complex logical fallacy. Just because a high profile apparatchik says something that doesn't mean it's correct. Furthermore, those authority argument logical fallacies are so wonderful because one can take the opposite side and logically and successfully argue that Stockman doesn't know a thing and this renders your argument false. Furthermore I'd lay 8:7 that when Stockman was around in the 80's you were probably beating him up. It's not what people say that matter, it's only the price action of the market that means anything. But you say that the short term rate for money is cheap(correct), but you have demonstrated a problem with calculating interest(like when you told me my returns should make me a billionaire because you were confused with simple and compound interest.) That being said, what about the yield curve? What about the long term end of the curve? The short end of the yield curve is not allowing for much gambling these days, plus combined with the new regulations...not much gambling by the banks at all. The yield curve doesn't allow a carry trade, nor any speculative, at risk rational investment beyond 91 days if you look at it. I notice a lot of premises being made on these pages that are, in fact, unwarranted assumptions. The assumptions seem to be chosen that will give the best fit for the conclusions that are desired. Also, many different types of Ad Ignorantium arguments are made here, with a number of disproved contentions and premises just casually ignored because of the inability to come up with something that will successfully counter those pesky facts.
— October 11, 2011 9:32 a.m.

Who caused San Diego's massive power failure September 8?

I would contest your contention that commercial banks make most of their money speculating. JPM Chase only made about 1.4 billion out of the 5.6 billion Q1 FY 2011 trading. BofA's income is 85% reserve releases and they are on life support. Wells Fargo made 3.5 billion Q1 FY 2011 and only 250 million was due to trading, most of their income was managing their 1.7 trillion under management. Most banks trading income has lessened under the new rules and regulations, and is less than 25% of profits on average, if at all....remember some pretty banks reported big trading hits as of late. I would also question the contention that banks are delighted with high unemployment. Has this been quantified, or just editorial/opinion? Then there's this myth that banks can borrow all the money they want from the Fed at 0% which is simply not true. While the fed does occasionally loan some monies out at 0%, this is a rare exception, not the rule. The allowing the banks to borrow infinite money at 0 fallacy should be addressed. Somehow, the popular culture has gotten in it's head this 0% money meme, and it will not go away because it's repeated by financial press that largely does not do it's homework. The discount window is overnight and can be rolled over and consists of primary, secondary, seasonal, or emergency credit. The Fed's overnight loans are largely made at several rates depending on the classification, and is not usually zero.http://www.frbdiscountwindow.org/index.cfm Plus, if you look at the Fed's consolidated balance sheet, you will find that an average of 9 borrowers are at the discount window in March 2011(latest release)http://www.federalreserve.gov/monetarypol… On page 17-19, you will also notice that the Fed demands collateral for using the discount window in most cases, so even a 0% rate would have a real interest rate after the collateral was figured in. Also, note the sizes of the institutions using the window...The table suggests that Citi, BofA, Wells Fargo and the other major banks are not using the window as of now. Has the author ever studied the Fed's balance sheet? I suppose the public would be better served if the business press used more due diligence in their reporting, and avoided repeating fallacies, untruths, and representing editorial as fact.
— October 11, 2011 7:34 a.m.

Who caused San Diego's massive power failure September 8?

I think you're bumping against what came first the chicken or the egg. I understand your need to beat up Wall Street as that's just part of who you are.
— October 8, 2011 8:41 a.m.

Who caused San Diego's massive power failure September 8?

But it all starts with the insatiable desire of money by our elected leaders that get in bed with the big business guys(capitalists but the antithesis of free markets). Here's a lecture from an acquaintance, and she describes the "Shadow Elites" and their impact on democracy and this country. http://www.youtube.com/watch?v=SiXGcEpI-sI She coined the term, "Flexion," which describes those shadow elites, and the term means one of those who moves freely through the highest levels of government, business, academia...these people are all lining their own pockets and their friends pockets at the expense of everyone else. Her latest book is pretty good.
— October 8, 2011 7:21 a.m.

Who caused San Diego's massive power failure September 8?

Even the best risk management can be met with an outlier of biblical proportions. Furthermore, we didn't have to bail out the firms...it's just that they are politically connected and got the government to bail them out. Frankly, I wish that they would have all gone under, kind of like 1873. We need a brush clearing of biblical proportions and kicking the can down the road until the politicians are out of office isn't going to solve anything.
— October 8, 2011 3:56 a.m.

Who caused San Diego's massive power failure September 8?

Most trading firms and banks have really good risk management systems in place that won't allow a single trader to put on a hundred thousand cars of T-Bonds or whatever. It's the firms that get sloppy that mess up, like UBS etc.
— October 7, 2011 8:44 a.m.

Who caused San Diego's massive power failure September 8?

Have you noticed that all reported rogue traders lose money? I guess those traders who operate outside the box and make money end up with corner offices and a key to the executive wash room.
— October 6, 2011 10:20 a.m.

San Diego unions push transaction tax

My house has lost 50% of the perceived value in the past 4 years, yet my taxes are up every single year. Go figure.
— October 2, 2011 6:41 p.m.

San Diego unions push transaction tax

You ought to turn off all of the TV and get a Bloomberg Machine. They might have a free trial, but I don't know. Bloomberg is all the up to the minute quotes(the ultimate truth) and unfiltered news reports. All of those TV business channels are even worse than the print business reporters....and they are pretty bad. Just look at Alan Abelson, who has been bearish since the DJIA was at 700. Can you imagine how broke you'd be if you listened to him?
— October 1, 2011 4:04 a.m.

San Diego unions push transaction tax

SO: So did you ever figure out the little word problem? The box was so small nobody can even read what it says.
— October 1, 2011 3:57 a.m.