Wednesday, March 25, 2009

A Few Final Notes Out of FFI

Short seller Jim Chanos was on a panel at FFI and said he did not care if the uptick rule was reinstated. He said that short-sellers had done fine in the past with the uptick rule in place, and if some key stock or the overall market dropped in the future, without the uptick rule in place, then everyone would blame short-sellers.

Chanos' thinking seemed to be to throw regulators and legislators a bone. My thinking is that this is poor strategy. Once regulators and legislators get the uptick rule in place, it is not as though they are going to go away. They are going to look for the next bone to chew on. It's best to keep them busy chasing that inconsequential bone so that they don't have the time to notice that on the table is filet mignon.

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George Soros, at a number of the sessions, pointed out that while everyone keeps talking about systemic risk, that what has been going on is not protection against systemic risk, but only protection of the financial sector.

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Martin Weiss' father was one of the few people, perhaps the only one, who made money shorting stocks in 1929 and also 1987. Weiss' father was also a friend of Bernard Baruch. At FFI, I told Weiss that I suspected that Baruch (and Keynes) influenced FDR to prop up the gold price for personal gain. Weiss wasn't willing to go that far, and said we will probably never know what really happened. But, he told me that his father, and a few others, were hanging around with Baruch at the time, and that while Baruch never leaked any information to them, Martin's father and the others were all buying gold stocks aggressively and that Baruch was aware of this and, at a minimum, he certainly didn't do anything to discourage them.

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BTW: Weiss has a new book coming out in April on how to protect your assets in turbulent times. I've seen an advance copy of the book and it is a winner. I'll review it once it is available for purchase by the general public.

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2 comments:

  1. Are there any Weiss books you would recommend?

    ReplyDelete
  2. Wait for the new book. It's a winner.

    ReplyDelete