IS LIVE RIGHT NOW.
MARIA: PRESIDENT BIDEN
UNVEILING HIS MASSIVE TWO 1/4
TRILLION-DOLLAR SPENDING PLAN
YESTERDAY HE IS CALLING
INFRASTRUCTURE PLAN, IT
INCLUDES RAISING CORPORATE TAX
RATE FROM 21 TO 28% ALSO
INCLUDES IMPOSING 21% GLOBAL
MINIMUM TAXING TO HELP COVER
THE COST WE ARE EXPECTING PART
TWO OF THIS PLAN, IN THE NEXT
COUPLE WEEKS WILL INCLUDE,
FURTHER TAX INCREASES AS WELL
JOINING ME RIGHT NOW FOUNDER
EDITOR OF THE BEAR TRAPS
REPORT LARRY MCDONNELL,
WONDERFUL TO TALK ABOUT POLICY
AND MARKETS, HOW ARE YOU
EXPECTING INVESTORS TO RESPOND
TO THIS SPENDING PLAN WE ARE
TALKING ABOUT, WHAT, 7
TRILLION DOLLARS THROWN AT
THIS ECONOMY AT THIS POINT IN
ABOUT A YEAR.
>> MIND BLOWING YOU THINK POST
LEHMAN AREAA WE HAD LESS THAN
TRILLION 700 BILLION, THE
INSTITUTIONAL INTENSIFIERS WE
RUN A BOTTOM LINE BOTTOM LINE
CHAT ABOUT 1,000 INSTITUTIONAL
INVESTORS AND MORE AND MORE
CONCERN HERE GROWING FEAR THAT
THE OBAMA-BIDEN TEAM IN 2010
REMEMBER THIS MARIA, THEY LOST
63 SEATS IN THAT FIRST
MIDTERM, THE MOST SINCE 1930s,
SO, THEIR MODUS OPERANDI RIGHT
NOW DEMOCRATIC ON PRO RATA
IFRS PILE AS MUCH SPENDING
FIRST TWO YEARS AS POSSIBLE
THROUGH RECONCILIATION ANOTHER
IN FOURTH QUARTER THIS BILL
FLOATED PROBABLY HEADWINDS
NEAR-TERM AT THE END OF THE
DAY WE ARE GOING TO BE LOOKING
AT YEAR FULL OF POTENTIALLY
FOUR TRILLION DOLLARS IN NEW
SPENDING THE IMPLICATIONS FOR
PEOPLE WATCHING US RIGHT NOW
BOTTOM LINE IS, IT IS GOING TO
WEAKEN DOLLAR SUBSTANTIALLY
FORCE IF HE HAD INTO YOU TUFSH
CONTROL BY THIRD, FOURTH
QUARTER SUPPRESS YIELDS HOLD
THEM DOWN WEAK TENS DOLLAR A
BOOMED FOR COMMODITIES.
>> IMPORTANT POINT I AM GLAD
YOU MENTIONED IMPACT OF
PRESIDENT OBAMA’S SPENDING ON
ACTUAL MAKE-UP OF THE
CONGRESS, BECAUSE RIGHT NOW
YOU ARE TALKING WITH DEMOCRATS
REALLY HOLDING A VERY
RAZOR-THIN LEAD IN TERMS OF
MAJORITY HERE, SO THEY WANT TO
JAM IN AS MUCH AS POSSIBLE
WHILE THEY HAVE THE LEAD, WHEN
YOU SAY THE FED MANAGING WHAT
HAPPENS NEXT ARE YOU SAYING
YOU ARE EXPECTING THE FEDERAL
RESERVE TO START CHANGING ITS
LANGUAGE?
AT SOME POINT?
IN TERMS OF WHAT THEY ARE
GOING TO DO I MEAN WE HAVE
SEEN THIS BACKUP IN INTEREST
RATES, ALREADY RIGHT, 1.7% ON
10-YEAR.
>> YES, A LOT OF OUR
INSTITUTIONAL CLINES OVERSEAS
CLIENTS ABOUT 26 COUNTRIES
LOOK AT FOREIGN OWNERSHIP OF
TREASURYS DOWN ABOUT 15, 20%
IN TERMS OF FELT ATTORNEY
OWNERSHIP APPLYING TREASURYS
THAT MEANS FEDERAL RESERVE
THROUGH MMT, OR MODERN
MONETARY THEORY BIDEN
ADMINISTRATION IS FORCING IF
FED INTO MMT MODERN MONETARY
THEORY THE FED HAS TO MAKE
MAKE UP FOR WHAT INTERVAL
INVESTORS ARE NOT BUYING.
MARIA: LET ME MOVE TO WHAT WE
SAW OVER THE LAST WEEK, AND
THAT IS THE -- THE LOSSES,
TIED TO UNWIND OF ARKAGOS
HEDGE FUND, -- THEY ARE
INVESTIGATING PONL LOSSES 09
MILLION DOLLARS TRYING TO DEAL
WITH ARKAGOS WE HEARD FROM
NOMURA CREDIT SUISSE WARNED OF
SIGNIFICANT LOSSES WHO IS
EXPOSED TO THAT HEDGE FUND
UNWIND WILD SWING IN STOCKS
FRIDAY WAS AMAZING TO SEE,
STOCKS LIKE DISCOVERY CBS
VIACOM IS TO IMPACTED BY
UNWIND.
ARE WE GOING TO SEE IMPACT
NEGATIVE ON BANKS, LARRY?
>> WELL, I WILL NEVER -- I WAS
SO PROUD OF YOU BECAUSE, YOU
AND I WERE DOING -- A -- ON
SHOW, 2009, 10 YOU BROKE REPO
105 STORY WHAT LEHMAN BROTHERS
WAS DOING TAKING 50 BILLION A
MONTH OF LEVERAGE OFF THE
BALANCE SHEET, REPORTING
EARNINGS AND BRINGING IT BACK
ON SO IT WAS A TRYING TO HIDE
LEVERAGE.
HERE WE ARE 12 YEARS LATER
BANKS DOING -- NOT BANKS NOW
HEDGE FUNDS USING TOTAL RETURN
SWAPS, 21ST CENTURY TRICKS TO
HIDE LITERALLY BILLIONS AND
BILLIONS OF DOLLARS LEVERAGE,
AND IN THIS CASE, ONE INVESTOR
HAS HIT THE GLOBAL BANKING
SYSTEM WITH ABOUT 12 BILLION
OF LOSSES.
TENDED FOR PEOPLE WATCHING
RIGHT NOW IMPLICATIONS ARE,
HEDGE FUNDS RIGHT NOW MUTUAL
FUND ASSET MANAGERS CANNOT
TRUST PRIME BROKE, THE BANKS
ON STREET RIGHT NOW A WEEK
LATER CAN’T CALCULATE LOSSES
THIS IS SCARY, HAVE NOT GIVEN
A NUMBER NUMBER OF BANKS NOT
GIVEN THANK YOUS NUMBER THAT
MEANS THAT WE ARE GOING TO SEE
A PREPOTENTIAL DELEVERAGING AS
A INVESTORS HEDGE FUNDS CAN’T
TRUST PRIME BROKE, A NATURAL
DELEVERAGING PROCESS FUNDS
START WITH HOUSE, SENATE
HEARINGS, GOING TO BE
ENTERTAINMENT TIME ON
TELEVISION.
MARIA: ABSOLUTELY, LARRY
THOSE AS THE WERE INCREDIBLE I
REMEMBER IN LEHMAN COLLAPSE
WHEN I FIRST GOT THE CALL
BEFORE WEEKEND THAT CHANGES
EVERYTHING WHEN LEHMAN WENT
UNDER I FIRST GOT THE CALL
THAT JPMORGAN WANT TO ACQUIRE
BEAR STEARNS FOR TWO DOLLARS
REMEMBER THAT I SAID WAIT A
SECOND ARE YOU INSURE MULTIPLY
PAID 10 DOLLARS EXTRAORDINARY
MOMENT IN TIME QUICK BEFORE
YOU GO DOES ANYTHING TODAY
FEEL LIKE WHAT WE LIVED
THROUGH WHAT WE WITNESSED,
DURING THE FAILURE OF LEHMAN
BROTHERS, ARE YOU EXPECTING,
ANY -- YOU KNOW, SIGNIFICANT
DECLINE IN THIS MARKET GIVEN
INFLATION, HIGHER INTEREST
RATES, SPENDING,ETS, ET
CETERA, ET CETERA,.
>> THE FACT EXTREME LEVEL
SPECULATION THE FACT ONE
INVESTOR LITERALLY ALMOST TOOK
DOWN YOU KNOW LARGE FINANCIAL
INSTITUTIONS, THAT TELLS YOU
THE RISK REWARD IS ATERRORIOUS
TWO TO 4% UPSIDE, PROBABLY 30
TO 40% DOWN AT THE END OF THE
DAY, YOU LOOK AT BIG BANKS IN
EUROPE CREDIT SUISSE, UBS THEY
HAVE A LOT OF EXPOSURE HERE WE
ARE HEARING FROM CLIENTS GOING
OFF TO TO BE A CAPITAL RAISE
OR AT THE END OF THE DAY MAY
BE THERE MAY BE, A FORCE HAD
THE MERGE OF UBS AND CREDIT
SUISSE SPECULATED IN THE
MARKET WON’T BE A LEHMAN TYPE
DISASTER, BUT IT WILL CALF BE
A SHOCK COMING, COMING SOON
PROBABLY NEXT ABOUT 30 TO 60
DAYS.
>> WOW.
LARRY WE WILL KEEP TALKING
ABOUT THIS I KNOW THAT CREDIT
SUISSE UBS STORY HAS BEEN
GOING ON A WHILE I WANT TO
KEEP TALKING ABOUT THAT,
REALLY, TAKING A LOOK AT THE
LANDSCAPE OF THIS INDUSTRY
WITH YOU GREAT CONVERSATION
PLEASE COME BACK SOON GOOD TO