The New York Times reports:
It is the Wall Street equivalent of a perfect game of baseball — 27 up, 27 down, the final score measured in millions of dollars a day. Despite the running unease in world markets, four giants of American finance managed to make money from trading every single day during the first three months of the year.
Their remarkable 61-day streak is one for the record books. Bank of America, Citigroup, Goldman Sachs and JPMorgan Chase & Company produced the equivalent of four perfect games during the first quarter. Each one finished the period without losing money for even one day.
Goldman Sachs — which is fighting an S.E.C. suit claiming the bank defrauded customers on a complex mortgage investment — posted its first perfect quarter ever. Goldman made at least $100 million on 35 days during the quarter, and at least $25 million on the remaining trading days.
Well, When you are actually gaming the system, to one degree or another, why would this surprise anyone.
HFT using super computers, Market manipulation, inside information etc etc.
We should cheer about this. Big American companies making steady profits. More money, more jobs,… even more tax returns without raising tax rates…
Oh, yes I forgot… Current administration is one fostering general mediocrity so no, no on the success. How dare those bankers do what they are supposed to do – make money.
Coincidence? I think NOT!
Good show on tv is Dylan Ratigan, MSNBC 1PM PST. He covers the financial field more than the other spin meisters. He recently made the point that a stable useful stockmarket would not behave the way our market has become.
Its movement suggests manipulation that adds nothing to our economy–the aggragation of wealth to invest in the economy to provide jobs and profit.
Instead, it is acting as a Gambling House with all the tables rigged.
Now, I don’t know how much of this statement is based on somebody hitting a “B” rather tan an “M” but even that is ridiculous beyond respectability.
Yep, everything Big Capitalism touches turns into shit, and not the good kind.
Re:#4 bobbo, “Instead, it is acting as a Gambling House with all the tables rigged.”
That is an huge exaggeration of course. There are cheaters and elements of unfairness, but… all the tables? It’s just not true.
Did he give an example of how “a stable useful stock market” would operate… where there was no gamble, no risk?
Skeptic–well I’m watching an old show right now. He’s talking about computer driven automatic sales that will make 10,000 trades per second when there is a one penny per stock profit to be made. Banks/Traders are making millions by skimming the cream out of the system.
The main point===this does not serve America, business, competition, jobs. All it does is transfer wealth from the many to the few.
I’d call that a rigged table system of gambling without risk.
Wake up Skeptical. Anti-GW, pro Wallstreet?==not looking good.
This “high frequency trading” makes up 50% of market activity–according to Dylan.
You confuse having a stable market as if that means without risk. The point really is just the opposite. We have an unstable market driven by insiders that are not exposed to risk at all==or when over leveraging to insane levels ((if you want to call that “risk” as opposed to fraud)) then the government steps in and bails them out.
Don’t you smell something wrong???
Doesn’t that knife in your back tell you something?
“Germany, the country with the autobahn, puts an additional tax on high frequency trading in order to inhibit this activity.”
We have all grown up thinking the stockmarket is about investing==long term investing for retirement and such. Where the stockmarket is is a big pile of cash that the sharp operators are constantly stealing from.
Dylan makes mentions of other factors at play that I don’t know about but as usual==the rest of the world regulates what the USA allows to go on unregulated.
Its criminal, Its disgusting. Its legal.
Yes, there is “lots” of very easy things that could be done to stablizing the market and return it to its original worthwhile function. Require all stocks to be held for one week? Thats real easy. Who should ever be allowed to by a stock, or 10,000 shares for less than one second?
Senator Bernie Sanders: “We currently have 6 huge financial institutions who have assets over 60% of our GDP. Thats insane.”
Who can disagree with that?
Evidently the majority of those in Congress who voted against financial reform.
Yes, we are a two party system. We the people vs Wallstreet Criminals.
Get the list of congress slime voting against reform and VOTE THEM OUT OF OFFICE.
Bobbo, I understand that there are problems. What i object to is alarmist exaggeration, and mincing terms like assets and GDP so that they SEEM alarming. For instance “6 huge financial institutions who have assets over 60% of our GDP”. Does he mean assets ‘worth’ over 60% of GDP? If so, how does that affect anything in your opinion? Bill Gates is worth more than the combined GDP of the world’s 70 smallest countries. So, if all his assets were redistributed to other smaller companies, how would that affect the GDP?
I’m not anti-gw (what on earth do you mean by that?), nor am i pro wall street. There are deficiencies in both that have led to mistrust. Your B&W attitude… you are either with us or against us… and nonsensical labeling, makes it difficult to reason/discuss anything with you.
As for the computerized trading, the software is available to anyone, so the playing field becomes more hectic…. but essentially the similar cash value in the end. The trades would be a lot bigger if restricted to a week. 10 minutes would be more reasonable. The problems arise more from complexity and competition… being one up, faster and faster trades, searching for inside information…. which leads to cheating. The SEC needs to be given some teeth.
#10–Skeptic==”I understand that there are problems.” /// Well, thats half the battle.
Not that names should control, but I’m thinking my definition of “skeptic” is more 50/50 on doubt/certainty. On the border, not convinced. Your opinion seem more set, more convinced, more “contra” than doubtful.
So, I turn to my touchstone of reality:
Skeptical: 1. Denying or questioning the tenets of especially a religion
and I see thats the problem right there. Denying is what you keep doing, and questioning is what I keep going on. Good, thats one ambiguity down.
Maybe this will help understand your position(s) as well:
Apologist: A person who argues to defend or justify some policy or institution
Really doesn’t catch the perfidy of most apologists does it?
Perfidy: An act of deliberate betrayal
So–you understand their are problems but you want to discuss what the word “worth” means???
I’d like to see Andy Kauffman’s take on a Wallstreet Regulator. Would it start with yo-yo’s???
Lets see. Is my attitude B&W? Well, on certain issues = yes, as many good opinions should be.
Do we need Wallstreet Reform or not? Pretty B&W wouldn’t you agree? Or do you want to discuss what agreement means?
Organized religion pays ZERO taxes. Even less that wall street. TAX all religion. Now. Forever.
@ Skeptic : “As for the computerized trading, the software is available to anyone, so the playing field becomes more hectic…. but essentially the similar cash value in the end.”
Except its not just the software, is it?
Its the computers placed as close, physically, as possible to the central trading computers – to minimize the programmed buy/sell reaction time to minute fractions of a second.
So I have no expectation – if I was to start using any of the many advertised trading programs – that my Comcast connection in Oregon would place me on a level playing field with the corps who pay big money to locate their computers across the street from the main exchange.
#4,6,7,8,9,11 Damn Bobbo, better than usual commentary, and in abundance, thanx.
You just about summed it up, just a little observation though, if you’re going to flesh out an issue so thoroughly you leave little or nothing left for others to comment.
In any case, this is one occasion where we concur absolutely.
#11, bobbo…
How does someones assets, corporate or personal directly affect GDP? You think they do, so enlighten us. I even gave you an example, now show some balls and answer the question instead of trying to change the subject, otherwise this conversation will go nowhere. After all, it was your comment that I’m questioning.
Re: “Skeptical: 1. Denying or questioning the tenets of especially a religion”
Pay extra attention to the “or” in that sentence this time. I’m not denying anything, but perhaps you should consider Bobbo the forgetful? After all I’ve explained many times what parts of AGW I’m questioning… modeling, aspects of radiative forcing, and a concerted effort of pro AGW scientists to silence the findings of detracting climate scientists in several ways. It’s all been discussed ad nauseum on DU, but not surprisingly, NONE of it has been resolved by scientific process… or addressed properly by the pro AGW scientific community. Current radiative forcing formulas contain pure guesswork, and misrepresent the warming effect of CO2 by up to 6 times. That is a big margin of error, don’t you think? Don’t you want to question that one?
# 14 mikiev, banks get first dibs, computerized trading or not. I’ve been trading for 15 years… kids stuff by comparison, but I’ve traded about 2 million in stocks over that time.
Stick with the corruption angle, plain and simple. insider trading, stock dilution, misleading news, options gymnastics… the crimes are at least equally attributable to public companies themselves. A better question… Do you want stricter and more forceful government intervention? Like everything else, the market has become huge and unwieldy, and the only way to tame it is to revisit the rules and penalties. At least the SEC is going after Goldman Sachs re the mortgage debacle, but they are way too impotent for my liking. The OSC is no better.
Hey Skeptic–I think I see the schism. I’m in “Big Picture Mode” and you want to quibble in the details. So, innocently, we pass each other as ships in the night, bound for our separate destinations, on different passages, but on the same ocean.
As far as assets affecting GDP–I was directly quoting Bernie Sanders. I only took from his statement that those banks were “insanely” large. Doesn’t matter how large, or by what matter, THEY ARE TOO LARGE!! Past proven to be too large to fail, and only getting larger with our corrupt Congress. So–I failed to back up in reverse and defend a point that was and still is irrelvant.
Now, don’t get me wrong, WORDS are important. But so are ideas.
When given a choice, go with the Big Idea–eschew the quibble, otherwise you have the blind leading the sheep.
Likewise, this thread is not about AGW. Its about telling shit from shinola. Sorry I didn’t direct your attention that way.
Amodedoma–high praise. You must be settin me up for sumthing? I will disarm you now. I have the same umbrage, but in the main, I only acted as a selective reporter on the idea’s and words of Dylan Ratigan. Check him out. Like Skeptic, he is a stock trader and financial whiz. Unlike Skeptic, he is upset over the gross corruption we call Wallstreet. I don’t expect him to remain on the air for long.
This guy calculated the odds of this occurring:
http://market-ticker.org/archives/2305-More-On-Goldmans-Perfect-Record.html
Excerpt:
In the “real world” we have had 234 years of history in America. There have been, on average, 240 days (approximately) of trading in each of those years, or 56,160 trading days, and there have been 936 quarters. The NYSE was founded in 1792, so in fact there haven’t been that many days on which stocks have traded in the United States, but that’s close enough.
The odds of this outcome happening in any one quarter since the founding of the nation are approximately 8.1 x 10-16 or quite significantly (by close to 100,000 times!) less likely than a one-in-a-trillion chance.
To put this in perspective you have a 1-in-500,000 chance each year of being hit by lightning while retrieving your mail, walking your dog, or taking a hike.
In comparison to that risk in ordinary life the odds of Goldman pulling this off in a game of chance are approximately forty million times LESS than the probability either of that event happening to you in the next year (again, assuming I’ve checked my zeros correctly.)
Should such an outcome happen on the street with the outcome subject to the exchange of money (that is, a wager) the gullible would hand over the wager. A person with a bit of knowledge of mathematics and even the tiniest bit of street smarts would react to such an event by pulling his sixgun and drilling the coin-flipper, as he would be certain (within HIS knowledge of having just been robbed) that the coin was rigged.
Now certainly trading is not a pure game of chance. Indeed, quite to the contrary; trading is allegedly a game of skill in the main.
I will leave it to you, and those who investigate frauds, to determine whether the application of skill, without any sort of cheating such as front-running client orders, insider information or other forms of rigging the markets, can turn the random chance odds of 8.67 x 10-19 into an event that has, in fact, actually occurred.”
later, he calculated the odds for all of the TBTF banks that reported similar miracles:
http://market-ticker.org/archives/2307-The-Perversity-Of-Bank-Driven-Policy-Response.html
Excerpt:
“If you’re wondering why the big banks have “captured” the political environment in every nation of the world, you need only look at the Goldman results through a somewhat-different lens.
See, it wasn’t just Goldman – it was also Bank of America, Citibank and JP Morgan who scored “perfect quarters.”
Now if Goldman’s record was predicated on the outcome of a game of chance set of odds and had an 8.67 x 10-19 probability of occurring, for four of these institutions to do so would be that to the 4th power, or something approaching 5.65 x 10-73.
As pointed out in the forum by Tsberts, there are fewer than this many particles (atoms, etc) in the known universe.
Now it is certainly true that trading activities are not a pure game of chance, and that most of the trading profits are generated from “market making” (that is, earning a spread.)
But that makes the performance even more outrageous, because these “market making” activities are claimed to be something that provides net benefit to market participants and thus the economy as a whole.
That claim looks awfully hard to sustain when the book-maker never loses – not even once on a daily aggregate basis.
Indeed, this puts into stark relief the nature of “banking” these days in the Wall Street context, which is increasingly nothing more than an activity intended and executed to skim off profits for the banksters at the expense of literally everyone else in the economy.
They seem to be doing a good job of it too, if these results are any indication.”
Bobbo, I you brought up AGW… not I.
While you are exclaiming the obviousness of the big picture… I am more focused the causes. Like AGW, the truth is in the details. While you scream it’s the end of the world, I try and sort the wheat from the chaff. So while you may not like my ‘quibbling” on details… my reply is “suck it up” and try not to be such an alarmist. The system isn’t rotten to the core. It needs a cleanup, and better management.
As for the 6 largest banks you mentioned, What does their size have to do with anything? If those 6 banks were 20 smaller banks, would the mortgage crisis NOT have happened?… or would the government have bailed out 20 banks instead of 6?
If you want to compete on the world market you have to be a big player. You haven’t offered one viable alternative. That’s because there isn’t one unless you are up for a new world order.
Winston, interesting stuff. Perfect quarters have happened before as well, so I suspect that skill has made the game less of a gamble for some. That’s why we allow the skilled players to manage our money in hopes of beating the odds.
#21–QuibbleMaster==errors in thinking tend to bunch up. You get to quibbling by mischaracterizing the argument/proposition/theme/Big Idea.
I never screamed and never claimed the end of the world. You see your manipulation?
I’m happy to suck it up/deal with the ambiguity/accept the bad with the good, but isn’t that a two way street? How does one avoid your mischaracterizations when posting what really is plain to all: Wallstreet needs to be re-regulated.
Deal with that instead of quibbling, misdirecting, mischaracterizing, and apologizine.
Same dodge is used with Winston, although I haven’t looked at his links. Accepting his statement as accurate, I am SKEPTICAL of your statement that there have been perfect quarters before. Not a quibble, you are now making up BS. Now, the last time I said that to you, you proved me wrong. Care to try that again? I will rest on Winstons stated odds and wait for your contradicting link. I doubt you can respond on point.
RTFA…
“A JPMorgan spokesman said the last time the bank had a perfect run was the first quarter of 2003. ”
You should know me better than that by now.
Refreshing your memory, you posted…
“We currently have 6 huge financial institutions who have assets over 60% of our GDP. Thats insane.”
My response…
“What i object to is alarmist exaggeration, and mincing terms like assets and GDP so that they SEEM alarming.”
So although some of you postings make perfect sense, That one caught my eye as sensationalism. You took it as a personal attack… again… and lambasted me in the next post.
GetSmart===”Please allow me to introduce myself, a man of wealth and fame!”====I HAVE LOST MONEY ON EVERY HOUSE I HAVE EVER OWNED!!!!!! While my friends have become rich doing just the opposite. All just timing and market fluctuations. Others made money before and after me on the same houses. Thank goodness I made enough money as a wage slave.
but on a related personal note, I was thinking just last night that I have accomplished much, more than most people with only 2-3 failures. I don’t care about losing money on houses, that actually was partially caused by selling to move to better jobs. But relatedly, I have always wanted to build my own house of my own design. Not be the contractor==pound every nail, run every wire. I’ve done parts and pieces of the entire job. But, none of it all together. But then I want to live in the house for my entire life==watching the grape arbor grow and develop. Put my arms up to the main cross beam and know I put it there.
But our lives go in other directions. I blame Wallstreet.
27,
Aim for Wilmington Delaware..PLEASE.
Lets just nail this one shut, shall we?
US Senate Committee on Environment and Public Works.
http://bit.ly/aKLKlv
Shat… wrong thread. Sorrrreeeee.
Thanks Skeptic. I respond on other thread.