Economy
Related: About this forumSTOCK MARKET WATCH -- Monday, 30 January 2012
[font size=3]STOCK MARKET WATCH, Monday, 30 January 2012[/font]
SMW for 27 January 2012
AT THE CLOSING BELL ON 27 January 2012
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Dow Jones 12,660.46 -74.17 (-0.58%)
S&P 500 1,316.33 -2.10 (-0.16%)
[font color=green]Nasdaq 2,816.55 +11.27 (0.40%)
[font color=red]10 Year 1.89% -0.03 (-1.56%)
30 Year 3.06% -0.03 (-0.97%)
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[font size=2]Market Conditions During Trading Hours[/font]
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]
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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
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[font color=black][font size=2]Handy Links - Economic Blogs:[/font][/font]
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The Big Picture
Financial Sense
Calculated Risk
Naked Capitalism
Credit Writedowns
Brad DeLong
Bonddad
Atrios
goldmansachs666
The Stand-Up Economist
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[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
[/center][font color=black][font size=2]Handy Links - Videos:[/font][/font]
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Charlie Rose talks with Roubini
Charlie Rose talks with Krugman
William Black: This Economic Disaster
Bill Moyers with Kevin Drum and David Corn
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Financial Sector Officials Convicted since 1/20/09 = [/font][font color=red]12[/font]
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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red]
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Tansy_Gold
(17,857 posts)Saturday's Canyon Arts Festival in Gold Canyon, Arizona, proved to be one of my very very best shows ever. Glorious weather, a stupendous crowd estimated at twice the size of last year's. Traffic was backed up at least a mile on US Hwy 60 approaching the venue.
Now my inventory is depleted and I have to get to work making more. Two more shows coming up in April, so I have a little bit of time. . . . . . .
Hotler, hang in there. We love you all to pieces.
Tuesday Afternoon
(56,912 posts)
Demeter
(85,373 posts)Sounds like a jailbreak.
DemReadingDU
(16,000 posts)
congrats on a good show!
Loge23
(3,922 posts)Making more may spark some creativity for new designs!
Roland99
(53,342 posts)
AnneD
(15,774 posts)My mom told me about it. She said things are starting to pick up a bit. Bother is starting to schedual shows in AZ too.
Ghost Dog
(16,881 posts)CANBERA (dpa-AFX) - Asian shares fell on Monday as investors took some profits off the table ahead of the European Union summit meeting later in the day, where EU leaders and finance ministers will discuss the steps to be taken by the EU in order to overcome the current debt crisis. Focus remained on Greece after the nation's finance minister, Evangelos Venizelos, rejected a German proposal for the E.U. to take control over Greece's tax and spending decisions. Commodities lost ground and the euro snapped a five-day advance against the dollar, weighed down by delays in negotiations between Greece and its private creditors on a debt swap deal.
Tokyo stocks fell for a third day, hit by a strong yen and earnings downgrades. Investors were also concerned about the outlook for global economic growth after data released over the weekend showed U.S. GDP grew at a slower-than-forecast 2.8 percent in the fourth quarter. Both the Nikkei average and the broader Topix index shed around half a percent each...
... China's Shanghai Composite index lost 1.5 percent and Hong Kong's Hang Seng index ended 1.7 percent lower as Beijing failed to meet expectations for a cut in banks' reserve requirements over the week-long Lunar New Year holidays...
... South Korea's Kospi average ended 1.2 percent lower, as weaker-than-expected fourth quarter GDP data from the United States and uncertainty over Greek debt talks prompted foreign funds to turn net sellers after a 12-session buying streak... India's benchmark Sensex was last trading down 1.9 percent on profit taking after rallying more than 11 percent this month. Indonesia's Jakarta Composite was losing 1.8 percent and Singapore's Straits Times was down a percent, while the Taiwan Weighted gained 2.4 percent...
/... http://www.finanznachrichten.de/nachrichten-2012-01/22563522-asian-shares-fall-ahead-of-eu-summit-020.htm
Ghost Dog
(16,881 posts)Jan. 30 (Bloomberg) -- Vasu Menon, vice-president of wealth management at Oversea-Chinese Banking Corp., talks about U.S. and Asian stocks. Menon also discusses Europe's sovereign debt crisis, the U.S. economy, and People's Bank of China monetary policy. He speaks from Singapore with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
Emerging-market stocks fell on concern China may not ease monetary policy and before Europe’s leaders meet to discuss their debt crisis.
The MSCI Emerging Markets Index (MXEF) lost 0.9 percent to 1,007.59 as of 10:05 a.m. London time. The Sensitive Index, or Sensex (SENSEX), slid 1.9 percent in Mumbai. Benchmark indexes fell at least 0.8 percent in Russia and South Africa as commodity prices fell. Taiwan’s Taiex Index (TWSE) surged 2.4 percent on its first day of trading after holidays for the Lunar New Year. The Shanghai Composite Index (SHCOMP) lost 1.5 percent after a week-long closure.
China held off from cutting bank reserve requirements last week after Barclays Capital Asia Ltd., JPMorgan Chase & Co. (JPM) and Industrial Bank Co. predicted this month that the reserve ratios were likely to fall before the holidays. European Union leaders arrive in Brussels today to put the finishing touches on a deficit-control treaty and endorse the statutes of a 500 billion-euro ($656 billion) rescue fund to be set up this year.
“There will be a lot more volatility,” Vasu Menon, vice- president of wealth management at Oversea-Chinese Banking Corp., said in a Bloomberg Television interview from Singapore. “The key event for this week is whether Greece is able to solve its debt problem.”
/... http://www.bloomberg.com/news/2012-01-30/most-emerging-stocks-decline-on-china-policy-caution-europe-debt-outlook.html
Demeter
(85,373 posts)Demeter
(85,373 posts)brrrrr
Ghost Dog
(16,881 posts)and chilly 16ºC nights on this island. On Sunday I'll be at sea. From Cadiz Monday I guess I'll just hug the Mediterranean coast and take the fast highway North until I can't take it anymore. Then I'll slow down and turn off onto the back roads where it's really at. Once over the mountains, France will be highway again, most likely, until Brittany and the boat over to Big Brother Britain, where I'm looking at... North-East wind and snow warnings with wind- and humidity- effect temperatures that feel like -14ºC... for the coming days, but which might just have passed by the time I get up there. 
AnneD
(15,774 posts)is it any wonder Britons went out adding colonies to the Empire.
Tansy_Gold
(17,857 posts)such as Roland and Fuddnik, but I personally will try to refrain from gloating too much about the weather in the sunshine belt.
Demeter
(85,373 posts)U.S. stock futures fell on Monday, tracking losses in Asia and Europe, as investors eyed a European Union summit amid fresh worries over Greece’s ability to sort out its financial difficulties...tensions appeared to be brewing over Greece ahead of a summit of European Union leaders set for later on Monday.
German Finance Minister Wolfgang Schaeuble said in an interview with The Wall Street Journal on Monday that Greece must take the necessary steps to get its economy and finances in order, or euro-zone leaders may not grant it a fresh bailout.
That comes on the heels of weekend reports that Germany wants to appoint a European Union Commissioner with veto power over Greece’s finances, a report that was subsequently dismissed by Evangelos Venizelos. Also over the weekend, negotiators said an agreement was close over a voluntary debt swap between Greece and its private creditors. Talks are expected to continue this week.
Ghost Dog
(16,881 posts)European stocks fell for a second day amid concern today’s meeting of the region’s leaders will fail to draw a line under the sovereign-debt crisis. U.S. index futures and Asian shares declined...
... The Stoxx Europe 600 Index retreated 0.7 percent to 253.55 as of 8:05 a.m. in London. The benchmark gauge has still rallied 18 percent from its Sept. 22 low as the U.S. economy maintained its recovery and speculation grew that the euro area will contain the debt crisis.
“The outlook for economic growth in Europe in 2012 is not a healthy one and consensus forecasts for earnings-per-share growth likely do need to be adjusted downwards,” said Ian Scott, the chief global strategist at Nomura Holdings Inc. in London. “Nevertheless, even a recession in the euro area, and very slow growth elsewhere, is unlikely to be sufficient to undermine the market if governments and central banks are able to stabilize sovereign spreads and lessen the immediate tail risk of a messy sovereign default.”
Futures on the Standard & Poor’s 500 Index expiring in March fell 0.7 percent and the MSCI Asia Pacific Index retreated 0.9 percent.
/... http://www.bloomberg.com/news/2012-01-30/european-u-s-stock-index-futures-fall-before-summit-asian-shares-slide.html
Ghost Dog
(16,881 posts)European Union leaders gather for their first summit of 2012 as a deteriorating economy and struggle to complete a Greek debt writeoff risk sidetracking efforts to stamp out the financial crisis.
EU chiefs arrive in Brussels about 2 p.m. today to put the finishing touches on a German-led deficit-control treaty and endorse the statutes of a 500 billion-euro ($661 billion) rescue fund to be set up this year. Greece and its private creditors said Jan. 28 they expect to complete a deal in coming days after bondholders signaled they would accept European government demands for a bigger cut in their debt holdings...
... Another objective at the summit will be to complete a fiscal compact, which was negotiated in December in talks that exposed a rift in the EU after the U.K. refused to participate. The rules aim to provide stricter sanctions and closer cooperation on national budgets...
... EU leaders plan to endorse the statutes of the permanent bailout fund, the European Stability Mechanism, to be signed in early February and sent to national parliaments to ratify. The ESM is scheduled to go into operation this year...
/... http://www.bloomberg.com/news/2012-01-29/greek-debt-talks-risk-derailing-eu-summit-progress-on-crisis-fighting-plan.html
... The summit - the 17th in two years as the EU battles to resolve its sovereign debt problems - is supposed to focus on creating jobs and growth, with leaders looking to shift the narrative away from politically unpopular budget austerity.
The summit is expected to announce that up to 20 billion euros (£16.8 billion) of unused funds from the EU's 2007-2013 budget will be redirected toward job creation, especially among the young, and will commit to freeing up bank lending to small- and medium-sized companies.
But discussions over the permanent rescue fund, a new 'fiscal treaty' and Greece will dominate the talks...
/... http://uk.reuters.com/article/2012/01/30/uk-eu-summit-idUKTRE80S0SY20120130
Demeter
(85,373 posts)Evangelos Venizelos said the proposal to create a budget commissioner with the power to veto Greek decisions ‘ignores key historical lessons’
Read more >>
http://link.ft.com/r/R5WAEE/U1ZY65/GYN7Q/FKS9XI/SP2BED/50/t?a1=2012&a2=1&a3=30
Ghost Dog
(16,881 posts)... The FTSE 100 index is currently declining 0.68 percent. Most miners are notably lower. Anglo American is declining 1.8 percent and Antofagasta is losing 2.3 percent. Steel maker Evraz is declining 4.8 percent. Rio Tinto is losing 0.9 percent. Goldman Sachs raised the stock to 'Buy' from 'Neutral.' Among lenders, Barclays is falling 2 percent and Lloyds Banking is declining 3.1 percent. Royal Bank of Scotland is down 2.2 percent and Standard Chartered is rettreating 2.7 percent. BP is losing 1.2 percent and Royal Dutch Shell is dropping 1 percent. Budget airline Ryanair reported a profit for the third quarter, mainly reflecting a 17 percent increase in average fares. The Irish company also lifted its profit outlook for the full year. The stock is losing 1.4 percent. GlaxoSmithKline is gaining 1.2 percent.
Elsewhere in Europe, the German DAX is falling 0.46 percent and the French CAC 40 is losing 0.68 percent. Switzerland's SMI is dropping 0.30 percent.
In economic news, Eurozone economic confidence improved in January, posting the first increase in sentiment since March 2011, a survey by the European Commission showed. Meanwhile, Spain marked the first contraction in economic activity since the fourth quarter of 2009. Official figures showed that the Spanish economy shrank 0.3 percent quarter-on-quarter in the fourth quarter, in line with the quarterly estimates from the Bank of Spain...
/... http://www.finanznachrichten.de/nachrichten-2012-01/22565278-uk-market-falls-020.htm
Demeter
(85,373 posts)...There is today an enormous gap between the way many C.E.O.’s in America — not Wall Street-types, but the people who lead premier companies that make things and create real jobs — look at the world and how the average congressmen, senator or president looks at the world. They are literally looking at two different worlds — and this applies to both parties. Consider the meeting that this paper reported on from last February between President Obama and the Apple co-founder Steve Jobs, who died in October. The president, understandably, asked Jobs why almost all of the 70 million iPhones, 30 million iPads and 59 million other products Apple sold last year were made overseas. Obama inquired, couldn’t that work come back home? “Those jobs aren’t coming back,” Jobs replied. Politicians see the world as blocs of voters living in specific geographies — and they see their job as maximizing the economic benefits for the voters in their geography. Many C.E.O.’s, though, increasingly see the world as a place where their products can be made anywhere through global supply chains (often assembled with nonunion-protected labor) and sold everywhere.
These C.E.O.’s rarely talk about “outsourcing” these days. Their world is now so integrated that there is no “out” and no “in” anymore. In their businesses, every product and many services now are imagined, designed, marketed and built through global supply chains that seek to access the best quality talent at the lowest cost, wherever it exists. They see more and more of their products today as “Made in the World” not “Made in America.” Therein lies the tension. So many of “our” companies actually see themselves now as citizens of the world. But Obama is president of the United States. Victor Fung, the chairman of Li & Fung, one of Hong Kong’s oldest textile manufacturers, remarked to me last year that for many years his company operated on the rule: “You sourced in Asia, and you sold in America and Europe.” Now, said Fung, the rule is: “ ‘Source everywhere, manufacture everywhere, sell everywhere.’ The whole notion of an ‘export’ is really disappearing.” Mike Splinter, the C.E.O. of Applied Materials, has put it to me this way: “Outsourcing was 10 years ago, where you’d say, ‘Let’s send some software generation overseas.’ This is not the outsourcing we’re doing today. This is just where I am going to get something done. Now you say, ‘Hey, half my Ph.D.’s in my R-and-D department would rather live in Singapore, Taiwan or China because their hometown is there and they can go there and still work for my company.’ This is the next evolution.” He has many more choices. Added Michael Dell, founder of Dell Inc.: “I always remind people that 96 percent of our potential new customers today live outside of America.” That’s the rest of the world. And if companies like Dell want to sell to them, he added, it needs to design and manufacture some parts of its products in their countries.
This is the world we are living in. It is not going away. But America can thrive in this world, explained Yossi Sheffi, the M.I.T. logistics expert, if it empowers “as many of our workers as possible to participate” in different links of these global supply chains — either imagining products, designing products, marketing products, orchestrating the supply chain for products, manufacturing high-end products and retailing products. If we get our share, we’ll do fine.
And here’s the good news: We have a huge natural advantage to compete in this kind of world, if we just get our act together. In a world where the biggest returns go to those who imagine and design a product, there is no higher imagination-enabling society than America. In a world where talent is the most important competitive advantage, there is no country that historically welcomed talented immigrants more than America. In a world in which protection for intellectual property and secure capital markets is highly prized by innovators and investors alike, there is no country safer than America. In a world in which the returns on innovation are staggering, our government funding of bioscience, new technology and clean energy is a great advantage. In a world where logistics will be the source of a huge number of middle-class jobs, we have FedEx and U.P.S. If only — if only — we could come together on a national strategy to enhance and expand all of our natural advantages: more immigration, most post-secondary education, better infrastructure, more government research, smart incentives for spurring millions of start-ups — and a long-term plan to really fix our long-term debt problems — nobody could touch us. We’re that close.
THIS "OPINION" IS SO ELITIST, SO SELECTIVE TO FAVOR THE 1%, AND SO FULL OF HOLES, IT RESEMBLES SWISS CHEESE, THE OLD-FASHIONED KIND.
1) STEVE JOBS DOESN'T MAKE THE RULES. AND HE'S DEAD, ANYWAY.
2) CHINA SACRIFICED ITS PEOPLE TO GET THOSE JOBS--AS IN DID THEM SERIOUS INJURY AND EVEN DEATH.
3) NATIONS ARE NOT GOING AWAY, GLOBALISM IS. IT'S UNSUSTAINABLE AND IMMORAL IN ITS PRESENT FORM.
4) WE NEED A PRESIDENT WHO ISN'T SUCH A PUSHOVER. WE HAVE BORDERS FOR A REASON. IT'S TIME TO FIND SOMEONE WHO RESPECTS OUR BORDERS AND THE BORDERS OF OTHER NATIONS, AND HAVE HIM/HER LEAD THE POLICY OF THIS NATION.
Demeter
(85,373 posts)like JPMorgan, Steve Jobs, Nike, Pfizer, etc.
Ghost Dog
(16,881 posts)(Reuters) - China intends to establish Shanghai as the global centre for yuan trading, clearing and pricing over the next three years as part of broader plans to make the commercial hub an international financial centre by 2020.
The plan for Shanghai's financial innovations through 2015, published jointly by the country's economic planning agency and the Shanghai government on Monday, set goals on a wide range of areas aimed at further developing Shanghai, though some analysts said many of them appeared ambitious...
... China wants to transform Shanghai into an international financial centre on par with the likes of New York and London by 2020. That goal was set in 2009 by the State Council and analysts have taken it as a broad deadline for liberalising the currency.
/... http://uk.reuters.com/article/2012/01/30/uk-china-economy-shanghai-idUKTRE80T0DY20120130
Ghost Dog
(16,881 posts)Financial crime reached record levels in 2011 as a widespread fraud epidemic hit British banks, the Government and investors.
The value of reported fraud rocketed to £3.5bn last year, an increase of 150pc on 2010.
According to KPMG's Fraud Barometer, the spike in the number of cases is down to heightened vigilance on the part of companies and Government agencies in uncovering the crimes, as well as an increasingly sophisticated class of fraudster.
The report, which only records crime values in excess of £100,000 that are heard in the High Courts, revealed that 41pc of all attacks were perpetrated by professional criminals. Well-organised gangs targeted the public sector, banks and investors, ahead of consumers and commercial businesses.
Fraudsters cheated the public sector on 70 occasions in 2011, stealing £1.1bn of Government money...
/... http://www.telegraph.co.uk/finance/financial-crime/9048060/Financial-crime-hits-record-levels-as-fraudsters-net-3.5bn.html
Demeter
(85,373 posts)The new federal task force led by New York Attorney General Eric Schneiderman sent subpoenas to the 11 largest financial institutions in the past few days as part of its investigation into possible residential mortgage-backed securities fraud. (President Obama formed the task group and announced it during his State of the Union address Tuesday.) Federal officials did not disclose which 11 banks have come under investigation.
Schneiderman said in a press conference Friday that he will be joined by Delaware AG Beau Biden, Massachusetts AG Martha Coakley, Nevada AG Catherine Cortez Masto, California AG Kamala Harris and Illinois AG Lisa Madigan. U.S. Attorney General Eric Holder said 15 lawyers and investigators are working with the group. The FBI will add 10 agents, and another 30 lawyers and staff will join the group. The Securities and Exchange Commission will also participate. SEC Director of Enforcement Robert Khuzami said there "would be no stone unturned, no dark corner unexposed to the light."
"We have jurisdiction to go after every aspect of the mortgage bubble and the crash of the financial market," Schneiderman said. "We have jurisdiction over every MBS issued over the last decade with Delaware and New York joining the group." IS A DECADE ENOUGH? I DON'T THINK SO! THAT'S WHERE THE WORST WILL WIGGLE OUT. IT'S BEEN GOING ON MUCH LONGER THAN A DECADE--DEMETER
Holder said if there is evidence of it, civil and criminal charges will be brought. Department of Housing and Urban Development Secretary Shaun Donovan guaranteed any crackdown from the group's investigation would include compensation to the homeowners affected by the financial crisis as well as investors. "It became clear very quickly that Eric and I shared a vision that it would be a grave injustice to hold these institutions accountable and potentially have hundreds of billions be paid to private investors and pension funds but not make sure homeowners who hold those loans who depend on being able to get those loans fixed to be able stay in those homes," Donovan said. He also made clear the investigation and ongoing settlement negotiation between other state AGs and mortgage servicers over foreclosure problems would be separate and any charges would not release the banks from liability in the robo-signing scandal.
Iowa AG Tom Miller, heading up the mortgage servicer investigation, has said the resulting settlement would not release the banks from securitization or lending liabilities.
WELL, IF IT'S TRUE, AND IT'S VIGOROUSLY PURSUED, THIS COULD BE THE START OF SOMETHING GOOD AND VERY BIG....
Demeter
(85,373 posts)...If governments are to underwrite bank loans, they may as well be doing the lending in the first place – and receiving the gains. Indeed, since 2008 the over-indebted economy’s crash led governments to become the major shareholders of the largest and most troubled banks – Citibank in the United States, Anglo-Irish Bank in Ireland, and Britain’s Royal Bank of Scotland. Yet rather than taking this opportunity to run these banks as public utilities and lower their charges for credit-card services – or most important of all, to stop their lending to speculators and gamblers – governments left these banks operating as part of the “casino capitalism” that has become their business plan.
There is no natural reason for matters to be like this. Relations between banks and government used to be the reverse. In 1307, France’s Philip IV (“The Fair”) set the tone by seizing the Knights Templars’ wealth, arresting them and putting many to death – not on financial charges, but on the accusation of devil-worshipping and satanic sexual practices. In 1344 the Peruzzi bank went broke, followed by the Bardi by making unsecured loans to Edward III of England and other monarchs who died or defaulted. Many subsequent banks had to suffer losses on loans gone bad to real estate or financial speculators.
By contrast, now the U.S., British, Irish and Latvian governments have taken bad bank loans onto their national balance sheets, imposing a heavy burden on taxpayers – while letting bankers cash out with immense wealth. These “cash for trash” swaps have turned the mortgage crisis and general debt collapse into a fiscal problem. Shifting the new public bailout debts onto the non-financial economy threaten to increase the cost of living and doing business. This is the result of the economy’s failure to distinguish productive from unproductive loans and debts. It helps explain why nations now are facing financial austerity and debt peonage instead of the leisure economy promised so eagerly by technological optimists a century ago.
So we are brought back to the question of what the proper role of banks should be. This issue was discussed exhaustively prior to World War I. It is even more urgent today....
Demeter
(85,373 posts)MICHAEL HUDSON SHOWS US THE WAY OUT OF THIS BATTLEFIELD TO VICTORY OVER THE CRIMINAL CLASS
Miko052
(1 post)Demeter
(85,373 posts)It seems they fixed the problem (or I reinstalled back to when it was working).
Chrome was driving me crazy, bogging down and crashing the flashplayer.
DemReadingDU
(16,000 posts)1/30/12 Freddie Mac Betting Against Struggling Homeowners
Freddie Mac, a taxpayer-owned mortgage company, is supposed to make homeownership easier. One thing that makes owning a home more affordable is getting a cheaper mortgage.
But Freddie Mac has invested billions of dollars betting that U.S. homeowners won't be able to refinance their mortgages at today's lower rates, according to an investigation by NPR and ProPublica, an independent, non-profit newsroom.
These investments, while legal, raise concerns about a conflict of interest within Freddie Mac.
"We were actually shocked they did this," says Scott Simon, who heads the mortgage-backed securities team at the giant bond trading and investment firm called PIMCO. "It seemed so out of line with their mission, out of line with what Congress wanted them to do."
Freddie Mac, formally called the Federal Home Loan Mortgage Corporation, was chartered by Congress in 1970. On its website, it says it has "a public mission to stabilize the nation's residential mortgage markets and expand opportunities for homeownership." The company is owned by U.S. taxpayers and overseen by a regulator, the Federal Housing Finance Agency (FHFA).
In December, Freddie's chief executive Charles Haldeman assured Congress his company is "helping financially strapped families reduce their mortgage costs through refinancing their mortgages."
But public documents show that in 2010 and 2011, Freddie Mac set out to make gains for its own investment portfolio by using complex mortgage securities that brought in more money for Freddie Mac when homeowners in higher interest-rate loans were unable to qualify for a refinancing.
Those trades "put them squarely against the homeowner," PIMCO's Simon says.
more...
http://www.npr.org/2012/01/30/145995636/freddie-mac-betting-against-struggling-homeowners
xchrom
(108,903 posts)
xchrom
(108,903 posts)why all the robo signing? shedding light on the shadow banking system
The Wall Street Journal reported on January 19th that the Obama Administration was pushing heavily to get the 50 state attorneys general to agree to a settlement with five major banks in the “robo-signing” scandal. The scandal involves employees signing names not their own, under titles they did not really have, attesting to the veracity of documents they had not really reviewed. Investigation reveals that it did not just happen occasionally but was an industry-wide practice, dating back to the late 1990s; and that it may have clouded the titles of millions of homes. If the settlement is agreed to, it will let Wall Street bankers off the hook for crimes that would land the rest of us in jail – fraud, forgery, securities violations and tax evasion.
To the President’s credit, however, he seems to have shifted his position on the settlement in response to protests before his State of the Union address. In his speech on January 24th, President Obama did not mention the settlement but announced instead that he would be creating a mortgage crisis unit to investigate wrongdoing related to real estate lending. “This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans,” he said.
The Deeper Question Is Why
Whether massive robo-signing occurred is no longer in issue. The question that needs to be investigated is why it was being done. The alleged justification—that the bankers were so busy that they cut corners—hardly seems credible given the extent of the practice.
The robo-signing largely involved assignments of mortgage notes to mortgage servicers or trusts representing the investors who put up the loan money. Assignment was necessary to give the trusts legal title to the loans. But assignment was delayed until it was necessary to foreclose on the homes, when it had to be done through the forgery and fraud of robo-signing. Why had it been delayed? Why did the banks not assign the mortgages to the trusts when and as required by law?
Demeter
(85,373 posts)Hope you are having a good morning.
xchrom
(108,903 posts)
Demeter
(85,373 posts)but that means canceling the morning trip outside, where it's bitter cold...so I guess it's a wash so far.
xchrom
(108,903 posts)Demeter
(85,373 posts)It's horrifying. It shows that the mortgage mess is ten times worse than we've discovered so far....maybe even 100 times worse.
Po_d Mainiac
(4,183 posts)for every agent that will be assigned under the announced plan, there were 20 during the S&L melt down. 
xchrom
(108,903 posts) indeed.xchrom
(108,903 posts)New industrial real estate leases signed in 2011 returned to levels not seen since prior to the recession of 2008-09, according to year-end statistics for the nation’s industrial market compiled by a real estate brokerage.
More than 306 million square feet of new leases were completed last year, up 14% from 2010, and the highest level of activity since 2007, Cushman & Wakefield said.
Of the 33 U.S. industrial markets tracked by the brokerage, 22 reported an increase in new leasing activity, with Phoenix, Dallas-Fort Worth, northern and central New Jersey, Houston and California’s Inland Empire among the markets with the most significant increases.
“While there is still concern that global economic uncertainty may erode some of the progress made in the U.S. industrial market, we’re increasingly confident that we are at the beginning of a sustained recovery that will gain momentum over the next 12 to 24 months,” said Jim Dieter, head of U.S. Industrial Brokerage for Cushman & Wakefield.
*** that was actually the whole article
Demeter
(85,373 posts)...Freddie Mac has invested billions of dollars betting that U.S. homeowners won't be able to refinance their mortgages at today's lower rates, according to an investigation by NPR and ProPublica, an independent, non-profit newsroom. These investments, while legal, raise concerns about a conflict of interest within Freddie Mac. "We were actually shocked they did this," says Scott Simon, who heads the mortgage-backed securities team at the giant bond trading and investment firm called PIMCO. "It seemed so out of line with their mission, out of line with what Congress wanted them to do."
Freddie Mac, formally called the Federal Home Loan Mortgage Corporation, was chartered by Congress in 1970. On its website, it says it has "a public mission to stabilize the nation's residential mortgage markets and expand opportunities for homeownership." The company is owned by U.S. taxpayers and overseen by a regulator, the Federal Housing Finance Agency (FHFA).
In December, Freddie's chief executive Charles Haldeman assured Congress his company is "helping financially strapped families reduce their mortgage costs through refinancing their mortgages." But public documents show that in 2010 and 2011, Freddie Mac set out to make gains for its own investment portfolio by using complex mortgage securities that brought in more money for Freddie Mac when homeowners in higher interest-rate loans were unable to qualify for a refinancing. Those trades "put them squarely against the homeowner," PIMCO's Simon says.
Freddie Mac's trades came at a time when mortgage rates were falling to record lows. Millions of homeowners wish they could refinance, but their lenders tell them they can't qualify for today's low rates because of tight rules. Freddie Mac is one of the gatekeepers with the power to set those rules, and lately, it has been saying no more often to homeowners. That raises concerns among some industry insiders who see a conflict: Freddie Mac's own financial health improves when homeowners can't refinance. Simply put, "Freddie Mac prevented households from being able to take advantage of today's mortgage rates — and then bet on it," says Alan Boyce, a former bond trader who's been involved in efforts to push for more refinancing of home loans....Freddie and FHFA repeatedly declined to comment on the specific transactions, but Freddie did say that its employees who make investment decisions are "walled off" from those who decide the rules for homeowners....
MORE
Demeter
(85,373 posts)Threat of humiliating Commons debate on £1m bonus is averted after fears grew that some Tory MPs may not have backed the RBS bank chief
Read more >>
http://link.ft.com/r/J0VG55/7A912U/Q38E1/GDJSKY/2ODZH5/AZ/t?a1=2012&a2=1&a3=30
THE POLITICIANS IN UK ARE MADE OF STERNER STUFF....
GOVERNMENT 1
PSYCHOPATHIC BANKSTER 0
Demeter
(85,373 posts)US banks fear that any recovery in the US housing market will be further delayed as a result of moves to remove credit ratings from American regulations, which will boost banks’ capital requirements by billions of dollars.
Bankers have until Friday to respond to a proposal by the Federal Reserve and other regulators that would increase the “risk weights” on securitised assets, driving up sharply the equity capital that banks are forced to set against them.
Read more >>
http://link.ft.com/r/BLH300/PF0MMC/SUO9T/AMYDZP/ORO10S/HK/t?a1=2012&a2=1&a3=29
1) THERE IS NO RECOVERY
2) THERE WON'T BE UNLESS THE BANKS ARE PROSECUTED
Demeter
(85,373 posts)FOR OUR "SPORT OF KINGS" ENTHUSIASTS
xchrom
(108,903 posts)i cry every time the movie secretariat comes on.
and it's not even a good movie -- but i love that horse.
Tansy_Gold
(17,857 posts)for Round Table.
I was visiting a friend when I happened to notice a newspaper article about his death in 1987, and I burst into tears.
xchrom
(108,903 posts)i just love their bodies -- such beautiful creatures.
i have fond memories of going to the track in the bay area with my dad.
we didn't know anything about the horses -- we loved our 2$ bets -- watching the beautiful horses run and people watch.
Tansy_Gold
(17,857 posts)Could have gone for free after the 6th race, but my parents weren't into it. We went maybe once a year, and I was in heaven. I did get to see Round Table in one of his last races there
Before IL Hwy 53 became a 47 lane freeway in the late 60s, it was a little country road that wound through the stable area of the racetrack. We'd take that route to visit my grandparents in Roselle, and during the summer I'd literally hang my head out the back seat windows -- we never had a/c in those days -- just to catch a whiff of the horses. And if I actually saw one, oh my goodness, the gods had smiled upon me.
I knew nothing about the horses at all. As for those $2 win-place-show bets, I always picked the horse with the longest tail.
xchrom
(108,903 posts)oh how you've taken me back -- riding in my parents car in the back seat...heaven.
and i think the longest tail is a perfectly sound bet.
AnneD
(15,774 posts)was it to me. We grew up aroung horses. I don't care to ride them much but I love a fine horse (it is in my blood). If I had been in Australia, it would have been Pharr Lap. Those two were messengers for the Gods
What do Indian children dream of when they sleep...horses my friend horses.
Wild horses that you ride bareback as one. Wild horses with manes so long your hair entertwined so much that you cannot tell where their mane ends and your hair begins. Wild horses that wear their own paint. Wild horses that stand guard over you while you rest.
That is what Indian children dream when they sleep.
xchrom
(108,903 posts)
A member of the Occupy movement demonstrates outside the Iowa Democratic Party Headquarters on Dc. 29, 2011, in Des Moines, Iowa. (Andrew Burton/Getty Images)
When the economic and financial crisis erupted in 2008, progressives hoped that it would trigger a popular revulsion against the right-wing economic policies that caused the crisis. It is now clear that these expectations are not being met. Moderate progressive policy moves have been overwhelmed
by public-sector layoffs and budget cuts as Republicans, too many Democrats and even President Barack Obama himself, have chosen austerity or “belt-tightening” as a main policy objective.
But how did the dogma of these “Austerians” – inspired by the Austrian School of economics – come to dominate public policy?
Progressives were not the only ones hoping to seize the opportunity of the economic crisis. A right-wing coalition of ideologues and industrialists saw it as a chance to achieve final victory in the war they have waged since the 1930s to destroy the New Deal institutions built under President Franklin Delano Roosevelt and extended through the late 1970s.
xchrom
(108,903 posts)You may remember that there was a time when apartheid in South Africa seemed unstoppable.
Sure, there were international boycotts of South African businesses, banks, and tourist attractions. There were heroic activists in South Africa, who were going to prison and even dying for freedom. But the conventional wisdom remained that these were principled gestures with little chance of upending the entrenched system of white rule.
“Be patient,” activists were told. “Don’t expect too much against powerful interests with a lot of money invested in the status quo.”
With hindsight, though, apartheid’s fall appears inevitable: the legitimacy of the system had already crumbled. It was harming too many for the benefit of too few. South Africa’s freedom fighters would not be silenced, and the global movement supporting them was likewise tenacious and principled.
In the same way, the legitimacy of rule by giant corporations and Wall Street banks is crumbling. This system of corporate rule also benefits few and harms many, affecting nearly every major issue in public life. Some examples:
* Powerful corporations socialize their risks and costs, but privatize profits. That means we, the 99 percent, pick up the tab for environmental clean ups, for helping workers who aren’t paid enough to afford food or health care, for bailouts when risky speculation goes wrong. Meanwhile, profits go straight into the pockets of top executives and others in the 1 percent.
DemReadingDU
(16,000 posts)1/30/12 3 Months After The MF Global Bankruptcy, We Find That $1.2 Billion (Or More) In Client Money Has "Vaporized"
On the three month bankruptcy anniversary of the company whose rehypothecation gimmicks will one day be seen as a harbinger of everything that is broken with the multi-trillion ponzi system, but not just yet despite loud warnings otherwise, we are getting close to a final verdict of where the $1.2 billion (and possibly more as originally predicted by Zero Hedge - see below) in commingled client money may have gone. Note the use of the passive voice because using the active, as in money that MF Global executives stole from clients, is prohibited in a legal system in which nobody goes to jail for something as modest as $1.2 billion in theft.
That verdict? "Vaporized."
No really (and yes, in the passive voice of course). From the WSJ: "As the sprawling probe that includes regulators, criminal and congressional investigators, and court-appointed trustees grinds on, the findings so far suggest that a "significant amount" of the money could have "vaporized" as a result of chaotic trading at MF Global during the week before the company's Oct. 31 bankruptcy filing, said a person close to the investigation."
Uh huh... Because money simply vaporizes. Which means one of two things: i) the "vaporization" is merely the phrase that so called investigators use to avoid the far more troubling sounding "stolen" as it would imply guilt, something which the former NJ governor and Goldman CEO (and not to mention JP Morgan which most likely was on the receiving end of the $1.2 billion + transaction) will, under guidance from counsel, sternly disagree with, or ii) the capital markets are such an unprecedented and manipulated fraud, that nobody has any clue at any moment, where any client money is, and that any residual capital still "invested" in mythical representations of "assets", which are likely rehypothecated so many times, that not even Bank of America's robosigning division would have a clue where to start unraveling, will promptly be converted into tangible manifestations of capital.
So when someone asks what happened to stock market volume, and to investor confidence in the "stock market" feel free to use just that phrase: "it vaporized."
more...
http://www.zerohedge.com/news/3-months-after-mf-global-bankruptcy-we-find-12-billion-or-more-client-money-has-vaporized
the Wall Street Journal article...
1/30/12 Money From MF Global Feared Gone
http://online.wsj.com/article/SB10001424052970203920204577191014034430488.html?mod=rss_markets_main
xchrom
(108,903 posts)DemReadingDU
(16,000 posts)&feature=player_embedded
xchrom
(108,903 posts)
xchrom
(108,903 posts)The brightening economy as the 2012 election year begins doesn’t yet match Ronald Reagan’s “Morning in America.”
President Barack Obama presides over an economy that eluded the threat of a double-dip recession in mid-2011 and now is strengthening, with growth accelerating in the fourth quarter to a 2.8 percent rate, the fastest in 18 months, from 1.8 percent the previous quarter.
Still, the pace remains well short of the recovery that helped propel the re-election of Reagan -- who, like Obama, faced a contraction considered in its time to be the worst since the Great Depression and also lost congressional support in mid- term elections.
“We’re getting growth but we’re not getting prosperity,” said Neal Soss, chief economist at Credit Suisse in New York, who was an assistant to former Federal Reserve Chairman Paul Volcker from 1981 to 1983.
Demeter
(85,373 posts)http://gigaom.com/cloud/davos-does-data/
...The big data phenomenon refers to the explosion of data of all types — location coordinates churned out by cell phones and GPS, machine data from manufacturing gear, consumer data from Twitter and Facebook. Just a fraction of that information resides in traditional databases. It’s not only too much to get one’s head around but also overwhelms traditional database and analytics tools, giving rise to a new generation of computing technologies: the Hadoop data framework, NoSQL databases and big data analytics...
Topless protesters detained at elite Davos forum, trying to call attention to poor
http://www.washingtonpost.com/world/europe/topless-protesters-detained-at-elite-davos-forum-trying-to-call-attention-to-poor/2012/01/28/gIQAB6pSXQ_story.html
Three topless Ukrainian protesters were detained Saturday while trying to break into an invitation-only gathering of international CEOs and political leaders to call attention to the needs of the world’s poor. Separately, demonstrators from the Occupy movement marched to the edge of the gathering and engaged in a brief standoff with police...With temperatures around freezing in the snow-filled town, they took off their tops and tried to climb a fence before being detained. “Crisis! Made in Davos,” read one message painted across a protester’s torso, while others held banners that said “Poor, because of you” and “Gangsters party in Davos.”
Davos police spokesman Thomas Hobi said the three women were taken to a police station and told that they weren’t allowed to demonstrate without a permit — or naked. They were released later Saturday.
The activists are from the Ukrainian group Femen, which has staged small, half-naked protests to highlight a range of issues including oppression of political opposition....
OCCUPY UPSTAGED!
Uninvited guest, Mr 99 Percent, crashes Davos
http://www.reuters.com/article/2012/01/26/uk-breakingviews-davos-inequality-idUSLNE80P03120120126
The most difficult guest to avoid bumping into at the World Economic Forum this year has no badge. He was not invited to the annual gathering in Davos, but he haunts the panels, hallway conversations and politicians' speeches. He is Mr. 99 Percent, the spectre of the unemployed and disenfranchised.
Not everyone at the Swiss conference is a member of the privileged 1 percent, but the whole point of the endeavour is to bring together the powerful of the world (and Mick Jagger). And the Indian billionaires, Chinese entrepreneurs, Wall Street chieftains and leaders of organized labour agree on one thing. An increase in civil unrest would be bad for business. The only beneficiaries of last year's confrontations in the streets of downtown Manhattan, north London or Santiago were the makers of tear gas and barricades.
But the power-brokers and plutocrats cannot agree on what should be done. The Forum's agenda is a bit schizophrenic. A Wednesday panel, "The Seeds of Dystopia," focused on how to keep the 225 million unemployed around the world from losing faith in capitalism and civic institutions. One idea was to pay more attention to limiting the ratio of executive compensation to average worker pay.
But at the same time, and just down the hall, a hedge fund manager, a consultant and a corporate chairman discussed "The Compensation Question." Their answer, in a nutshell, was that it's a matter for shareholders -- leave us alone....
Davos 2012: The unfinished and the unmentionable
http://www.bbc.co.uk/news/business-16782067
Anyone who listened to the main sessions in Davos could tell you the top two items now on the to-do list for European leaders: fixing the eurozone's financial firewall and finally sealing the deal on Greece.
But there's a second list I'd like to compile after a few days talking to senior leaders and business people here in the mountains. That's the list of fears, lurking on the sidelines, which could come back and bite us, but no-one wants publicly to confront.
Call it the Davos Unmentionables...This year, the two unmentionables were Portugal and the price of oil. (IRAN, EMBARGO AND THREAT OF WAR)
This Year, Davos Doesn't Deliver
http://online.wsj.com/article/SB10001424052970204573704577186962466956958.html
THANK GOD!
Davos Diary
http://www.indianexpress.com/news/Davos-Diary/905322/
Not confidence-inspiring
The most gripping exchange during a session on Russia came when Bill Browder of Hermitage Capital — once the biggest foreign investors in Russia and now a critic — asked the panel about the notorious death in police custody of Sergei Magnitsky, his lawyer and auditor. The response of Igor Shuvalov, the deputy prime minister, was (presumably) meant to sound reasonable and reassuring. He described the case as “horrendous” and said that some people had already lost their jobs and been charged over it. But it was very difficult to get to the bottom of the case, because the “system” was protecting some guilty people. The assembled business people did not seem impressed.
Mexican waves
President Felipe Calderón of Mexico, who is finishing his single six-year term this year, warned that the eurozone faced “a timebomb” which must be deactivated fast. He is particularly worried about the lack of growth amid austerity, particularly in southern Europe. That sounds very much like the warning David Cameron gave to the Davos VIPs, but it sounds all the more credible from a neutral Mexican leader.
Next year’s new year
The absence of Chinese senior officials — who stayed away from Davos this year owing to the forum’s clash with Chinese lunar new year festivities — has been something of an embarrassment for organisers. Especially this year, when there will be the once-a-decade leadership shuffle in China, it made sense for senior Chinese officials to celebrate the new year at home, where they can be seen with the people during the festivities. Now it appears that the World Economic Forum is open to moving the annual Davos gathering to an earlier date, possibly in mid-January, to ease the way for Chinese leaders to attend....
Demeter
(85,373 posts)Sometimes a single fact stands out amid all the clutter, offering a flash of insight and clarity. Here is one of them: Citigroup Inc. (C) Chief Executive Officer Vikram Pandit is a co-chairman of the World Economic Forum’s annual meeting this week in Davos, Switzerland. At first blush, the notion might seem almost ho-hum, a non- event. Upon further consideration, this looks like it can’t possibly be right. Then it turns out, much to our amazement, that the story is accurate, confirming once again that our world is stark mad. You really have to wonder why anyone outside of Citigroup would pick Pandit to lead anything.
It’s one thing for Citigroup to blow itself up so spectacularly that it needs multiple taxpayer bailouts to stay afloat. What seems strange is that an organization like the World Economic Forum would honor the fellow who was Citigroup’s CEO throughout most of the financial crisis, by selecting him as one of its six co-chairmen. If Sheila Bair had gotten her way when she was head of the Federal Deposit Insurance Corp., Pandit would have been fired years ago....It’s stunning when you think about it: How does Pandit, who owes much of his fortune to the American public’s largess, wind up being showcased as a paragon of leadership and free enterprise, little more than a year after the U.S. Treasury finally sold the last of its Citigroup common stock? And what message are the rest of us are supposed to take away from this? That his example is to be celebrated?
Global Elites
Maybe the distinction bestowed on Pandit should be of no surprise at all. Founded in 1971, the World Economic Forum describes itself as an international organization of large corporations that is “committed to improving the state of the world” with “no political, partisan or national interests.” But it’s becoming hard not to suspect that the annual gathering in Davos has become a conclave for global elites to promote crony capitalism and state-backed enterprise, ensuring that national coffers remain available to be tapped for private gain.
Pandit joined Citigroup in 2007 after selling it his Old Lane Partners LP hedge fund, which the bank shut the following year. Pandit’s take from his share of the sale was $165 million, the last $80 million of which he received in July. In February 2008, two months into his job as CEO, Pandit certified in Citigroup’s 2007 annual report that the company’s internal controls were effective. Eight days before he did that, the U.S. Office of the Comptroller of the Currency had sent him a seven-page letter detailing all sorts of ways in which Citigroup’s controls were inadequate....In November 2008, in spite of the company’s insistent refrain that it had “very strong capital,” Citigroup took a second federal-bailout package. That boosted its proceeds from the Troubled Asset Relief Program to $45 billion, plus $301 billion of asset guarantees. Another rescue came in 2009, when the Treasury Department let Citigroup repay $25 billion of its bailout money in common shares rather than cash. Then in March 2010, appearing before a congressional oversight panel, Pandit said Citigroup was a healthy institution back in November 2008 when the government saved it from going under. Short sellers (of course!) were to blame for the bank’s problems, he said.
........
Maybe if Citigroup blows up again someday, they could put Pandit in charge of the whole conference.
Demeter
(85,373 posts)After many years of attending these meetings, I have become a great believer in the existence – and the power – of hubris. I do not know if it is the gods or human nature, but success and failure are too frequently inextricably linked and the Davos meeting offers an extraordinary laboratory to observe the phenomenon.
Read more >>
http://link.ft.com/r/H60H77/GD1CZI/4VXHZ/IIFFSL/2OD43B/1G/t?a1=2012&a2=1&a3=30
Demeter
(85,373 posts)Russia now has a rapidly growing middle class prepared to invest in better medical services, better housing and higher retirement benefits. The task of the government is to make sure their money doesn’t go up in flames.
Read more >>
http://link.ft.com/r/4RNQTT/R3VKS0/MJTKN/L9PPFG/62QDT1/28/t?a1=2012&a2=1&a3=30
Demeter
(85,373 posts)While it has been nearly three years since Washington bailed out the banks, the financial industry is still clinging to $19 billion in taxpayer money. Nearly 500 banks, ranging from beleaguered regional powerhouses to obscure community banks, owe roughly 8 percent of the $245 billion doled out at the peak of the financial crisis, according to Treasury Department data released this week. Regions Financial, a large lender based in Alabama, owes $3.5 billion, the most of any bank.
Even as bailout money has slowly returned to the government’s coffers throughout the year, many banks still refuse to part with their lifelines. Some institutions, well-positioned to reimburse taxpayers through fresh stock offerings, are choosing instead to wait for brighter days when their stock prices are not so depressed...Other stragglers desperately need the money. Nearly one-third of the remaining debtors have missed their recent dividend payments to the government, according to an analysis by Linus Wilson, professor of finance at the University of Louisiana at Lafayette. “The percent of deadbeats,” Mr. Wilson said, “will almost surely rise in the short term.”
Next month will be the three-year anniversary of the highly contentious Troubled Asset Relief Program. At the time, as the economy teetered on the brink, the government injected much-needed capital into the banking industry, charging the banks 5 percent annual interest. There is no deadline for repayment, although a steeper 9 percent dividend payment kicks in after five years. Wall Street giants like Goldman Sachs and JPMorgan Chase, eager to shed the stigma of TARP and its caps on executive bonuses, quickly repaid the bailout money. Over the last two years, other big banks followed suit...The Obama administration now expects to turn a roughly $20 billion profit on the bank bailouts, programs once seen as a major drain on the government’s bottom line. Still, the overall TARP payouts — which included lifelines to the American International Group, the automotive industry and embattled homeowners — will likely cost taxpayers up to $37 billion.
The $19 billion owed by banks is down 14 percent from May. The decline is partially a result of dozens of banks repaying their debts using a separate pool of government funds. Under a new program intended to encourage small-business lending, smaller banks can exchange their rescue money for cheaper capital, provided they meet certain lending targets. “Unfortunately, this means that taxpayers will see less money from their risky investments,” Mr. Wilson said. Only 10 banks have fully repaid their bailout funds over the last few months, Treasury Department data shows. And now, roughly 160 of the 500 debtors are behind on their dividend payments to the government, according to Mr. Wilson. More than 70 banks have failed to keep up with at least six dividend payments, his research shows, allowing the Treasury Department to appoint directors to the boards of the firms. Some banks are in even deeper. Saigon National Bank in Westminster, Calif., has missed 11 payments, Mr. Wilson said.
Another 12 institutions have a good reason for not paying up: They have filed for bankruptcy.
Demeter
(85,373 posts)Nearly three months after MF Global Holdings Ltd. collapsed, officials hunting for an estimated $1.2 billion in missing customer money increasingly believe that much of it might never be recovered, according to people familiar with the investigation. As the sprawling probe that includes regulators, criminal and congressional investigators, and court-appointed trustees grinds on, the findings so far suggest that a "significant amount" of the money could have "vaporized" as a result of chaotic trading at MF Global during the week before the company's Oct. 31 bankruptcy filing, said a person close to the investigation. VAPORIZED NOT SNORTED UP THE NOSE OF JPMORGAN, LIKE COKE?
Many officials now believe certain employees at MF Global dipped into the "customer segregated account" that the New York company was supposed to keep separate from its own assets—and then used the money to meet demands for more collateral or to unfreeze assets at banks and other counterparties as they grew more concerned about their financial exposure to MF Global. Investigators also are examining other scenarios that have gained traction in recent weeks, such as the possibility that MF Global suffered steep losses on investments made using customer money. Officials investigating the case have looked into whether such investments were appropriate under rules at the time.
As money poured out of MF Global, much of it likely passed through J.P. Morgan Chase & Co. and other banks where the securities firm had accounts, as well as trade-clearing partners such as Depository Trust & Clearing Corp. and LCH.Clearnet Group Ltd., people familiar with the matter said. Those companies have denied being knowingly in possession of any missing MF Global money, and any efforts to make them fill the hole would face daunting hurdles. And because the firms usually were middlemen between MF Global and other counterparties, the funds they touched were then scattered widely, complicating the search.
Of the $6 billion kept at MF Global by farmers, hedge funds, floor traders and other customers when panic erupted over its exposure to European sovereign debt and shaky financial outlook, about $5.3 billion has been located, according to James Giddens, the bankruptcy trustee for the securities firm's U.S.-based brokerage operation. But hundreds of millions of customer dollars are potentially snarled in litigation with other parts of MF Global, including its U.K. arm, and U.S. officials might never be able to recover those funds. As a result, Mr. Giddens believes the shortfall is at least $1.2 billion, though regulators at the Commodity Futures Trading Commission and CME Group Inc., parent of the Chicago Mercantile Exchange and New York Mercantile Exchange, have estimated the total is smaller than that.
Demeter
(85,373 posts)A tax evasion investigation in the United States has reached Julius Baer, a spokesman for the Swiss lender confirmed Wednesday, a day after the government charged two advisers with conspiring to help clients evade United States taxes on more than $600 million hidden in offshore accounts...Preet Bharara, the United States attorney for the Southern District of New York, and Charles R. Pine, an Internal Revenue Service investigator, announced the indictment of Daniela Casadei and Fabio Frazzetto on Tuesday, without identifying the bank by name. Martin Somogyi, a Julius Baer spokesman, confirmed that “one current and one former employee” had been indicted, but said he could not comment further.
Julius Baer “is one of a number of Swiss financial institutions supporting the ongoing negotiations between the U.S. and Switzerland and is cooperating with the U.S. government investigation,” the bank said....According to the indictment, Ms. Casadei and Mr. Frazzetto “allegedly advised U.S. taxpayer-clients to open undeclared accounts under code or fictional names.” The two defendants “also allegedly advised clients not to worry about U.S. law enforcement authorities,” the indictment states, because the bank “no longer had offices on U.S. soil.”
The Justice Department has aimed at a number of banks over tax evasion in recent years, most notably UBS, the largest Swiss lender. UBS agreed in 2009 to pay $780 million and hand over some client names to end criminal proceedings. The department’s offshore compliance initiative has criminal investigations at eight banks, according to an apparently inadvertent disclosure last month. Julius Baer, though dwarfed by institutions like UBS and Credit Suisse, has a large international presence, particularly in Asia. Its deals mainly with wealthy private clients, family offices and asset managers. The indictment Tuesday alleged that the two advisers helped to conceal their clients’ ownership of bank accounts collectively holding more than $600 million by opening and managing them under fictional names or under the name of non-American relatives or sham corporate entities.
Ms. Casadei and Mr. Frazzetto, both residents of Switzerland, according to the indictment, face up to five years in prison and fines of $250,000 or more if they are convicted of the charges.
xchrom
(108,903 posts)Oil dropped for a second day in New York on speculation that European Union leaders meeting today may fail to resolve the region’s debt crisis, while OPEC’s secretary-general said the market is well-supplied.
Futures slipped as much as 0.9 percent as stocks dropped and the dollar strengthened. EU chiefs will gather in Brussels today to complete a German-led deficit-control treaty and endorse a 500 billion-euro ($660 billion) rescue fund. Hedge funds and other large speculators increased wagers on rising crude prices, the Commodity Futures Trading Commission’s Commitment of Traders report on Jan. 27 showed.
“The market is taking off risk before the meeting,” said Thina Saltvedt, an analyst at Nordea Bank AB in Oslo, who predicts Brent crude will average $107 a barrel this quarter. “Ahead of this meeting, sentiment is less optimistic.”
Crude for March delivery fell as much as 85 cents to $98.71 a barrel in electronic trading on the New York Mercantile Exchange. It was at $99.10 at 1:10 p.m. London time. The contract lost 14 cents to $99.56 on Jan. 27. Prices are 0.3 percent higher this month.
Demeter
(85,373 posts)Japan's rapid aging means the national population of 128 million will shrink by one-third by 2060 and seniors will account for 40 percent of people, placing a greater burden on the shrinking work force population to support the social security and tax systems.
The population estimate released Monday by the Health and Welfare Ministry paints a grim future. In year 2060, Japan will have 87 million people. The number of people 65 or older will nearly double to 40 percent, while the national work force of people between ages 15 and 65 will shrink to about half of the total population, according to the estimate, made by the National Institute of Population and Social Security Research.
The total fertility rate, or the expected number of children born per woman during lifetime, in 2060 is estimated at 1.35, down from 1.39 in 2010 well below more than 2 needed to keep the country's population from declining. But the average Japanese will continue to live longer. The average life expectancy for 2060 is projected at 90.93 for women, up from 86.39 in 2010, and 84.19 years for men, up from 79.64 years.
Prime Minister Yoshihiko Noda has pledged to push for social security and tax reforms this year. A bill he promised to submit by the end of March would raise the 5 percent sales tax in two stages to 8 percent in 2014 and 10 percent by 2015, although opposition lawmakers and the public pose challenges to its approval...Experts say that Japan's population will keep losing 1 million every year in coming decades and the country urgently needs to overhaul its social security and tax system to reflect the demographic shift.
"Pension programs, employment and labor policy and social security system in this country is not designed to reflect such rapidly progressing population decline or aging," Noriko Tsuya, a demography expert at Keio University, said on public broadcaster NHK. "The government needs to urgently revise the system and implement new measures based on the estimate."
Demeter
(85,373 posts)I AM THE GHOST OF CHRISTMAS PAST....AND I STILL HAVEN'T SEEN A SALES REPORT!
http://news.yahoo.com/consumer-spending-fizzles-december-savings-134041387.html
Consumer spending was flat in December as households took advantage of the largest rise in income in nine months to boost their savings, setting the tone for a slowdown in demand early in 2012. The Commerce Department said on Monday spending was the weakest since June and followed a 0.1 percent gain in November.
Economists polled by Reuters had expected spending, which accounts for more than two-thirds of U.S. economic activity, to nudge up 0.1 percent last month. For all of 2011, spending rose 4.7 percent, the largest increase since 2007...When adjusted for inflation, spending dipped 0.1 percent, breaking three straight months of gains. It increased 0.1 percent in November.
The government reported on Friday that consumer spending grew at a 2.0 percent annual pace in the fourth quarter, helping to lift gross domestic product 2.8 percent - an acceleration from the third-quarter's 1.8 percent rate...Part of the spending, which has been concentrated in motor vehicles, has been funded from savings and credit cards as high unemployment constrains wage growth...Wages rose last month, helping to prop-up incomes. Income advanced 0.5 percent, the largest gain since a matching increase in March, and followed a 0.1 percent rise in November. Economists had expected income to rise 0.4 percent.
Taking inflation into account, disposable income rose 0.3 percent after being flat the prior month. With disposable income outstripping spending, the saving rate rose to 4.0 percent from 3.5 percent in November. Savings increased to annual rate of $460.1 billion, the highest since August, from $407.8 billion the prior month. The report showed inflation pressures generally contained, with a price index for personal spending nudging up 0.1 percent after being flat the prior month.
AND IF YOU BELIEVE ANY OF THOSE NUMBERS, THE FED HAS SOME MORTGAGE-BACKED SECURITIES, AAA+ RATING, FOR YOU.
Demeter
(85,373 posts)LONG TIME PASSING...
http://www.theatlantic.com/business/archive/2012/01/where-did-all-the-workers-go-60-years-of-economic-change-in-1-graph/252018/
President Obama's State of the Union speech was surprisingly bullish on reviving manufacturing, prompting one very clever person on Twitter to say something along the lines of: "Democrats want the economy of the 1950s, while Republicans just want to live there."
It got me thinking: What did the economy look like in the 1950s? If you could organize all the jobs into buckets and compare the paper-shuffling professional services bucket to the manufacturing bucket, what would they look like around 1950, and how has the picture changed in the last 60 years?
National Journal addressed just this topic in its special report on the rise and fall and rise of manufacturing. The spectacular graphic compares employment by sector in 1947 and 2007 and its most important lesson is a whopper. Manufacturing and agriculture employed one in three workers just after World War II. Today, those sectors employ only one in eight.
.......MORE.....
Update: I should have made this point more clearly: Manufacturing jobs have declined as a share of the economy. But manufacturing hasn't declined as an industry. It's grown. By a lot. Here's total industrial production (manufacturing, utilities, and mining output) indexed to 1945. Output has sextupled.
IT DOESN'T SAY, BUT I THINK THAT'S IN DOLLARS...AND IF THEY AREN'T CONSTANT DOLLARS, GIVEN OUR INFLATION HISTORY, THAT STILL REPRESENTS A DECLINE IN MANUFACTURING...STAY TUNED FOR MORE INVESTIGATIVE RESULTS
IT'S NOT CLEAR IF "GOVERNMENT" INCLUDES THE MILITARY, WHICH SHOULD BE SEPARATE FROM "GOVERNMENT", ANYWAY. ALTHOUGH MERCENARIES COULD BE THROWN IN WITH MILITARY...
AND WHAT ABOUT CRIMINALS...THOSE NOT GAINFULLY EMPLOYED BY CORPORATIONS?
WHAT ABOUT RELATION TO THE GROWING OR SHRINKING WORKFORCE? THIS GRAPH IS TELLING IN WHAT IT DOESN'T TELL.
xchrom
(108,903 posts)European Union leaders gather for their first summit of 2012 as a deteriorating economy and the struggle to complete a Greek debt writeoff risk sidetracking efforts to stamp out the financial crisis.
EU chiefs arrived in Brussels today to put the finishing touches on a German-led deficit-control treaty and to endorse the statutes of a 500 billion-euro ($656 billion) rescue fund to be set up this year. European finance officials yesterday discussed a deal that Greece and its private creditors expect to complete in the coming days after bondholders signaled they would accept government demands for a bigger cut in their debt holdings.
Efforts to hold the 17-nation euro area together with bolstered fiscal rules and a stronger firewall are colliding with stalled progress in Greece, where the crisis began in 2009. To prevent a financial collapse, Greek bondholders have been pushed to cede more ground after agreeing in October to take a 50 percent cut in the face value of more than 200 billion euros of debt.
“The fact we’re still at the beginning of 2012 talking about Greece is a sign this problem hasn’t been dealt with,” U.K. Chancellor of the Exchequer George Osborne said at the World Economic Forum in Davos, Switzerland.
Roland99
(53,342 posts)Core PCE index climbed 0.2% in December
PCE inflation index rose 2.4% last year, core 1.8%
PCE inflation index rose 0.1% last month
Personal spending falls less than 0.1% in December
Personal spending increased 2.2% in 2011
Disposable personal income up 0.9% in 2011
Personal income rises 0.5% in December
Roland99
(53,342 posts)Looking at the rate and the speed of decline this past month, it’s hard to argue that the current 65% drop is meaningless:
...
What is the bottom line? The stark decline in the BDI today should be taken very seriously. Most similar declines have occurred right before or in tandem with economic instability and stock market upheaval. All the average person need do is look around themselves, and they will find a European Union in the midst of detrimental credit downgrades and on the verge of dissolving. They will find the U.S. on the brink of yet another national debt battle and hostage to a private Federal Reserve which has announced the possibility of a third QE stimulus package which will likely be the last before foreign creditors begin dumping our treasuries and our currency in protest. They will find BRIC and ASEAN nations moving quietly into multiple bilateral trade agreements which cut out the use of the dollar as a world reserve completely. Is it any wonder that the Baltic Dry Index is in such steep deterioration?
Along with this decline in global demand is tied another trend which many traditional deflationists and Keynesians find bewildering; inflation in commodities. Ultimately, the BDI is valuable because it shows an extreme faltering in the demand for typical industrial materials and bulk items, which allows us to contrast the increase in the prices of necessities. Global demand is waning, yet prices are holding at considerably high levels or are rising (a blatant sign of monetary devaluation). Indeed, the most practical conclusion would be that the monster of stagflation has been brought to life through the dark alchemy of criminal debt creation and uncontrolled fiat stimulus. Without the BDI, such disaster would be much more difficult to foresee, and far more shocking when its full weight finally falls upon us. It must be watched with care and vigilance...
Roland99
(53,342 posts)Nasdaq 2,790 -26 -0.94%
S&P 500 1,303 -13 -0.98%
GlobalDow 1,903 -26 -1.32%
Gold 1,732 -4 -0.21%
Oil 98.64 -0.92 -0.92% [/font]
Ghost Dog
(16,881 posts)By Ambrose Evans-Pritchard
6:28PM GMT 29 Jan 2012
Credit to households and firms shrank by €90bn in December alone. It is the biggest drop in a single month since the launch of the euro, worse than after the Lehman collapse in October 2008 or at any time during the Great Recession.
One dreads to think what would have happened to Europe’s banking system and to the solvency of Italy and Spain if Mario Draghi had not come to the rescue before Christmas with unlimited three-year funding at 1pc, against almost any collateral: that is to say, if the mad Hayekians had still been in charge of the European Central Bank...
... In the meantime, great damage has been done. The International Monetary Fund expects economic contraction of 2.2pc this year in Italy and 1.7pc in Spain, with further declines in 2013 - if all goes well.
This will play havoc with debt trajectories. Italy’s debt will rise to 127pc of GDP by next year. Spain’s will rise to 84pc, more than 11pc worse than forecast in September. There will be scant improvement to the budget deficit in either country. So much austerity for so little gain...
... The bitterness is starting to show. Rodrigo Rato, head of Bankia and a former IMF chief, said the structure of monetary union is rigged in favour of Germany. “When the Germans are in trouble, the other EU members help it, and when the others have problems, Germany takes advantage to lower its own borrowing costs,” he said.
There is a core of truth to this. The ECB set rates too low over much of the last decade to help Germany out of slump, setting off credit booms that destabilized half of Europe. The favour was not returned in mid-2011 when the Trichet-Stark team raised rates even though real M1 deposits were collapsing across Club Med, with consequences that are now painfully apparent...
/... http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9047851/Mario-Draghi-the-Latin-Blocs-monetarist-avenger.html
Demeter
(85,373 posts)but this is more like a mugging, actually. And Germany didn't intentionally start it, but there it is!
Demeter
(85,373 posts)What shall we make of this surprise pronouncement in President Obama’s State of the Union address? A belated investigation has been launched into the role of fraud in the financial crisis. This much is clear: Despite rampant illegalities, bank fraud and countless cases of perjury, the response to date — at the federal level and from most, but not all, states — has been underwhelming, cowardly even. A few principled holdouts — the attorneys general of Delaware, New York, Nevada and California — refuse to rubber-stamp a pre-investigation settlement with banks, but that’s all. Despite chances to bring crooks to justice, there has been little action. So, here we are, four years after the great financial collapse, three years after the recovery began and in the last year of Obama’s term — and the president has finally decided to investigate the role of fraud in the great global financial crisis. Hence, this new task force — the unit of Mortgage Origination and Securitization Abuses — begins behind the curve. The statute of limitations is, in many cases, close to elapsing. HOW CONVENIENT!
Even so, do not dismiss the investigation out of hand because of the timing: History informs us that a serious investigation can begin four years after the fact. Recall that Ferdinand Pecora was the fourth chief counsel for the Senate committee that investigated the Wall Street crash of 1929 and subsequent Depression. He was appointed in 1932 and received broad investigatory powers in 1933. His report ran thousands of pages. Thanks in large part to Pecora’s findings, Congress passed the Glass-Steagall Banking Act, which separated commercial and investment banking; the Securities Act of 1933, which established penalties for filing false information about stock offerings; and the Securities Exchange Act, which created the Securities and Exchange Commission to regulate the stock exchanges. Nearly 50 years of financial stability followed.
The personality in charge can make all the difference. In an encouraging sign, Obama appointed to the task force New York Attorney General Eric Schneiderman, one of the few attorneys general not railroaded into a premature settlement with banks of the robo-signing-foreclosure scandal...Critics have derided the task force as little more than election maneuvering. The politics are obvious: Both Occupy Wall Street and the tea party were very unhappy with the bank bailouts; they seem even less happy with the lack of prosecution.
It’s fair to ask: Is this new task force a meaningless exercise? It is too soon to tell, of course. Like good poker players, we can look for “tells” that signal whether this will be a farce or a serious player. We’ll find clues in the structural setup of the office as well as the areas it investigates. In the setup of the office, four aspects are crucial:
●Does the office have subpoena power (as the New York attorney general’s office has through the Martin Act)?
● Are there going to be public hearings (preferably in the Senate)?
●Will the commission have a significant budget?
WILL ENOUGH ENFORCEMENT BE GIVEN TO THE TASK FORCE? SO FAR, NO. BUT THE SUBPOENAS ARE FLYING ALREADY...
AnneD
(15,774 posts) and lurkers.
After a weekend that included a zombie sleep, serious cacooning, and a zen knitting session, my battery has been recharged and I am at work today.
Poor hubby asked why I was home so early. When I told him my BP was up, he suggested that they might want to change my meds. Frankly, I don't think I am the one with the problem. What pill is going to help this society or make these kids lives any better. I don't think I have the problem here.
I went to sleep for 15 hours-getting up once to have a banana and water. If you have never had a migraine, the next day feels alot like a hang over without the benefit of the alcohol. When I awoke, hubby and I went to have breakfast and a cup of coffee and I felt much better. Hope springs eternal (how else could one explain the Chicago Cubs).
I then went into a knitting marathon. Knitting puts me into a zen-like trance, my mind goes into auto-pilot. I think it is like a computer cleaning files, your concious and subconcious are working but you are focused on a routine subsystem.
Anyway, I am back at work today. What keeps me going....I feel like Johnny Appleseed. I may not enjoy the fruits of my labor, but they are there. I like to think saved 4 people last week. There is a cumulitive effect after a while.
Happy hunting and watch out for the bears.
xchrom
(108,903 posts) Demeter
(85,373 posts)Me too. It helps to maintain life to get away from it for a while...before killing someone.
AnneD
(15,774 posts)I defragged my mental disk drive.
I was dripping with toxins when I left, anything I said of did would be toxic to whom ever I tried to help.
Thanks for all the kind thoughts and well wishes on my behalf. It helps to know you are not alone or crazy... 
Demeter
(85,373 posts)I don't vouch for anyone's sanity, including my own. After all, we all show up here....
DemReadingDU
(16,000 posts)Defragging the mental disk drive
Awesome, I am starting now!
xchrom
(108,903 posts)(Reuters) - European leaders struggled to reconcile austerity with growth on Monday at a summit due to approve a permanent rescue fund for the euro zone and put finishing touches to a German-driven pact for stricter budget discipline.
Officially, the half-day summit was meant to focus mainly on ways to rekindle growth and create jobs at a time when governments across Europe are having to cut public spending and raise taxes to tackle mountains of debt.
But disputes over the limits of austerity, and about Greece's unresolved debt restructuring negotiations with private bondholders, may sour efforts to send a more optimistic message that Europe is getting on top of its debt crisis.
The risk premium on southern European government bonds rose and stocks were lower on concerns about a lack of tangible progress in the Greek debt talks and gloom about Europe's economic outlook.
Demeter
(85,373 posts)The banks, the Euro, and any other vampire squid-like corporations.
Demeter
(85,373 posts)Bundlers from the securities industry have raised at least $9 million for the Obama campaign so far...Among these bundlers are employees of big-name firms including Goldman Sachs, Morgan Stanley, Barclays and Citigroup.
It’s worth emphasizing that for all the talk about grass-roots fundraising by the Obama campaign, the bundlers are a major part of the effort. The data released so far shows that at least one-third of all the money raised was sent in by a bundler, according to CRP.
The strong support for Obama from the financial services industries is not new. In 2008, employees of Goldman Sachs contributed more to Obama than employees of any other company.
None of this is to say that all of these bundlers are helping Obama exclusively out of self-interest – say, to protect their industries (or tax advantages) from tightened regulation. But it certainly prompts the question: If Obama wins a second term with these donors in his corner, how robustly will he follow through on his populist rhetoric?
Demeter
(85,373 posts)...The U.S. Supreme Court has ruled that judges can throw out cases because they don’t like or believe the plaintiff … even before anyone has had the chance to conduct discovery to prove their case. In other words, judges’ secret biases can be the basis for denying people their day in court, without even having to examine the facts. Judges are also becoming directly involved in politics with the other branches of government.
Claims of national security are being used to keep the shenanigans of the biggest banks and corporations secret, and to crush dissent.
But this essay focuses on something else: the fact that the laws themselves are now being kept secret....
READ IT YOURSELF
xchrom
(108,903 posts)Financial regulators have asked Deutsche Bank to disclose the total risk it faces from a number of lawsuits brought by investors in its products who lost money in the 2008 financial crisis, SPIEGEL has learned.
Authorities appear to be concerned about the many lawsuits pending against Germany's biggest bank. At a meeting with management board members of Deutsche Bank in New York in October, regulators from Germany, the US and Britain demanded that the bank submit a report on the open US lawsuits and the compensation claims linked to them.
The lawsuits are overshadowing the transition of power at Deutsche Bank from outgoing CEO Josef Ackermann to the two new co-chief executives, Indian-born Anshu Jain, the head of the investment banking division, and Jürgen Fitschen, the head of Germany operations, in the coming weeks.
The litigation includes a $1 billion claim from the US government which has filed a lawsuit alleging that Deutsche Bank and its subsidiary Mortgage IT wrongfully obtained state credit guarantees. In addition, the Federal Housing Finance Agency is suing the Frankfurt-based bank, as is the Teachers Insurance and Annuity Association.
xchrom
(108,903 posts)In a time of scarce resources, plans to cut deficits and reduce spending can develop into campaign issues. Judy Woodruff and Tom Edsall, a longtime Washington Post reporter who's now a New York Times columnist and journalism professor, discuss how austerity could shape and define American politics this election year and beyond.
8.54 minute video at link
xchrom
(108,903 posts)KARACHI - Pakistan's fast-growing current account deficit is moving the country ever closer to a repeat of the 2008 financial crisis that led to a request for an International Monetary Fund (IMF) bailout, with repayment of that rescue set to exacerbate its present dire situation.
The State Bank of Pakistan (SBP), in its first quarterly report for the fiscal year 2012 issued at the weekend, said financial flows had almost dried up. The central bank is particularly concerned about the pace at which the current account has deteriorated.
The deficit widened to $2.154 billion in the first six months of the current fiscal year, compared with a surplus of $8 million in the same period last year. A weakening current account is adding to
pressure on the rupee, which has fallen to a record low of 90 to the US dollar.
The SBP said Pakistan was likely to miss its 4.2% target for gross domestic product (GDP) growth in the 12 months through June because of energy shortages, high oil prices and a decline in global prices for agricultural commodities.
A continuing high import bill for oil purchases will make it difficult to reduce the current account in the coming months, putting pressure on foreign exchange reserves as Islamabad, with no additional sources of revenue, starts repaying $8 billion to the IMF in March.
Demeter
(85,373 posts)It never gets old...because it's timeless.
Good ole Helicopter Ben and Timmy.
The oughtta be a law.
Demeter
(85,373 posts)At least it's above freezing.
Roland99
(53,342 posts)The survey, based on 56 domestic banks and 23 U.S. branches of foreign banks, said that more than half of banks that make loans to European banks had tightened standards. Almost 20% said that the standards had been tightened considerably.
U.S. banks also reported that they had increased the rate they had tightened standards on loans to nonfinancial firms that have significant exposures to Europe.
At the same time, U.S. banks reported that they had picked up business as European banks pulled back to rebuild their balance sheets. Foreign banks, for their part, reported that they had tightened their loan standards and that demand was little changed.
