The Who

by Larry Levin

The time is almost upon us, and I'm not talking about Halloween. Next week millions of Americans will be casting ballots to elect the next President of the United States. I am not partial to either candidate since both offer nothing new. Regardless of who is elected I can imagine one thing - we'll all be singing Won't Get Fooled Again from The Who.

In the mean time, wouldn't it be very refreshing to hear the following from a politician?

In the last few weeks I have come to realize that I, along with the rest of America, have been bamboozled for more than 20 years by a group of men and women who have robbed us all for their personal benefit. You, I, and everyone else in this great nation have been systematically lied to regarding our economy. We are suffering a historic stock market crash, along with record rates of foreclosure and economic suffering, as a direct consequence of these lies colliding with the laws of mathematics.

If you elect me, every one of these bastards who created the economic mess we are in is going to prison. All of them. All the "captains of industry", all the ratings agency executives, maybe even some members of Congress, Treasury, the SEC and the Fed. Every last one of the people who knew and didn't tell the American People, every last person who lied in front of Congress as to the state of the American economy, every person who leaked some sort of information and every executive in a firm who knowingly presented a misleading financial statement anywhere - on TV, in the press, in their published quarterly reports. All of them. The FBI and Justice Department will be the only branch of government that will grow in size, and grow mightily it will, because we are going to lock up each and every one of these people.

Every financial institution that is operating with excessive leverage is going to stop that immediately. There are dozens of large foreign banks that have played a vital part in creating this mess, and some of them who are listed on our stock exchanges or have offices here in the United States. Every one of those firms is going to conform to our rules or leave our shores on January 21st.

The house price appreciation you "enjoyed" was, as you've seen, a fraud. If you elect me you may lose your home, but you'll be able to buy it back at half price once you're foreclosed and prices correct to a sustainable level. While this sounds cruel, if you think about it for a while you will realize it's in your best interest - your mortgage payment will drop in half too, because your house price will be cut in half. Those intelligent banks will write down principal rather than foreclose because it's cheaper for them to lose 40% than to lose 60%; the foolish will force you to rent for a year or two while this process completes. We will urge lenders to be intelligent, but if they're not, they will go bust, so at least your pain will be theirs. For those lenders and banks that go under, not one dime will be paid in severance or golden parachutes, and if they try it, those executives will go to prison as well. We will claw back every nickel we can from those firms and individuals who have illicitly profited from this bubble, starting with the executives of firms who have failed or been "absorbed."

There are many who think that we have had "too much capitalism." In fact we haven't had capitalism at all - we have had blatant fraud and theft instead. A capitalist society is one in which those who make bad decisions fail and go bankrupt, not one in which those who fail are rescued by taxpayer money. A capitalist society does not reward those who lie, cheat and commit fraud with bailouts and handouts. A capitalist society does not allow its Treasury and Federal Reserve to operate in the dark of night, choosing winners and losers among financial and other firms.

All of these abuses are part and parcel of why we are in this mess, and all will end the day of my inauguration.

We will not spend more than we make in my administration and you will have to live with not spending more than you make. "Saving" is not a dirty word. It is, in fact, the only legitimate base against which to lend. Those firms and individuals who have spent the last twenty years under both Republican and Democrat Congresses and Presidents living a lie must adjust to truth and reality, and do it now. I will force through Congress my first week in office a bill reversing the so-called "bankruptcy reforms"; every American who gets in over their head will be able to file Chapter 7 and stick it where it belongs - on the lenders who made the imprudent loans. You will not get off scot free, as your credit will be ruined for seven years and your Hummers, vacation homes and other toys will be gone, but you won't be forced into debt slavery either. It is only just that if a company can go bankrupt no matter its size and income, discharging its debts, so should you be able to.

It is time for America to face the facts: Our entitlement systems and the explosion of easy credit have made promises that cannot be fulfilled. This is not a question of political will or desire; it is the laws of mathematics.

You can vote for the other guy who has promised you that which is mathematically impossible to deliver, in which case you are voting to destroy this nation, and that is precisely what will happen if you vote for him. You have only seen the beginning of the carnage and pain that will be served upon our economy and stock market if you vote to continue to spend more than we make, attempting to vote yourself a paycheck and refusing to address head on the pernicious fraud and abuse throughout Wall Street, Main Street, K Street and Washington DC.

Or you can vote for me, and I will, from my first day of office forward, operate an administration that will force the bad debt into the open where it defaults, force the frauds and phonies into the court system where they will be tried for their crimes, and set right our national budget, our economy and our trade policy.

Taking the course that preserves America will not be easy. It will not be painless. But you may rest assured that if you choose me to lead this charge, these promises will be fulfilled, our nation will be purged of this pernicious and outrageous fraud, and if you suffer, those who perpetrated this fraud upon you will have justice, and their just punishment, meted out to them.

Thank you, and may God Bless America. (From Karl Denninger of The Market ticker)

The Who, Won't Get Fooled Again (partial lyrics)

I'll tip my hat to the new constitution
Take a bow for the new revolution
Smile and grin at the change all around
Pick up my guitar and play
Just like yesterday
Then I'll get on my knees and pray
We don't get fooled again
No, no!

There's nothing in the streets
Looks any different to me
And the slogans are replaced, by-the-bye
And the parting on the left
Are now parting on the right
And the beards have all grown longer overnight.

Meet the new boss
Same as the old boss!!

Until a politician has the guts to say something like what's above, nothing will change.


Previous Day's Trading Room Results:

Trade Date: 10/27/08

E-Mini S&P Trades*
(before fees and commissions):


1) PP sell @ 8:45am at 866.50 = -1.75 (1 lot)

2) IDVA buy @ 11:15am at 874.25 = -2.00 (1 lot)

3) VA buy @ 1:15pm at 880.00 = -1.50 (1 lot)

4) OTF sell @ 2:10pm at 877.00 = +3.50

5) Algorithm positions (3)...combined total...+2.50

ZB (30 Year Bond) Trades*
(before fees and commissions):


1) No trades.



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