Saturday, March 29, 2008

The Financial Crisis – The Worst Is Yet To Come

Dear Friends,
A friend sent me the following article.Thought you would like to know.

The Financial Crisis – The Worst Is Yet To Come

A guru once told me that for most people, it is easier to accept and believe a lie than Truth. To accept truth is to accept a paradigm shift – a shift that challenges our perception, our comfort zone and the harsh rejection of a false reality for which we have been entombed.

Why do we allow ourselves to be lulled into a state of mind whereby we accept uncritically the propaganda by the financial elites in the mass media?

    1. There is so much information out there that it is just impossible to check and verify each and every bit of information. So we take the easy way out and assume that they are correct and verifiable.

    2. Thinking is hard work and we don't seem to have the time to think things through.

And that is why it is so easy to subdue the masses through propaganda. Anyone who challenges the official line will be demonized and labeled a pariah. It is just not worth the effort. Our mind ceases to function.

Try this exercise. In a normal working day, from the time you wake up to the time you go to bed, how many hours do you actually devote to thinking about issues that affect your life and your family?
Less than fifteen minutes!
In this article I would like to invite you to think critically about certain issues which will enable you to see through the lies and propaganda of the financial elites concerning the current global financial crisis.
For the purposes of this exercise, I will use the headlines of leading international newspapers.

First Headline

New York Times Sunday 16th March 2008: "JPMorgan Chase Says It Will Acquire Bear Stearns for $2 a Share."

The week preceding the sale of Bear Stearns, its shares were quoted at US$60 per share. The sale of Bear Stearns was broadcasted by all the major international news agencies. This was followed by the Fed's announcement on 18th March 2008, that it had reduced its target for the Federal Fund Rate 75 basis points to 2-1/4 percent.

The Dow went wild and rose over 400 points.
The official line then went out – The crisis is contained, the worst is over. The Market will rally. The good old days are back!

Please consider my reaction. "This is baloney! Horseshit and bullshit. If you are still in the market, take whatever gains and get out of the market!"

Let me now take you through my thinking process and show you how I arrived at my conclusions.

Step 1: I did a research of the price of Bear Stearns in the 4th quarter of 2007. It was quoted at US$180 per share. In early 2008, it went down to US$80. In early March, it plummeted to US$60 and just before the sale it was US$27.

Yet, JP Morgan Chase bought Bear Stearns for US$2 per share, paying approximately US$250 million.

Step 2: Further research showed that the HQ building was worth at least US1 billion. Therefore, Bear Stearns' liabilities must be horrendous and taking everything into consideration, the quoted price of US$27 on Friday, 14th March 2008 was either overvalued or JP Morgan took advantage of the situation to demand from the Fed, as a condition for taking over Bear Stearns, that it must be at bargain basement price.

Step 3: Given this scenario of a leading global investment bank in such dire situation, how can anyone trust the valuations of the other global banks that are equally exposed to the toxic wastes of sub-prime mortgages, CDOs, CLOs, CDSs etc.

Step 4: The deal was structured and finalized between the Fed, JP Morgan Chase and Bear Stearns on Sunday, 16th March 2008. There can be only one conclusion – such drastic and rapid intervention by the Fed on Sunday is to prevent the total collapse of Bear Stearns before the opening bell on Monday. This back room deal stinks!

Bear Stearns is therefore insolvent, bankrupt in layman's terms.

Yet prior to this collapse, financial analysts of leading financial newspapers and brokerage houses were giving clients the "buy" signal. So does it make any sense to rely on such advice without thinking through?

There is no such thing as a "free market". It is only "free" for the big boys of Wall Street to make money out of suckers, and should the market turn against them the Central Banks are "free" to intervene to bail them out at the expense of the small guys! This is the stark reality in every major depression and recession in the last century. The coming depression will be no exception. People will put up with this nonsense and rip-off and allow the fat cats to get away with this massive fraud and wealth transfer.

Second Headline:

Thomson Financial -12th March 2008

"The International Monetary Fund (IMF) today warned authorities worldwide to 'think the unthinkable' in planning to cope with a mounting crisis in the global financial system."

Given this warning by none other than the IMF, why are people still debating whether there is a global financial crisis? Why is our government insisting that Malaysia will not be affected by this mess? Why are people accepting President Bush's assessment that here is no recession in the US?

Once again, let's go through the thinking process.

What can be the "Unthinkable" referred to in the above quote?

Why is the IMF avoiding the use of the word "Depression"?

Therefore, to think the unthinkable is to adopt a paradigm shift, to prepare for the worst scenario. Yet, there are people who refuse to accept this reality. It is just mind boggling.

Those of you who have followed my "Red Alerts" since last year but refused to accept my prognosis will have to reckon with the IMF assessment, albeit nine months behind the curve!

The IMF has now wised up to reality and is taking corrective measures. I suggest that you prepare yourself for the coming financial Tsunami.

Tuesday, March 18, 2008

An Intro to "Healthy" Living


Q: I've heard that cardiovascular exercise can prolong life; is this true?
A: Your heart is only good for so many beats, and that's it... don't waste them on exercise. Everything wears out eventually. Speeding up your heart will not make you live longer; that's like saying you can extend the life of your car by driving it faster. Want to live longer? Take a nap.

Q: Should I cut down on meat and eat more fruits and vegetables?
A: You must grasp logistical efficiencies. What does a cow eat? Hay and corn. And what are these? Vegetables. So a steak is nothing more than an efficient mechanism of delivering vegetables to your system. Need grain? Eat chicken. Beef is also a good source of field grass (green leafy vegetable). And a pork chop can give you 100% of your recommended daily allowance of vegetable products.

Q: Should I reduce my alcohol intake?
A: No, not at all. Wine is made from fruit. Brandy is distilled wine, that means they take the water out of the fruity bit so you get even more of the goodness that way. Beer is also made out of grain. Bottoms up!

Q: How can I calculate my body/fat ratio?
A: Well, if you have a body and you have fat, your ratio is one to one. If you have two bodies, your ratio is two to one, etc.

Q: What are some of the advantages of participating in a regular exercise program?
A: Can't think of a single one, sorry. My philosophy is: No Pain = Good !

Q: Aren't fried foods bad for you?
A: YOU'RE NOT LISTENING!!!... Foods are fried these days in vegetable oil. In fact, they're permeated in it. How could getting more vegetables be bad for you?

Q: Will sit-ups help prevent me from getting a little soft around the middle?
A: Definitely not! When you exercise a muscle, it gets bigger. You should only be doing sit-ups if you want a bigger stomach.

Q: Is chocolate bad for me?
A: Are you crazy? HELLO . Cocoa beans! Another vegetable!!! It's the best feel-good food around!

Q: Is swimming good for your figure?
A: If swimming is good for your figure, explain whales to me.

Q: Is getting in-shape important for my lifestyle?
A: Hey! 'Round' is a shape!

Wednesday, March 05, 2008

The E! Channel is starting to irritate me

When Astro (Malaysia's only satellite T.V provider) announced that they will be adding the E! Channel, I was very excited. Celebrity and Entertainment news 24 hours a day? , "Woohoo!" I screamed. After a few months, I must say the novelty has worn off. I find myself getting extremely irritated by the 'up beat-ness' of it all. I mean seriously, how excited can you be that Brittney has finally found some time to see her children!? Then again, why the hell do we care? I blame the E! Channel for making it news to begin with. To hell with Britney, Paris, Lindsey and whoever else. But I'm getting a little side tracked here, my beef is with the E! Channel and those irritating fuckers on 'The Daily Ten'.

Ryan Seacrest, Giuliana Dipandi Rancic, Debbie Matenopoulos, Catt Sadler and Sal Masekela are all astronomically irritating. From the sound of their voices to the their 'up-beat' style, they have collectively put me off watching the E! Channel all together. Maybe its the excessive repeats or maybe its the content, but all I know is, if I see the channel is on, I change it or switch the T.V off! In my house, the other inhabitants insist on keeping the E! Channel on even if no one is watching. As if, the sudden news of Heath Ledger's untimely demise has any bearing on their lives. Not to mention the numerous follow up investigation specials on why he took his life. Bah!

Oh lets not forget, the recent Academy Awards (or any other excuse for celebrities to get together) and how the E! Channel basks in the glory of its godly know-it-all attitude. "Oh look, she is wearing green, that's was sooooo last season, but we love the shoes!" Two hours of red carpet pre-Oscars bullshit and then of course the countless post-Oscars crap. Dissecting everything to who wore what and why. Who arrived with who and said what. Who got sad to who was the most drunk. Utter utter nonsense.

Its funny, if you watch too much E!, you find yourself becoming more and more stupid. Seriously, you will feel as if your brain is melting. If you don't believe me, try it. I give you just 30 minutes, and you will know what I'm talking about here. I think if you want to torture someone, lock them up in a room, tie them down to a wooden chair, have them watch repeats of the Daily Ten with the sound blasting loudly. Ryan Seacrest's voice will bounce around in you head until you die, like it has throughout me writing this........ I have to stop now.

Macam P

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