Let’s review a few of ‘Puter’s most recent economic prognostications:
1. The failure of the Super Committee would inevitably lead to a downgrade.
‘Puter: “GP Calling it now. When SuperCommittee fails this week, rating agencies will downgrade US debt again b/c no real plan to repay. They must.” Twitter, 19 Nov 2011.
Reality: “Credit rating agencies reiterated Monday that the U.S. is at risk of a downgrade following the announcement that the supercommittee has failed.” The Hill, citing S&P sources, 22 Nov 2011.
2. Housing markets need to clear through foreclosure.
‘Puter: “Mitt Romney was exactly right when he said that the economy will improve when the markets are permitted to clear. … In the personal context, this means requiring banks to properly value their holdings, and speeding the process of liquidating bad debt. That is, suing defaulted consumers into bankruptcy where the debts are assigned value by court order and/or liquidating real and personal property collateral where available.” Gormogons, Americans Hate Math, 20 Nov 2011.
This is consistent with liquidation of inventory and realization of losses on bad debt. Banks foreclose, increasing the number of houses on the market, and thereby decreasing prices on inventory. Banks want to sell real estate owned as soon as possible to avoid carrying and operating costs, so prices are set low, further decreasing prices. This depressed market keeps potential selling homeowners on the sidelines until the market finds bottom. It’s completely consistent with ‘Puter’s prognostication. We’re still shaking out bad debt.
3. Bank of America and Wells Fargo are zombie banks, and regulators are hiding their undercapitalization.
‘Puter: “There’s a lot of pretending going on at banks these days. Wells Fargo and Bank of America have significant portfolio risk. But the banks are pretending that their collateral is worth more than it is, or that the loans are performing better than they are, or that the market value of the loans is greater than it is, to avoid raising equity. A sudden push to raise significant equity by either of these banks would be a red flag to the market, and likely spell the banks’ end. Instead, regulators and banks pretend that the banks’ assets are worth more through accounting niceties, such as suspending mark to market accounting.” Gormogons, Americans Hate Math, 20 Nov 2011.
Reality: “U.S. regulators have informed Bank of America’s board that the company could face public enforcement action if they are not satisfied with recent steps taken to strengthen the bank, the Wall Street Journal said, citing people familiar with the situation.
BofA has been operating under a memorandum of understanding since May 2009. The memorandum, which is not public, identified governance, risk and liquidity management as problems that had to be fixed, the paper said, citing people familiar with the document.” Reuters, BofA Warned By Regulators To Get Stronger: Report, Reuters, 22 Nov 2011 (bold emphasis added).
It’s a burden being right all the time. Now, please, for the love of Pete, listen to ‘Puter before it’s too late!
Always right, unless he isn’t, the infallible Ghettoputer F. X. Gormogons claims to be an in-law of the Volgi, although no one really believes this.
’Puter carefully follows economic and financial trends, legal affairs, and serves as the Gormogons’ financial and legal advisor. He successfully defended us against a lawsuit from a liquor distributor worth hundreds of thousands of dollars in unpaid deliveries of bootleg shandies.
The Geep has an IQ so high it is untestable and attempts to measure it have resulted in dangerously unstable results as well as injuries to researchers. Coincidentally, he publishes intelligence tests as a side gig.
His sarcasm is so highly developed it borders on the psychic, and he is often able to insult a person even before meeting them. ’Puter enjoys hunting small game with 000 slugs and punt guns, correcting homilies in real time at Mass, and undermining unions. ’Puter likes to wear a hockey mask and carry an axe into public campgrounds, where he bursts into people’s tents and screams. As you might expect, he has been shot several times but remains completely undeterred.
He assures us that his obsessive fawning over news stories involving women teachers sleeping with young students is not Freudian in any way, although he admits something similar once happened to him. Uniquely, ’Puter is unable to speak, read, or write Russian, but he is able to sing it fluently.
Geep joined the order in the mid-1980s. He arrived at the Castle door with dozens of steamer trunks and an inarticulate hissing creature of astonishingly low intelligence he calls “Sleestak.” Ghettoputer appears to make his wishes known to Sleestak, although no one is sure whether this is the result of complex sign language, expert body posture reading, or simply beating Sleestak with a rubber mallet.
‘Puter suggests the Czar suck it.