Tag Archives: Wall Street

Wall Street Crash, October 1929

This post is probably the most valuable post on this website, for the amount of history, learning, wealth and losses it captures, and lessons that are as relevant today, as they were in the Wall Street Crash, October 1929. Please read and share. Thanks.

Claud Cockburn, writing for the “Times of London” from New York, described the irrational exuberance that gripped the nation just prior to the Wall Street Crash, October 1929 and the following Great Depression of the 1930s, the bread lines, the apple sellers, etc. As Europe wallowed in post-war malaise, America seemed to have discovered a new economy, the secret of uninterrupted growth and prosperity, the fount of transforming technology:

“The atmosphere of the great boom was savagely exciting, but there were times when a person with my European background felt alarmingly lonely. He would have liked to believe, as these people believed, in the eternal upswing of the big bull market or else to meet just one person with whom he might discuss some general doubts without being regarded as an imbecile or a person of deliberately evil intent – some kind of anarchist, perhaps.” Continue reading

TopNews-05Feb2012

  • Romney wins Nevada GOP caucuses, Fox News projects – Fox News
    Globe and MailRomney wins Nevada GOP caucuses, Fox News projectsFox NewsThe pressure is on the rest of the Republican presidential field to knock Mitt Romney down a peg after the former Massachusetts governor sailed to victory in the Nevada caucuses following his big Florida win earlier in the week.Gingrich explains his way forwardCNNAnalysis: Romney Win Lea […]
  • Iran raid likely to drag in US, hurt global economy

    CBC.ca — Iran raid likely to drag in US, hurt global economy– Reuters AfricaBy William Maclean MUNICH (Reuters) – An Israeli raid on Iran’s nuclear facilities would deliver a painful shock to the global economy, revive flagging Islamist militancy and possibly drag the United States into a regional war whether it backed its …Israeli defense minister says he […]
  • Syria: UN veto gives Assad ‘licence to kill’ – opposition

    BBC News Syria: UN veto gives Assad ‘licence to kill’ – opposition. Russia and China have handed Syria’s government a “licence to kill”, say opposition activists, after the two countries vetoed a UN resolution. The Syrian National Council, an opposition umbrella group, urged Moscow and Beijing to change their minds.Why China, Ru […] Continue reading

Lehman Brothers Case Study

This is an ongoing post to study what exactly happened to Lehman Brothers.

Sep 15, 2008: Lehman Brothers was the 4th largest investment bank in the world. Why was Hank Paulson smiling the day Lehman Brothers was declared bankrupt? Did he play a role in the denial of US Govt support for Lehman Brothers at a critical juncture? Nobody knows that. But what one surely knows is that Hank Paulson is ex-Goldman Sachs and Goldman Sachs is a long term beneficiary of Lehman Brothers fall. Agreed that Lehman had much higher leverage (about 40x) than its peers (20x), so their balance sheet was much higher in risk. But if US Govt could support other large financial organizations like AIG, Fannie Mae and Freddie Max, maybe they should have offered some “short term support” to Lehman Brothers too. In credit crunch situation, time is all that one needs, and with a bit of time, Lehman could have got a chance to get sell some of its assets to raise capital or raise fresh capital from its long term investors globally. The US Govt’s/ Fed’s attitude of “not a single dollar to support you” towards Lehman Brothers was not logical and it harmed the global financial markets, including US economy. Continue reading

Thoughts On 1000 Point Fall in Dow Jones

http://graphics8.nytimes.com/images/2010/05/07/business/07trade_graphic/07trade_graphic-popup.jpg

Create a massive fall in the market large enough to trigger stop-losses typically set up at 5% drop, and then buy blue chip stocks at 30% less price before they recover, sell Put Options at 1000% gain, blame it all on computers and trading algorithms. Some person or some company somewhere has walked away with billions in profits after this event. It looks very well planned. This event was most probably an example of higest form of market manipulation, a bold master stroke, though illegal and unethical.

To find answers, we need to check the money-trail. Continue reading