this is real journalism

[PartridgeRun]

For all the peeps who would like to read good quality info about the why's and the how's of the economic crisis we're in, I found this GEM.

http://www.deepcapture.com/

This is investigative journalism at it's absolute best!
Honestly, these guys have been sounding the trumpets for a long time, no one would listen and now the mitten has most definitely hit the windmill...the invisible fist of the free market on it's trajectory - straight and true - WHAMMO!
we're in for some VERY interesting times ahead indeed...

--edit--
here is a segment with one of the main players behind the site

http://www.youtube.com/watch?v=SIHw7C73s3E

[Teazer]

Short selling does make things rough on companies that are under capitalized, and that puts pressure on management when the share price drops, but it does have its benefits. However, if traders are actually shorting shares that not only they don't own, but don't even borrow, then they should get jumped on hard. I wouldn't say that would cause the current crisis, but it would add to the (justifiable in some cases) kicking some companies are getting beyond what is productive. IMO though given many stocks are somewhat illiquid, particularly in a financial crisis, bringing back the uptick rule would be a nice way of limiting & smoothing the speed and amount that shares can go down due to shorting pressure while still retaining their beneficial effects when stocks are going up faster than is justifiable.

[Michael]

Yeah, I heard another economist saying they gotta bring back the uptick rule. Maybe too little, too late for the current situation, though.

[PartridgeRun]

Hi Teazer :

If you don't think that one extremely important component of this crisis is naked short-selling, then I'm afraid you just haven't done your homework. The driver of the catastrophe is the criminal activity of wall-street sociopaths that have been engaging in the largest robbery in history...the incompetence of journalists and politicians in handling and putting an end to that activity (naked short-selling) boggles the mind really.
This is fraud on a truly massive scale....truly massive.
You have some very frightened experts saying, that if the system can't handle this and find a way to evolve out of it and coming out a better system...it will likely come to civil action in America.

...then you figure in peak-oil and you know that this is just the beginning of the end of an era...

[Muad'dib]

Oil is at $80 a barrel...

[PartridgeRun]

Oil is at $80 a barrel...

what's your point?
The "peak-oil forecast" is exactly telling us that extreme price-volatility will be the common scenario as peak-production sets in. It's goddamn unfortunate that short-term price oscillations help mask the long-term trend in resource extraction.

Think about this; the people behind the link I posted upthread predicted the financial collapse in very precise terms... they were spot on.

The peak-oil theory rests on the work of geophysicist M.King Hubbard. He pioneered a modelling-technique with which he predicted that american oil-production would peak in 1970, he did this in 1956...spot on. The theoretical foundation of Hubbert-curves have since been expanded upon, and have they been employed in predicting the peak of oil-production in the North Sea...again right on the money.

The value of any theory lies in it's predictive power - and that pretty much sums it up right there.
There are a lot of very hardworking people, who have been presenting hard, solid data in an attempt to warn the political elite of the western world for a very long time. Nobody listened and now we're all gonna get it. It is as simple as that.
The Goon is coming to collect and we're gonna get it...

[Muad'dib]

The ice age is coming, the ice age is coming...

Seriously Chicken Little, its not that I don't agree with you, its just that I have a hard time taking people with a holier than thou attitude seriously. It's repugnant. I should know, I do it all the time.

[Teazer]

If you don't think that one extremely important component of this crisis is naked short-selling, then I'm afraid you just haven't done your homework.

... and your credible evidence for this supposition?

[PartridgeRun]

... and your credible evidence for this supposition?

You could go to http://www.thesanitycheck.com/, plenty of evidence there.
Or you could actually try to read the material on deepcapture.com.

The ice age is coming, the ice age is coming...

Seriously Chicken Little, its not that I don't agree with you, its just that I have a hard time taking people with a holier than thou attitude seriously. It's repugnant. I should know, I do it all the time.

yada yada yada...
And I have a hard time taking people who like to pop out and take opportunistic swipes at people seriously, even when they try to smooth it over with self-professions afterwards.

Seriously though, I'm not here to revel in that holier than thou attitude, being born in the western world I'm just as guilty as the next guy.
When posting I try to keep it factual - too bad if that rubs you the wrong way.

[Andy_S]

Nice, but what is new in this? There was an excellent piece in Vanity Fair some months back on the fall of Bear (the hack interviewed a lot of Bear and other sources). The final point was though, that the criminals (almost certainly hedge funds with short positions on Bear) remain unknown: Shorters are very, very difficult to catch, and it is uncertain if the SEC is up to the job, given current laws.

More broadly, is this the end of investment banks as we know them?

My understanding is that this crisis is the result of rules that allowed banks to do a lot of things IBs used to do - forcing IBs to take riskier and riskier positions. Nothing wrong with risk - but if you are an IB, you have no deposit base, pretty much all you have is leverage. If you are a bank you have a capital base, and you have a legal, fiduciary duty NOT to risk the capital base of your depositors. IBs could do what they did, as their investors, funds and high-wealth individuals, understood that they COULD lose. A bank depositor, OTOH, does not risk his capital, he puts it in a safe place where it will accumulate interest.

One thing I did agree strongly with in the piece is that there is a certain cosmic justice to this. The arrogance of the Street needed tempering. The best outcome of this crisis might be to bring us back to a more conservative financial system across the board, but particularly, at the top.