The criminal rich were well aware of what they did, and that the party would end.

How did I know the crash was coming four years ago, and for the very reasons that it happened? Anyone can understand how bubbles work. All you need is half a brain and no stake in believing the get-rich hype. It's been 290 years since John Law's France and the near simultaneous South Sea crash of 1719-20, some 380 since the tulip mania of 1637. It's been 80 since the Wall Street crash of 1929, so newness is an excuse. The dot-com bubble burst and Enron went down just eight years ago, so you can't say the history is too remote to remember.

Little about the basic scheme of overvalue and oversell -- with a wink -- was different in this latest and greatest round. Many investors knew they were in a bubble market in the hope of cashing out before it crashed.

One of the tricks this time was that the perpetrators deployed hired mathematicians with sophisticated but ultimately fictional algorithms to conceal the predatory, largely criminal practices that became the financial sector's norm. They knew exactly what the inevitable results would be, years before 2008.

Come on, Madoff and Thain aren't "black swans" - they were the chairmen of the equities markets! Madoff hired the ratings agencies for a blessing and was cleared by the blind men at the SEC. He was not an abberration or a bad-apple surprise: he was the paradigm of the modern financial sector. This is a Ponzi economy.

From the Gramm-Rubin deregulation offensive on behalf of Citigroup and Enron, from yesterday's "Kenny Boy" Lay to today's John Thain, all of the executives at the biggest financials, not to mention the ratings agencies, the central bank, the Goldman Sachs cabal who recently commandeered the Treasury with the blessings of the corporate parties, the supposed government overseers of the SEC, and the outgoing Halliburton Administration are neck-deep in breathtaking financial criminality, and even more astonishing self-enrichment. Sadly, the Yes-on-TARP voter Obama is a step away from fully cementing his own complicity in the intentional, long-running and systematic plunder of the American people and the world on behalf of the billionaire-banker class.

Before the crash, any banking poobah who didn't go along with derivatives scammery would have been eaten alive for not pulling down the highest return in accordance with the Money-God's commandments. Even their apologists know this; it's their excuse, for pete's sake!

For those who really want to read about the crisis, and not the justifying mumbo-jumbo advanced by the players, Michael Lewis laid it out in a brilliant treatment published in Portfolio:

http://www.portfolio.com/news-markets/national-news/portfolio/2008/11/11/The-End-of-Wall-Streets-Boom?print=true#

The End
by Michael Lewis December 2008 Issue
The era that defined Wall Street is finally, officially over. Michael Lewis, who chronicled its excess in Liar’s Poker, returns to his old haunt to figure out what went wrong.

Being rich dosen't make you smart.

K&R

Bush's occupation of the WH. They came very close to blowing up when Spitzer went after them, but we know how that turned out.

and stopped the music. Ever since then, we have been watching who can get a chair before the dust clears and everyone realizes how extensive the wreckage is. After that point in time, it will be pitchforks and torches.

The best-laid plans of mice and men often go awry.

in August, 2007, when the sub prime mortgage bubble burst. Countrywide, the biggest contributor to it, barely avoided bankruptcy that month. Others weren't quite as lucky. That's when banks started to look at their asset columns and realize just how much of it was funny paper from hedge funds, exotic "securities" that were likely nothing but a bunch of bum loans in Florida and California.

There had been warnings since the Sept 2006 collapse of the Amaranth Advisers hedge fund, but the real shock came in August, 2007.

Everything has snowballed since then, including the Societé Generale bust in January of 2008.

who comes in with a small caliber bullet hole straight through his heart, joking about it, pretending he's not a dead man.

I had a morbid kind of fun with it, since there were so many denialists all the way into September 2008!

In fact, the dead man is still pretending. So it will be, 'til the day the government/fed finally knows the joke has become too obvious for the Asians to tolerate, and starts taking these super-sinkholes like Citibank and AIG into receivership. Or the Asians write down their dollars and lower the boom.

because I've seen this sort of thing coming for a very long time.

I just hope some people took the advice. They'll be in the best position to survive this thing intact.

at the beginning of the McCain-Palin administration, with a rapid stimulus plan in the form of several new wars.

"It's been 80 since the Wall Street crash of 1929, so newness is NOT an excuse."

In The Know: Should The Government Stop Dumping Money Into A Giant Hole?
http://www.theonion.com/content/video/in_the_know_should_the_government

There were indicators all along. After 2004, more companies started buybacks and going private.

On DU, we were talking about the Housing Bubble in 2002, more so each year thereafter. Try an advanced Google search.

Marjorie Kelley has a book called, "The Divine Right of Capitol," in which she compares the stock market to buying a used car. Excepting IPOs, 100% of the money that goes to Wall Street goes into propping up someone else's gamble.

Let me restate that: excepting IPOs, 100% of the money that goes to Wall St. goes into propping up someone else's gamble.


We purchase a car as an investment to get us to work and back. When we buy a used car, that money is never an investment in Ford Motors. It's to prop up the investment the original buyer made. Likewise, buying stock from a seller only props up their investment.

By keeping stock prices high, the company benefits indirectly because the higher the stock price, the cheaper it is for them to get loans.

Look where that got us.

since the end of 1999 I started to pay attention to some financial boards, they knew what was coming, of course getting the timing right is tricky :)

in the year 2000 there was a bubble thing happening.Dot com jobs dried up.That was my big warning sign. I got out from under a mortgage and bad relationship in the nick of time.

in addition to the dot.com jobs drying up, the near vertical move of the stock market in late the 1990's could not be sustained.

We need to be on watch for the next bubble.

:)

It will go from zero to a quadrillion and crash within a week.

who as a class are criminals. Somebody downstairs tapped on the pipes so they turned down the music a little and stopped pissing out the window for a while, but the party goes on. But if you're one of those people downstairs, eating dog food and awaiting eviction, well yes, the party is over for you. But you'll keep paying for their party, the party never ends, until the revolution.

Though "party" in this case refers not to the lives of the rich, but to the speculative bubble. ;)