Posts Tagged ‘Dodd-Frank’

Hilary, Liz and Dodd-Frank

February 21, 2017

Violin

Oh, there was a time, when I was a young man, when I would fiddle around, and that was nice enough for a while.

Then life came and went.

Nowadays, I find myself content to merely listen while life slips by.

In ages past, a maestro such as Felix Mendelssohn could  imagine something incredible; he could then summon up in his own mind and hands– an exquisite composition, an intricate stream of vibrations–as sublime as any that could ever be coaxed from a mere box constructed of wood and wire. He could then write the composition. Then, 170 years later Hilary could set bow to instrument and, with help from the orchestra, make it all happen so perfectly.

https://www.youtube.com/watch?v=o1dBg__wsuo

There’s a reason why my fiddle has been set aside all these years. Why bother? There’s somebody who can do it better. There’s somebody out there who can, in fact, do it perfectly.

Just listen. But I get to thinking. . .

Years go by. We pay attention, try to figure things out. There’s always somebody out there who can do things better than we can. Leave the complicated stuff to experts. And listen. Listen and learn. Maybe you’ll learn a thing or two.

Just daydreaming now; I think of Sally Field in Forrest Gump when she was playing his mother and she said life is like a box of chocolates; you never know what you’re gonna get.

Think about 2008. Everybody just lollygaggin’ along. . .then whoosh! well, you remember what happened. Everybody’s shell-shocked. Uncle Hank stammering on the Tube. They had to twist Congress’ arm two or three times before they’d come up with the money to fix the mess, at least temporarily.

Then the experts get trotted out to analyze, to testify, to figure what the hell happened in stock markets that made the thing come crashin’ down–something about market manipulations of MBS’s, unforeseen incredibilities of CDO’s, the incredulous defaulting of credit default swaps blah blah blah

As the thing unwinds, along come the explanations, the excuses, the wagging fingers, the committees, the commissions, the oversight agencies get rolled out, cranked up. Republicans in shock because Obama’s in. Democrats trying to figure out what went wrong and how to fix it. Democrats got to fix everything, so what do they do. . .

Let’s fix everything up, they say.

Ok. Obamacare and Dodd-Frank.

Years go by. Big shock when Trump comes blasting’ into 1600 Pennsylvania Ave after those 8 years of Mr. Smooth.

Now this morning we hear Amy and Juan on the radio, and here’s Senator Liz whining about how the new Republican whirlwind wants to wind down Dodd-Frank, which was supposed to be the big fix, the big Democratic fix.  I mean, she’s a little bit crazy, like all Democrats, but there’s one thing about Liz, she can play the rhetoric like Hilary plays the violin. It’s no wonder Mitch had to cut her off last week. Anyway,  Liz is saying:

“Commercial and consumer lending is robust. Bank profits are at record levels. And our banks are blowing away their global competitors. So, why go after banking regulations? The president and the team of Goldman Sachs bankers that he has put in charge of the economy want to scrap the rules so they can go back to the good old days, when bankers could take huge risks and get huge bonuses if they got lucky, knowing that they could get taxpayer bailouts if their bets didn’t pay off. We did this kind of regulation before, and it resulted in the worst financial crisis since the Great Depression. We cannot afford to go down this road again.”

I mean, Liz might have a point there. If things are so ROBUST, why do we still get this feeling about the 20,000+ Dow? Is it deja vu, or deja due, or prescience, maybe too much twitter or not enough facebook, or a rerun of common sense or what? Maybe it’s all just a bunch of hot air blowin’ around and we keep wonderin’ about the whole house of cards but we can’t really put our finger on what’s wrong cuz you know the answer my friend is blowin’ in the wind and life is like a box of chocolates anyway, a mere lala land where we think we got it figured out but really we don’t.

Although I do have to remind you, Liz, since I am a registered Republican: we can’t fix everything. If we could, and if we did, why, how boring would that be?

So my advice to you is we’d best leave the fiddlin’ to the experts. Sooner or later we’ll all have to face the music anyway.

Glass half-Full

the Ole Firmer’s Almaniac

May 27, 2016

The ole firmer walked around the backside of the barn. His wearied eyes took a moment to focus on the horizon; dark clouds appeared to dominate that distant line; they’d been hanging there for quite a long while now. The immediate vicinity was clear, however, if BLS numbers are to be believed. Mixed signals here there and yon. The times they are a-changin’, thought he, and things ain’t ClasicBldgRuf
what they used to be.

The rules of the game have changed; the old computations are no longer working, with the ole firmer and his firm being blindsided by all the new manipulations, robo-washed sterile by robo-driven arbitragers as if someone behind the sprays and fluff were cleaning the clocks of commerce, wiping away the profits, constantly leveling the playing field and rendering the firmer high but not dry, now eyeless in nasdaq, then dumb in the dow, spooked by the S&P, then suddenly swept up again in a flood of liquidity, floating on Fed flotsam, pummeled by day trade dealers punting buyback fluff up and down the field. The firmer pondered all this while studying the broad side of his barn. Need to fix that roof-– the thought crossed his mind for the umpteenth time.

Then without warning, his step coincides with a pile of BLS. Oh shit, exclaimed he. Up on the rooftop, the ever-vigilant barnyard blackbirds squawked loudly, as if trumpeting their amusement at his misfortune.  Caw! Buyback! Caw! Quoth the raven: Evermore! Now and evermore! So shall your ascending P/E path be: driving under the influence of BLS, monitored by SEC, checked with OMB, hog-tied with Dodd-Frank, frothing high in P/E ratios, fearless Fannie and fawning Freddie sharpening pencils in the background, consuming FOMC reports, leaning on Fed puts, flummoxed at SEC stops, disgusted with IRS farts and bewildered by WTF surprises.

LOL . . . not.

The ole firmer’s labor participation rate was, and had been for awhile, after 89 months of zero-bound interest rates on the downward trajectory–headed south, as some folks say, although he  wasn’t comfortable with the phrase. And out there on what used to be the open prairie of Price discovery–that old crossroads of supply and demand– well, it has become well-nigh impossible to determine where, when, how and why, it seemed to the ole firmer.

This is what it felt like, he surmised, to be on Main Street in a Kmart world, then at Kmart in a Walmart world, now being disoriented in an Amazon jungle, no way out,  with the Fed ham-stringin all the supply lines so’s to simulate demand on a rising level. How this gmo steady-state staid new world of post-capital never-everland came about he’d never understand.

The old firmer would never understand. He felt like the onslaught of old-timers’ disease was gnawing away at his youthful entrepeneural sensibilities.

The obnoxious ravens on the roof calmed down, their screechy cawing now lapsing into a low zirping. Quoth the raven–Nevermore! There’s no real investment any more. No more frontier, no more exceptional expansion, no more manifest destiny, where do we go from here, caught between rocknroll and a hard face.

They say casinos are big now.

Where’s the high-flyin’ high-multiplyin’ authentic productivity? Inventories high, sales low. Slow go. What would Rockefeller do? Where’s JP Morgan when you need him? Carnegie’s steel has all been laid; Edison’s taking a nap  and Bell won’t answer the phone. No Ford nor Chevy on the horizon that I can see, thought he. Watson’s now a programmed response. Fairchild’s been implanted in a solid state econ. Gates is creaky; Jobs is gone– out there somewhere on that musky dark cloud horizon. What’s everybody doing?

Tappin’ on chinky glass, devolving in devices vices, sippin’ Singapore slings,  all sound and futility signifying no-growth, thought he, hobbling along on a programmed 2% inflation path. Old-timers like me can no longer hit the broad side of a barn with our antiquarian projections based on old-school free-market dynamics, rallies and hog bellies, bushels, widgets and gadgets, buy and sell orders ’til the bears come home, might as well lay bricks in mortars with all these start-up farters.

Out on the horizon, big dust-storm coming up. Bulls are at it again, trying to stampede their way out of the Everything’s OK corral, but Uncle Fed and Aunt Fannie shut ’em down every time.

Glass Chimera