Here Comes FIATtackWatch: Bernanke Goes Watergate, Prepares To Eavesdrop On Everything Mentioning The Fed

Two weeks ago, the media's heart went aflutter when it learned that the president had borrowed a page right out of ole' Joe McCarthy's communist witch hunt book with the launch of Attack Watch. The response by everyone, even fans of Obama, was immediate and brutal. Yet where Obama took about 24 hours to crash and burn, someone else has stepped in with a far stealthier method of seeking the trators amongst us: none other than our old friands, the Federal Reserve Bank of the United States, which in a Request for Proposals filed to companies that are Fed vendors, is requesting the creation of a "Social Listening Platform" whose function is to "gather data from various social media outlets and news sources." It will "monitor billions of conversations and generate text analytics based on predefined criteria." The Fed's desired product should be able to "determine the sentiment of a speaker or writer with respect to some topic or document"... "The solution must be able to gather data from the primary social media platforms – Facebook, Twitter, Blogs, Forums and YouTube. It should also be able to aggregate data from various media outlets such as: CNN, WSJ, Factiva etc." Most importantly, the "Listening Platform" should be able to "Handle crisis situations, Continuously monitor conversations, and Identify and reach out to key bloggers and influencers." Said otherwise, the Fed has just entered the counterespionage era and will be monitoring everything written about it anywhere in the world. After all, why ask others to snitch for you and anger everyone as Obama found out the hard way, when you can pay others to create the supreme FIATtack Watch^TM using money you yourself can print in unlimited amounts. And once the Internet is completely "transparent", the Fed will next focus on telephone conversations, and finally will simply bug each and every otherwise "private" location in the world. Because very soon saying that "printing money is treason" will be treason, and such terrorist thoughts must be pre-crimed before they even occur.

More Greek Platitudes As IMF Faces Shortfall and Deflects Back to ECB

In speeches by 'Andsome George Papandreou and Evangelos 'Creosote' Venizelos today, the state of Greek, and for that matter global, economic challenges seemed to swing from dire to soluble to dismal within a few small sound-bites. Noting, via Bloomberg, that Greece faces 'huge challenges' and the 'end to the global financial crisis appears more distant', G-Pap admitted (somewhat intriguingly) that there is an urgent need to shield EU members from the crises but was then followed up by his wing-man finance minister who whined that Greece is not the Euro-area's central problem and that the problem of sovereign debt in Euro-area is significant. What was most comforting was Venizelos' expectation that the IMF will extend Greek loan maturities while at the same time BBC News is reporting a growing concern that the IMF will not have enough money to bail out larger European countries if the crisis should spread. It is neither a case of IF or WHEN! It is now, and while this weekend has been marked by a litany of statements, corrections, and re-statements indicating left-hands not knowing what right-hands are doing, we suspect that the simple application of game-theoretical first-mover-advantage is weighing heavy on many politicians (especially Portuguese and German). Just to put one final coffin in the nail of co-operation, IMF's Borges then notes his expectation of the ECB and EFSF as the solution for Europe, once again deflecting, denying, and de-risking?

 

 

But but but...if it was liquidation why....

silvergoldsilver at silvergoldsilver - 40 minutes ago

is the OI not falling off a cliff like on April 29th? From Harvey today: "The total gold comex open interest fell by a tiny 8161 contracts despite the huge raid on Thursday. The new open interest rests at Friday night at 489,588 from Thursday's level of 497,749. The front options exercised month of September saw its OI fall from 123 to 73 for a loss of 50 contracts. We had 40 deliveries on Thursday so we finally had some minor cash settlements. The next front delivery month in gold is October and strangely the OI did not fall much, settling at 29,569 from Thursday's level of 30,297.... more »

 

 

Guest Post: Changing Risk Perceptions Across Multiple Asset Classes

Bottom line this market is very dangerous right now . As witnessed in August when the SPX appeared "oversold" it still managed to sell off another 200 points and take out support levels as if they never existed. The most recent short covering rally has taken away buying pressure and flushed out weak shorts. With leverage still at multi year highs it appears selling pressure remains the bigger risk to equities. Most important though is the diminished threat of the Bernanke put which is analogous to a pick up game between a group of guys on the weekend. The "bears" begin to show an ability to outscore the "bulls" only to see Michael Jordan (the most famous Bull) come in from the sidelines and reverse everything. Perhaps Michael Jordan is sidelined for a while finally or at least limited in his ability to score at will.

 

 

CDS Implied Probability of Default – Be Careful

Unless something changes in the next 24 hours, I expect we will hear more and more talk about default, not only of Greece but of other countries and of banks. Just in case that happens, here is some information that may help you make good decisions. There will be lots of chatter about the “likelihood of default” the CDS market is implying, but although it can be a useful statistic, it can also be very misleading. Before jumping into trades based on erroneous assumptions, it is worth spending a few minutes reading this. If all it does is confuse you, maybe that is a good thing in itself, because you won’t take a headline about default probability as fact.

 

 

Presenting The Org Chart Of The Soon To Be Quite Famous Banque De France

The bank that Napoleon created, and which will very shortly be in every major newspaper's headlines,  certainly believes in the ideology of Keeping It Simple Stupid. Presenting the Banque De Paris Org Chart.

France Resets The Rumormill: "No Plan To Recapitalize Banks" ... Until Tomorrow

It's just getting plain idiotic in France and Europe. After last week the global stock market soared (then crashed) on two separate micro-occasions (since everything is now measured in HFT time) following rumors first from the FT then from someone we don't even remember who, that French banks would be recapitalized, here comes the strawman reset for the next 24hours. From Reuters: "French banks are solid and can face any risk from their exposure to Greek sovereign debt, the head of the Bank of France, Christian Noyer, told a French newspaper, adding that there was no secret plan in place to recapitalise them." Well, no, they are not. Just ask the Chinese. Or Siemens. But at least this latest refutation gives France hope that when BNP, SocGen and CA are all down 15%, leaking this same rumor for the third time, may provide a short-term temporary boost. Alas, not even the vacuum-tube controlled market is that dumb.

Investing Lessons From A Pianist

Admin at Marc Faber Blog - 1 hour ago

I urge my readers to remember the words of Pianist Artur Schnabel: “The notes I handle no better than many pianists. But the pauses between the notes – ah, that is where the art resides”. Similarly, most investors are about equally good (or bad) at selecting stocks and other investments as well as at “timing” the market. However, some investors are more responsible and disciplined in their approach and that is where the superior performance comes from. As Dietrich Bonhoeffer noted, “Action springs not from thought, but from readiness for responsibility.” *Marc Faber is an internat... more » 

 

CME raises Margin Requirements on Gold and Silver/ Global Deterioration escalates

Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 8 hours ago

Good morning Ladies and Gentlemen: The CME at 11 o'clock pm est, Friday night raised margin requirements on gold, silver and copper. This is another of their blatant manipulation moves as they wait until the bankers bomb gold and silver and then when the longs are fragile  they hit with increased margin requirements. I cannot urge you enough to please stay away from the thieves at the comex.

Record Correlations + Record Low Mutual Fund Cash + Soaring Dispersion = Recipe For Redemption Driven Disaster

The topic of surging market return correlation (and the death of alpha on broader terms) is nothing new to long-term Zero Hedge readers: every time the market appears poised to crash, stock and sector correlations reach new highs while return dispersion drops as fundamentals and technical are broadly ignored, and only the roar of the thundering herd matters. And while whether a spike in volatility is a precondition to correlation jumps, or simply a coincident factor, is unknown, in recent weeks an equity correlation of 1.000 has been matched by a jump in volatility not seen since the days of September 2008. What this has done is to make return dispersion for the hedge fund community higher than historical associated with comparable episodes of palpable market fear, exposing a broad rift between the outperformers (very few, mostly macro hedge funds) and underperformers (many, long-biased primarily). Curiously in the (massively levered) mutual fund community everyone is broadly underperforming with roughly the same intensity. Which means that while in the past one’s returns could suck, at least so would everyone else’s, the past month has accentuated the ability of funds to generate alpha (and even beta) lead to broad reallocation of capital by fund LPs. The will force the en masse selling of winners to satisfy margin calls, exacerbated by record low mutual fund cash "dry powder" positions, and sets the groundwork for even more volatility as all traditional hedging strategies fail. So what is an investor to do in such a confusing environment? Pray... is the short answer. As for the longer one, there is not much that can be done according to Goldman, which in its latest weekly chartology has little if any words of encouragement for both clients and market speculators alike.
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China Is Doing The Right Thing To Cool Things Off

Admin at Jim Rogers Blog - 13 hours ago

They’re doing their best to cool things off...I expect them to continue to do it, and that is causing more slowdown around the world. - *in CNBC.com* *Jim Rogers is an author, financial commentator and successful international investor. He has been frequently featured in Time, The New York Times, Barron’s, Forbes, Fortune, The Wall Street Journal, The Financial Times and is a regular guest on Bloomberg and CNBC.* 

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Here We Go - This Is Why They Wanted To Annihilate The Metals This Week

Dave in Denver at The Golden Truth - 16 hours ago

*G20 sources: all efforts behind the scenes (by G20 members) are now going into recapitalising banks, preparing economies for default.* Zerohedge posted this. Here's the LINK So it sounds like Greece will be allowed to default and the bigger news regarding gold/silver is that the ECB is prepared to print plenty of money of keep the banking system from collapsing. Sort of like what happened here in 2008. That's why the LBMA raised margins on OTC gold forwards by substantial margin. They wanted to "flush" the market ahead of this. Ultimately this is uber-bullish for the meta... more » 

Guest Post: Bleeding the Patient, Modern Economics and the Symbolic Economy

Modern economics is analogous to the junk-science of 17th century medicine, and it serves a symbolic economy of phantom wealth and freedom. Back in the bad old days, the premier physicians of the age accepted and practiced the idea that the cure for illness was to bleed very ill patients, effectively weakening them. Countless patients who might have recovered if simply left "untreated" died as a result of the misguided "science of healing" of the era. Only with the advent of a true understanding of the nature of infection, the immune system and disease did the "folk" pseudo-science of bleeding pass from accepted medical practice. We are mired in a similar era of pseudo-science being accepted as actual science, i.e. as reflecting the underlying causal mechanisms of life and the universe, and that pseudo-science is called economics. As I have noted here many times, we are experiencing not just a standard-issue financial crisis but the failure of the entire pseudo-science edifice of modern conventional economics.