As IF Times

link Goldman Sachs Advice Hands Clients Losses in 7 of 9 Top Trades – Bloomberg.com.

Gee, I wonder how that happened?  Goldman makes “trading” profits every single day for the first quarter of this year, yet the picks given to clients were losers.  Anyone who has experience trading markets knows that it is improbable if not impossible to have wins every single day for a quarter with directional bets.  More likely what are considered “trades” are arbs between positions which in fact carry very little risk to Goldman.  Especially in making markets in over the counter derivatives where they may be the only source of bid/ask quotes.

Let’s be clear here, Goldman is not in the trading business, it is in the business of making money, which doesn”t have to be the same thing.  Guessing in which direction macro economics takes prices is very much an imprecise science.  Forecasts which may be brilliant may take more than  the expected time to unfold and  can eat up resources in the meantime.  However, if you are the primary market maker for products, you are able to see the supply and demand from both sides and profit accordingly.  Logically if you think about it, it’s difficult to see why Goldman maintains any clients at all if they are so adept at trading their own accounts.  The answer is of course, they need customers to get order flow.  Without the benefit of knowing the customer on both sides of a trade, for example a municipality being advised on an interest rate swap and a hedge fund on the other side, it would be difficult to carve out  a “trading” profit. 

No doubt, much of the trading profits are derived from currency trading and arbitrage, which becomes somewhat easier if your boys are advising nation states on interest rate policies.  Goldman is a great organization, but they exist to make money, trading is a coincidence.  As for the advice given publicly to customers, well that’s par for the course.  Historically, funds and advisers in general have always underperformed the overall market indices, but the illusion of special insight keeps people coming back.

There is an old saying, I’m unsure of who to attribute it to, but it goes, “never buy stocks from someone who sells them for a living”.  Something to think about next time someone tells you to go long bananas.

link Iranian cleric defends earthquake-promiscuity link.

There must be some restlessness among the natives.  The Islamic cleric in the article seems to be trying to quell the waters of discontent or perhaps address growing skepticism among once blindly faithful followers by issuing this new theory on hell.  Some smart Ahmed may have posed the question of why the West isn’t under constant earthquakes if their promiscuity and sinning ways are so vile.  The answer offered is that there are deeper pits of hell for the really bad sinners.  If the threat of going to that permanently warm spot wasn’t scary enough, now we learn that there may be levels of hell! 

As is the case with all wars from the beginning of time, they are fought by young boys being sent to their deaths by old men.  If the vision of the afterlife that is portrayed by the clerics is so wonderful why aren’t they already up there going through their inventory of virgins?  Or are they content to suffer mortal life while the younger, dumber guys go on to permanent bliss? 

The notion that there may be different levels of hell for the sinning Westerners is supposed to be a comforting thought for the jihadists.  Heck, not only for them but also if you happen to be a sinning Westerner.  According to the cleric, there are levels of hell, like an inverse condominium.  The mild sinners occupy the top levels but the elevator buttons would show descending floors in a panel with increasingly negative numbers.  If promiscuity itself is something to be banished to hell for, you’d have a fair number of people up at the top floors.  Some moderately promiscuous sinners such as basketball athletes and porn stars would occupy the middle levels.  At the very very deepest levels, your only neighbours would be Warren Beatty, Wilt Chamberlain and Hugh Hefner.  It would be 3 day’s travel in the elevator to get that deep.

If promiscuity brought on earthquakes and natural disasters, the only solid land mass left on the earth would be Antarctica, unless you count the indiscretions of penguins.   It’s all fine to threaten eternal damnation, fire, brimstone etc, to keep the rabble in line and in fact perhaps even desirable in the mortal world.  If people didn’t believe there were special places in hell for the truly heinous among us, it would be difficult to have faith in anything.  For the information of the cleric however, there already is an hell on earth for promiscuous sinners.  It’s called herpes.