[yesplease]

$this->bbcode_second_pass_quote('Cid_Yama', 'B')ull Crap! The markets, the environment, geopolitical relations have steadily degenerated over the last couple years. Because we haven't experienced total armageddon yet, doesn't mean we aren't hurting and moving ever closer.

[yesplease]

Like I said, it ain't my mouth. I'm sure there are others who are willing to take it, but it ain't something (unlike the relatively sure fire stuff I've wagered on in the past) I would take.

[Minvaren]

$this->bbcode_second_pass_quote('Zardoz', '')$this->bbcode_second_pass_quote('OilFinder2', 'I')t's been about a month-and-a-quarter since the prediction. Still waiting for that market shutdown.

[Cid_Yama]

Oh, it's coming alright. Like I said, <i>it was all that "recovery in the 2nd quarter" then "recovery in the 3rd quarter" and "no recession," that has proved to be false.</i> Just because the worst hasn't happened <b>yet</b>, doesn't mean it isn't barreling down on us like a locomotive.

There is a Big Picture within which all of this operates, and that picture is very scary. Some people on here act like all possible outcomes are weighted evenly. Far from it, and the optimists are living in fantasy land.

The world as you knew it has already ended, <b>NEVER</b> to return.
Global shipping for all practical purposes has shut down. This should be like a wailing siren.
Goods are sitting dockside in filled shipping containers going nowhere. Shipping containers have become unavailable, shutting down business down the line.
Producers are not getting paid and being forced to shut down.
Materials suppliers are not getting orders and are shutting down.
Farmers are not planting because they can't get the lines of credit they need. Come harvest time there will be nothing to harvest.
Ranchers are culling their herds, because they can't get the lines of credit necessary to feed them over the winter.
In the Dakotas they couldn't get the propane necessary to dry their corn, so it couldn't be harvested.

The whole chain of commerce is coming apart. 2 years from now, you will experience the truth of this unequivocally. Can you survive without grocery stores or gas stations? Can you survive the hordes of starving unemployed human locusts?

Get a macro perspective.

[Cid_Yama]

<b>Hedge fund assets fall $170 billion in third quarter</b>

Global hedge fund industry assets fell by $170 billion in the third quarter of 2008 as negative returns of more than 10 percent combined with heavy net outflows, research firm Lipper TASS said.

The data provider said there was a net outflow of $18.6 billion in the third quarter, reversing the trend of the previous two quarters.

The figures appear to confirm fears that investors spooked by the market turmoil have withdrawn from hedge fund products seen as opaque or too complex.

All hedge fund sub-strategies measured by Credit Suisse/Tremont posted negative returns in the quarter.
link

<b>Shareholders Flee Fortress</b>

Fortress Investment Group, the listed private equity and hedge fund group, has ­suspended redemptions at its flagship Drawbridge Global Macro Fund after investors sought to withdraw more than $3.5bn in funds, ­according to a regulatory ­filing on Wednesday.

Fortress took the action, at least in part, because the fund – which had $8bn under management as recently as September – has to keep a minimum level of assets or risk having to unwind ­derivatives trades, a person familiar with the matter said.

Fortress shares closed down 63 cents, or 25 per cent, at $1.87 in New York. It has lost about 88 per cent of its value this year and now has a market capitalisation of about $773m.

In its filing with the ­Securities and Exchange Commission, Fortress estimated that the Drawbridge fund would have assets of $3.65bn by January 1. The decline reflects both investment losses and earlier withdrawals.

Fortress’s decision to ­suspend redemptions comes at a time when the entire hedge fund industry is shrinking.

Testifying last month at a congressional hearing in Washington, hedge fund manager George Soros said that he expected the industry to shrink by about 75 per cent as a result of the ­combination of losses and withdrawals.
link

[JJ]

$this->bbcode_second_pass_quote('Cid_Yama', 'O')h, it's coming alright. Like I said, <i>it was all that "recovery in the 2nd quarter" then "recovery in the 3rd quarter" and "no recession," that has proved to be false.</i> Just because the worst hasn't happened <b>yet</b>, doesn't mean it isn't barreling down on us like a locomotive.
There is a Big Picture within which all of this operates, and that picture is very scary. Some people on here act like all possible outcomes are weighted evenly. Far from it, and the optimists are living in fantasy land.
The world as you knew it has already ended, <b>NEVER</b> to return.
Global shipping for all practical purposes has shut down. This should be like a wailing siren.
Goods are sitting dockside in filled shipping containers going nowhere. Shipping containers have become unavailable, shutting down business down the line.
Producers are not getting paid and being forced to shut down.
Materials suppliers are not getting orders and are shutting down.
Farmers are not planting because they can't get the lines of credit they need. Come harvest time there will be nothing to harvest.
Ranchers are culling their herds, because they can't get the lines of credit necessary to feed them over the winter.
In the Dakotas they couldn't get the propane necessary to dry their corn, so it couldn't be harvested.
The whole chain of commerce is coming apart. 2 years from now, you will experience the truth of this unequivocally. Can you survive without grocery stores or gas stations? Can you survive the hordes of starving unemployed human locusts? Get a macro perspective.

[wisconsin_cur]

$this->bbcode_second_pass_quote('Cid_Yama', 'T')he whole chain of commerce is coming apart. 2 years from now, you will experience the truth of this unequivocally. Can you survive without grocery stores or gas stations? Can you survive the hordes of starving unemployed human locusts? Get a macro perspective.

[Cid_Yama]

2 years is when even those with their heads buried deep will no longer be able to pretend it's not happening. 2009 will be the year that will be remembered as the year it all fell apart.

[Cid_Yama]

"It now seems silly that investors actually thought the multi-trillion [dollar] hedge fund industry could somehow post robust profits even in down markets. Apparently, expectations were that savvy fund managers would quickly reverse course - liquidating long exposure and increasing shorts - if and when markets began to turn."

I see where he is going with this, as the essential flaw in this theory is that it assumes that the guys who are taking the other side of my shift in my portfolio from long to short are some stupid bunch of yahoos who will say, "You want me to take the other side of your short by going long, even though the market is down, and has been going down, and every freaking technical indicator that anyone has ever thought up says the market will continue going down? Hahahaha!"

It turns out (and you might want to write this down) that there are not that many stupid yahoos anywhere, as Mr Tice seems to confirm when he says that "Not unpredictably, liquidity evaporated almost immediately as fear provoked selling from fearful investors, leveraged players facing margin calls, derivative traders dynamically hedging exposure, and others desperately trying to hedge market exposure."

But, since nobody trusts anybody since there is no reason to do so and every reason not to do so, then ain't nothing getting hedged, disproving yet another bit of stupid neo-Keynesian econometric claptrap upon which their whole preposterous theory depends, which, by this time, is so discredited as a theory that it is embarrassing that, as a country, we still believe such stupidity.

http://atimes.com/atimes/Global_Economy/JL06Dj01.html

[Cid_Yama]

<b>Bernard Madoff arrested over alleged $50 billion fraud</b>

Bernard Madoff, a quiet force on Wall Street for decades, was arrested and charged on Thursday with allegedly running a $50 billion "Ponzi scheme" in what may rank among the biggest fraud cases ever.

The former chairman of the Nasdaq Stock Market is best known as the founder of Bernard L. Madoff Investment Securities LLC, the closely-held market-making firm he launched in 1960. But he also ran a hedge fund that U.S. prosecutors said racked up $50 billion of fraudulent losses.

Madoff told senior employees of his firm on Wednesday that "it's all just one big lie" and that it was "basically, a giant Ponzi scheme," with estimated investor losses of about $50 billion, according to the U.S. Attorney's criminal complaint against him.

Authorities, citing a document filed by Madoff with the U.S. Securities and Exchange Commission on January 7, 2008, said Madoff's investment advisory business served between 11 and 25 clients and had a total of about $17.1 billion in assets under management. Those clients may have included other funds that in turn had many investors.

The SEC said it appeared that virtually all of the assets of his hedge fund business were missing.

The fraud alleged here could further encourage investors to pull money from hedge funds.

"This is a major blow to confidence that is already shattered -- anyone on the fence will probably try to take their money out," said Doug Kass, president of hedge fund Seabreeze Partners Management.
link

<i>How many of the hedge funds who have suspended redemptions, actually as empty as this one?</i>

[ReverseEngineer]

$this->bbcode_second_pass_quote('Cid_Yama', '&')lt;i>How many of the hedge funds who have suspended redemptions, actually as empty as this one?</i>

[Cid_Yama]

I can just picture the headlines:

<b>Most Hedge Funds Found 'Totally Looted', Managers on the Run</b>

[Cid_Yama]

<i>While it is almost impossible to calculate just how much money is being locked up against investors’ will, estimates run as high as $400bn. “There are more assets frozen in suspended hedge funds than the $325bn distributed to date under the Tarp,” says Marc Freed, a managing director at Lyster Watson, a fund of hedge funds.

At the same time that many fund managers are telling their investors that they can’t sell, one Goldman Sachs credit fund, which is down 55 per cent to the end of October, is letting investors out, even if it means selling at the current low levels.

That is a better alternative than the choices made at one Citigroup credit fund. Managers at that fund refused to let investors out since January last year, only to tell investors in November that they were winding up the fund and that investors can expect to receive back no more than ten cents on the dollar. (That recovery is far lower than the amount investors would have gotten back if they had been allowed out almost a year earlier.)</i>link

How much do you figure will be left by the end of 1st Q 2009?

That $400 billion is toast.

[Cid_Yama]

<b>Madoff Losses could be even higher than $50 billion and extend to the rest of the hedge fund industry</b>

Throughout the rumor-fueled hedge fund world on Friday, money managers were comparing notes and assessing losses. By all accounts, they run broad and deep — in the billions.

Mr. Merkin, a prominent philanthropist and the founder of several hedge funds, including one called Ascot Partners, jolted his clients on Thursday with a letter announcing that “substantially all” of that fund’s $1.8 billion in assets were invested with Mr. Madoff.

“As one of the largest investors in our fund, I have also suffered major losses from this catastrophe,” Mr. Merkin said in the letter.

“These investors were never aware that all of their money was invested with Madoff,” Mr. Susman said. “They are obviously shocked.”
link

City Superwoman Nicola Horlick is among the victims of a Wall Street broker thought to have lost $50 billion in what may be the world's biggest fraud.
Horlick's company Bramdean Alternatives had $20.9million invested in Bernard Madoff's hedge fund scam - some 9.5 per cent of it's assets.

Horlick and her clients are not alone - some of America's wealthiest socialites are facing ruin after Madoff was accused of masterminding a financial con of 'epic proportions'.
link

The $50billion(£35billion) estimate of fraudulent losses outlined in court papers is second only to the $63.4billion crash of oil company Enron in the U.S. financial hall of shame.

Prosecutors fear Madoff's losses could go even higher.

<i>Everyone is aware of the herd mentality of the hedge funds. How many other hedge funds were invested through Madoff with their investors unaware?</i>

[dohboi]

“There are more assets frozen in suspended hedge funds than the $325bn distributed to date under the Tarp”

This is clearly an enormous understatement. The main question is:

By what order of magnitude do assets in troubled hedge funds exceed the amount so far distributed under TARP?

Clearly it is more than 10 times, even 100 times, since CDSs alone are said to be in the range of $60T. It is likely, then closer to 1000 times or more, approaching or even exceeding one quadrillion dollars.

The US government is no where close to throwing that much money at the problem. But until they do, it is essentially throwing money down the toilet.

Frankly, nothing is going to stop this thing.

The governments of the world should just agree to hunt down all who were involved in this fiasco, confiscating all their money, and putting them to work on farms growing turnips.

Oops, the governments are all owned by these guys already.

Oh, well.

[Cid_Yama]

The hedge funds have been hearing the tolling of the bell since the Madoff thing broke.

If anyone thinks hedge funds will still exist after the 1st Quarter redemptions, they are fooling themselves.

Managed funds are dead, and managers need to start liquidations now or start looking for countries lacking extradition. Good luck on that, since this thing is global.

Obama wants to put people to work? I know a bunch of people from the financial industry who just happen to need jobs and can be sent out to audit each and every managed fund in <b>teams</b> so as to avoid any hanky panky. And other teams to do auditor oversight. You want to renew confidence? It's time to get out the aircraft lights and illuminate every darkened shadow in every nook and cranny.

$this->bbcode_second_pass_quote('OilFinder2', '')$this->bbcode_second_pass_quote('billg', 'N')otice he says "in coming days", not in the coming weeks or months.
$this->bbcode_second_pass_quote('', '[')...]''Systemic risk has become bigger and bigger,'' Roubini said at the Hedge 2008 conference. ''We're seeing the beginning of a run on a big chunk of the hedge funds,'' and ''don't be surprised if policy makers need to close down markets for a week or two in coming days,'' he said.[...]

[manu]

A big collapse is coming right after Christmas. Have a happy New Year Everyone.

[Carlhole]

Didn't see this posted anywhere yet.

View From The Markets/FT.com

$this->bbcode_second_pass_quote('', 'D')ec 17. -- Nouriel Roubini, Professor of Economics at the Stern School of Business at NYU and chairman of RGE monitor, expects 2009 to be a year of economic stagflation and recession for most of the global economy. He expects a severe, global recession. Whether or not it persists into 2010 will depend on how aggressive and effective policy actions are: monetary and fiscal policy and efforts to recapitalize financial institutions in the US and elsewhere. He believes there could be a return to positive economic growth by 2010. The European Central Bank should follow the Federal Reserve cut interest rates further. The US needs a plan to reduce the debt burden to US households. The remedies will cost taxpayers a lot of money.

[Typo]

Positive economic growth in 2010? Ha! Doesn't he read PO.com? If he did, he would know that the end of the world is imminent.