Wednesday, August 08, 2012

Source of the Next Bubble Identified!

It took quite a while to figure this out. At first I thought that unpaid mortgages and people staying in homes for free might create a large enough bubble. Then I thought that maybe student loans could provide enough money to power the next bubble. But alas, both of these frauds can only provide a small fraction of the money required to power the next boom. How much money? Each of them are worth 2 maybe 3 trillion. How much is needed? About 15-25 trillion.

Where in the blazes can that much bubble money possibly come from? It's simple: It comes directly from the future! These are no ordinary loans I'm talking about. 

This latest and greatest scam is called the "capital appreciation bond". It is simply a deferred interest loan. Yes, as unbelievable as it sounds, it is really true, and it is really happening. Imagine taking out a $300k mortgage and not paying any principle or interest for 30 years. At the end of the 30 years, you simply agree to pay the amount due. Exactly how much money would be due in 30 years? Haha it is the truly unbelievable and astronomical amount of $1.3 million!! For a 5% mortgage! But the real kicker is that it wont be 5%. Because it is deemed a higher risk loan, it will be more like 10%. Or 20%. At 10% interest, that same $300k loan comes out to.... an unfathomable $5.2 million

3 million such loans is all it takes to produce a $15 trillion bubble.

It's pure insanity. But no more insane than claiming 10 years ago that the Federal Reserve would buy $2 trillion in worthless mortgage backed securities! Well they did it. And they're going to do it again, when the next unforeseeable crisis appears out of nowhere 5-7 years from now.

The key to making this work is getting the number entered onto a balance sheet. That is all the Fed needs now. People are so dumbed down that they are incapable of processing this very simple type of outright open fraud. So it will happen. All these $5 million loans on $300k homes will get packaged into securities and eventually sold to the Fed when the next crisis comes. But not before the financial sector reaps obscene profits from the fees on these loans that will never be paid. 

If you think that the country is not far gone enough to allow this level of fraud... you better drink your Brawndo because we're there. We are that far gone.

Thursday, August 02, 2012

Yes, Facebook Stole From You Too

You say "I dont own Facebook stock, so why do I care that Facebook was designed from the ground up to be an investor scam?"

But you would be wrong to say you don't own Facebook. You do own Facebook. Everyone owns Facebook. How many billions of dollars of pension fund money was dumped in there when it went public? How many billions in 401k money?

And guess what happens when those funds lose money because their Facebook stock loses 90%? You know damn well what happens. The government bails them out. One way or another, taxpayer money is going to fill the void left by this Facebook scandal.

It is funny and convenient how only after the stock goes public, does the truth come out about Facebook's ad clicks being mostly bots.

See this article for some background:

From the article:  

The timing here may be a bit questionable, from my opinion: This all occurred “earlier this year,” Mango told me. So why the wait to publicize the situation? “We’ve been too busy to post about it until now since our site just launched out of beta a couple of weeks ago,” he said.

Too busy? Yeah right. More like they didnt want to be crushed by some tentacle of wall street for throwing a monkey wrench into their Facebook IPO scam.

Have the major marketers who have been spending millions on Facebook advertising for years simply not noticed such a thing? It’s possible, but it would be surprising.

Possible? Not just possible. Extremely probable. There is no way a large company, with millions in IT resources, wouldnt know that Facebook clicks are coming from bots. I think they all knew; I think all the major Fortune 500 companies knew Facebook was a scam from the get. Ad revenue would have been much much higher if anyone believed in this model.

Same goes with all the major investment houses. But they saw an opportunity to make billions selling a bag of stinky crap to anyone stupid enough to take it.... such as a pension fund. Now that the general public owns this stinky bag of crap called Facebook, I fully expect the truth to come out. I expect the following headline: "Internal documents show Facebook advertising model designed around click bot fraud." Hell we might even find evidence these bots are running on facebook-owned hardware. Wouldnt that be a hoot. But it doesnt really matter. Why run the bots yourself when you design a system that can be gamed by bots? I mean really, what is this, 1995? Like they didnt know? There is just no way any rational person could ever believe that this company did not know it had bots running rampant through its primary revenue generation stream.