Re: >H Blowoff Models

Adam Rifkin -4K (
Wed, 22 Dec 1999 04:41:32 -0800 (PST)

> There appears to be something on the order of $120-200 trillion
> (depending on whose figures you use) floating about the global
> marketplace. No one really knows what all is out there, how it all
> works, the amounts or the due dates, since these instruments are not
> regulated. US banks are exposed to the (official) tune of a cool $33+
> trillion (Item: who gets to bail them out?). Bear in mind the US GDP
> is about $9 trillion, World GWP about $25 trillion. Much of this new
> paper was concocted by physicists cum Wall Street rocketeers; I wonder
> how many of them studied sigmoid curves, predator-prey equations and
> catastrophe theory?

> ...

> So this presents an interesting problem, which I have not seen
> addressed at all: how to manage the "unwinding" of this multiplicity
> of exposed positions in such a way as to minimize the damage to the
> world economy? Presumably the Fed, the ECB, BOJ, etc. have some sort
> of war games rooms where they do such scenario planning, but they
> haven't been talking about it, besides, their objectives may be different.

Nice thought, but aren't feedback cycles like the one the market is
currently in, inherently unstable?

Also, only in a mania do we have stories such as this:

Talk about your blowoff tops...

> Tuesday December 21 12:03 PM ET
> Feds: CEO Gave Inside Tips to Porn Star

> NEW YORK (Reuters) - A former chairman and chief executive officer of
> financial investment firm Keefe, Bruyette & Woods has been charged with
> insider trading for giving tips about potential bank mergers to a porno
> actress, according to court papers made public on Tuesday.

> James McDermott Jr., the former CEO who now works at investment bank
> Allen & Co., was charged with securities fraud and perjury in Manhattan
> federal court for giving non-public information to Kathryn Gannon, also
> known as Marylin Star.

> Court papers describe Gannon, a Canadian citizen who has lived in Miami,
> as an actress and model specializing in adult films. The papers said
> that Gannon had an ``intimate relationship'' with McDermott.

> The papers noted that Keefe, Bruyette provides financial services and
> advice to various banks in connection with potential and actual
> corporate mergers and acquisitions. As head of Keefe, Bruyette,
> McDermott had access to non-public information about the firm's clients.

> The complaint also charges a third defendant, Anthony Pomponio, a
> self-employed New Jersey businessman, with allegedly trading on the
> tips. The papers allege that Pomponio also had a relationship with
> Gannon.

> Both Gannon and Pomponio opened brokerage accounts at Charles Schwab in
> 1997 and began buying stocks of small regional banks. Some of the banks
> were on Keefe, Bruyette's confidential list of potential acquisition
> targets and others were about to make public announcements of merger
> transactions.


Relinquishing junk. Stage one, preparation. For this you will need one
room which you will not leave. Soothing music. Tomato soup, ten tins
of. Mushroom soup, eight tins of, for consumption cold. Ice cream,
vanilla, one large tub of. Magnesia, milk of, one bottle. Paracetomal,
mouthwash, vitamins. Mineral water, Lucozade, pornography. One
mattress. One bucket for urine, one for feces and one for vomitus. One
television and one bottle of Valium. Which I've already procured from
my mother. Who is, in her own domestic and socially acceptable way also
a drug addict. And now I'm ready. All I need is one final hit to
soothe the pain while the Valium takes effect.
-- Trainspotting