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Wednesday, December 31, 2014

Vietnam Sentences Corrupt Bankers To Death By Firing Squad

American bankers who brought on the 2008 global financial collapse, by and large, didn’t get indicted, or face any significant consequences for their actions. In fact, many of them even got huge bonuses.

That wouldn’t have been the case in Vietnam, another nation struggling with corrupt and unscrupulous bankers.
During a recent cleanup of Vietnam’s financial sector, the strictly authoritarian nation sentenced three bankers to death by firing squad in the past six months alone.

A pair currently on death row had embezzled roughly $25 million from the state-owned Vietnam Agribank. Back in March, a 57-year-old former regional boss from Vietnam Development Bank, found himself sentenced to death by firing squad over a $93-million swindling job.

According to Vietnam’s Tuoi Tre news outlet, many of the co-conspirators got life in prison, with the “Madoffs” of Vietnam being the high-profile characters who were sentenced to death. The point, many in Vietnam say, is to send a message.

Adam McCarty, chief economist with the Hanoi-based consulting firm Mekong Economics, says that “It’s a message to those in this game to be less greedy and that business as usual is getting out of hand.”
“The message to people in the system is this: Your chances of getting caught are increasing,” McCarty continued. “Don’t just rely on big people above you. Because some of these [perpetrators] would’ve had big people above them. And it didn’t help them.”

“They don’t care about foreigners. It’s all internal politics,” McCarty said. He explains that foreign banking learders wouldn’t be dissuaded by a few executions anyway. “If you really want to want to resolve the problem, you can’t just arrest people,” he said. “You’ve got to improve accountability and transparency in the entire system.”

A local, Vietnames op-ed recently ran, confronting this issue, saying that, “it is better to prevent corruption,” the paper opined, “than deal with it after the fact.”
(Article by M.B. David)

Monday, December 29, 2014

Martin Armstrong opines on Ancient coins as an investment:

Ancient Coins As Investment


A number of people have been inquiring about coins as an investment for parking money. Keep in mind that the best market for coins or stamps tend to be the country of origin. Thus, US coins will bring the highest prices in the USA just as German will bring the best price in Germany.


There are some markets that are international. That is Art where in the late 1980s, the Japanese began buying famous art at huge prices. Ryoei Saito  had purchased Vincent van Gogh’s: “Portrait of Doctor Gachet”, (1890) paying $82.5 million back in 1990 (Inflation adjusted price: $146,8 million). Note: Saito lost a fortune in the Japanese Depression and the whereabouts of the painting are now unknown).


Ancient Coins are in that same category where the market is truly international. The biggest buyers these days are in China and Russia. Many famous people collected Ancient Coins from President Teddy Roosevelt but there was also the American coin collection of US president John Quincy Adams, Many American billionaires also formed famous Ancient Coin collections, notably J.P. Morgan, Calouste Gulbenkian, William Randolph Hearst, J. Paul Getty, and Nelson Bunker Hunt (whose collection was auctioned off by Sothebys shown above). King Farouk I of Egypt assembled a massive coin collection.

Perhaps the earliest known major collector was the Roman Emperor Augustus. Nearly all of the great European national collections were first formed privately by kings and nobility who were often avid collectors. Lorenzo de’ Medici, the patron of the Renaissance, was one of the most notable ancient coin collectors of his time. Even the Catholic popes formed outstanding private collections which are now the core of the current Vatican collections. And many important scientists and scholars, such as Sigmund Freud and Desmond Morris, have also formed fine collections. In our own time many famous personalities such as Buddy Ebsen, Elton John and Tina Turner, to mention just a few, have also been avid collectors. There were other collectors of stamps right down to Calvin Klein.
The Ancient Coin market is international and way under priced compared to US coins, but far broader in the scope of collectors coming from truly around the world. There will be such a gathering at a show in New York City come January. The US coin market holds the record for prices paid with a 1794 US Silver Dollar fetching more than $10 million (seek Stacks Bower Sale)..
The most expensive painting was the 2011 sale for $250 million of PAUL CÉZANNE“The Card Players”, 1892/93 (Inflation adjusted price: $258,4 million). Seller: George Embiricos. Buyer: Royal Family of Qatar.
The same trend is impacting art and collectibles.

Rare coins are becoming rarer as those who have them just hold and the supply continues to shrink. Every field is pretty much the same story. Nobody wants to sell for then what do you do with the cash?

Many emails have come in asking if we can assist in obtaining high-end ancient coins since they are an international item and movable without tariffs. I realize this may be in many respects safer than just metals and diamonds for transport. But I am not sure there is enough of a supply even available of coins $10,000+. Most seem to go to auction where they know they can get big bucks. Here is a Naxos tetradrachm, probably the finest known that would probably bring $1 million+ today. If there are any hoards that appear, I typically get a phone call.

We will keep everyone in mind since so many are looking to get “off the grid” these days and ancient coins are not likely to be confiscated as was the case with gold..


Bernanke tells U.K.’s King: We saved our economies

Published: Dec 29, 2014 1:04 p.m. ET
Getty Images
Former Fed Chairman Ben Bernanke: No point to economics unless the knowledge is used to “make the world better.”
WASHINGTON (MarketWatch) ) — Former Federal Reserve Chairman Ben Bernanke believes history has already vindicated the novel efforts of the U.S. central bank to revive the economy after the financial crisis of 2008.
The Fed and the Bank of England offered financial aid to beleaguered banks and deployed tools such as quantitative easing — creating new money — on a massive scale to help heal badly damaged economies.
The result has been that the U.S. and Britain have grown much faster than the European Union, whose response has been less aggressive.
‘By stabilizing the financial system, we avoided much, much worse persistently bad consequences for our economies.’
Ben Bernanke
“By stabilizing the financial system, we avoided much, much worse, persistently bad consequences for our economies,” Bernanke said in an interview with Mervyn King on BBC. King was head of the Bank of England during the crisis and was a constant ally of Bernanke, a longtime friend whom he had first met at MIT three decades earlier.

Saturday, December 27, 2014

David Stockman Debunks TARP Profit Claims: The Fed Runs A ‘No Banker Left Behind’ Program

By John Morgan at NewsmaxFinance

Washington’s untruths about the Troubled Asset Relief Program (TARP)’s so-called “success” add up to something worse than the original taxpayer bailouts of big banks and other corporations, according to David Stockman, White House budget chief during the Regan administration.

He noted the Treasury Department recently concluded that the 2008 TARP had actually returned a profit of $15.3 billion, returning $441.7 billion on the $426.4 in taxpayer monies invested to save the likes of Citigroup, Bank of America, General Motors, American International Group (AIG) and other pre-meltdown spendthrifts.

“The ‘small profit’, along with most of the so-called ‘recovery’ of Uncle Sam’s $426 billion initial investment, was ground out of the backs of America’s savers and depositors; or it was scalped from the massive financial bubbles the Fed has generated in the Wall Street casino,” Stockman wrote on his Contra Corner blog.

“In short, under an honest monetary regime of market clearing interest rates, bank balance sheets would be far smaller. Likewise, deposit costs would be far higher, and opportunities to scalp profits from the global scramble for yield far less abundant.”

Stockman said the mainstream economics narrative and media coverage on the Federal Reserve’s ultra-easy money policies is simply perpetuating a fiction.

That’s because “what lies beneath its ‘extraordinary measures,’ such as ZIRP [zero interest rate policy], QE [quantitative easing], wealth effects and the rest of the litany, is a central banking regime that systematically destroys savers. Period,” he claimed.

Stockman said the central bank’s ZIRP has allowed big banks to profit while average Americans get squeezed by earning next to nothing on their savings.

“The policy apparatus of the state has subjected savers to brutal punishment for one reason alone. Namely, to enable the insolvent big banks of America to dig their way out of the deep hole they were in at the time of the financial crisis. By scalping false profits from the Fed’s regime of financial repression, they have, in fact, been able to return accounting profits to pre-crisis levels and beyond.”

He noted that ZIRP has enabled banks to carry $10 trillion of deposits at negative real interest rates, while making money on that cash, and pay out an average of 0.4 percent on six-month CDs when an honest payout should be closer to 4.0 percent.

“This has been called the Fed’s ‘No Banker Left Behind’ program and for good reason,” Stockman said.
“But the heart of the matter is this. The Fed and other central banks of the world have created trillions of fiat credit that is drastically mispriced and would not even exist in a free market based on honest savings from current production and legitimate requirements for capital investment.

“TARP wasn’t ‘repaid’ with a profit. It was simply perpetuated and morphed into a new form of destructive state subvention and mal-investment.”

The Center for Economic and Policy Research (CEPR) was likewise suspicious of the official government line that the U.S. made a “profit” on its TARP taxpayer loans to corporate America, and called The New York Times’ coverage of the matter a “children’s story.”

“Before you start thinking that this is a great idea and we should give all the government’s money to the Wall Street banks, imagine that we had given the same money to a different institution, Bernie Madoff’s investment fund. As we all know, Madoff’s fund was bankrupt at the time because he was running it as a Ponzi, the new investors paid off the earlier investors. He hadn’t made a penny on actual investment in years,” said CEPR on its website.

CEPR said if the government had lent Madoff tens of billions of dollars at the same low rates it charged Wall Street banks, Madoff easily could have invested the money and paid off the debt, also. (It apparently helps when taxpayers are subsidizing your loans.)

“This would have then allowed (former Treasury Secretary) Timothy Geithner to boast about how we made a profit on the loans to Bernie Madoff.

“The reality is that the boast of a profit in this context is pretty damn silly. The question is whether an important public purpose was served by rescuing the Wall Street banks from their own greed.”

Friday, December 26, 2014

Opinion: The Fed is heading for another catastrophe

With so much dry kindling, it will not take much to spark the next conflagration


StephenS. Roach

In these days of froth, the persistence of extraordinary policy accommodation in a financial system flooded with liquidity poses a great danger. Indeed, that could well be the lesson of recent equity- and currency-market volatility and, of course, plummeting oil prices.
With so much dry kindling, it will not take much to spark the next conflagration.
Central banking has lost its way. Trapped in a post-crisis quagmire of zero interest rates and swollen balance sheets, the world’s major central banks do not have an effective strategy for regaining control over financial markets or the real economies that they are supposed to manage. Policy levers — both benchmark interest rates and central banks’ balance sheets — remain at their emergency settings, even though the emergency ended long ago.
While this approach has succeeded in boosting financial markets, it has failed to cure bruised and battered developed economies, which remain mired in subpar recoveries and plagued with deflationary risks. Moreover, the longer central banks promote financial-market froth, the more dependent their economies become on these precarious markets and the weaker the incentives for politicians and fiscal authorities to address the need for balance-sheet repair and structural reform.

A new approach is needed. Central banks should normalize crisis-induced policies as soon as possible. Financial markets will, of course, object loudly. But what do independent central banks stand for if they are not prepared to face up to the markets and make the tough and disciplined choices that responsible economic stewardship demands?

The unprecedented financial engineering by central banks over the last six years has been decisive in setting asset prices in major markets worldwide. But now it is time for the Fed and its counterparts elsewhere to abandon financial engineering and begin marshaling the tools they will need to cope with the inevitable next crisis. With zero interest rates and outsize balance sheets, that is exactly what they are lacking.

Sunday, December 21, 2014

Gold: It's all about the Media Narrative

There's only one media in the United States: it's all mainstream in that it's all owned by billionaires who all have the exact same motivation which is to protect their billions.

NBC, FOX, BLOOMBERG, CBS, NEW YORK TIMES, HERITAGE FOUNDATION, PROGRESSIVE POLICY INSTITUTE, SIRIUS, CNN, ETC: all owned or funded by billionaires, all perpetuate the same narrative: The US banking system is basically and fundamentally sound, profitable, deep, and safe.

This is the narrative that was shaken and almost crumbled in 2008.  It was saved by the most massive transfer of wealth from the citizenry to the banking elite in the history of the world.

The narrative, now, is that the banking system is stronger than ever, that it didn't really even need the bailouts which were forced upon them and that they've paid it all back plus interest.  And the economy is healing and quickly returning to full strength.

Who reported on the destruction of the Volker rule?  The story was annihilated by the "story" that Sony Pictures didn't open a slapstick comedy on time because of "hackers."  Wow.  That's so much more important than the fact that banks again have been licensed to be gambling parlors.

Meanwhile the banks have dismantled Dodd Frank, jetisoned the Volker Rule and are piling up bets in derivatives that leverage their balance sheets by 50-1.  The Fed is in worse shape with over 3 Trillion dollars of bad debt on their balance sheet.

As long is the "Strong Bank" narrative  is believed by most of the people, Gold will languish.  It may fall to 1000 or even 900 dollars an ounce.  Which is still 300 percent above where it started to move when people began to doubt the efficacy of the banking system back in 2000.

But the very second the narrative cracks and doubt spreads through the mass consciousness gold will move at the speed of thought.

And it won't have anything to do with COT reports or calls for delivery on the Comex, or Diwali, or Chinese New Year.

It will be 400,000,000 Americans and 4 Billion other world citizens suddenly realizing all at once that their dollars and their euros and their yen in their Bank Accounts are not a safe store of value.

And then the move will be fast and furious.

It might be a good idea to get in ahead of it.

Because there's no telling when it will happen.

Saturday, December 20, 2014

Dodd Frank: Dead. Volker rule:Dead. Bail ins: Alive (like zombies are alive)

New G20 Rules: Cyprus-style Bail-ins to Hit Depositors AND Pensioners

On the weekend of November 16th, the G20 leaders whisked into Brisbane, posed for their photo ops, approved some proposals, made a show of roundly disapproving of Russian President Vladimir Putin, and whisked out again. It was all so fast, they may not have known what they were endorsing when they rubber-stamped the Financial Stability Board’s “Adequacy of Loss-Absorbing Capacity of Global Systemically Important Banks in Resolution,” which completely changes the rules of banking.

Russell Napier, writing in ZeroHedge, called it “the day money died.” In any case, it may have been the day deposits died as money. Unlike coins and paper bills, which cannot be written down or given a “haircut,” says Napier, deposits are now “just part of commercial banks’ capital structure.” That means they can be “bailed in” or confiscated to save the megabanks from derivative bets gone wrong.

The Global Bankers’ Coup: Bail-In and the Shadowy Financial Stability Board

On December 11, 2014, the US House passed a bill repealing the Dodd-Frank requirement that risky derivatives be pushed into big-bank subsidiaries, leaving our deposits and pensions exposed to massive derivatives losses. The bill was vigorously challenged by Senator Elizabeth Warren; but the tide turned when Jamie Dimon, CEO of JPMorganChase, stepped into the ring. Perhaps what prompted his intervention was the unanticipated $40 drop in the price of oil. As financial blogger Michael Snyder points out, that drop could trigger a derivatives payout that could bankrupt the biggest banks. And if the G20’s new “bail-in” rules are formalized, depositors and pensioners could be on the hook.
The new bail-in rules were discussed in my last post here. They are edicts of the Financial Stability Board (FSB), an unelected body of central bankers and finance ministers headquartered in the Bank for International Settlements in Basel,


Fed Delays Volcker Rule, Giving Wall Street Another Holiday Gift


WASHINGTON -- Christmas came early for Wall Street this year. The Federal Reserve on Thursday granted banks an extra year to comply with a key provision of the Volcker Rule, a move that gives financial lobbyists more time to kill the new regulation before it goes into effect.

The Volcker Rule is a key element of the 2010 Dodd-Frank financial reform law that bans banks from engaging in proprietary trading -- speculative deals that are designed only to benefit the bank itself, rather than its clients. Thursday's move by the Fed gives banks an additional year to unwind investments in private equity firms, hedge funds and specialty securities projects. The central bank also said it plans to extend the deadline by another 12 months next year, which would give Wall Street a two-year reprieve through the 2016 presidential election.

The Fed's delay comes less than a week after Congress granted Wall Street a reprieve from another reform that had been mandated by the 2010 Dodd-Frank financial reform law. The measure, known as the swaps push-out rule had eliminated federal subsidies for trading in risky derivatives -- the complex contracts at the heart of the 2008 banking meltdown. Bank watchdogs say the Volcker Rule delay adds insult to injury.

Tuesday, December 16, 2014

Silk Carpet sells for $45 Million US in Hong Kong



Price Realized

Monday, December 15, 2014

For those whose phone doesn't include a clock app: A machine you strap to your wrist that records the time of day! What will they think of next?

$565,000 Greubel Forsey GMT Black Watch Is Idiosyncratic, Incredible(y stupid)

Dec 14, 2014 1:03 AM ET

Photographer: Stephen Pulvirent/Bloomberg
The Greubel Forsey GMT Black.
There are no two ways about it: Greubel Forsey makes incredible watches. The designs are a bit, shall we say, "idiosyncratic," and after a decade they still continue to ignore all but the highest end of the market. It's all part of the charm. The GMT was first released in 2011, but the GMT Black is a departure from the rose gold and platinum versions we've seen trickle out since, utilizing lightweight titanium instead of a precious metal for the case. This is a watch to stare at. Go ahead, we'll be here a while.
First Thoughts: Even if the GMT Black isn't the sort of thing I'd wear to watch to the Giants game on Sunday (unless I owned the team, maybe), it's the most approachable version of one of the most impressive watches on the market. The titanium case means that even with its large profile it still weighs less than a Ferrari -- even if it costs more. The black finish makes it less in-your-face and lets you really admire the finishing on the non-blackened components. The GMT might be a few years old by now, but staring at that globe never gets old.
Cocktail Party Fact: It's a little hard to give Greubel Forsey's case shapes proper names, but that wonky geometry has a purpose. At 43.5mm across (without the bulges), the GMT's case is already big. The idea with the asymmetrical design is to highlight the design elements that Greubel Forsey wants wearers to focus on, to give the tourbillon and globe room to breathe, without having a bunch of empty dial space around the edges. The extra sapphire window at the side of the globe is another nice touch that adds to the effect. It might seem strange at first, but the unusual shape is a really smart solution.

Sunday, December 14, 2014


Shakespeare's First Folio found in France: Bard's 400-year-old book was overlooked on library shelf - and it's worth £3.5 million

  • Found in St-Omer, the book is the first compilation of the Bard's plays
  • Book is the 231st copy found in the world, and only the second in France
  • Because it is in English, it is thought French readers overlooked it
  • It is in good condition, but missing 30 pages, including the title page
  • First folio is the only source for 18 of Bard's plays, including Macbeth
  • Published seven years after Shakespeare's death, it originally sold for £1

A rare and valuable copy of William Shakespeare's First Folio - the first-ever compilation of the Bard's plays - has been uncovered in a provincial library in France.
The 1623 book, which is one of the most coveted in the world, lay undiscovered among hundreds of others in St-Omer, near Calais, for some 400 years.
Worth up to £3.5 million ($5.5 million), it was discovered when librarian Remy Cordonnier dusted off a book of Shakespeare's works for an exhibition.
Hidden in plain sight: A rare and valuable copy of William Shakespeare's First Folio (pictured), the first-ever compilation of the Bard's plays, has been uncovered in a provincial library in northern France
Hidden in plain sight: A rare and valuable copy of William Shakespeare's First Folio (pictured), the fir

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Friday, December 12, 2014

Martin Armstrong: Telling it like it is:

Enough is Enough – Shut the Gov’t Down Rather The Repeal Dodd-Frank

Dimon Testifies About JPMorgan Trading Losses on Capitol Hill Jamie Dimon, head of JP Morgan, personally telephoned individual lawmakers to urge them to vote for the repeal of Dodd Frank. This is getting really out of hand. Let us make this very clear. Besides the fact that these banks LACK the models to prevent them from blowing up every single time running to government with their hand out asking can they spare a trillion, the sheer fact that they can make heaps of money from trading means they are NOT lending. Spain converted itself from the richest nation in Europe to the poorest by doing precisely this short-term type planning.
Spain did not invest in developing its country. Spain squandered all its money living high on the hog, as they say. The saying was a French man knew how to unload ships rather than a Spaniard. The banks are traders not lenders.They are trading with YOUR money. Profits are their’s – losses are taxpayers. Allowing them to be derivative junkies means they do not do what they are supposed to be doing – lending money that expands jobs and builds the national economy.
The Republicans are simply counting their donations for political campaigns. This will be the downfall of the Republican Party come 2016. The banks will blow up AS ALWAYS, and the people will get outraged because at G20 they said the depositor has to pay for the next bailout – bail-ins. There is no disclosure mandated. There should be a warning label on bank accounts – THIS BANK SPECULATES WITH YOUR MONEY. Hey – borrow this regulation from the FDA regulating food


The Department of Treasury is spending $200,000 on survival kits for all of its employees who oversee the federal banking system, according to a new solicitation. As FreeBeacon reports, survival kits will be delivered to every major bank in the United States and includes a solar blanket, food bar, water-purification tablets, and dust mask (among other things). The question, obviously, is just what do they know that the rest of us don't?
As Free Beacon reports,
The Department of Treasury is seeking to order survival kits for all of its employees who oversee the federal banking system, according to a new solicitation.

The emergency supplies would be for every employee at the Office of the Comptroller of the Currency (OCC), which conducts on-site reviews of banks throughout the country. The survival kit includes everything from water purification tablets to solar blankets.

The government is willing to spend up to $200,000 on the kits, according to the solicitation released on Dec. 4.

The survival kits must come in a fanny-pack or backpack that can fit all of the items, including a 33-piece personal first aid kit with “decongestant tablets,” a variety of bandages, and medicines.

Thursday, December 11, 2014

from martin armstrong:

Banks Win Big Time – Another Bailout is in the Wind.

After months of hard-fought negotiations over agency dollars and policy provisions, the net result is a 1,600 page bill released last night.The deal was announced late yesterday after Democrats accepted Republican demands to undo some regulations including the banking provision that will allow the trading banks to deal in derivatives again in subsidiaries will full insurance from the government once again. The big banks can keep swaps trading in units with federal FDIC insurance. Just amazing. Grease enough palms and the country is yours. This bill has to pass by Friday. They would not have stuck this partial repeal of Dodd-Frank if they did not have the votes.

Wednesday, December 10, 2014

From Ellen Brown: (Wisdom of hard asset protection)

Big Banks Will Take Depositors Money In Next Crash -Ellen Brown


The G-20 met recently in Australia to make new banking rules for the next financial calamity.  Financial reform advocate Ellen Brown says these new rules will allow banks to take money from depositors and pensioners globally.  Brown explains, “It became rules we agreed to actually implement.  There was no treaty, and Congress didn’t agree to all this.  They use words so that it’s not obvious to tell what they have done, but what they did was say, basically, that we, the governments, are no longer going to be responsible for bailing out the big banks.  These are about 30 international banks.  So, you are going to have to save yourselves, and the way you are going to have to do it is by bailing in the money of your creditors.  The largest class of creditors of any bank is the depositors.” 

It gets worse, as Brown goes on to say, “Theoretically, we are protected by deposit insurance up to $250,000 in the U.S. and 100,000 euros in Europe.  The FDIC fund has $46 billion, the last time I looked, to cover $4.5 trillion worth of deposits.  There is also $280 trillion worth of derivatives that the five biggest banks in the U.S. are exposed to, and under the bankruptcy reform act of 2005, derivatives go first.  So, they are basically exempt from these new rules.  They just snatch the collateral.  So, if you had a big derivatives bust that brought down JP Morgan or Bank of America, there is no way there is going to be collateral left for the FDIC or for the secured depositors.  This would include state and local governments.  They all put their money in these big banks.  So, even though we are protected by the FDIC, the FDIC is not going to have the money. . . . This makes it legal for these big 30 banks to take our money when they become insolvent.  They are too-big-to-fail.  This was supposed to avoid too-big-to-fail, but what it does is institutionalizes too-big-to-fail.  They are not going to go down.  They are going to take our money instead.” 

Part of the coming financial calamity will involve hundreds of trillions of dollars in un-backed derivatives.  Brown contends, “If the derivative bubble pops, nobody knows what is going to happen, and it’s obvious it has to pop.  It can’t just keep growing.  Depending on who you read, some people say it is up to two quadrillion dollars.  It’s virtual money, and it cannot keep going on.”

When a financial crash does happen, you can forget about getting immediate access to your money.  Brown says, “The banks will say, well, we don’t have it.  All the money goes into one big pool since Glass Steagall was repealed.  They are allowed to gamble with that money and that’s what they do.  I think maybe Bank of America is the most vulnerable because of Merrill Lynch.  Everybody is concerned, and they do very risky deals and they are on the edge.  I think they have over $50 trillion in derivatives and over $1 trillion in deposits. . . The Dodd-Frank Act says we, the people, are no longer going to be responsible for the big banks when they collapse.  It is not clear the FDIC will even be able to borrow from the Treasury, but even if they could, who is going to pay that money back?  Let’s say they borrowed $1 trillion.  Who is going to pay that $1 trillion back?  It will bankrupt all the small banks that had to contribute to this premium.  They will say we’re raising your premium to everything you got, basically.  Little banks will go out of business, and who is going to survive–the big banks. . . . What we’re going to have left is five big banks, and everybody else is going to be bankrupt.”

Tuesday, December 9, 2014


Here We Go Again – the Effective Repeal of Dodd-Frank As Xmas Gift to Bankers?

The high-flying banks are at it again. There has been lobbying going on to sneak a clause in the continuing resolution to fund the government over the holidays for the December 11th deadline. The provision they are trying to sneak in would allow the banks to trade derivatives through subsidiaries that are federally insured by the FDIC. In other words, they are circumventing the very reforms of the 2007-2009 crash.
This is not yet confirmed. The bill was held up and the final language was being submitted at midnight last night. This is how they operate so everyone is asleep and the real dirty shit is stuffed in bills in the middle of the night. This tactic is outright fraud upon the nation and the world. We seriously need political reform or there will be no future.
This is how the lame-duck Congress always functions – bribe time on steroids. The manipulating banks are trying to sneak this into  a bill to keep the government funded for Christmas and they know they will get the votes because nobody will read the fine print on Capitol Hill. They are trying to now effectively repeal the Dodd–Frank Wall Street Reform and Consumer Protection Act (Pub.L. 111–203, H.R. 4173) before the new Congress comes in. These lame-duck sessions are highly dangerous and have done far more long-term damage to the nation than any other session. This is Congress on sale to the highest bidder.
When we get the real real final language, we will confirm everyone what they have pulled off this time if it survives.

Wednesday, December 3, 2014

New G20 Rules: Cyprus-style Bail-ins to Hit Depositors AND Pensioners

On the weekend of November 16th, the G20 leaders whisked into Brisbane, posed for their photo ops, approved some proposals, made a show of roundly disapproving of Russian President Vladimir Putin, and whisked out again. It was all so fast, they may not have known what they were endorsing when they rubber-stamped the Financial Stability Board’s “Adequacy of Loss-Absorbing Capacity of Global Systemically Important Banks in Resolution,” which completely changes the rules of banking.
Russell Napier, writing in ZeroHedge, called it “the day money died.” In any case, it may have been the day deposits died as money. Unlike coins and paper bills, which cannot be written down or given a “haircut,” says Napier, deposits are now “just part of commercial banks’ capital structure.” That means they can be “bailed in” or confiscated to save the megabanks from derivative bets gone wrong.
Rather than reining in the massive and risky derivatives casino, the new rules prioritize the payment of banks’ derivatives obligations to each other, ahead of everyone else. That includes not only depositors, public and private, but the pension funds that are the target market for the latest bail-in play, called “bail-inable” bonds.
“Bail in” has been sold as avoiding future government bailouts and eliminating too big to fail (TBTF). But it actually institutionalizes TBTF, since the big banks are kept in business by expropriating the funds of their creditors.
It is a neat solution for bankers and politicians, who don’t want to have to deal with another messy banking crisis and are happy to see it disposed of by statute. But a bail-in could have worse consequences than a bailout for the public. If your taxes go up, you will probably still be able to pay the bills. If your bank account or pension gets wiped out, you could wind up in the street or sharing food with your pets.
In theory, US deposits under $250,000 are protected by federal deposit insurance; but deposit insurance funds in both the US and Europe are woefully underfunded, particularly when derivative claims are factored in. The problem is graphically illustrated in this chart from a March 2013 ZeroHedge post:

Tuesday, December 2, 2014

Chart Of The Day: US Public Debt Will Hit $18 Trillion On December 9th

By Craig Eyermann at
Sometime in the next two to three weeks, the total public debt outstanding for the U.S. government will exceed 18 trillion dollars. If you were to ask us to pin down a precise date, we would say sometime around December 9, 2014, given the rate at which the national debt has been increasing during the federal government’s current fiscal year:
Since the start of the U.S. federal government’s 2015 fiscal year on October 1, 2014, the national debt has grown at an average rate of $2.08 billion per day.
If it helps put these very large numbers into a more human scale, when the U.S. national debt reaches $18 trillion, that will work out to be about $124,275 per U.S. household, which is up from $81,984 per U.S. household at the end of the 2008 fiscal year. And the new figure would be on top of your mortgage, car loans, student loans, credit cards, et cetera that you might also have.
But unlike those tangible things, where you can at least point to your house, your car, your education, or even the Christmas presents you might be buying this upcoming Black Friday, can you point to what you personally got in return for that $42,291 worth of additional debt per household that the federal government accumulated during the last six years?
If you cannot, is it really worth it?