Even though O’Donnell laudably tried using to emphasis the audience’s focus onand hopefully very last, Charlie Sheen trainwreck interview, courtesy of the tragic undertow that threatens to pull Sheen beneath for excellent, I was overtaken, not from the pulling on the thread, in addition to the voracious audience he serves. It did not make me sad, it developed me angry.
On the subject of celebrities, we are able to be a heartless country, basking within their misfortunes like nude sunbathers at Schadenfreude Seaside. The impulse is understandable, to some degree. It could possibly be grating to pay attention to complaints from many people who benefit from privileges that many of us can not even envision. If you can not muster up some compassion for Charlie Sheen, who can make further cash for a day’s do the job than the majority of us will make inside a decade’s time, I guess I can not blame you.
Along with the quick tempo of occasions on the net in addition to the info revolution sparked through the Web-based, it’s extremely painless for that solutions sector to believe it’s exclusive: regularly breaking new ground and carrying out items that nobody has at any time finished ahead of.
But there can be other kinds of company that have currently undergone a few of the identical radical shifts, and also have just as terrific a stake within the future.
Take healthcare, as an illustration.
We usually feel of it as a significant, lumbering beast, but in reality, medicine has undergone a series of revolutions inside past 200 a long time which might be not less than equal to individuals we see in technological know-how and facts.
Much less understandable, but nonetheless within just the norms of human nature, is the impulse to rubberneck, to slow down and find out more about the carnage of Charlie spectacle of Sheen’s unraveling, but of the blithe interviewer Sheen’s everyday living as we pass it during the best lane of our every day lives. To become straightforward, it could be challenging for folks to discern the distinction among a run-of-the-mill attention whore, and an honest-to-goodness, circling the drain tragedy-to-be. On its individual merits, a quote like “I Am On the Drug. It’s Referred to as Charlie Sheen” is sheer genius, and we cannot all be expected to consider the total measure of someone’s daily life every last time we hear something funny.
Quickly forward to 2011 and I'm attempting to check out signifies of being a little more business-like about my hobbies (mostly new music). From the stop of January I had manned up and commenced to advertise my blogs. I had developed a number of completely different blogs, which had been contributed to by friends and colleagues. I promoted these routines by using Facebook and Twitter.
2nd: the little abomination the Gang of Five around the Supream Court gave us a year or so back (Citizens Inebriated) actually features a touch bouncing betty of its own that could really effectively go off with the faces of Govs Wanker, Sacitch, Krysty, and J.O. Daniels. Since this ruling extended the notion of “personhood” to each corporations and unions, to strive to deny them any best to operate inside the legal framework that they had been organized beneath deprives these “persons” for the freedoms of speech, association and motion. Which implies (after yet again, quoting law school educated spouse and children) that both the courts really need to uphold these rights for the unions (as individual “persons” as guaranteed by the Federal (and most state) constitutions, or they've to declare that these attempts at stripping or limiting union rights must utilize to serious companies, also.
Now that silver continues hitting nominal high after high (except of course for the record price hit during the Hunt Bros period), and there is a very distinct possibility we may see an unprecedented melt up in the price of silver to over triple digits for a variety of previously discussed factors, here is a post we produced a year earlier, courtesy of a "deep insider" which dissects with exquisite detail the nuances of silver market manipulation, which in retrospect may have been just a little early. Considering that every single trope mentioned is now in play (even the unmasking of Buffett's unbelievable PM bashing hypocrisy when he himself was one of the people who utilized blatant silver market manipulation for his own purposes when it suited him back in 1997 to send silver soaring), we believe readers should re-read this post in its entirety as it presents a walk-thru for the mechanics, and strategy, of the ongoing unprecedented move higher in the shiny metal.
From A Deep Insider's Walkthru To Silver Market Manipulation, posted originally in April 2010, when silver was lower.... way lower.
As the topic of physical delivery has gained prominent attention
recently, it is crucial to complete the circle and show how this
weakest link in the PM market is (ab)used by the big boys: Phibro and
Warren Buffet. Pay particular attention to the analogues between the
methods employed in the 90's commodity market and how the PM (and
equity) market is being gamed currently. And to think that each new
generation of traders believes it has discovered something new... (All emphasis below is ours)
Background
- As
a market maker in silver options from 1989 to 2000 I was present during
both the 1994 and 1997 silver events. They were seminal in my education
of gamesmanship in trading and how probabilities can come up short. - Prior
to going out on my own, I traded at a small market making firm. When a
trader finished training there, he had top-tier options knowledge but
was not educated in whom the players were, the fundamentals of the
markets, and how probabilities were useless when information was
asymmetric. That wasn’t their business, they taught option’s theory.
Since I had drunk the kool-aid, I thought fundamentals and gamesmanship
were useless in the face of the almighty Standard Deviation model. That
was a mistake.
Phibro Early Exercise
- In
April 1994, the Thursday before Easter, the trading day ended with a
rather unusual run up of 15 cents near the close to finish at 435ish
around noon. Options expired that day at 4pm but we weren’t anywhere
near the closest strikes (425 and 450) so most of us left. It was a 4
day weekend in the U.S. but silver traded globally, albeit il-liquidly
in Asia. Comex wouldn’t open until next Tuesday. My education in
gamesmanship started that afternoon at JFK airport as I was waiting for a
flight, my first vacation in 5 years. - My backer paged me at the
airport to inform me that someone was exercising the K 450 calls. I
scoffed thinking it was a retail sap that was talked into exercising
some 5 lot piece by an overzealous broker. “Great I said, let them, the
options are out of the money.” And I hung up - 10 minutes later
he had me paged again. “You don’t understand, it’s Phibro exercising.”
Again I naively said, “So what, they are energy guys.” But I was
curious, “How many? “ I asked. “All of them, five thousand, he replied.
Now I was really curious, but still woefully ignorant that it was I who
was the sap at the table. “Why would they do that?” and he explained it
to me. I nearly shit myself and bent over in the cab vomiting on the
ride back. - Cancelling my trip, I headed back to the office to
assess the reality of what would happen, probabilities were no longer
important. Survival was important. I had no money and was trading on a
$25k note lent to me by my backer. - We covered by buying futures
on my entire short open Interest equivalent of EXPIRED OUT OF THE MONEY
OPTIONS in Singapore with a dealing firm. We did this prior to even
actually knowing if I was exercised, probabilities be damned. How did I
know they exercised? The price covered at was $462; that is how. The
450s were already in the money by 12 cents. - Phibro exercised all
5k lots. I had a fraction of that but big enough to be carried out on a
stretcher had the rest of my position not bailed me out/ performed on
Tuesday next week. - The weird part was, the market stabilized
that Tuesday and did not run to “infinity” as it could easily have. We
found out later it was because Phibro’s exercise was a no-no and Warren
Buffet ordered them to shut the trade down as it was too big of a
potential scandal. Especially in light of his coming to Solly’s rescue
and lending his good name to fix their most recent Treasury scandal. A
couple head’s rolled there if I remember correctly. - My guess was
that the client was a Buffet or Soros type. Someone that would only go
to Phibro, as these guys were the best at preventing information
leakage, and always aligned themselves with client interests, where as
if IB had an order and acted in dual capacity as a dealer, he would
potentially front-run the order or stop it out poorly on an exit. Phibro
didn’t take other side of their client’s orders. They ran with them,
and took care of the clients first. - Phibro got a big order for a
client to buy silver, one that had to be handled expertly, and filled
over time, no information leakage would be tolerated. These guys were a
prop desk that took orders as brokers once in a while. - They accumulated options for their own account (K 450C) to piggyback but not front-run the client.
- They must have bought futures for themselves as well as the client with his permission.
- They beat the VWAP by gunning the market on light volumes 1 hour before a 4 day US holiday. [TD: compare and contrast with the daily patterns seen every single day in the endless move up in the S&P]
- They
exercised the 450 Calls that day and then lifted the offers of the 1 or
2 OTC metals dealers left open during Singapore hours, running them
over during illiquid markets.
Never Again!
- I became infatuated with Phibro gamesmanship and made it a point to understand that particular type of player.
- Libertarian
Darwinist that I was I did not blame them. At the time It was a
buyer-beware market for big businesses and they did nothing wrong. They
took risk and they aren’t bigger than the market. I wanted to play with
the big boys, and that was the price. - For me it was about
learning how to read the signs and not be on the wrong side of one of
those events again, even if I was not privy to their meetings.
Here is some of what I learned:
- In
metals (and energy and anything else with an OTC market) the IB firms
have dealing desks along GS, MS, Republic, JPMorgan, Scotia Mocatta, all
were essentially broker dealers in precious metals. All had clients:
miners who hedged production and hedge funds who speculated OTC. They
provided liquidity by taking the other side of their client’s trade and
“back-to-backing” them in the futures markets or held onto them in their
prop books as counterparty because of something else they saw. - Their
client left resting orders with them in the IB’s Central Limit Order
Book (CLOB) which served as good information to trade around for the IB.
Sometimes they front-ran the client, other times they go for stops to force the client to puke. Sometimes they’d just make markets, depending on many things. It was poker to them. - Phibro
was different. These were smart guys but they weren’t a dealing bank.
They exploited imbalances in markets and took positions. They had
ideas. They also took orders for heavyweights who needed absolute
discretion. They did not make it their business to fleece their own
clients and instead aligned their interests. And they made the banks
look like pikers when a client came to them with an order. - For
the next 4 Years I paid attention to how those dealing banks and phibro
played the markets. It was all about gamesmanship, Bayesian probability,
and knowing your counterparty’s motivation with these guys. Information
and misinformation.
Some methods:
- How
I.B firms would use a thinly traded floor to print the price that would
trigger a massive stop loss in the OTC markets and bury their own
clients. Or how they would buy for their own accounts in front of
resting limit orders for clients and simply use their clients to stop
themselves out if the market printed thru their buy levels. Or how they
would use dual representation to show loudly they were buyers on one
side of the ring, while they were selling quietly upstairs to other OTC
dealers. Trading with themselves in multiple entities, etc. - An
IB with a Commodity Index was in heaven. Prop trading, captive client
flow from IB deals and OTC dealing and Brokerage. The good ones knew how
to integrate and hedge macro risks, whether to front run their own
index clients or get out off their way. “Chinese walls” did not exist
in Commods. - Commods were mostly self regulated and that lead to predatory yet mostly legal behaviour.
- Some
of these were necessary to protect their interests with such a small
number of players. Some were possibly unethical, but most were legal.
Their clients were all big boys who left resting orders with the IBs at
their own risk. Clients themselves had to resort to some of the same
tricks to keep the IB desks honest, like Coming in backwards,
“spoofing”, leaving buy stops to get sell orders filled. The alternative
for these clients was to put massive orders in the floor where
liquidity was subjective, non continuous and information leakage was
massive.
1997- Warren Buffet.
- I got my chance to not get run over in 1997, when Warren Buffet gave an order to Phibro to buy silver.
- Short version. Here is what went down.
- Buffet gives Phibro the order- fact
- Phibro
begins filling it as a broker using various OTC dealers as
counterparties, and letting the I.B dealers sweat getting out of the
risk. - fact - Phibro buys options for their own account (no exercise game this time tho)- fact
- Phibro buys futures for their own account. – not confirmed.
- One
by one the IB dealers start to catch on that this is no ordinary order
Phibro is handling. They back away and liquidity gets harder to find.-
fact - Other bigger hedge funds in the small circle of professionals, and other smart firms start getting long.- fact
- Silver
starts getting delivered from the Comex vaults. Some of it actually
removed. Some of it just “covered with a sheet” for removal. But ounces
begin to be removed from the warehouse. Phibro was rumored to be taking
delivery and beginning to telegraph fear in the markets to start
spoofing the VWAP. Rumor was they had a warehouse in Red Hook where they
stored it. Never confirmed. - Point here is, the saps for the
last part of this play were the producers and refiners who were
complacently net short and dependent on above ground silver to satisfy
delivery requests. - Producers had been over-hedging for years in
this market, as silver was cheap and they had business cash flow issues.
It was their habit to sell forward production not yet available to
them. And if forced to, they would lease already above ground silver and
make delivery, collateralizing it with silver yet to be mined. Their
positions were habitually synthetically long the contango as they rolled
their deliverable production further and further out the curve in an
attempt to squeeze much needed cash (cost of carry)for their businesses.
The net effect was that sometimes they had to borrow silver for prompt
delivery while they rolled their production hedge back further. – my
interpretation of what I learned. May not be accurate to the “T”, am not
a physical guy. - Example: in 1995 a miner has silver due above
ground in 1997. He hedges it in Z-1997 contract. Z 1997 comes and if he
doesn’t have that silver available for some other reason; he covers the
short and rolls it back. How much he needs to do this is a function of
his obligations, cash flows, and his greed for carry. If leases are
cheap, he will seek to capture all the contango and lease it until he
gets the silver available. - If lease rates go up, it is not
unlike a miner strike. Silver is needed for delivery now, and term risk
becomes the issue. Contango collapses and market goes backwardated. He
will be forced to sell the contango to get that prompt silver short back
if he cannot make delivery. He has to defer delivery. - These guys were dependent on the specs NOT taking delivery for years. Specs didn’t have balance sheets to take and store physical metal. Specs usually were the weak hands at futures expiry.
- But then…..Entities
that stored silver in bank vaults (like the Republic vault) begin to
remove silver from the available pool for leasing. This made the “easy
money” portion of production financing no longer easy. Think: smart
money getting the word that a squeeze was on and playing along with it. - Phibro
(and others) start selling the contango in the futures market to
prepare to take delivery of even more contracts. Or at least put
pressure on the producers who had front month shorts they would have to
make a decision on delivering. Phibro KNEW that the producers had to
sell the spreads to get their shorts back. But they couldn’t lift their
shorts altogether as part of their financing deals with their bankers.
Their own positions were now breaking down in every way except flat
price. The market really didn’t move much. This let them stay in denial. - Buffet announces he is long and intends to take delivery of silver. Contango collapses. Market spikes to 7.40.
- Rumor
is gov’t intercedes and asks Buffet to not do this, it would break the
industry. (Kind of like how the exchange begged the gov’t to help it
shut down the Hunt Bros.) He says ok, and agrees to lend then their
silver back to them. Essentially charging them 40% interest to delay
delivery for a year.
What to look for:
- Find the overleveraged/ extended party- and you will find the weak hand at the table. (Producers in 1997)
- Tail
wags dog: if the pricing venue trades smaller volume than the OTC, then
manipulate price with small volumes to execute trades with big volumes
favorably. (OTC vs Comex floor) - Divide and conquer- if
counterparties are undercapitalized and/ or fragmented, then it will be
easier to get them to move like a herd. (happens in options ALL THE
TIME at expiration) - Manipulate data- take delivery of metal, take risk off books, manipulate MTM data.
- Create
an exit strategy- a good catalyst like Easter weekend, an announcement
by an investor etc. or develop a market and grow your own bigger fool.
ie – retail.
Comments - So many points to make here:
- How
derivative markets can create a problem thru too much liquidity that
cannot easily be reconciled by bringing physical production on line fast
enough. - How this works both ways, and that dealing banks have
been playing the gold/silver carry game for easy funding of other trades
for years. - How, even though I personally think that what the
OTC does is their own business, but the increasing securitization of
commodities leaves regulatory arbitrage and OTC games to affect a new
generation of ETF buyers, either thru incremental banking or thru
contango cancer. That Wall Street salesmen and players with
access to both markets retail and professional can exploit the captive
audience created with ETFs and other fund type instruments to shear and
in some cases skin the sheep. - That much of this happens
because the gov’t is too stupid to see the inherent conflict of
interest in what a broker-dealer does. Regulation will not stop gaming
the law. Ethics do, and not everybody has ethics. So best you
can do is prevent situations of conflict of interest, like the existence
of Broker-dealer type entities. Either you trade for yourself, or you
trade for others. Period. - Fact is, if there were retail
public in this game back then, the IB firms would have somehow sold
them on the idea to BUY contango, or short silver. But the
financialization of commodities wasn’t there yet. And the “bigger fool”
game stopped at the producers. If it happened again, with ETFs, cross
regulatory semi fungible products, asymmetric access to venues and other
factors in a global market, the public would be killed, short squeeze
or long puke (like in UNG now) take your pick. - You can never
know intentions, and no one is bigger than the market, but the
consequences of a lack of transparency and the free reign in which banks
can tell half-truths to investors is a big factor in enabling strong
hands to fleece weak hands with little market risk. It’s all a con game.
And when the IBs figured out how to change the rules, then they
were free to use their killer techniques to exploit a million little
fish instead of the 10 big fish they usually competed with. - Phibro
was a ballsy cowboy trading firm. The banks at the employee level are
as well, but corporately, they first seek to make money and secondly
provide a service. When they should be providing a service that makes
money. - Everything that was done I’ve seen done the other
way, keeping prices low, shaking out weaker players. Rarely does it
happen in such a dramatic way. It is usually a series of “short cons” as
opposed to Phibro’s home run. It’s all Darwinism. But when civilians
are involved as they are now, then it is no longer caveat emptor. - Instead of taking a million dollars from a hedge fund, these guys take a dollar from a million people now.
One of the prime topics of conversation during NBA All Star Weekend is the league’s labor agreement or lack thereof.
The league is enjoying an unprecedented level of popularity and its future is bright. Midway through the 2010-11 season, the league's talent level is deeper than ever and many of the those talented players are just beginning their careers. The NBA’s marketing machine is world class and interest in the league is at an all-time high.
However its road to success is approaching a giant pothole – otherwise known as its next labor agreement — and to me we’re entering a fascinating point in league history.
Forbes Magazine has reported that 12 of the 30 NBA teams lost money last season. And NBA Commissioner David Stern, several weeks back, claimed that league owners were projecting a cumulative loss this season of approximately 350 million dollars.
Stern has declared that the current labor situation is untenable because the players are being paid too much guaranteed money. The players for their part are digging in and this labor dispute shows few if any signs of getting resolved anytime soon.
There is also one glaring problem that I personally feel the NBA needs to fix because, if you ask me, it’s the one negative the league has faced for as long as Stern has been commissioner. Each season, too many teams have zero chance of making the playoffs.
Let’s face it, if you’re a fan of the Timberwolves, Wizards, Nets and a bunch of other teams, you’re basically watching games to see the opposing team because your team’s best chance to improve is to lose as many games as possible, get a high lottery draft pick and then have the ping pong balls fall the right way on lottery night. Luck plays too big a role in who’s good and who’s not.
Continued on the next pageSource: http://removeripoffreports.net/ corporate Reputation Management
The ultimate in repairing a bruised reputation for business
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