Obama has done it. He has brought America down. It only took him just over four years. The Republicans could have stopped him. They didn’t…
If you thought the crash of 2008 was bad, think again. The crash that is coming –I cannot put a date on it, but it is not far away now – will be orders of magnitude worse.
So, what should you do to protect yourself and your [...]
As stocks have risen in recent years, the big hedge funds and the “too big to fail” banks have used borrowed money to make absolutely enormous profits. But when you use debt to potentially multiply your profits, you also create the possibility that your losses will be multiplied if the markets turn against you. When the next stock market crash happens, and the gigantic pyramid of risk, debt and leverage [...]
by Phoenix Capital Research
Modern financial theory dictates that sovereign bonds are the most “risk free” assets in the financial system (equity, municipal bond, corporate bonds, and the like are all below sovereign bonds in terms of risk profile). The reason for this is because it is far more likely for a company to go belly up than a country.
Because of this, the entire Western financial system has sovereign bonds (US [...]
Romney made good on his pledge to release his tax returns from 2011 before the election, and went a step further than was previously anticipated in releasing a certified summary of his tax returns over a two-decade period preceding 2010.
You can see them here: http://www.mittromney.com/disclosure
The Republican’s campaign said Romney paid more than $1.9 million in taxes on income of about $13.7 million. That amounts to a 14.1 percent effective tax rate; [...]
Sept 12, 2012
The financial collapse of the Eurozone may be upon us. This Wednesday, September 12, the Federal Constitutional Court of Germany must decide whether it is legal for Germany to participate in the financial bailouts of other nations in the Eurozone.
The court has been inundated with tens of thousands of petitions (not just petition signers, but tens of thousands of individual petitions) demanding the court say NO [...]
The LIBOR scandal started back in 2007 when a secretive branch of the US TREASURY – Exchange Stabilization Fund (ESF) used 7 trillion dollars of TBILLS to keep interest rates low.
This organization has absolutely no oversight, meaning they operate above/outside of the law.
Further, the US Government used JP Morgan as the ‘vehicle’ to get these financial instruments into the market place.
What is the bottom line? It has lead to an [...]
Talk of replacing Libor with other benchmarks is likely to remain just that for two reasons: No substitute would easily work for all the financial instruments Libor serves, and rewriting derivatives contracts tied to Libor would be an herculean, and legally fraught, task.
The “new and improved” Libor would almost certainly do away with the current gymnastics-scoring-meets-clairvoyance method of calculation.
At present, large banks submit daily estimates of their costs of [...]
There are now 1.5 quadrillion in derivatives floating around. The banks said the US government must bail them out in 2008. Now there are 3 times the derivatives as in 2008.
By the end of 2012 there might be 2 quadrillion in derivatives, I don’t see how we can continue much longer with this massive bubble being blown up by the banks. When it pops it will take down the whole [...]
“Suspicious Cartel Agreements that Include Derivatives”
The Bank of England said recently that Libor is not the only market which is manipulated by the big banks. Wenoted last month:
“There have also been allegations that the self-certifying derivatives indicator – iSwap – has beenmassively manipulated. See this and this.”
Spiegel reports today:
““In our investigations, we concentrate on suspicious cartel agreements that include derivatives. This includes possible secret agreements about the determination of these lending rates,” says European Competition Commissioner Joaquín Almunia. In other words, the [...]
Paul Craig Roberts & Nomi Prins
Sunday, July 15, 2012
According to news reports, UK banks fixed the London interbank borrowing rate (Libor) with the complicity of the Bank of England (UK central bank) at a low rate in order to obtain a cheap borrowing cost. The way this scandal is playing out is that the banks benefitted from borrowing at these low rates. Whereas this is true, it also strikes us [...]
By Roland Jones
It may seem like just another obscure banking scandal at a 322-year-old British bank, but there are a number of good reasons why you should care about the LIBOR rate-rigging scandal now roiling the world’s biggest and most powerful banks, including that it probably cost you money if you own a mortgage.
In late June, Barclays paid $453 million to regulators in the U.K and the U.S. to settle accusations that [...]
Katrina vanden Heuvel, Wednesday, July 11, 2012
… The stakes are staggering. The Libor should be as good as gold. It pegs the value of up to $800 trillion in financial instruments. The collusion was systematic and routine. Investigations are underway not only in the United Kingdom but also in the United States, Canada and the European Union. Those named in the probes are all the usual suspects: JPMorgan Chase, Citibank, [...]
If Barclays Plc (BARC) would lie about its borrowing costs, what else would it lie about?
That question gets to the heart of the damage Barclays did to itself by submitting false numbers for years to the British Bankers’ Association as part of the surveys used to set the London interbank offered rate, the benchmark for $360 trillion of financial instruments globally. The most important asset any bank has is trust — especially [...]
Most people have no idea that Wall Street has become a gigantic financial casino. The big Wall Street banks are making tens of billions of dollars a year in the derivatives market, and nobody in the financial community wants the party to end. The word “derivatives” sounds complicated and technical, but understanding them is really not that hard. A derivative is essentially a fancy way of saying that a [...]
Wall Street Journal says Comex has been classified as ‘too big to fail’
Submitted by cpowell on Fri, 2012-05-25 06:09. Section: Daily Dispatches
A Mess the 45th President Will Inherit
Taxpayers Now Stand Behind Derivatives Clearinghouses
From the Wall Street Journal
Thursday, May 24, 2012
President Obama’s standard gripe is that the economy has performed so poorly during his term because of the financial crisis he inherited from George W. Bush. But this week it is Mr. Obama [...]
… Which Will Lead to Bailouts and Encourage Even More Fraud
The government has been bailing out the giant, insolvent banks for years. (Many of the bailed out banks are foreign.)
That is preventing the economy from recovering … like countries that have grabbed the bull by the horns.
The government has allowed the amount of derivatives to reach 1.2 quadrillion dollars.
That is feeding the parasite of casino gambling … which is preventing the real economy from recoveringand is killing the host of actual productivity.
What is [...]
Ed Conard is a former partner at Bain Capital and a friend/public supporter of presidential candidate Mitt Romney. So it’s no surprise that he’s staunchly supportive of the super rich, and has written a book on why.
In “No Consequences”, Conard argues that the super wealthy actually help society by investing money into technologies and companies that will allow people to become richer and live more efficient lives, according to a New York Times Magazine profile of the businessman.
WASHINGTON – The House is nearing bipartisan approval of two bills easing requirements that President Barack Obama’s overhaul of financial regulations imposes on some exotic financial instruments.
Both bills are expected to pass easily later Monday. Lawmakers say they are relaxing rules that could otherwise inhibit companies’ profits and ability to create jobs, but consumer groups say relaxing the rules would be too risky.
From Dividend Growth Stocks:
Before the 2008 financial meltdown, names like Bank of America (BAC), Citigroup (C), U.S. Bancorp (USB), and Wells Fargo & Company (WFC) were held in many dividend growth portfolios. And why not? They paid a good yield and grew their dividend on a regular basis. Now their yields range between 0.5% and 1.7%. There is a lesson to be learned here.
Investors should never over-allocate in one sector [...]
Bloomberg reports that Bank of America (BAC) has shifted about $22 trillion worth of derivative obligations from Merrill Lynch and the BAC holding company to the FDIC insured retail deposit division. Along with this information came the revelation that the FDIC insured unit was already stuffed with $53 trillion worth of these potentially toxic obligations, making a total of $75 trillion.
Derivatives are highly volatile financial instruments that are occasionally used [...]
Every workday morning in London, at about 10 o’clock, representatives from 19 banks make a series of decisions that affect financial transactions around the world, from what homeowners pay on their mortgages to the underlying value of credit-default swaps and corporate bonds.
The bankers’ power is unsettling, says Tim Price, who helps oversee more than $1.5 billion as director of investment at PFP Group LLP, an asset-management firm in London.
“It’s a [...]
French Bund spreads have just crossed 147 bps as the “cash bond long yet unable to hedge with CDS” crowd realizes that the Italian contagion is about to hit Paris. And unable to hedge using creative modern financial instruments, said crowd has reverted to the good old fashioned version thereof. We call it selling. Expect the spread to hit 150 bps momentarily.
No surprises here:Wednesday, 03 August 2011
France, As [...]
For the latest gimmick to mask PIIGS sovereign debt exposure (where we already know that the traditional fallback of “gross being irrelevant and only net being important” crashed and burned today after Jefferies offloaded precisely half of its gross exposure, while raising net, thereby confirming that gross exposure is indeed a risk), we turn yet again to Morgan Stanley. As a reminder, despite our note that the company’s gross exposure (which [...]
The Sunday Telegraph has learnt that the Government is pinning its hopes for so-called “credit easing” on the British bourse and its market for allowing retail investors to invest in corporate bonds.
Credit easing will at first see the Government inject billions of pounds into the corporate bond markets by buying bonds in larger companies, but the Chancellor then hopes to create a small and medium sized enterprise (SME) bond market, [...]
by Lisa Du
Bank of America came under further scrutiny this week after Bloomberg reported that the company moved risky derivatives from its investment bank arm to its retail banking unit following a Moody’s downgrade last month.
(To clarify: Bank of America Corp. is the holding company that oversees Merrill Lynch — the investment banking division — and Bank of America — the retail banking branch everyday people use.
Derivatives are financial instruments or contracts [...]
Plans to stabilise the European debt crisis by deploying a €2 trillion (£1.75 trillion) bail-out fund are “misguided” and could “create an even worse crisis”, a leading think tank has warned.
Riot police during an anti-austerity protest in Athens on Wednesday. Open Europe has called for a radical restructuring of Greek, Portuguese and Irish debt Photo: Reuters
By Louise Armitstead
6:00AM BST 20 Oct 2011
Open Europe has instead called for Europe’s banking system to be “fundamentally [...]
Most people have no idea that Wall Street has become a gigantic financial casino. The big Wall Street banks are making tens of billions of dollars a year in the derivatives market, and nobody in the financial community wants the party to end. The word “derivatives” sounds complicated and technical, but understanding them is really not that hard. A derivative is essentially a fancy way of saying that a bet [...]
WASHINGTON (Dave Clarke) – Regulators are considering holding Wall Street chief executives legally liable if they allow certain types of proprietary trading on their watch.
Regulators due to reveal the Volcker rule proposal next week are expected to ask whether CEOs should have to certify, or “attest,” that their bank has put in place the proper systems to make sure no proprietary trading is taking place.
THE END OF AN ERA
“All paper assets are either worthless now or will become worthless in the very near future including paper fiat currencies. If you want to help bring down this corrupt system the best way is to opt out.
Do not play their game, you cannot win. Sell your stocks and bonds and use the funds to buy real hard assets.”
[Editor's Note: As my readers know, [...]
Renowned fund manager Eric Sprott forecasts a silver price explosion in this decade. Silver will become the investment of the decade. The continued monetisation of outstanding debt by central banks would result in an acceleration of the global capital flight into safe havens such as gold or silver.
According to Sprott, it is entirely possible that we will see gold at $12,000 per troy ounce, after the yellow metal took [...]
In order to understand why there will be a second round to the Great Crisis, we first need to understand why Round 1 (2007-2009) occurred. And that cause can be explained in one simple word: derivatives.
As their name implies, derivatives are securities that are “derived” from underlying assets (homes, debt, etc). While they are technically considered “assets” by the financial community, the fact is [...]
From Brandon Smith of Alt Market
In A Currency Tug Of War The US Dollar Loses
I imagine sometimes in my most optimistic moments that one day I will live in the midst of a true free market economy, where the tides of trade and investment, the ebb and flow of commerce, are a rather beautiful thing. A marketplace without centralized manipulation, were legitimate supply and demand are [...]
I recently spoke at the Foreign Correspondents’ Club of Japan in Tokyo, where we covered a number of interesting topics. Following that event, you may have recently read headlines where the media has quoted me as predicting a second financial crisis. In this post, I’d like to give a little more context to that comment and also cover something I am particularly worried about: [...]