MBS Vigilantes v. Jellyfish ~ The Risk Averse Alert

Wednesday, April 06, 2011

MBS Vigilantes v. Jellyfish

I heard today that, mutual funds are flush with cash. Whether this is true is of little consequence. The relevant question is whether there is a sane fund manager who does not suspect this public disclosure of the industry's cash position the sound of sirens waiting to smash their boats.

Let's just say increasingly muted trading over the past 18 months suggests Team Fraud's scamming has gone too far for anyone of any consequence to blindly trust an "all clear" enticing deeper entry into an asset class proven evermore perilous over the past thirteen years. Once bitten, twice shy, no doubt is an enduring mantra ... these days drawing enormous sums into the safest paper (U.S. Treasuries) and that barbaric relic, gold.

Likewise, only a complacent fool would take solace in so-called "bond vigilantes" taking hold of Portugal and sending its caretaker Prime Minister to his knees begging for a bailout. Not when MBS vigilantes await meaningful redress of all manner of fraud besieging their interests. Only fantasy would have one think the likes are holding their breath anticipating satisfaction from the 50 state Attorneys General team "investigating" the robo-signing, and other related criminality, such as has cropped up during Team Fraud's tireless effort to prevent any meaningful measure of mortgage principal modification, as otherwise would best serve MBS investors' interests.

Herein lies an explosive detonator whose lighting possibly awaits state AGs to prove no less jellyfish than well-provisioned scam bots in Congress whose actions over the past thirty years have buried the nation in debt, all to back a leveraged Ponzi scheme whose unwind is unstoppable. In lighting the MBS fuse the gates of Hell will burst wide open. Indeed, were even a match struck (let alone the fuse lit) a tomorrow whose pre-market futures are trading 3-5% lower could bring everyone screaming what in the name of John Law is the meaning!

We, among some portion of a thin 16% currently bearish stocks, at least would have a clue...

Fast Money
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