Tuesday, December 30, 2008

That's Oil Putin

The economy is in slippery shape. Mostly down, with a few ups here and there. Most of the ups are in prices for goods and commodities. Another up is unemployment. Downs include Christmas sales, home and car prices.

Oil has its ups and downs too. Remember where gas pump prices were a few months ago? They are down again, but may head up again. The connection between oil and an economy that depends on it tells us a bit about our economic future.

So what will the future bring? Year-end (or year-beginning - depending on when you read this article) is a good time to make predictions about America’s and the world’s future. However, predictions are like opinions - which are like noses – everybody has one.

For example, there’s a “prominent” Russian analyst, Professor Igor Panarin, who thinks the United States is going to collapse by 2010. The Wall Street Journal actually printed an article by this ex-KGB hack predicting a breakup of America by July 2010 into five parts that would combine with other world powers. He thinks Alaska will break off from the United States and combine with Russia. Boy, Sarah Palin won’t have to look too far to see Russia if that happens. He thinks Hawaii will join with Japan or China. Midwestern states will join Canada, California will become a part of China, Northeastern States will join the European Commonwealth, and best of all, he thinks Texas will become a part of Mexico.

Texas joining Mexico? This idiot obviously never heard of something called the Alamo, or the eighteen-foot border fence or the Minutemen. The only amazing thing about his prediction is that the Wall Street Journal considered this recycled propaganda attack from the Soviet era credible enough to print. You might expect this type of story from World Weekly News, next to the “Bat Boy” stories, but finding it in a financial newspaper? Gee, Wall Street Journal readership must really be down. What’s next, WSJ - page 6 topless girls?

Russia thinks it’s doing well. It’s bragging about how well it’s doing. Of course, it has a lot of gold and gas and oil reserves. It also has a lot of debt. What is not being said in the hype to return Russia to the stage as a world power is that if the United States ever failed, so would Russia. Russia sells us things. Russia NEEDS to sell us things. Oil prices are down because demand is down. If our economy totally failed, demand would likely all but dry up, which would put a huge damper on Russia’s economy.

The real analysis - it’s all about oil again. Six months ago, oil sold for $147 a barrel. Now it’s under $40 a barrel. Russia spent a lot of money to develop new oil fields – but no one needs or is going to buy the new supply right now. Russia will have a budget deficit this year. By the way, so will Saudi Arabia. So will Iran – according to VOA News, Iran depends on oil for 80% of its foreign income.

Of course, as oil goes down, natural gas prices are looking to increase. Russia has a lot of natural gas too. Russia’s main source of natural gas appears to be Professor Panarin. But other than the Wall Street Journal, I don’t think many other people are buying it.

In fact, it’s Russia that is failing. Yesterday, the ruble fell to an all-time low against the Euro. According to Bloomberg News, Russia devalued its currency for the . 12th time in seven weeks. Between August and November, Russia lost 1 million jobs. Putin has scared away foreign investors with his militaristic talk and attacks on private business in Russia. Russia’s attempt to supplant the Soviet Union as a world power is very expensive. It’s newest submarine launched missile, the Bulava SLBM, failed a test launch right after Russia made a commitment to full scale production – an expensive embarrassment to Russia’s prime minister – and dictator – Vladmir Putin. Putin expects to raise natural gas prices, first, because he can, and second, because he has to do so to finance remilitarization. However, just as with oil, demand will shrink as an adaptation to price increases and a smaller economy. Reagan broke Russia with an arms race. Putin thinks he can break America with a new arms race. I’ll make a prediction – Russia will go broke first. Funny thing about pipelines, they’re remarkably easy to sabotage. That’s why Iraq isn’t producing much oil now.

Russia’s failure is why Putin is investing in chaos. He has followed a strategy of trying to break up nations into factions. He’s done it in Georgia, supporting separatist movements. It’s a KGB strategy – divide and conquer. He’s backing the Palestinians because war in the Middle East boosts oil prices, and right now he needs oil prices up to pay his bills. He’s shutting off gas supplies to Ukraine to try to break it up. And now he’s using his stooge , Panarin, to try to stir up trouble in America. But it will fail of course. Russian’s willingness to use force, in fact, it’s need to use force, will be it’s undoing. Putin is still popular in Russia, but as his economy worsens, so will his popularity. That’s why he’s painting America as a devil and failed experiment – to take attention off his own failures. However, the worst thing that could happen for Russia is for Putin to succeed in bringing back the Soviet Union. The USSR failed once – it would fail again – but do a lot of damage on the way down.

So, Professor Panarin, here’s my prediction. Putin gets a lot of press in 2009. By 2014, he’ll be the subject of a “whatever happened to” documentary. The world has changed. Try as he might, Putin won’t be able to change it back. The world is too interconnected. Russian soldiers in South Ossetia were eating chicken imported from America.

So keep an eye on gas pump prices. As oil falls, so does Putin.

Tuesday, December 2, 2008


It was just reported that in order to maintain sufficient liquidity to continue its operations, Trump Entertainment Resorts will have to miss a $53.1 million interest payment on its 8.5% senior secured notes due 2015 that was originally scheduled for yesterday.

Although the casino operator still has a 30 day grace period to make the payment, it's reminiscent of the last time Trump defaulted on its debts and had to seek bankruptcy court protection in 2004. Trump is trying to restructure its debt so it can stay in business - last year they lost $371 million. Trump shares lost a lot of their luster, and now reportedly hover at around 25 cents a share.

Deutsche Bank sent Trump $13.2 million for a hotel construction project in Chicago, but they are also both suing each other over the project and late payments by Trump.

It may not be long until Trump hears the word from his bondholders - Donald, you're fired!

It's possible that by next year, it may be a contest to see who is poorer, Donald or Rosie O'Donnell.

Ironically, Trump's ex-wife Ivana, is also undergoing a financial restructuring of sorts, having filed for divorce from her fourth husband, Rossano Rubicondi. They married last April and split about three months ago, but kept it secret because Rossano was appearing on the Italian version of Survivor. Survive this, Rossano!

Wednesday, November 26, 2008


Wolf's Version - with apologies to Clement Clarke Moore.

‘Twas the month before Christmas and all through the city
decorations were up but the sight wasn’t pretty
for although Thanksgiving was still barely here
all the stores were dressed up for the end of the year.

Sleighbells here, reindeers there, holly boughs all around
but nary a sign of Tom Turkey is found.
‘twas as though Saint Nick put the fowl in a hearse
and decreed to Thanksgiving, henceforth, Christmas comes first.

That jolly old Elf must have howled with a wail,
“That turkey interferes with our holiday sales”;
so we’re left with no choice but to conquer the bird,
and sing Christmas carols till no gobble is heard.

After all, a Thursday sale is but a single day;
whilst we need a full week to earn our full pay,
so out with old feathers, pilgrim hats won’t be seen;
we’ll pretend those props came from last Halloween.

We need to make sales and to keep our costs down
so you’ll see Christmas windows all over the town.
decorating windows twice; why that’s nothing but trouble
so we prefer Ho Ho Ho to Gobble Gobble Gobble.

Stores open late, tinsel sparkling with glee.
MasterCard, Visa – final spending spree.
but this holiday season’s no season for thanks,
while the Fed’s lending money to those reckless banks.

Our economy is in the toilet so let’s spend for Santa
and come New Year’s Eve we’ll share a pint of Mylanta;
for our holiday debts banks won’t be forgiving;
though the banks don’t need Christmas when they’ve got Banksgiving;

But there’s no sense resisting; we must accept our fate.
so Merry Christmas to all this November 27 and 28.

Monday, November 24, 2008

Welcome to My Weblog

I'm Marvin Eric Wolf and I approve this message.

This weblog will have several goals.

First, I will try to keep readers up to date on changes in bankruptcy law, the current fiscal crisis, and issues involving debt relief and creditor abuses. I'm the State Chair for Northern New Jersey for the National Association of Consumer Bankruptcy Attorneys. There is no State Chair for Southern New Jersey at the moment, so for now, there's just me.

Second, I will post reprints from my weekly articles in Local Talk and Local Talk Newark - some of them are business related, some are not. Some are serious, some are satire. You may notice that the English grammar in these articles is fractured. This is quite deliberate as (a) I try to keep something close to a conversational tone in my personal writing, and (b) this is my revenge against all my nasty English teachers who insisted I couldn't write this way. I can, I do, and I will. veni, vidi, vengeance.

Anyway, I begin a lot of sentences with "And" and "But." But my goal is to make the grammar checker on Word get a heart attack while casually relating information to real people. And, yes, you CAN pass the bar exam with split infinitives and incomplete sentences. At least, in America, you can.

I expect the blog postings to lurch back and forth from professional to personal at random - just like in real life. I hope it will be entertaining and not too dry.

In most cases, I will make my opinion known. Keep in mind my opinions are only opinions.

Also, since I'm not your lawyer and not licensed in every state, I'm not actually giving legal advice - I'm not allowed to do this. You need your own lawyer to get legal advice. I may state my opinion but I'm not saying you should rely on it. In other words, your mileage may differ.

Although bankruptcy law is federal law, and in theory should be the same throughout the country, in practice, nothing could be further from the truth. Between local rules, local practice, local decisions on issues, and local state law issues that impact on local bankruptcy law, two courts can issue totally opposite decisions on an issue, and both be right - until the Supreme Court speaks.

The new bankruptcy law - BAPCPA - which we in the trade lovingly call BARF (Bankruptcy Abuse Reform Fraud) - closed some loopholes but opened up many others. It's not a bad time to be a bankruptcy attorney.

I'll leave you with this thought - up until 1994 we used to file bankruptcies to modify first mortgages by dropping them down to fair market value and dropping the interest rate to something more reasonable. No one complained, the system worked fine, and mortgage companies got performing mortgages on their books. Then, in 1994, the U.S. Supreme Court screwed us all with a decision called Nobelman and said we couldn't do it any more. If Congress gives us back this power, we won't need $750 billion of taxpayer dollars. We can stop the whole foreclosure crisis and restore liquidity to banks without costing the U.S. taxpayer even one penny. But don't hold your breath waiting for this to happen even with a Democratic Congress. It would make sense, it would be cost effective and it would work - so of course, they probably won't do it. To Congress, it makes more sense to throw good money after bad and keep the same foxes in charge of the chicken house.

Definition: Credit Default Swap - that's where you take out insurance on your neighbor's house and pray that it burns down, while dropping dried leaves and playing with matches on his lawn, and calling the press to tell them you smell smoke.

The worldwide derivatives market is a 156 TRILLION dollar market. I don't think $750 billion will make much of a dent.

This is not lawyer advertising. My other website - www.wolfprotect.com is lawyer advertising.

So enjoy.