Tuesday, May 20, 2014

OMG: On Warren Buffett's Over the Top, Embarrassing, Praise for Tim Geithner's New Book

How much of a crony has Warren Buffett become?

He is quoted on the back of Tim Geithner's new book, Stress Test: Reflections on Financial Crises:
Sensational...Tim's book will forever be the definitive work on what causes financial panics and what must be done to stem them when they occur.
Buffett's father, Howard, who knew the great Austrian school economist, Murray Rothbard, must be turning over in his grave. In the quote above, Buffett is not only discounting Austrian school business cycle theory but even Keynesianism, for an alleged-theory by the total crony Tim Geithner.

Let it not be forgotten that just days after Buffett invested $5 billion in Goldman Sachs, the Treasury announced that it would bailout Goldman and other top tier Wall Street investment banks. Buffett made a killing in Goldman stock as a  result of the bailout. Would Buffett have put $5 billion in Goldman if he wasn't tipped off that a bailout was coming? I doubt it.


  1. Forget all that. I want to read Timmy's book on how to not pay taxes. I think he knows much more about that subject, even if it just boils down to "be a crony insider."

  2. “As a result of this we have the markets in total lockdown. The markets have become so manipulated that it’s laughable. The situation has become so bad that we have Deutsche Bank coming out and saying perhaps the Fed and the central banks are controlling markets too much through their guidance.

    What a laugh that is. It’s a whole lot more than guidance. The U.S. government has agents all over these markets working them in whatever direction they want. So it’s important for people to understand that you are getting no true information from what’s happening in markets short term.


  3. joshua rosner ‏@JoshRosner 3h

    Geithner & Fed ignored pre-crisis warnings by Gramlich & Bair. Blame them not Bush or Obama. See NYT story from '07. http://tinyurl.com/o6cd6ne


  4. Buffett agreed to invest $5 billion in Goldman on Sep, 23, 2008 - over a full month before TARP was passed.

    1. As an economic theorist Buffett is full retard. But as a shrewd crony capitalist money grubber he knew, without having to be told by an insider like Bevis Geithner, that Goldman Sachs would get bailed out. G-S is a major intermediary between The Fed and The U.S. Treasury Dept. A bailout naturally follows from that relationship.

    2. The Buffett-Goldman deal was indeed announced on 9-23 but TARP was passed just a little more than a week later on 10-3.

    3. Buffett's first rule: Invest in what you know.

  5. And let's not forget how Buffet poo-poos holding gold because it is an inferior investment product relative to holding farmland, or equities that pay a dividend, etc. No shizzam, Sherlock! It's not an investment. It doesn't pay dividends, and you can't eat it. But it IS money, and its value will NEVER go to zero. So if you're a little guy that just wants to protect the purchasing power of what he has earned instead of having that purchasing power stolen through inflation of the money supply, then you sure don't want to hold fiat. Schmuck.

    1. An investment in farmland and/or equities would not be you holding fiat. How has your gold investment done in the last three years or thirty years? Keep hoping the U.S. melts down while your investment melts away. All this blog seems to have are washed up gold bugs and conspiracy theorists, true libertarians such as myself find this insulting.

    2. Mr. Libertarian, who sent you?

      Deutsche Bank: "Perhaps The Fed And Other Central Banks Are Controlling The Market Too Much These Days"

      Today, it's Deutsche Bank's turn to voice a lament on the topic of uber-manipulated, rigged markets. From Jim Reid:

      Perhaps the Fed and other central banks are controlling the market too much these days with their guidance. In the old days central banks used to like to create an element of surprise to ensure that markets didn't become complacent. With the crisis fresh in people's minds, with the stock of debt still huge and with the recovery still so uncertain they feel they cannot risk creating too much uncertainty at the moment. The risk to this strategy is clearly that bubbles can build with so much central bank visibility and also that if they do have to change course suddenly it could create more problems due to the surprise factor in markets positioned for stability. Anyway for now low vol rules.

      The irony, of course, is that by now "people" know very well that the market crashes when the Fed manipulates it "too much" or as the case is now - is the only price setter -


    3. Flooded By Gold Smuggling, India's New Cabinet Prepares To Lift Gold Capital Controls

      And sure enough, earlier the Reserve bank of India made the following announcement:

      The Government of India and Reserve Bank of India has been receiving representations from the jewelers, bullion dealers, AD banks, and trade bodies to rationalise the guidelines for import of gold. Taking into account such representations and in consultation with the Government of India, it has been decided to modify the guidelines for import of Gold by the nominated banks / agencies / entities. These revised guidelines which will come into force with immediate effect are as under:

      Star Trading Houses / Premier Trading Houses (STH/PTH) which are registered as nominated agencies by the Director General of Foreign Trade (DGFT) may now import gold under 20:80 scheme subject to the following conditions:

      The STH/PTH should have imported gold prior to the introduction of 20:80 scheme. STH / PTH should get the required verification done by the Department of Customs at any port where they have imported gold consignment in the past.
      The first lot of gold under this scheme would be based on the highest monthly import during any of the last 24 months prior to the RBI’s notification dated August 14, 2013, subject to a maximum of 2000 Kgs.
      As in the case of other nominated agencies, the eligible quantity may be imported by STH / PTHs from any port, subject to their eligibility limit / maximum quantity allowed to them.
      For proper compliance, before import, they must submit the import plan, port-wise and quantity-wise, to the concerned Customs office, where the verification of the figures of past performance was done. This information will be sent to all the other ports from which imports are permitted. The overall discipline of exporting 20% of each imported consignment before the next consignment is imported will be equally applicable to such STH/PTH importers.

      Further, it has been decided to permit the nominated banks, to give Gold Metal Loans (GML) to domestic jewellery manufacturers out of the eligible domestic import quota of 80% to the extent of GML outstanding in their books as on March 31, 2013.

      So will India finally allow its population to once again purchase gold without limitations as it appears set on doing? And how will the price of gold react when the formerly largest buyer of gold is back on the bid and scramble to make up for one year of lost activity? We should know shortly, but one thing is certain: in the absence of private sector manipulation now that even the Gold Fixing cartel is imploding, the central bank manipulators, especially those at the BIS will have to work overtime in selling paper gold to compensate for what may well be a tsunami of pent up physical purchases out of the country with the 1.2 billion population.