January 25, 2008

UPDATE: Bailout Bernanke didn't know about rogue trader, panicked 3/4 point cut now seen as glaring mistake. So, will Bernanke fix his error now?


WE ARE RUN BY CORRUPT INCOMPETENT MONKEYS

Congress should immediately call Bernanke in for questioning, and open an investigation into the Fed's behavior since 2001

This latest glaring market-induced mistake should be corrected immediately. The technical sell-off on Monday that had day trader Bernanke panicking on Tuesday is now being reversed, and so should this rate cut.

What is most shameful and scandalous for the Fed is that Societe Generale had informed the Bank of France about what was going on on Monday, YET THE FED AND THE BANK OF FRANCE DID NOT COMMUNICATE, so the Fed went ahead and put in their market stop-loss order on Tuesday morning before the market opened. If they had known the truth, there's NOW WAY IN HELL THEY WOULD HAVE MADE THIS GLARING MISTAKE. NO WAY.

Ben Bernanke should resign, the Fed should be investigated, and this 3/4 point mistake should be reverse post-haste. And if you believe Bernanke made a historic mistake, you might want to think about getting long.

Fed didn't know about SocGen trades on Monday - Revelations spur market to reassess central bank's intentions in a new light

The Federal Reserve was not aware that Societe Generale was unwinding trades in Europe on Monday that had been amassed by a rogue trader at the French bank, a Fed source said Thursday.

Some observers, citing Societe Generale's sensational announcement, say the Fed's dramatic policy remedy may have been too much too fast.

Why the Fed, which usually keeps in contact with the world's central bankers, wasn't aware of this when Bernanke held his emergency policy meeting remains an unanswered question that might dog officials in coming days.

Longer-term, if the Fed was spooked into making an emergency rate cut this week on the back of what was just technical selling, it could further undermine market confidence in Bernanke.

25 comments:

Princess Mononoke said...

I think this Jr. Trader is the fall-out guy, a sham created by SocGen.

I have to wonder if they made all this shit up. They needed somebody to blame for yet another financial fiasco self-induced by another banking institution!

And NOW this guy is CONSIDERED missing? He either is or is not, right?

Princess Mononoke said...

You also have to ask yourself: was this so-called fraud - mass selling by one investment bank induced by "the Power's That Be" to MANIPULATE Bernanke to panick and cut rates the way he did! IRRATIONALLY...

Anonymous said...

THE ENTIRE UPPER MANANGEMENT OF
THE UNITED STATES OF AMERICA IS INTELLECTUALLY.....BANKRUPT!!

FROM THE WHITE HOUSE, THE US SENATE, US HOUSE OF REPS, THE CABINET,THE PENTAGON BRASS,THE FEDERAL RESERVE, WALL STREET, FORTUNE 500 CORPS.,IVY LEAGUE UNIVERSITIES,STATE UNIVERSITIES, STATE AND CITY GOVTS., PENSION FUND MANAGERS,SCHOOL DISTRICT BOARD MEMBERS,AND THE REAL ESTATE COMPLEX,ETC.

GROSS INCOMPETENCY, NO INSIGHT,FORESIGHT,HINDSIGHT,AND A TREMENDOUS LACK OF ETHICS.

Anonymous said...

First rule of upper management in America today is:

REMAIN TOTALLY OUT OF TOUCH WITH REALITY/REAL WORLD, AND YOU WILL BE REWARDED/PROMOTED! DO NOT LISTEN TO OR BECOME FAMILIAR WITH THE UNWASHED MASSES!

happy homeowner in the stix said...

Wait a minute. If the Bank of France knew about this and didn't tell anybody, why is this Bernanke's fault?

He was just acting on the information he had at the time, just like everyone else in the world did. Are you going to call for confiscating the portfolios of people and institutions that traded "incorrectly" in hindsight, too?

I know you hate the guy, Keith, but blaming him for this is like blaming him for a rainy day that ruins your picnic. Call it a mistake if you want, but if anyone should lose their job it should be the asshole in charge of the Bank of France who let the whole world go through the last week of market convulsions.

H. Lime Phd said...

Rent the Movie ROUGE TRADER ...

Anonymous said...

Im sorry Keith,

There is no freaking way this dude cause that crash on Monday, no way.

This is just an easy way out for Soc Gen.

This takes me back to the good old "Jack Grubman" days at Citi. It was all his fault.

This Soc Gen analyst probably got a couple of million to stay shut.

Danny

tangelo mozilo said...

The Fed doesn't care WHY the Monday's selloff happened. They just care THAT it happened, because it gave them an excuse to cut.

Anonymous said...

what SHOULD happen is no cut at the next meeting - the problem is the market has ALREADY priced that 50bpt cut in and if it doesnt happen we will tank like a big dog-

watch the 10yr note - the bond market isnt too fond of what they see as a monster panic mistake by bendover - note to fed: DO NOT CUT NEXT WEEK! unfortunately they will.

cletus

Anonymous said...

Jérôme Kerviel is my new Hero. Think about it, he was a total stranger and then:
- he loses 1/5th of his company's capital
- he causes the greatest market crash in one day since 9/11
- he forces Bernanke to cut rates 75 points

Coming soon:

- Kerviel stole your retirement money
- Kerviel stole your house
- Kerviel stole your paycheck
- Kerviel stole your wife
- Kerviel eats children
- Kerviel did 9/11

The trick being, that guy jusnt doesn't exist

Anonymous said...

bastards...

Anonymous said...

Ben Bernanke, meet Jerome Kerviel.

Kerviel is reportedly the rogue futures trader at Société Générale, one of France's largest banks, who made over $7 billion in fraudulent trades that his employer was forced to unwind on Monday amid a global selloff that sent markets in Asia tumbling while U.S. investors on holiday could only watch in horror.

Federal Reserve Chairman Bernanke, who has been pilloried by intense criticism in the financial community, was watching too. Throwing caution to the wind, he jumped into the fray Tuesday morning, slashing the fed funds rate target at the opening bell by 75 basis points -- the first emergency reduction of that size since 1982 -- signaling that the economy was facing a crisis of historic proportions.

Like everyone else, Bernanke was unaware of the massive trading fraud in France that almost surely tripped the panic wire in a global market already shell-shocked by a relentless credit crunch. When Société Générale disclosed its problems on Thursday, a fresh round of finger-pointing ensued on Wall Street.

In a note to clients, Fusion IQ CEO Barry Ritholtz, a contributor to TheStreet.com's sister site RealMoney.com, called the Fed's trigger-happy response to the market selloff "sheer folly and utter irresponsibility."

"Tuesday's panicked 75 basis cut will prove to be an historical embarrassment, a blot on the Fed for all its days," wrote Ritholtz. "Failing to understand what their responsibilities are is bad enough; allowing themselves to be bossed around by futures traders is inexcusable."


http://www.thestreet.com/s/fed-up-with-bernanke/markets/marketfeatures/10400369.html?puc=_dm

Anonymous said...

There was a rogue trader named Stan O'Neal at Merrill Lynch that cost them $24 billion. They let him go with a $160 million severance. I think this kid should get at least $20 million for his efforts.

Anonymous said...

THE ENTIRE UPPER MANANGEMENT OF
THE UNITED STATES OF AMERICA IS INTELLECTUALLY.....BANKRUPT!!

FROM THE WHITE HOUSE, THE US SENATE, US HOUSE OF REPS, THE CABINET,THE PENTAGON BRASS,THE FEDERAL RESERVE, WALL STREET, FORTUNE 500 CORPS.,IVY LEAGUE


Congress isn't corrupt because it is run by Nancy Pelosi, Chuck Schumer, Chris Dodd and Harry Reid.

Anonymous said...

This is worst than the Pinochio story. Bernanke, SoGen Executives and Trichet worked in concert one to unload their known massive losses and the other to massively cut at the expense of every U.S. citizen. The Rogue Trader story is extremely bad that it shows the level of manipulation of the markets and the media. Is there anyone we should trust anymore?

Anonymous said...

CNBC has 3 shills on at this moment debating whether or not it is a good idea to allow the Sovereign Funds to purchase our banks and assets. Is it good capitalist sense or are we selling ourselves to the highest bidder to prevent depression. Yes, they are actually using the word depression now to justify our sale to the foreigners.

They showed a list of all the big banks in trouble and the amount listed for each bank's bailout by foreigners.

These Sovereign Funds have no oversight people. They operate in the shadows. They are going to own our banks completely in the next year. Who are these people that are purchasing America? What are they going to do once the purchases are complete?

We are talking about retiring in Ensenada, Mexico in 5 years, but I am not sure there will be anywhere to run when these Funds get finished purchasing us.

Anonymous said...

There was a rogue trader named Stan O'Neal at Merrill Lynch that cost them $24 billion. They let him go with a $160 million severance. I think this kid should get at least $20 million for his efforts.

January 25, 2008 4:04 PM

Perfect.

Russ DoGG said...

GROSS INCOMPETENCY, NO INSIGHT,FORESIGHT,HINDSIGHT,AND A TREMENDOUS LACK OF ETHICS.


many of the mainstream journalists have expressed disbelief of this explanation. But are the French Business executives monkeys too?
If Soc Gen's CEO monkey will lose his job as well, then maye it was an accident as he says. If the CEO monkey stays- then its a sham.

Has anybody heard about the CEO monkey coming under pressure to resign from shareholders?

stuckinthecity said...

e was just acting on the information he had at the time, just like everyone else in the world did. Are you going to call for confiscating the portfolios of people and institutions that traded "incorrectly" in hindsight, too?



It is not B.B.'s job to make sure teh Dow goes up!

Anonymous said...

Ben you're killing me!!! Every time you lower rates to help your stockholder buddies you hurt the states budgets.

Every state calculates a yield on their cash accounts and include that income as part of the state budget.

As you continue to lower rates you are putting states like California in dier strates.

Ben you're killing us!!!

Anonymous said...

The fraud cost Societe Generale 4.9 billion euros, or more than $7 billion, but a bank official said Friday that Kerviel's positions had reached "several tens of billions of euros." The official spoke on condition of anonymity because of company policy on such matters.

French presidential aide Raymond Soubie said on LCI television that the trader had been dealing with more than 50 billion euros, or more than $73 billion. That figure easily outstrips the bank's market capitalization of 35.9 billion euros ($52.6 billion), and is close to the annual gross domestic product of entire nations such Slovakia, Qatar or Libya.

Princess Mononoke said...

Has anybody heard about the CEO monkey coming under pressure to resign from shareholders?
January 25, 2008 4:46 PM
===============

Yes, I heard on the news today that the CEO offered to resign and the shareholders denied his resignation! Seriously, isn't that crazy!?!?

Foxandthehenhouse said...


Has anybody heard about the CEO monkey coming under pressure to resign from shareholders?


No. Most corporate shares are now held by institutional investors and those are mismanaged by small groups of people whose voting reflects the fact that they are not caring for their own money. This is the root cause of the lack of accountability of corporate management.

ICEMAN said...

These board members were all in on it!!!!

It was all fake inorder to hide their stupid investment decisions.

Next thing you will hear is Billy Bob hits a fiber optic line in his back yard and causes a 30 billion dollar loss at Citigroup.

Hey as a matter of fact, I will be the fall guy for Countrywide. They can plaster my mugshot all of the media. They can defame me and call me a loser, cheater, thief, crackpot, and pirate. Yeah I will be the hacker code named Agent Orange who disposed of over 100 billion dollars in losses.

In exchange, I want $50 million dollars no..... $40 million in gold bullion, 5 million in Swiss Francs, 2 million in Yen, 2 million in Yuan, 1 million in Dollars. I would also like a foreclosure in San Fransisco, Miami Beach, Cancun, Zurich, and Singapore and all with no property taxes for life. I will be waitng by my phone.

I will even spray myself in orange tanner for the mugshot.

Iceman

Democraatus said...

Regardless whether the SG story is real or not, the reaction to it here is a clear sign how much distrust in MSM exists nowadays. Not without reason.

The US has been hijacked. Apparently, it takes three young blokes to tell just that.