Stock Market Volatility could be blamed on trader cocaine binges says Italian Undersecretary

November 10, 2011

Berlusconi passes the torch of ineptitude to his undersecretary Carlo Giovanardi

Carlo Giovanardi blames cocaine for the instability in the Italian markets

As trading in shares of France-Belgium bank Dexia tumble 36% as news of a £3.4bn bailout by French, Belgian and Luxembourg governments emerge, one Italian man has some ideas about what is causing the continued market volatility that we are regularly witnessing. Cocaine ladies and gentlemen.

Carlo Giovanardi is Undersecretary to Italian playboy/media-mogul/adulterer/sometimes President and master of all he purveys, Silvio Berlusconi, and as such he has been witness and heir apparent to some pretty monstrous ineptitude in his time. Now, after witnessing so much from his leader, he has thrown his own hat into the ring by blaming cocaine use amongst traders for the volatility affecting the Italian (and one supposes, global) markets.

On September 28th Italy extended a ban on short selling of financial shares until the 11th November. Short selling is far too complicated a financial concept for Take The Blame to understand, yet alone explain, but basically it is a concept which falls, almost perfectly, into the deranged hands of the cocaine freak. Because the cocaine freak is just that; a freak. A liar and a cheat who will prostitute the markets for their own gain leaving nothing but instability, volatility and confusion; the mirror image of the night before.

Short selling is the buying and selling of stock that the seller doesn’t own. Its like selling drugs that you don’t own on the promise that they will be there should your client actually want to get mashed. The stock is lent by the broker to the seller from a collection of his clients stocks. The stock is then sold and the money credited to the account of the seller. Now the crux of short selling is that at some point, as the stocks are not actually owned by either the seller or broker, the stocks have to be replenished back into the original account from where they were borrowed by the broker originally. Now, market drops and the seller can buy back the original stocks at a decreased price, thus making a profit on the difference of price. You borrow and sell at $10  then buy back at $6  and make $4 on every initial $10 investment and never actually owned any of it. By that end it is investing on the market falling, an investment in failure. Awesome. Rack up some lines and watch the market destabilise itself.

It is this availability of gambling with other peoples stocks that probably leads Mr. Giovarndi to his theory that there is a worrisome link between substance abuse and market flux. In a telephone call to Italian media, the undersecretary went on to say that Italians are trusting their money to people who are “not capable of making decisions”.

The idea is sound enough. Cocaine makes you confident, reckless, brave and full of your own ability to be a complete tool. Trading on the market gives you the opportunity to unleash these negative personality traits on peoples unsuspecting bank accounts. The problem is that, as almost every single financial institute has demonstrated over the last 5 years, you don’t need cocaine to royally screw things up.

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