Posted on 07/16/2005 1:38:48 PM PDT by wagglebee
WASHINGTON -- In the 1988 Hollywood hit "Die Hard," starring Bruce Willis, a group of "terrorists" take over a Japanese banking institution in Los Angeles, hold hostages and make demands for release of "political prisoners."
But it turns out the terrorists aren't really terrorists. They are bank robbers trying to make off with the fortune in the bank's vaults.
Could it be Osama bin Laden has seen "Die Hard"?
That is a question Scotland Yard and other law enforcement agencies are actually asking themselves following the July 7 London transit system attacks that killed 54 and injured scores more as they continue to scour the planet for evidence and additional conspirators.
Why? Because it appears some profited by short selling the British pound in the 10 days leading up to the attacks.
The pound fell about 6 percent (approximately 1.82 to 1.72) against the dollar for no apparent reason until, of course, the terror attacks sent the British markets reeling still further.
"This was an almost unprecedented weakness and far too sharp to be a coincidence," one economist with more than 35 years of experience in the investment industry, told Joseph Farah's G2 Bulletin, the premium, online intelligence newsletter published by the founder of WND. "That is, after all, an annualized rate of loss of well over 100 percent."
The fall did not go unnoticed by investigators, who are wondering whether the terrorist masterminds behind the attacks decided to make some money on their action or whether other investors with inside information about possible attacks took advantage of that knowledge.
"Currencies of establish countries simply do not fall that fast based upon any kind of economic or financial analysis," said the economist. "Somebody somewhere knew something. Or maybe I should say 'somebodies.'"
Could it be the terrorists have learned to make their attacks self-funding operations?
Could it be the terrorists are actually motivated by factors other than Islamic fanaticism?
These are some of the questions law enforcement agencies are asking but they're not really expecting to get answers.
The problem is that short selling of this kind can be done with near total anonymity.
"Trade currency futures through a Swiss or Austrian bank via an offshore company incorporated in Crete and you have a totally untraceable transaction," the economist noted. "No one will ever know who made the really big money off this situation, but I guarantee you this someone did."
It's not the first time suspicion about terrorists or someone profiting from short-selling prior to an attack.
Following the Sept. 11, 2001, attacks in the U.S., David Ruder, chairman of the Securities and Exchange Commission from 1987 to 1989, raised the question of whether terrorists may have gotten away with profiting from their attacks by short-selling shares in the U.S. markets.
Then U.S. Treasury Secretary Paul O'Neill confirmed the government was investigating possible short selling, but was not optimistic those responsible would ever be found.
Short selling allows investors to bet that stocks will fall by borrowing and selling shares in the hope of buying back at a lower price.
After Sept. 11, Chicago Board Options Exchange data showed 1,575 put options purchased in United Airlines' parent company five days before the attacks. On an average day, only 390 such put options are purchased. Investors bought 2,258 put options in American Airlines parent company, compared with 220 on a typical day. Insurance and other stocks also experienced and upswing in short sales.
Investigators never revealed how much money was bet, but short sellers could have made 30 times what they invested, given the huge plunge in the stock prices of those companies.
Government investigators from around the world never learned the identity of the short sellers in 2001. And, despite vigorous efforts being made to find out who was behind the short selling of the British pound in early July, hopes are slim the culprits will be found.
Short volume in airline shares has spiked on many occasions prior to 9/11, one famous example being August-October 1990, after Saddam's little excursion into Kuwait. There's nothing particularly indicative about an expansion of short volume...**before** the fact, sorry.
Yuri Sergeevich Andropov
I'm really hoping you didn't think I was suggesting that Shrivleup was his real middle name.
It was a joke.
say it out loud.
shrivel up and drop off
Very old joke (at least 1980s).
I keep pitchin' 'em but y'all, I say, y'all keep missin'
George Soros?
Actually, I didn't see the joke post, just the inquiry about the name. Sorry. (hangs head...)
The USD had broken through the 90 target last week but September's contract, although up 0.35 remained under 90.00 at 89.62.
Any further attacks within major E.U. states will most likely also place another drag on the Pound, as well as the Euro S-Franc & the Aussie.
In addition to currencies, the forecast is indeed going to be a very long hurricane season this year. The mid-Atlantic Ocean heated up far sooner then the norm. OJ should do very well {if} the Gulf related storms adversely effect Florida western & mid growing areas. Friday's close for September was an even @100.00 -0.80.
The options are equally untradeable, the IV is at least 8-10% too high to buy the straddles and I'd be taking the short end of the bet. Similarly, outright call buying is at least as risky as a straight long, and writing any oppies, naked or ratio-spread, is asking to have my head handed to me.
Just fyi, and speaking historically, the most persistent winning strategies in OJ are: 1) buying ATM November or January straddles in late April/early May when IV is below 20%, and B) trading the extremely high-reliability non-seasonal (see my book, Chapters 6 & 7 ... /endshamelesscommercial, heh heh heh) by writing March calls WOOM in November/December/maybe January.
Good trading to you!
.
You had been speaking on the Pound. Notice in the sharp upswing indicator line representing open interest (OP) during the the first week of July (at the bottom of the this chart.
The BP had a fine bullish run during the last 1/4 of 2003 jumping from under $1.50, climbing to the high $1.80's then diping back to $1.75 and remaining within a sideways range of $1.77ish to $1.85ish for most of 2004, then reaching a new high in the mid $1.90's over this last winter. The Bank of England keeping interest rates favourable, coupled with the declining USD all contributing to her rise. The BP sideways traded in the range of $1.93 to $1.85 during the last winter & spring until the anti-E.U. votes slammed the Euro & bolstered the USD.
Since the BP was already bearish along with other 'EU' related currencies against the USD, logic would mandate a continuation of shorting the BP after the London bombings.
Good trades!
I was just thinking about that just today. According to Larry Nichols, Hillary bought pharmacutical stocks just before she announced that she was backing off on reforming them. But, what Nichols wondered about even more was who she may have tipped off.
"The US economy continues to roll, Europe's to stall. My guess is that currency traders are well aware of the trend...."
But the rate that WND reported, 6% in 10 days, that's pretty steep, isn't it? What you are talking about would be more gradual, not at a rate of 60% in 100 days.
It was interesting reading your post. This is deep. The KGB had a lot of inside knowledge. They could help investors with some of their intelligence, couldn't they? People like Armund Hammer [sic?].
I also wonder about the people in Echelon. I would imagine Echelon could be extremely helpful to investors.
FRegards....
Savage is a lot smarter than people give him credit for. Boortz actually thinks Savage is the smartest man in talk radio. Personally I think Boortz is shortchanging himself, however. That man's an evil genius. He's brilliant enough to see through all the leftist BS, even though he has little faith in his heart.
One thing I've noticed about Savage is that he can "wing it" on radio so well he sometimes goes through phases where he might run a show on two measly articles. Not enough to keep me interested.
"I noticed that this attack, like 9/11 also occurred after a major tennis tournament."
Please elaborate. Is one of bin Laden's men a tennis fan?
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