Commodity ETFs: Toxic, deadly, evil
Commentary: Warning: next crash dead ahead, bigger than dot-coms, subprimes
The warning screams at you: "Do Not Buy Commodity ETFs!" Yes, this Bloomberg BusinessWeek cover reads like National Enquirer or a flashing neon sign on the Vegas Strip.
And just in case you didn't get the warning, B/W repeats it twice more, on the cover: "Do Not Buy Commodity ETFs ... Do Not Buy Commodity ETFs." Then, as if afraid you still won't get it, they scream even louder: Commodity ETFs are "America's worst investment."
Worst? Add toxic, deadly, evil. Commodity ETFs are rapidly becoming a malicious virus breeding chaos in the global markets pricing all commodities: food, farm lands, metals, oil, natural gas, livestock, water and other natural resources are the assets under commodity derivatives and their ETFs, pricing that's now controlled more by Wall Street speculators than the weather, adding wild swings in volatility and trillions in global derivative risks.
And once again the usual suspects, the Goldman Conspiracy of Wall Street Banksters, are in the lead.
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Commodity index ETFs now a lethal WMD threat to Earth's survival
But far more chilling is BusinessWeek's warning of future consequences. Remember Bill Gross's "New Normal?" As future returns drop, investors are chasing riskier deals, like commodity ETFs: "Passive buy-and-hold investors at one point in mid-2008 held the equivalent of three years of production of soft red winter wheat. Wall Street's success in attracting those buyers boosted demand for futures contracts, which helped determine what consumers would pay for baked goods. Wheat prices jumped 52% in early 2008, setting records before plunging again, and sugar more than doubled last year even as the economy slowed." Warning: Capitalism's competitive pricing model is dead.
And if all these warnings from the likes of Bogle, Gross, Bloomberg Markets and BusinessWeek seem a bit hysterical, remember how hysteria drove past bubbles: dot-coms in 1999, subprimes in 2007. Euphoria blinds investors to dangers lurking in every bubble. And today that risk is magnified as 21st century bubbles are blowing bigger, more powerful and more dangerous, adding the new risk of nuclear "food fights."
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Commodity-index ETFs are a global threat far more dangerous to the world than nuclear attacks from terrorist nations. Nuclear WMDs have the power to wipe out major urban areas killing tens of thousands instantly, like Japan in 1945, leaving massive scars across humanity for many decades.
And yet, as Funk puts it: "Heilberg's bet on chaos is beginning to play out on the streets." The toxic trail of commodity ETFs is already proving to be deadly, starving thousands worldwide, while the new Capitalists of Chaos only see incredible profit opportunities, as they make huge bets that they'll get even richer in the next round of catastrophes, disasters, poverty, starvation and wars.
Bottom line: Commodity ETF/WMDs are mutating into a toxic pandemic fueled (and protected by) the insatiable greed of banks, traders and politicians whose brains are incapable of giving up their profit machine, won't until it implodes and self-destructs. The Wall Street Banksters have no sense of morals, no ethics, no soul, no goal in life other than getting very rich, very fast. They care nothing of democracy, civilization or the planet.
They are in a race to become the richest man in the world, to control more assets, more commodities, more rights, more land, more money than Warren Buffett, Bill Gates and Carlos Slim combined. It's a contest and the other 6.3 billion humans on the planet are just profit opportunities (and collateral damage) in the dangerous high-stakes games played by the new Capitalists of Chaos ruling the world.
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2 COMMENTS:
Taleb nails the heart of the problem with Wall Street and politicians....
Wednesday, August 4, 2010
Taleb Calls Out Alan Blinder for Questionable Ethics
Here’s the trigger: last year at Davos, Blinder interrupts Taleb’s conversation with a third party to pitch a savings product, one that allows high net worth individuals to arb FDIC insurance regs by allowing them to put funds in a single account, which would then be split up among banks so that the investor would circumvent regulations that limit FDIC insurance (then $100,000 per account).
Now it’s already a bit unseemly for a former Fed vice chairman to be peddling investment products personally, particularly since, per Taleb:
….it would allow the super-rich to scam taxpayers by getting free government sponsored insurance. Yes, scam taxpayers. Legally. With the help of former civil servants who have an insider edge.
I blurted out: “isn’t this unethical?” I was told in response, “We have plenty of former regulators on the staff,” implying that what was legal was ethical.
Tell me if you understand the problem in its full simplicity: former regulators and public officials who were employed by the citizens to represent their best interests can use the expertise and contacts acquired on the job to benefit from glitches in the system upon joining private employment — law firms, etc.
http://tinyurl.com/2dv4x2m
THE REAL EVIL OF THE WORLDS FINANCES.
: IS ZURICH FINANCIAL SERVICES.
ITS THOUSANDS OF COMPANIES USE DIFFERENT NAMES TO DECIEVE EVERYONE. THE ADVERTISING LOGO (Z) IS USED EXTENSIVELY WITH THE WORDS,,,CHANGE HAPPENS ZZ,,,
THIS GROUP ABUSES, LIES, CORRUPTS, RIGS, USES FRAUD,AND MUCH WORSE.
THE FEDERAL RESERVE OWN SOME OF ITS AFFILIATE COMPANIES. WHY DON`T THE US GOVERNMENT LOOK AT BERMUDA OWNED ENTITIES,STARTING WITH THE NAME ACE INSURANCE, ALMOST EVERY LETTER A TO Z CONTAINS A ZURICH OWNED COMPANY.
IT IS TIME THIS GROUP WAS TURNED INTO A PUBLICLY OWNED COMPANY. YOU HAVE PAID FOR ITS CONTINUED EXISTANCE.
MY ADVISE TO EVERYONE, INVESTOR,REGULATOR,JOE PUBLIC OR BANKER > IS: CHECK OUT THE COMPANIES ULTIMATE OWNER AT COMPANIES HOUSE ETC.
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