Household HSBC Watch

Cassandra was the young and beautiful daughter of Priam, the last king of Troy. Apollo bestowed upon Cassandra a special gift—the ability to see the future. The problem with the gift was she could see the future but could not do anything about it. Analysts and economists said for many years that there is a direct relationship between manufactured wealth and the inevitable resulting crash. That is not Cassandra - just basic simple economics 101. Then from the ashes of Household International rose HSBC, or specifically HSBC Finance. Lacking the gift of Cassandra and falsly relying on due dilligence and shaky risk management HSBC thought their bank to own the world.

The fairy tale continued as John Bond and those in London quickly changed from pin stripped banks into the emperor with no clothes. People around the world stood in the wings laughing as the stage was set and William F. Aldinger could no longer pull the puppet strings. Mr. Chairman, the Emperor has no clothes. This entire adventure has been based on propaganda and manipulation. “Oh my” said Bond and Aldinger. “We need to retire right now and pretend we no nothing about it.”

What a dreadful day for the team of 150 PhD’s - to be ignored like mere high school students with dunce caps. Meanwhile the risk officer resigned. “What’s happening” asked Stephen Green and Mr Geoghegan? “A jolly good day, as it means you get to be in charge now, and people will respect you all over the world” said the serfs.

Meanwhile in the deepest regions of the Southern part of the United States a loud voice was heard. “These idiots are going to let me buy a house” said an unemployed worker. “I’ll take their money because the payments are going to be cheaper than the rent on our double-wide.” The new home buyer continued to look at a mountain of paperwork. “I don’t know what all this means but I really don’t care. I done good. Besides, these bastards tried to repossess my car just last month, so I’ll take their money.”

Some call it subprime. I call it debt distortion. Others call it a foreclosure waiting to happen. Whatever it was, the 28 billion dollar giveaway at HSBC is one of the funniest financial disasters in a long time. Cassandra saw the future. Activists and watchdogs saw the future. Aldinger and Bond saw the future. HSBC paid $14 billion for a worthless company and managed to loose that much trying to revive it. This is the long con at its best. The only one who do not think it was funny are investors and people that became homeless due to foreclosure.