Category Archives: Finance

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Hello. I’m from your neighborhood private equity company, and I’m here to help you.

“Private equity,” “hedge funds” and “wealth management” are the current euphemisms for what insanely wealthy people do with astronomical sums of money in pursuit of ever more astronomical sums of money. All the terms used for the practice could  be replaced with the more honest, “piracy,” were it not for the fact that piracy is against the laws of every civilized country, whereas the wholesale ruination of private companies and public institutions is universally legal and lavishly rewarded. Continue reading →

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I have developed a unified field theory that explains everything that is rancid in the industrial world. Excess wealth, I propose, is the ultimate source of the steady crapification of our political, economic, social and private lives. 

Modern sovereign states have adopted MMT — Modern Monetary Theory — which tells them, as I understand it, that if you have your own currency you can never go broke, so laissez les bon temps rouler!  I much prefer my own TMM Hypothesis, which is, there’s Too Much Money out there, in the hands of too few people. Continue reading →

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Wait a minute. If money grows as one-dollar bills, how long would it take to harvest $1.9 trillion for a COVID relief bill? Snag.

I have been trying to get my head around Modern Monetary Theory (MMT), but every time I try I end up wound around its axles. I don’t understand why I’m having such difficulty, since every congresscritter and would-be congresscritter in America is talking about it as if they totally understand it. It seems to me that its core proposal is that if you’re the federal government, money really does grow on trees. 

Deficits don’t matter, MMTers insist, neither does the national debt. Just today I heard a congresscritter lamenting on TV that the trillions of dollars the country is spending on COVID relief will have to be repaid by our unfortunate grandchildren. Not so, say MMTers, we don’t repay the loans, we roll them over — that is, when they come due we borrow enough to pay them off. And if we need more money t0 pay the ever rising interest costs, we just print it. (Actually, I think that metaphor is out of date; no need to print it now, we just imagine it into being, electronically. With artificial intelligence, or something.) Continue reading →

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“Everything was going great. Then I got this bug.” SoftBank

Everything bad that happens over the next several months will be blamed on the coronavirus. This will be done by the usual gaggles of amnesiac journalists and pols, who think history is what happened last week, and especially by their bosses, the industrialists who brought us globalization, climate change, morbid wealth for the chosen few and deaths of despair for the rest of us.

A few titanic train wrecks ago, the people of the criminal enterprise Enron celebrated themselves as the smartest people in the room because they figured out how to steal electricity from poor Peters in one part of the country to sell at a stiff markup to rich Pauls somewhere else. Today the malefactors don’t even pretend to be smart.

SoftBank is the criminal enterprise I have in mind. In the first place, who names a bank soft, as in soft touch? A better message would be conveyed, I would think, by calling it the hard-ass bank. But then we find out it’s not a bank, it’s a wealth management company.

My favorite person’s favorite coffee brand is “Chock Full O’ Nuts,” which features a label next to, and almost as big as, the brand name that says, “Contains No Nuts.” So the art of draining the last drop of meaning from our language for purposes of manipulation is not new. It’s just more advanced. And depraved. Continue reading →

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We were going to take him right to the hospital. But his credit card got declined.

When Jesus told the parable of the Good Samaritan, he was trying to explain to a lawyer how to get into heaven. We don’t know if the lawyer got the point or not — I’d bet not — but we do know one group of our fellow humanoids who definitely did not get the point: the people who come to our aid when we are so sick, or so badly injured, that we need to be rescued — after which they come after our savings, our homes, hounding us into bankruptcy if that’s what it takes to get their money. When Jesus said to the lawyer, referring to the Good Samaritan, “Go and do likewise,” this is not what He had in mind.

There needs to be a special place in Hell reserved for the new breed of air ambulance owners.  Increasingly, they are equity managers, people rolling the dice in the Big Casino with ORPM — Other Rich Peoples’ Money. Keep in mind that these are people managing the wealth of people who are already fabulously wealthy, and simply want more. These human buzzards spied a perfect business model in air ambulances: the customers are usually unable to talk, let alone negotiate a price, and even if they could, are too desperate for help to quibble. Continue reading →

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This is what your company has to look like if you want a shot at the big bucks on Wall Street.

Wall Street has made an enormous contribution to the history of our country in recent years, one that no one can deny: it has made the Trump White House look in comparison like a bastion of sanity, a cloistered campus of stable geniuses genuflecting on the big issues of our time. Wall Street, meanwhile, has spent an inordinate amount of its time and money chasing unicorns.

A unicorn on Wall Street is a relatively new private company that has been valued at over a billion dollars by no one-knows-who for no apparent reason. Like the dot-com startups of old, the unicorns gallop onto the field, issue gazillions of dollars’ worth of stock to the public, borrow gazillions more from the hedge funds, and then try to figure out how to do business. Unless you’re one of the people with access to the best stock research tools who moves the stock and the money around and gets rich from fees — and these days who isn’t — these things seldom turn out well. So, naturally, Wall Street is doing more and more of them, and they’re getting weirder and weirder.

Some examples (and remember, I am not making  this stuff up. You can’t make this stuff up):

Continue reading →

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The day the Plunge Protection Team slept in: February 5, 2018, the worst day in stock market history.

You and I are not among those who think the soaring American stock market, whose Dow Jones Industrial Index just reached a new all-time high, signifies a soaring American economy. Like everything else Trump says, that is clearly a lie. You and I are aware that the stock market has become the favored casino of the One Percent, where they gamble with their unearned wealth, intent on getting more.

Meanwhile back in the real world:

• When you add up all the profits of all the corporations in America for the past year, there aren’t any. As a group, they have been losing money for over a year;
• retail store closings are expected to hit 12,000 by the end of this year, 50 per cent more than the previous record set two years ago;
• global trade is slowing precipitously, while global debt is rising calamitously;
• the stock-trading desks at the global mega-banks have had their worst half-year in a decade (and that is much of what banks do to make money these days — roll the dice in the Big Casino. Making loans to productive businesses is, like paying taxes, for the little people);
• stocks are, by any rational measure, hideously over-priced and are being bought primarily by companies buying their own stock so that their earnings per share continue to rise even as their earnings continue to fall. 

Continue reading →

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Piles of unused cash are toxic to their owners and to the world. We know how to fix that. (Photo by Andrew Magill)

What an investment deal I got for you. Get your checkbook ready, you’re gonna love this. We buy a bunch of bicycles, see, and we put them out all over the place for people to rent, really cheap. They just grab a bike, go wherever, and leave it. To get them used to the deal, we gotta buy a ton of bikes, really saturate the city. And we give them a few months free, then we charge them a little bit a month. Small fees, big numbers, we’ll make 20, 30 per cent on the money for sure. Why did you put your checkbook away? What could possibly go wrong?

You say it reminds you of the oldest joke in retail, about the guy who found a wholesale source of shoes for ten dollars a pair and planned to sell them for nine dollars a pair? Asked how he expected to make any money, he replied, “Volume!”

Yes, the bicycle scheme sounds just that dumb. Yet in a frenzy that came out of nowhere just two years ago, 40 — count them, 40 — companies in China raised over $2 billion in venture capital to execute the bicycles-for-hire business plan in cities around the world. In a few crazed months, in addition to the venture capital, one startup — Mobike — was acquired for $2 billion. Another — Meituan — did an initial public offering of stock that raised $4.2 billion. Continue reading →

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In the best of times, it’s a good thing to be in the ten percent. Not so much, in the worst of times.

It is the best of times, it is the worst of times.

In August, Bloomberg Business mentioned, matter-of-factly, “There’s no doubt that the U.S. economy is in a boom.” The New York Times echoed, in November, “The economy is booming, with more people working at higher pay.” The belief that the economy is “booming” has become so well established among the well established that it is now presented not as an argument, but as an aside requiring no supporting evidence. Most economists “never thought the economy could grow this fast,” gushed former Federal Reserve Governor Kevin Warsh in October.

And yet, in this same country, in November, General Motors — the throbbing iron heart of industrial America — announced it was closing five manufacturing plants in the U.S. and Canada, it was killing off several passenger cars – including the Chevrolet Impala – and eliminating the jobs of 14,000 people. This followed a similar downsizing by Ford. The economy is booming, but people are not buying cars? Really?   Continue reading →