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Jul
15
Written by:
bobo
7/15/2008 2:59 AM
Here's what you won't be hearing any time soon, or reading about in the NY Financial press: "Easter Bunny's prediction of massive, pervasive naked shorting crisis comes to fruition, destroys US market." "Patrick Byrne's call that system is in danger of vapor locking due to illegal market manipulation cause by NSS now 100% dead on." "Bob O'Brien spelled out exactly how NSS will cause systemic meltdown and erosion of public confidence in US markets, and is completely correct on all counts."
Nope.
What we are seeing is the US markets relentlessly melting down, as even the bulge bracket firms, and the "too big to fail" entities, are victimized by unbridled, unconstrained naked short selling. Exactly as used to be the case in the 1920's. Exactly in the manner that resulted in the SEC being formed, and the uptick rule (discarded just a few short months back as an anachronism), and requirements for timely clearing and delivery. All of which the SEC has basically ignored, very deliberately.
While the national net worth is stolen, and the markets are rendered a cesspool of crookery that makes an Afghan flea market seem rigidly honest.
Cox is going to introduce an emergency rule requiring that short sellers actually borrow the stock they then sell - in the two largest holders of mortgages in the nation. Why? Because apparently it is OK to put thousands of companies out of business using the same technique, but when it becomes so obvious that the taxpayers are going to get stuck with a massive obligation due to the bear raid and resulting crisis of confidence that nobody can pretend it isn't happening anymore, the SEC has to act. Sort of is forced to.
Pure tripe. Ass covering. And it won't work. Because it will likely lack adequate penalties, and be so deliberately poorly written and structured that any serious legal challenge will overturn it.
This is how the SEC intends to pretend it is doing something, when for the last decade it has deliberately and studiously done nothing but aid and abet the predators. And even as it does something, mark my words, in the end, it will be shown clearly that it did nothing but help the crooks. This is a grandstanding sham, wherein the SEC does something in this "emergency" to appear active and on the ball.
I predicted that we would see a financial calamity, which would put the entire burden of years of unbridled crookery by wall street, squarely on the backs of the taxpayers. And here we are. I also predicted that the SEC would use this entire contrived disaster to let the criminals off the hook for robbing the nation of its retirement savings. That is still to come, but mark my words, it's a coming. I expect what I described two years ago, where the government basically allows all the naked shorts to close out at current mark to market, essentially rewarding the largest financial theft in history, and rendering the constitutional protection of property rights a farce. That's the only way this can be cleaned up - we, the investors lose everything, and the guys who drove all our companies into the toilet get to keep 100% of the money they generated doing so.
Patrick just issued a statement on this that sort of says it all, albeit much more politely than I do. So much for equality under the law. Depends upon how much juice one has, I suppose. And the ugliest part about all of this is that the Wall Street firms also singled out for special protection by Cox, are the very same firms that largely made this illegal and predatory scam possible, and which benefited hugely from the practice.
Billions and billions and billions made, raping the future of America via its public companies and their capitalizations. The destruction of GDP for profit, unchecked by any of the entities chartered with ensuring it would never happen.
As to who is sucking out all the money being gained by gaming the system, how do you think so many hedge fund managers are making close to a billion a year, or more, without generating anything? No new drugs, no shoelaces, no intellectual property....nothing. Just pulling the money out of the market. They win. You lose. You pay, they collect. And the fact that so many have done so many illegal things for so long ensures that it is not only pervasive, but that they are "too big to fail, or have too much juice to stop or prosecute." For example, you have the secretary of the treasury being the guy who ran Goldman when the most massive crookery in history was going on, and they created every variety of toxic derivative and bogus NSS scam I can think of (my opinion). This is the kind of guy I am describing. Someone running the country, who ran one of the big wall street firms that brought us to this point. Anyone seeing the irony here? Can anyone legitimately hope for any justice when crookery of this magnitude is rewarded thus?
We are in this situation precisely because the SEC decided to use the 1934 Act as asswipe, and behave as though the laws and rules requiring prompt settlement and delivery didn't apply to the brokerage community. The sleight of hand is well documented in the NIPC petition, which explains how there is no rule that allows the SEC to substitute flawed UCC state law for the federal securities laws, and yet they just go ahead and do it anyway, acting as though there is. That is the single most damaging thing the SEC has done, and it has created this entire nightmare.
If federal securities law was actually enforced by the SEC, then trades would be broken at T+3 when the share didn't arrive to make the securities entitlement shown in the customer account good. Instead, the SEC allows that securities entitlement to function like a share, but absent the actual share.
It's called counterfeiting, or rather, trading in unregistered securities. The 33 and 34 Acts outlaw it. But the SEC allows it, which allows brokers to not break trades once no share shows up, but instead to represent ever greater numbers of securities entitlements in the system, absent shares to support them, and trading exactly like genuine securities. Those securities entitlements that aren't allowed to exist per federal securities law once the share doesn't show up, instead trade like stock, are bought and sold, and have contaminated the entire system with a rot so pervasive as to be unfixable. The SEC deliberately did this. It wasn't accidental. It knows it's position and behavior violates federal law. But it doesn't care, because it figures you are all too stupid to get it, or to stop them.
It's a con game. They know it. They understand it. It is spelled out clearly in the NIPC petition. They have no answer, or counter to the charge. They simply ignore it, hoping that the bleating flock doesn't get it. Good bet.
And now, their refusal to rein in predatory, rampant naked short selling, in spite of a massive campaign by Patrick, and 4 years of alarm bell sounding on this blog, and even more and longer alarms by Dave Patch and Bud Burrell, has resulted in a complete breakdown in the functioning of the American market system.
The most disturbing part about this, aside from the obvious, is that, as Patrick points out, we are now officially a double standard financial market. If you are important to the nation's staying solvent, you have one set of rules and are protected, albeit in a sham manner. If you are "just" a normal company, you have another set of rules. You are the girl in the bar it is OK to rape. Paris Hilton? Tut tut, bodyguards everywhere to protect her. You?
A hussy who was asking for it. This astounding de facto admission from the SEC underscores that the whole conceit of a fair and balanced system is a lie and a sham.
What is insulting is not just that nobody is going to actually acknowledge that this was all preventable, and called well in advance by guys like me. No, it is that the SEC and elected officials obviously feel it is absolutely OK to allow unbridled criminal manipulation in small companies, and then later in medium sized companies, and now, in the largest entities on the planet. It's only when the biggest banks and financial institutions in the country are being put out of business that they suddenly pretend that they just discovered that selling stock that doesn't exist could be, well, er, negative for capital formation, investor protection, and the integrity of the markets.
No kidding.
Huh.
I mean, that is so unexpected. Imagine. Selling possibly trillions of dollars of non-existent stock, with the nudge nudge wink wink approval of the SEC, could eventually damage the whole system irreparably. That is so hard to grasp. Really.
What sickens me is that the structural deficiency could be largely solved by eliminating the market maker exemption, requiring the SEC to uphold federal securities law on security entitlements (and not pretend UCC preempts federal law), and requiring a pre-borrow on all short sales. But it won't be. They won't do it. They will instead engage in a series of half measures that won't actually do any good, and will result in the bankruptcy of the country in short order.
And you can go back over the years of blogs here, and read exactly how it was trumpeted to everyone that would listen, that this would destroy the US market system so 500 obscenely rich white guys could steal the national net worth. Just as a much smaller number did in the S&L crisis, at a much smaller level.
And you will never hear that it was all foretold, well in advance, by an extremely vocal minority that tried everything and anything to avert the disaster. Nope. I won't be mentioned, Patrick is invisible to the press, and everyone pretends that there was never any canary in the mine shaft. And even now, the captive NY press continues to advance the transparent lie that obvious and massive market manipulation didn´t cause the destruction of share prices in these huge companies, but rather, a sudden, spontaneous recognition that they were bad companies did. Sort of like the dot com implosion stole TRILLIONS of market cap, when one day the entire market realized that it was all hogwash and decided to sell in unison. I guess when you own the printing presses, you can argue whatever hogwash you like. It is NEVER the bad guys doing it, ALWAYS the company´s fault. Repeat until no more market is left to discuss.
This sort of a civilization is doomed, I'm afraid. That's the only conclusion I can arrive at. And when the population finds itself share croppers on land their fathers fought and died to protect, essentially serfs to the new owner/master structure that they owe everything they will ever make to, the only positive is that a few can honestly say, I told you so.
Small consolation.
Copyright ©2008 Bob O'Brien
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44 comment(s) so far...
Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Amen.
By Bob on
7/15/2008 10:52 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
I wish I had some money to move to Scotland...this fucken government sucks...
By stryker-ny on
7/15/2008 12:04 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Will Herb Greenburg be making a soundbite on CNBC to inform the SEC that Naked Short sales don't exist?
By Admiral Ackbar on
7/15/2008 12:07 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
They are all part of the same club and they all protect each other, but all is not lost. The club doesn't have that many members. Why can't we have those 500 rich white guys arrested and charged with treason?
William Donaldson founded Donaldson, Lufkin & Jenrette Securities. Their subsidiary, Pershing, was sold to BNY and has the largest declared failure to deliver of any clearing brokerage. When he headed the SEC, he stonewalled any attempts at settlement.
Many believe naked shorting is used to facilitate money laundering. Now, the Russian government is suing the bank of NY for just that.
I hate to get into conspiracy theories, but George Bush, John Kerry and William Donaldson are all members of a club named skull and bones, a group that only adds a handful of members per year.
http://tinyurl.com/5w4h9f
You can't help but read the news stories in these links and wonder if the network that has captured the SEC and many of our politicians is also the beneficiary of this crime.
http://tinyurl.com/5w8kmr
http://tinyurl.com/5sgkev
http://tinyurl.com/5nbzm3
http://tinyurl.com/5f7g7x
http://tinyurl.com/5w4h9f
http://www.pershing.com/statementoffinancialcondition.pdf
Securities failed to deliver $730 million
Securities failed to receive $968 million
By putting the pieces together on
7/15/2008 12:13 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Youve obviously never spent serious time in scotland. Basically, they scotch anything that isn´t bolted down, which means the roll it in batter and meat and fry it. That, and the sun is an unknown entity.
But agreed that mostly anywhere would be better than here, now, as the system becomes akin to the worst of the black market economies - at least in Russia, it´s sort of official that the mob runs much of the country. Here, same thing, but the pretense of superiority is offensive.
By bobo on
7/15/2008 12:25 PM
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Re: SEC
SEC moves on short sellers
Reuters-by Rachelle Younglai; Editing by Tim Dobbyn
WASHINGTON (Reuters) - The Securities and Exchange Commission will issue an emergency rule later on Tuesday to stop "naked" short selling in major financial firms, including Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE), the SEC said.
Short sellers borrow shares they consider overvalued and sell them. If the price drops, they repurchase the shares, return them and pocket the difference.
In a naked short sale, the investor sells stock that has not yet been borrowed. Sellers sometimes deliberately fail to deliver securities as part of a scheme to manipulate the stock price.
The emergency rule would require any person making a short sale in the listed securities to borrow the securities before the short sale is effected [sic] and deliver the securities on the settlement date.
The SEC has already proposed rules to curb naked short selling abuses and prevent market price manipulation.
By j on
7/15/2008 1:57 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Too little too late...justice delayed is justice denied.
By indentured servant on
7/15/2008 1:58 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
The rule just lays some outer boundaries so the scheme can go on longer. Just avoid our buddies the broker-dealers and major companies that will garner too much publicity. They can continue their plans with the small caps where not too many people are watching them. In the true nature of greed though they feel they are above the law and ignore measures to reign them in. I'm sure they can continue with NSS the majorfinancials and companies by using more obscure dealers offshore.However, exposure will be likely if they further threaten the whole financial system. I don't think they can blame the whole thing on subprime and Alt-A loans.
Is that 500 figure just a guess? Are you planning on having your book published? I imagine it tells a better. more complete story than the Naked Truth. Although it was good at explaining inside company fraud I look forward to a more thoroughly documented work on NSS.
By Trigger on
7/15/2008 2:28 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
A couple of quick thoughts:
1) Before making a heretofore unheard of emergency move like this I think we can assume that the SEC noticed a disproportionately high number of FTDs in recent trades in re: Fannie and Freddie. Otherwise it would have been way too risky of a move for a regulator as tepid as the SEC is.
2) The unintended consequence of taking down our entire financial system does not phase these crooks in the least.
3) The protection of development stage corporations typically targeted in these attacks should be augmented with this move lest a double standard be set. It's now time to play "catch up" in providing protection for the investors in these companies. Why would a "government sponsored enterprise" that trades publicly be accorded any favorable protection from fraud?
4) Rule 10b-21 "highlighting the liability" of being found guilty of fraud and aiding and abeting crimes for those practicing abusive naked short selling (ANSS) which is due soon might just have some teeth to it via providing truly meaningful deterrence.
5) The eyes and ears of the entire world are now on this stage such that the educational opportunities provided by the sanity check.com, deepcapture.com, investigatethesec.com, antisocialmedia.com, etc. may now gain some traction.
6) The arguments made against the options market maker exception may also be bolstered as that "comment period" winds down.
7) The insanity of removing "the Uptick Rule" in the midst of the worldwide uproar over naked short selling frauds might lead to its reinstatement.
By Dr. Jim DeCosta on
7/15/2008 2:32 PM
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Re: Banks
I know everyone is posting about the imminent collapse of major US banks (Washington Mutual said they have plenty of ammunition, lets see) and soon the death of US dollar - Just off the record, down here in Mexico banks are now refusing transfers from US CHECKS!! That's enough nightmare for ME and says a lot about what's going on with the US economy!
I am already warning friends down here to buckle up because it will definitely will be a rough ride for Mexicans as well
Dollar Falls to Record Versus Euro; Credit Woes May Damp Growth - Bloomberg 7-15-08
By Pics... on
7/15/2008 3:00 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Dr. Jim, my gut says that any rule will be so full of holes you could drive a Humvee through it. This is a CYA move, methinks. They know how big this is. They also know it can't be stopped unless there are massive penalties for violating the rules, which so far we've never seen. While I don't mean to be pessimistic, betting against the SEC actually doing anything of substance to curb market manipulation by the most powerful entities in the country would so far have been a 100% winning proposition.
By bobo on
7/15/2008 2:52 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
http://www.moneymorning.com/2008/07/10/dark-pools/
According to the latest data, nearly 12% of daily U.S. stock-trading volume is presently conducted via the 40 or so Dark Pools operated by the "usual suspects."
By kevin on
7/15/2008 3:46 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
The SEC better act quick and extend all the protections (in whatever flawed form) to all securities, as Section 6(b)(5) does not allow the SEC to treat any parties unequally.
The relevant text:
"The rules of the exchange are designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, ......and, in general, to protect investors and the public interest; and are not designed to permit unfair discrimination between customers,
issuers, brokers, or dealers, or to regulate by virtue of any authority
conferred by this title matters not related to the purposes of this
title or the administration of the exchange."
By tommytoyz on
7/15/2008 4:03 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
I have become immune to the actions of the SEC. Nothing they do could suprise me. On the same note I have become immune to the stupidity of our populace, they also can not do anything and I MEAN ANYTHING, THAT WOULD SUPRISE ME. We have only one chance and that is a member of the media like Oreilly, Letterman, Leno do a expose followed by updates on the progress. The chances of that happening are nill or next to none. I come up with the same outcome as you my friend. I only wish that GW goes down big time with Herb Greenberg and Jim Cramer arm in arm.
By rtway on
7/15/2008 4:10 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Oh come on, Tommy. Next you are going to tell me that the rules require the SEC to force all participants to clear and settle promptly, and preclude exemptions that aren't in the best interests of investor protection. Please. That's so, well, 1934. This is now. It's a party. Everyone needs a stuffed shark and a hockey rink. What's wrong with you? Jeez...
By bobo on
7/15/2008 4:42 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
The whole system is built on bs and promises.
Even the federal deposit program only backs 1.5% of deposits. I am hearing from friends that it is possible for more than 10% of banks and more than half of brokerages to go under. What happens then? Consolidation of power to the people that are in the IN secret societies? 100% profit to the naked shorts and prime brokerages that failed to deliver?
The only way out is to devalue the currency or have 10+% inflation so debts priced in dollars become less onerous. Guess what, that's on the backs of the indentured servants that sign away the next 25 years of their life to buy a home. (Mortgage is quite literally a pledge of your life force where you promise to work for 25 years in exchange for the privately owned banking system creating a bank draft out of thin air to pay for your home.)
Can you say the most profitable ponsy scheme ever? One so profitable THEY decide who gets elected and WHO regulates?
What about brokerages? If you have your certificate, you have zero risk. If it is lost or stolen, you just file an affadavit and get a new one (it's in your name). If you deposited it (signed ownership over to your brokerage), then good luck with that.
The scumbags are all about fractionally backing things. Kind of like that game, musical chairs, where the six kids are fractionally backed by five chairs and someone ends up holding the bag when the music stops.
http://cryptogon.com/
In the case of bank collapse, the FDIC has to step in to insure the value of deposits. Normally the FDIC attempts to maintain a fund at 1.25% of the value of its potential obligations. In recent months, however, this fund has slid to 1.19%, driven primarily by a rise in deposits, said Sheila Bair, chair of the FDIC. If this figure slides further to 1.15% it forces the FDIC to make moves to shore up the fund.
Bair said the FDIC is monitoring 90 institutions with assets of $26 billion that it has identified as troubled. The entire size of the FDIC reserve fund is $52 billion. As a precaution, the FDIC is running bank failure readiness exercises, she said.
By davidn on
7/15/2008 9:15 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
I'm more hopeful than most and still stick with my snowflake analogy. Mainstream media quotes memes from this site, deepcapture, etc. more and more often even if they won't admit it. Anyone that follows Cramer knows he reads this site several times a day as he spouts quotes from it on his show.
It can be incredibily frustrating, but truth always wins out. The problem is the populace isn't stupid. They are afraid. Theya re afraid their boss will read their posts. They are afraid their friends will think they are a conspiracy theorist. They are afraid their government will send them to guantomino bay.
I like to write on money, "911 was an inside job", "patriot act = dictatorship", "Do you trust your brokerage http://www.thesanitycheck.com", etc.
It reassures Joe and Jane Sixpack to learn he and she isn't alone and empowers him or her to be ready. It reminds of the movie "remember, remember, the 5th of november".
All the cowards become reassured, so they are ready for the avalanche of change.
I believe there is an organized attempt by the international banking elite to create a privately controlled worldwide money supply and they are willing to sacrifice the American middle class to make it happen. They have been successful with the Euro and the Amero is next.
What do you think will happen when the dollar goes into a freefall? They will come and offer the solution. " Lucky for you, we can trade your one cent dollar for dollar Ameros. The only catch is you are now part of the Americas from Canada to Venezuala".
I'm sorry Bobo, as I should avoid straying off topic, but 911 took out the SEC, the SEC backups and the physical gold under the towers, that saved the gold naked shorts from a squeeze went missing. The issues are related. Why do you think 911 was an attack on the financial district. How many potential anti naked shorts, with an understanding of clearance were killed that day?
http://www.gata.org/
http://911research.wtc7.net/wtc/evidence/gold.html
Anyway, I am very bullish, as I don't think the scumbags can keep up with the internet. They will inevitably lose and I hope the people with pitchforks target the lapdogs like Greenberg, first. The guys that sold out for a few thousand dollars.
http://tinyurl.com/6mao3h
By davidn on
7/15/2008 9:17 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
There is an important component in today's announcement which is not receiving the attention it deserves. This crack down on naked shorting includes, in addition to Fannie and Freddie, Goldman Sachs, Morgan Stanley, Lehman, and host of other broker dealers. There is a sad irony here. These are the companies who have made bundles off of the commisions earned from the naked short selling which has been done by their largest customers. I also believe that the broker dealrs are also members of the BOD which controls the DTCC. My suspicion here is that it is the heads of Morgan and Goldman who put pressure on Cox to do something about the naked shorting of their own stocks which would not cause any of their large hedge fund customers any real problems. I also don't understand why Cox felt a need to create an "emergency rule", when all he needs to really do is enforce the laws which already exist. This is simply another SEC scam which was designed by Cox's handlers to make sure that they are not taken down along with the rest of the market. For all of us who have followed this for the past 5 years or so, this is truly sickening.
By beegdawg on
7/15/2008 9:18 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
A post about naked shorting of physical gold by the private banking elite that publishes the US dollar and signs it "Federal Reserve Note."
This is from Sept. 1, 2001.
http://www.tinyurl.com/5a45h9
Think about it, they fail to deliver gold, oil, wheat, stock, etc. These elite scumbags don't work for a living, but they dream of controlling the world and their way of accomplishing it is to get us to play in a system they own and use to cheat.
The reason for 911 is they are afraid and know they are losing and that Joe and Jane Sixpack are figuring them out. They are trying to race to gain control before the peer to peer nature of the hive internet intelligence becomes too much for them.
By Naked Gold on
7/15/2008 9:19 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Ha ha ha ha...
Cox just figured out everbody can see the mess and he made it....
By bbhindyou on
7/15/2008 9:20 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Davidn: I'm going to leave out the last post, as the document is so poorly written and grammatically incorrect that if written by those professing to take over the world, they'd be better served with a copy of Strunk and White and a decent dictionary first. Let's not introduce a bunch of conspiracy claptrap here. No need. The truth is far too alarming to warrant hoaxes or wild eyed delusions...
By bobo on
7/15/2008 9:29 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Bobo,
indeed, the SEC, hedge funds and prime brokers ignore the law. They have been doing that for a long time. What I was referring to was what would play in court in front of a judge.
The SEC has now admitted in this emergency order that there is a systemic problem with naked short selling, and has attempted to protect certain securities from that.
Others can use this de facto admittance on the part of the SEC to ask a judge to extend the same protections to them.
At a bare minimum, the markets can not have two sets of rules under which securities are traded and any judge would agree. This is what I was referring to. That the miscreants will try and cart away as much money as possible is clear, regardless of the law.
I don't see any way around legal action. Without legal action, any new rules will have holes so large as to make the new rules useless. So this incriminating action will serve a purpose later as exhibit A. That's what I meant in my first post.
By tommytoyz on
7/16/2008 7:39 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
This is just to funny!
You can't Naked Short the Naked Shorters! Here the list
4th UPDATE:SEC's Cox:Limits On Shorting Fannie,Freddie,Others
Securities and Exchange Commission Chairman Christopher Cox told the Senate Banking Committee on Tuesday that the SEC will require short-sellers to pre- borrow shares before engaging in short sales of such companies.
The restrictions, required under a 30-day emergency order issued late Tuesday, will apply to 19 stocks in all. In addition to Fannie Mae and Freddie Mac, they are: BNP Paribas Securities Corp. (BNPQF, BNPQY), Bank of America Corp. (BAC), Barclays PLC (BCS), Citigroup Inc. (C), Credit Suisse Group (CS), Daiwa Securities Group, Inc. (DSECY), Deutsche Bank Group (DB), Allianz SE (AZ), Goldman Sachs Group Inc. (GS), Lehman Brothers Holdings Inc. (LEH), Merrill Lynch & Co. (MER), Morgan Stanley (MS), Royal Bank ADS (RBS), HSBC Holdings PLC (HBC, HSI), JPMorganChase & Co. (JPM), Mizuho Financial Inc., (MFG), and UBS AG (UBS).
SEC officials said the restrictions could be extended for a longer period, or to other stocks as well.
By hoag on
7/16/2008 2:51 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
So you can't naked short bank of america,citigroup, deutsche bank,ect....
Looks to me like the ones who are in cahoots with the S.E.C. just got named.
Lets all take a good hard look at these institutions.
They are the probably the perp's who have been robbing us blind.
They certainly have "juice" at any rate and "deserve" protection for some reason.
Maybe because they know too much of how the scam is run?
Perhaps they have paid for extra protection?
Who and how much?
This list is a line up of the usual suspects if I ever saw one and they gave it right to us.
funny!
By bbhindyou on
7/16/2008 7:41 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Bud Burell said the same thing in the recent interview about holders of real shares getting the shaft, which is what you say when they get off the hook on the illegal shares marked to market. How do they do that - do they just declare whatever is out there is now legal and issuers should adjust the filings accorndingly after a count, or do they have an amnesty program where the excess is bought at the current market (and who gets the proceeds?)? I don't doubt you that they probably have it up their sleeves and will find a way to do it if they can, but curious on the mechanics. Thanks.
By tmg1 on
7/16/2008 7:41 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
So first the SEC denied there was naked shorting....then they fought us on the naked shorting issue, then they passed Reg SHO to clean up naked shorting but grandfathered all the pre-existing fails because they were concerned about the volatility created from having to actually settle trades, then there were persistent fails in companies like OSTK, CALM that lasted for YEARS, then they eliminated the uptick rule and kept the options market maker exemption, then they started admitting there might be a pervasive naked shorting problem, and then they protected only the companies that were responsible for settlement failures.
You CANNOT make this stuff up......what's next? A nobel prize to the former SEC Commissioners who stopped the Pequot/Mack/Aguirre debacle?
My gawwd.........
By clearthinker on
7/16/2008 7:42 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
http://tinyurl.com/5zl9hc
By kevin on
7/16/2008 7:39 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Wachtell Memo
http://tinyurl.com/6pw8gr
By kevin on
7/16/2008 8:07 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
SEC chases short manipulators.
http://tinyurl.com/6k7u8b
By kevin on
7/16/2008 8:09 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
"You CANNOT make this stuff up......what's next? A nobel prize to the former SEC Commissioners who stopped the Pequot/Mack/Aguirre debacle?
My gawwd........."
maybe that could be the tactic... push these outrageous agendas to the degee of absurdity. let's propose to bail out any losses for hedge funds. maybe we could aid hedgies with contributions of 401k workers... for the benefit of our capital markets and all
By lost my name to shortsellers on
7/16/2008 10:44 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Options mm's want an exemption.
http://tinyurl.com/5hgn8d
By kevin on
7/16/2008 10:45 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
By protecting the big guys from naked shorting they are at least admitting it exists. I don't see how they can discriminate in this fashion without being called to task. Being called to task depends on law suits being filed or elected officials getting enough pressure. Probably both!
The elephant in the room now has company and it's bordering on a herd.
By Gates on
7/16/2008 10:46 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Excellent piece, Bobo; keep up the great work. This dragon's egg is about to crack. BTW, if anyone reading this hasn't heard Bud Burrell's most excellent and highly informative audio interview, by all means do so. An absolute gem, it can be listened to here: http://www.financialsense.com/Experts/2008/Burrell.html
By mwillwilly2003 on
7/16/2008 10:47 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
What's with Cramer ???
http://www.cnbc.com/id/15840232?video=794250312
By zinkley on
7/17/2008 5:23 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
For those of you that missed it yesterday, here's the Cox interview on CNBC with Erin Burnett ... stating that naked shorting is NOT illegal.
http://www.cnbc.com/id/15840232?video=795065904&play=1
By zinkley on
7/17/2008 5:23 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Video - Cramer calling Cox "out of touch" ... stating the SEC "looks the other way"
http://www.cnbc.com/id/15840232?video=795061550&play=1
By zinkley on
7/17/2008 5:24 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
From WSJ:The federal crackdown on short selling is causing a scramble on Wall Street, with brokerage firms racing to implement new controls before the rules take effect on Monday.
Brokerage firms and floor traders, here at the NYSE, are scrambling to prepare for new short-selling rules.
The unprecedented get-tough action by the Securities and Exchange Commission means that securities firms will have to fine-tune their back-office operations to comply with the requirements.
The biggest potential headache: Existing rules allow brokers to sell stock short as long as they reasonably believe they can locate the needed shares and deliver them on time. Under the new curbs, short sellers will need to make formal arrangements to borrow the shares before selling them.
"You need to have certainty that you have the stock," one Wall Street executive said Wednesday.
By hoag on
7/17/2008 5:05 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Zinkley: It is a technical argument based in fraud. It goes something like this: Failing to deliver isn't always against the rules - for instance if you are a maket maker you have an exception. Of if the certificate is lost or stolen, it isn't. But selling stock short without having located or borrowed it is absolutely illegal. That is why there are rules requiring firm locates, etc. But the real truth is that the illegality starts bigtime not when the sale takes place, but rather when the share fails to materialize, and instead of buying in the trade, the buying broker instead represents the security entitlement he created as a placeholder until delivery, as a genuine share. That violates a host of federal security laws. So like all cleverl liars, Cox is saying something akin to, "killing people isn't always illegal." True, in times of war, or if it is a death penalty case, or you are cop under certain circumstances, killiing people isn't. But most of the time it is. When you are a hedge fund selling shares in a company with no intention or ability to deliver the shares, that IS in fact illegal. So is manipulating the price of a stock by employing that strategy.
Read the NIPC petition linked in this article for a complete description of the laws it violates. Or remain uninformed.
By bobo on
7/17/2008 5:30 PM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
This will only take a minute. Write to your local newspaper, recommend these couple front page pictures, then tell them the story about Jim Cramer and his room mate Elliot Spitzer, Lil GW, etc. and remind them about how Cramer threatened to sue David Patch.
Cramer only backed down when the anti counterfeiting crowd started posting about his charitable trust in thestreet thread.
http://tinyurl.com/guljq
http://tinyurl.com/672qtc
The fact that they ADMIT COUNTERFEITING, but say it is okay for non bank stocks and Cramer plays like he shouldn't be pillaried because he finally agrees with us, gives us an opening to wake the people up.
http://www.investigatethesec.com/drupal-5.5/node/143
http://www.investigatethesec.com/drupal-5.5/node/268
http://www.investigatethesec.com/drupal-5.5/node/154
http://www.investigatethesec.com/drupal-5.5/node/264
http://www.investigatethesec.com/drupal-5.5/node/90
By homework on
7/18/2008 8:52 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
"Many people think naked short selling is already illegal, but that isn't true," Cox wrote.
http://tinyurl.com/5aa5wk
Translation: I regularly let the prime brokerages back entitlements with nothing as I let them treat shares as a fungible mass, then let value of shares owed to the prime brokerage net against value owed from the prime brokerage using repurchase agreements.
It's a great system, it creates billions of dollars of wallstreet bonuses off the backs of the suckers.
By kevin on
7/18/2008 9:44 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Bobo: Thanks, but I've been reading here for years, so I was hardly fooled, by the positions portrayed.
I was just making the video links available, for those that missed "the show".
By zinkley on
7/18/2008 10:11 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Exemptions for market makers.
http://tinyurl.com/65njch
By kevin on
7/18/2008 10:10 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Lehman Brothers issued a bunch of reverse convertible securities recently (back in may and also before may). These reverse convertible securities are linked to various stocks including Amd, apple, gm, intel, eslr, arch coal, and others. Obviously, there would be an incentive for Lehman to drive any of the stock linked to an issue of its convertible bonds down below the threshold limit (downside limit). Its interesting that Lehman is now protected from naked shorts but still has the power to drive down other company stock prices through naked shorts...this just seems wrong; its sort of like protecting the wolf while the sheep are sleeping.
By Derick Sharp on
7/24/2008 10:44 AM
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Re: SEC Discovers That Unbridled Naked Short Selling Might Actually Be, Er, Not So Good....
Bobo,
Your prognostication was right on! Bush's cronies apparently get to escape with more than the Treasury ($700B+) as they retreat to their mansions, leaving the U.S.of A. in cataclysmic debt, and hated around the World. What good are Elections?
By ginger on
9/28/2008 3:18 PM
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