RBS Yowsa

The UK government announced further measures to shore up the financial system today including increasing its equity stake in Royal Bank of Scotland to 70%, as RBS announced that it will lose around $40 billion this year. That's a lot of money.

It's MLK day so it's quiet on this side of the pond. Futures are up a little and oil is not doing much, but that is tomorrow's business.

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Bloomberg is reporting that Morgan Stanley is putting the same stupid oil trade on as Citi and others. It's complicated so try to stay with me but it goes like this:

1. Buy oil
2. Rent supertanker
3. Park supertanker
4. Sell oil later
5. Make money

Voila. The following quote is priceless:

“It’s a window of opportunity that won’t last long,” Gareth Lewis-Davies, a London-based energy analyst at Dresdner Kleinwort Group, said by phone. There may only be four or five banks with the expertise to make the trade, he said.

I'd like to see a bank that doesn't have the expertise to put that trade on.