Epic Santelli Rant On 'Un-American' Federal Reserve/Treasury Incompetence
Stunned
at the sheer ineptness and lack of due diligence in the Libor-rigging
details that are being uncovered specific to Geithner's Treasury and
Bernanke's Fed, CNBC's Rick Santelli reflects on just how unbelievable TARP was in this context. "Hurry up, let's spend three quarters of a trillion dollars; how much due diligence did they do for our role as taxpayers in basically bailing out the banking system? Obviously zero!"
and this as they knew these very-same banks were manipulating rates.
Opining on the un-Americanism of jet-skis and outsourcing, Rick states
unequivocally "what's un-American is we now have the Federal
Reserve Bank of New York and Treasury taking heightened importance in
regulating us in the future through Dodd/Frank. Shame on their
legislation!" Meanwhile, those very same un-American Treasury
staff (who we are supposed to trust with the future of our banking
system and implicitly the economy we pre-suppose) have just been caught soliciting prostitutes and breaking conflict-of-interest rules.
OMB's Stockman: "We're At The Fiscal Endgame"
To those on the hill and elsewhere who suggest this growing 'fiscal
cliff' and 'debt ceiling' crisis will all get solved, former Office of
Management and Budget (OMB) Director David Stockman tells Bloomberg TV
that "they will punt, punt, punt and kick the can with partial solutions
driven by eleventh hour crisis-based extensions that will go on for
the whole of the next term!" When asked whether this economy will be
mired in the doldrums, he rather ominously states "it will be worse, because we will be in recession" and notes that when the lame ducks re-look at the budget numbers with a realistic recession (instead of the current assumption of no recession within 12 years)
it will be far worse and in a political environment where 'we cannot
possibly raise taxes - and we cannot possibly cut spending'. With a 78%
disapproval rating for the 'do nothing' Congress, Stockman is surprised
that 16% somehow approve - approve of what? His warning is that unlike
in past periods, today "we are completely paralyzed, there is an ideological divide on taxes and entitlement like we've never had before"
and while he realizes that "the debt problem doesn't become a debt
problem until the market suddenly have a wake up call and realize that if the Fed doesn't keep printing, it's game over."
Stunned
at the sheer ineptness and lack of due diligence in the Libor-rigging
details that are being uncovered specific to Geithner's Treasury and
Bernanke's Fed, CNBC's Rick Santelli reflects on just how unbelievable TARP was in this context. "Hurry up, let's spend three quarters of a trillion dollars; how much due diligence did they do for our role as taxpayers in basically bailing out the banking system? Obviously zero!"
and this as they knew these very-same banks were manipulating rates.
Opining on the un-Americanism of jet-skis and outsourcing, Rick states
unequivocally "what's un-American is we now have the Federal
Reserve Bank of New York and Treasury taking heightened importance in
regulating us in the future through Dodd/Frank. Shame on their
legislation!" Meanwhile, those very same un-American Treasury
staff (who we are supposed to trust with the future of our banking
system and implicitly the economy we pre-suppose) have just been caught soliciting prostitutes and breaking conflict-of-interest rules.OMB's Stockman: "We're At The Fiscal Endgame"
To those on the hill and elsewhere who suggest this growing 'fiscal cliff' and 'debt ceiling' crisis will all get solved, former Office of Management and Budget (OMB) Director David Stockman tells Bloomberg TV that "they will punt, punt, punt and kick the can with partial solutions driven by eleventh hour crisis-based extensions that will go on for the whole of the next term!" When asked whether this economy will be mired in the doldrums, he rather ominously states "it will be worse, because we will be in recession" and notes that when the lame ducks re-look at the budget numbers with a realistic recession (instead of the current assumption of no recession within 12 years) it will be far worse and in a political environment where 'we cannot possibly raise taxes - and we cannot possibly cut spending'. With a 78% disapproval rating for the 'do nothing' Congress, Stockman is surprised that 16% somehow approve - approve of what? His warning is that unlike in past periods, today "we are completely paralyzed, there is an ideological divide on taxes and entitlement like we've never had before" and while he realizes that "the debt problem doesn't become a debt problem until the market suddenly have a wake up call and realize that if the Fed doesn't keep printing, it's game over."China’s GDP Figures… Lies… Damned Lies?
By Dan Denning, Daily Reckoning.com.au:
How long is a piece of string? It’s as long as the Chinese government says it is! In today’s Daily Reckoning, we wonder whether statistics or prices can be trusted any longer. And to remind you of what’s at stake in this great debate about the veracity of China’s economic data figures and the viability of its growth model, there’s this from the Chanticleer column in this weekend’s Australian Financial Review:
‘The slowest rate of economic growth in China since the global financial crisis is not a reason to panic but investors ought to be dusting off scenarios that involve a hard landing [like China's Bust].
‘It is better to have at least thought about the implications of a worst-case scenario rather than be taken by surprise when markets react to lower Chinese demand for Australian commodities…
‘The majority of Australians in default superannuation funds will have a high exposure to resources and will be vulnerable to a China slowdown. In fact, those with a typical default fund should brace themselves for negative super returns for the year to June 2012 of between 5 and 7 per cent simply because of their exposure to companies such as BHP Billiton and Rio Tinto.’
Read More @ DailyReckoning.com.au
US Treasury Curve 1990-2012 In Its Full 3-D Glory: Redux
Just
under two years ago, when we mocked then Morgan Stanley's analyst Jim
Caron's call for a surge in long-dated yields on the back of an
improvement in the economy (not something more realistic like the Fed
losing all control of the TSY curve), we penned "Visualizing The Past Of The Treasury Yield Curve, And Deconstructing The Great Confusion Surrounding Its Future"
in which we said that contrary to pervasive expectations of a bull
steepener, the treasury curve would continue flattening more and more,
until the whole thing would become one big pancake. Today, we have
decided to revisit that post: in short - Jim Caron was fired by Morgan
Stanley as head of rates following 3 consecutive years of bad calls
starting in 2009 (only to be rehired in June as a Portfolio Manager...
oops), while our view that sooner or later the 2s30s will be 0 bps is
over one third complete.The 4 Most Disconcerting Charts For European Equity Holders
Things are getting a little 'strange' in Europe. European
equity markets (and voatility) have disconnected from the reality of
European corporate, financial, and sovereign credit. As the
massive bifurcation in sovereign yields continues - with Spain near
record-highs and Swiss/German at record-lows - equities are still
significantly higher post the EU-Summit (and vol massively so) as
credit of any kind is dramatically wider. Specifically, 1) Europe's
broad equity index is massively outperforming credit post EU Summit; 2)
Europe's broad equity index Vol is majorly disconnected from XOver
credit; and, 3) Europe's broad equity index is in-line with
GDP-weighted sovereign risk BUT dramatically dislocated from Italian
and Spanish risk (that is reflective of the core of the stress). Just
as we have seen in the US, the method of choice for 'pumping hope' into
equity market valuations is through the levered selling of volatility -
it seems some-one/-thing with very deep pockets is getting awfully
brave as Europe's VIX drops to near pre-crisis levels (and its steepest in months as short-term complacency surges).
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We The Sheeplez... is intended to reflect
excellence in effort and content. Donations will help maintain this goal
and defray the operational costs. Paypal, a leading provider of secure
online money transfers, will handle the donations. Thank you for your
contribution.
by Charles Hugh Smith, Of Two Minds:
The
conditions that drove corporate profits to record heights have weakened
or reversed, yet analysts still expect year-over-year growth above 10%.
Based on what?
Corporate earnings are expected to resume their rapid rise after the “summer soft spot.” Zero Hedge recently published The Impossible Earnings Season Stepfunction which included this chart of profit growth expectations:
The debt was not evenly distributed; the bottom 95% loaded up on debt to compensate for stagnating earnings while the top 5% saw their relative debt burden fall as their earnings rose smartly.
Virtually all the earnings growth in the past 40 years flowed to the top 10% and the majority went to the top 5%, so the rise in wages shown in the above chart is deceptive: most of that increase flowed to the top 5%. (See Financialization and Crony Capitalism Have Gutted the Middle Class July 13, 2012)
Read More @ OfTwoMinds.com
from Matlarson10:
The
conditions that drove corporate profits to record heights have weakened
or reversed, yet analysts still expect year-over-year growth above 10%.
Based on what?Corporate earnings are expected to resume their rapid rise after the “summer soft spot.” Zero Hedge recently published The Impossible Earnings Season Stepfunction which included this chart of profit growth expectations:
The debt was not evenly distributed; the bottom 95% loaded up on debt to compensate for stagnating earnings while the top 5% saw their relative debt burden fall as their earnings rose smartly.
Virtually all the earnings growth in the past 40 years flowed to the top 10% and the majority went to the top 5%, so the rise in wages shown in the above chart is deceptive: most of that increase flowed to the top 5%. (See Financialization and Crony Capitalism Have Gutted the Middle Class July 13, 2012)
Read More @ OfTwoMinds.com
from RonPaul2008dotcom:
from Matlarson10:
from Robert Wenzel:
Bill Bergman-a former Federal Reserve (Chicago branch) economist and policy analyst, who has raised concerns about unusual currency transactions pre- 9-11—-including billions in one hundred dollar bills, is the guest this week on the Robert Wenzel Show.
Bergman worked at the Chicago Federal Reserve for over 13 years as an economist and financial markets policy analyst, until he started asking questions about unusual currency movements before 9-11. On the show we talk about what happened to him, after he started his investigation.
We also talk about how the Fed’s Biege Book is assembled, the trillion plus dollars sitting at the Fed as excess reserves, the LIBOR “scandal”, Warren Buffet and much more…
Finally, we crunched the numbers, and indeed found a material spike in currency during the ten weeks preceding 9-11 when compared to the previous five years. All the more compelling, considering the average includes the cash dump prior to the Y2K event in 2000. See the chart HERE.
Bill Bergman-a former Federal Reserve (Chicago branch) economist and policy analyst, who has raised concerns about unusual currency transactions pre- 9-11—-including billions in one hundred dollar bills, is the guest this week on the Robert Wenzel Show.
by Kesha Rogers, Congressional Candidate of the 22nd district of Texas LaRouche Pac:
The entire criminal operation that has turned our cities into slums,
stolen our pensions, bankrupted our cities and states, and murdered our
most vulnerable citizens, all in the name of “too big to fail”, has now
been exposed as “LIBOR-gate”. Let us be clear: this is not an interest
rate scandal; what is exposed is, all the hell you’ve been suffering for
the past 5 years, since the 2007 collapse of the system and the
2008-2012 taxpayer bailouts, was planned, preventable, and entirely
intentional. The highest elements of government and finance crossed
party lines to form a bipartisan coalition to murder Americans.
LIBOR is the London Inter-Bank Offered Rate, which is the interest rates banks offer to pay, when institutions buy their debt. 75% of major cities across the country purchased interest rate swaps, to “protect” themselves in case interest rates went up. But what has been revealed is that 16 major banks decided to rig the interest rates, and artificially lower them. Emails indicate that then-New York Federal Reserve Chair Timothy Geithner, in 2007, knew this was going on, and not only did nothing to stop it, but covered it up. When he became Obama’s Treasury Secretary, Geithner rewarded the banks that did it with taxpayer bailouts. The effect was that all these cities lost big money, while the bankers got their mortgage-backed securities, derivatives, credit default swaps, and other gambling debts bailed out with your tax dollars. Then the bankers foreclosed on you, demanded their contracts be paid, refused to lend, and said, “Your 401k has lost $150,000, so sorry.” All this while, the Bush and Obama administrations, working with the Federal Reserve, and Wall Street and European banks, knew the whole thing was a set up, from the very beginning. Instead of throwing these criminals in jail, our government held passed sham legislation, which did nothing to protect you.
This is the British Empire we have always talked about: using private ownership of money and debt, along with paid for politicians to enforce their laws, a financial-industrial cartel seeks to rule over nations and destroy our standard of living for their personal profit.
Read More @ LaRouchePac.com
The entire criminal operation that has turned our cities into slums,
stolen our pensions, bankrupted our cities and states, and murdered our
most vulnerable citizens, all in the name of “too big to fail”, has now
been exposed as “LIBOR-gate”. Let us be clear: this is not an interest
rate scandal; what is exposed is, all the hell you’ve been suffering for
the past 5 years, since the 2007 collapse of the system and the
2008-2012 taxpayer bailouts, was planned, preventable, and entirely
intentional. The highest elements of government and finance crossed
party lines to form a bipartisan coalition to murder Americans.LIBOR is the London Inter-Bank Offered Rate, which is the interest rates banks offer to pay, when institutions buy their debt. 75% of major cities across the country purchased interest rate swaps, to “protect” themselves in case interest rates went up. But what has been revealed is that 16 major banks decided to rig the interest rates, and artificially lower them. Emails indicate that then-New York Federal Reserve Chair Timothy Geithner, in 2007, knew this was going on, and not only did nothing to stop it, but covered it up. When he became Obama’s Treasury Secretary, Geithner rewarded the banks that did it with taxpayer bailouts. The effect was that all these cities lost big money, while the bankers got their mortgage-backed securities, derivatives, credit default swaps, and other gambling debts bailed out with your tax dollars. Then the bankers foreclosed on you, demanded their contracts be paid, refused to lend, and said, “Your 401k has lost $150,000, so sorry.” All this while, the Bush and Obama administrations, working with the Federal Reserve, and Wall Street and European banks, knew the whole thing was a set up, from the very beginning. Instead of throwing these criminals in jail, our government held passed sham legislation, which did nothing to protect you.
This is the British Empire we have always talked about: using private ownership of money and debt, along with paid for politicians to enforce their laws, a financial-industrial cartel seeks to rule over nations and destroy our standard of living for their personal profit.
Read More @ LaRouchePac.com
Bergman worked at the Chicago Federal Reserve for over 13 years as an economist and financial markets policy analyst, until he started asking questions about unusual currency movements before 9-11. On the show we talk about what happened to him, after he started his investigation.
We also talk about how the Fed’s Biege Book is assembled, the trillion plus dollars sitting at the Fed as excess reserves, the LIBOR “scandal”, Warren Buffet and much more…
Finally, we crunched the numbers, and indeed found a material spike in currency during the ten weeks preceding 9-11 when compared to the previous five years. All the more compelling, considering the average includes the cash dump prior to the Y2K event in 2000. See the chart HERE.
by Rick Ackerman, Rick Ackerman.com:
With last week’s powerful finishing stroke, the U.S. stock market
continued to thumb its nose at reality, rampaging higher on economic
news that seems to be getting worse by the day. Around mid-week, readers
of the Wall Street Journal could have glimpsed a perfect storm
gathering on the horizon. Numerous articles spread across two inside
pages summed up a darkening global economic picture. We learned that
China’s economy is decelerating at a rapid pace, Europe’s is dead on
arrival despite blather about further stimulus, and even a lean and
muscular Brazil has cut interest rates to get in step with increasingly
desperate central banks around the world. In the U.S., a carefully spun
recovery story was starting to unravel just in time for the election
with warnings that Q2 earnings are going to stink. It would appear that
the jobless “recovery” is finally starting to take its toll on consumer
spending. Henry Ford was right after all: business prospers only when
companies are hiring workers and paying them well. Meanwhile, so much
for the notion that a lean, mean manufacturing sector is going to lead
America back to prosperity. In fact, perhaps for lack of products to
sell the world, the U.S. trade deficit has begun to grow anew. This
problem barely gets a mention in the news these days, presumably because
other problems, most particularly stagnant U.S. incomes, falling
consumer confidence and intractable unemployment seem more immediate and
potentially fatal.
Read More @ RickAckerman.com
from CNBC:
With last week’s powerful finishing stroke, the U.S. stock market
continued to thumb its nose at reality, rampaging higher on economic
news that seems to be getting worse by the day. Around mid-week, readers
of the Wall Street Journal could have glimpsed a perfect storm
gathering on the horizon. Numerous articles spread across two inside
pages summed up a darkening global economic picture. We learned that
China’s economy is decelerating at a rapid pace, Europe’s is dead on
arrival despite blather about further stimulus, and even a lean and
muscular Brazil has cut interest rates to get in step with increasingly
desperate central banks around the world. In the U.S., a carefully spun
recovery story was starting to unravel just in time for the election
with warnings that Q2 earnings are going to stink. It would appear that
the jobless “recovery” is finally starting to take its toll on consumer
spending. Henry Ford was right after all: business prospers only when
companies are hiring workers and paying them well. Meanwhile, so much
for the notion that a lean, mean manufacturing sector is going to lead
America back to prosperity. In fact, perhaps for lack of products to
sell the world, the U.S. trade deficit has begun to grow anew. This
problem barely gets a mention in the news these days, presumably because
other problems, most particularly stagnant U.S. incomes, falling
consumer confidence and intractable unemployment seem more immediate and
potentially fatal.Read More @ RickAckerman.com
from CNBC:
from PeterSantilliTV:
My Dear Friends,
The justice department has been quoted by MSM concerning their desire
for jail sentences for those that are directly involved in Libor
Manipulation.
Barclays has said there are 17 in the US banks.
This is a major change, and would mean a great deal to the
unquestioned manipulation of the gold/gold shares and silver/silver
shares market.
The CEOs of those gold and silver companies suffering from unabashed
manipulation could very well have new legal precedent to recover lost
capital value for their shareholders.
It is the responsibility of every gold and silver share company CEO
to seek justice for their shareholders. It will take courage but that is
what they are paid for.
DOJ prepares criminal cases in Libor scandal.
The Justice Department is building criminal cases against several banks and their employees, including Barclays (BCS), for their role in manipulating Libor rates, the NYT reports. Bloomberg writes that Barclays traders involved in the scandal could be hit with U.S. charges by September. Meanwhile, New York and Connecticut have been conducting their own inquiry for six months.
Respectfully,
Jim
Jim
Jim Sinclair’s Commentary
It is coming here, there and everywhere!
China State Council may signal new easing: Nomura By Chris Oliver
July 16, 2012, 12:30 a.m. EDT
HONG KONG (MarketWatch) — A meeting of China’s cabinet, the State Council, this week will likely discuss economic policies for the second half of the year and possibly lay the ground for more fiscal stimulus, according to one analyst. In a note Monday, Nomura analyst Zhiwei Zhang said research trips over the weekend by Premier Wen Jiabao and Vice Premier Li Keqiang helped set the tone for the State Council meeting, which reportedly is slated for Wednesday. Zhang cited Premier Wen as emphasizing downward pressure on the economy, while also referring to the need for policy fine-tuning. "The press release from the State Council meeting may help shed some light on specific policy-easing measures," Zhang said.
More…
Jim Sinclair’s Commentary
QE will go to infinity to prevent Roubini’s call for hanging bankers in the streets.
Fewer U.S. companies planning to hire; Europe looms: poll WASHINGTON | Mon Jul 16, 2012 12:15am EDT
(Reuters) – American companies are scaling back plans to hire workers and a rising share of firms feel the European debt crisis is taking a bite out of their sales, a survey showed on Monday.
Only 23 percent of the firms polled in June plan to add to staff in the next six months, the National Association for Business Economics said on Monday.
NABE’s prior survey, conducted in late March and early April, had shown 39 percent of companies planning to add workers.
Already, hiring by U.S. companies has slowed dramatically in recent months as employers worry about a sagging global economy hurt by Europe’s snowballing debt crisis.
Some economic data has suggested at least some of the hiring slowdown has been due to caution rather than a decline in business. A July 6 Labor Department report, for example, showed companies asked employees to work longer hours last month, even though they slowed the pace of hiring.
The NABE survey suggests such caution on hiring could continue.
The poll showed 47 percent of companies polled felt their sales have dropped due to Europe’s woes.
Among companies that produce goods rather than provide services, the impact was even greater, with nearly four in five reporting a Europe-driven decline in revenues.
More…
Jim Sinclair’s Commentary
Easy with the radical words! Gold is going to and through $3500 which seems quite logical to me.
Radical gold bugs vindicated?
Commentary: Theory is getting MSM attention By Peter Brimelow,
NEW YORK (MarketWatch) — Gold rebounds — and the radical bugs are on a roll.
First, a proprietary purr. Let the record show that MarketWatch’s Mark Hulbert wrote before Friday’s bounce: “Someday, gold will wake up from its dreary, listless state and take off.
“And, if contrarian analysis is right, that day will come sooner rather than later.”
Hulbert reported that the average reading over the last four months of the Hulbert Gold Newsletter Sentiment Index (HGNSI), which reflects the average recommended gold market exposure of a subset of short-term gold timers tracked by the Hulbert Financial Digest, was minus 3.3%.
He noted: “You have to go back as far as 1991 to find another four-month period in which the average HGNSI reading was this negative. Gold at that time was trading around $360 per ounce — or around $1,200 an ounce lower than where it stands today.”
Gold for August delivery GCQ2 -0.44% obliged by jumping $26.70 or 1.71% on Friday to $1,592 basis. That meant gold actually made a gain on the week. (But the HGNSI remained 2.3% negative as of Friday night.)
When Hulbert wrote on Thursday night, things were looking pretty dismal. At its low of $1,554.40, the August gold contract looked headed to a new low for the year.
More…
Jim Sinclair’s Commentary
Every day the Fed mulls over the strength of the US economy is one day closer to the economic bottom falling out.
Operation Twist is a dark joke. QE to infinity is guaranteed regardless of denial.
How Close Are We to New Great Depression? Published: Monday, 16 Jul 2012 | 8:17 AM ET
Catherine Boyle
Staff Writer, CNBC.com
The risk of a new depression — a sustained, severe recession — has struck fear into the heart of markets and driven monetary policy in developed economies since the current financial crisis began.
“We’re in a very unfortunate position to be here,” Richard Duncan, author of The New Depression, warned on CNBC’s “Squawk Box Europe” Monday.
“When we broke the link between money and gold, this removed all constraints on credit creation. This explosion of credit created the world we live in, but it now seems that credit cannot expand any further because the private sector is incapable of repaying the debt it has already, and if credit begins to contract, there’s a very real danger that we will collapse into a new Great Depression,” he argued.
“If this credit bubble pops, the depression could be so severe that I don’t think our civilization could survive it.”
More…
Jim Sinclair’s Commentary
QE to infinity is certain.
Retail Sales Fall as Consumers Continue to Struggle Published: Monday, 16 Jul 2012 | 9:20 AM ET
U.S. retail sales fell for a third straight month in June as demand slumped for everything from cars and electronics to building materials, a sign the economic recovery is flagging.
Retail sales slipped 0.5 percent, the Commerce Department said on Monday.
It was the first time sales had dropped in three consecutive months since late 2008, when the economy was still mired in a deep recession. Analysts polled by Reuters had expected retail sales to rise 0.2 percent.
"Evidence is increasingly clear that the U.S. economy is slowing," said Jim Baird, an investment strategist at Plante Moran Financial Advisors in Kalamazoo, Mich.
The report adds to a spate of weak economic data that is raising pressure on President Obama ahead of his November reelection bid. Republican challenger Mitt Romney is focusing his campaign on the weak economy that has plagued Obama’s presidency.
The report could raise hopes that the Federal Reserve could launch another bond-buying program to help the economy.
More…
By Greg Hunter’s USAWatchdog.com
Dear CIGAs,
The Libor interest rate rigging scandal is being called the biggest financial fraud in history. Libor is a key interest rate that is used globally to set as much as $800 trillion in transactions. It is used to set interest rates for things such as credit cards, student loans, mortgages, corporate bonds and hundreds of trillions of dollars in derivatives. Libor stands for the London Inter-Bank Offered Rate. It is supposed to be an estimate of what it would cost for some of the biggest banks in the world to borrow money from one another. Sixteen global banks are involved in setting the rate, three of which are in the U.S. (JP Morgan, B of A, and Citi.) It was recently revealed by Barclays Bank (in the UK) that this key interest rate quoted by most of these banks was nothing more than a gigantic rate rigging scheme.
In a financial system reeling from one fraud after another, this is the mother of all rip-offs by the banksters. Karl Denninger of Market-ticker.org calls this, “the largest organized theft ever committed in human history.” This has already brought out lawsuits by the dozens from investors and institutions who say they were cheated by Libor rate rigging. Who’s suing the big banks? A better question might be who’s not suing? Let’s start with investors both big and small. CNN reported last week, “With Libor’s alleged suppression, Charles Schwab says, it was deprived of the higher interest payments it deserved. In another complaint, individual investor Ellen Gelboim claims she purchased corporate bonds that paid variable interest based on Libor, and suffered lower returns as the banks held the rate down.” (Click here for the complete CNN story.) These lawsuits and others have been combined into one in federal court in New York, but avalanches of new cases are coming.
Several state AG’s are also suing, right alongside municipalities and cities around the country, and that is just in the U.S. Remember, this scandal is global. Hedge funds trading in derivatives are going to line up to sue the big banks if they were on the losing end of a trade. Libor affects $550 trillion in derivative contracts. Some investors got hurt when Libor was manipulated up, and some took losses when Libor was manipulated down. There is something for everyone, and that equates to very big exposure to the banks involved in the alleged rate rigging. If the banks are responsible for just 1/10 of one percent of the $800 trillion in Libor transactions, it would represent $800 billion in liability to the banks. I’ll bet the total cost will be much higher, and some banks will go under as a result of litigation and loss of reputation. Ron Hera of Hera Research told me last week, “Truth is, if you take back more than 1% of what the banks have stolen, they’re busted.”
More…
Dear CIGAs,
The Libor interest rate rigging scandal is being called the biggest financial fraud in history. Libor is a key interest rate that is used globally to set as much as $800 trillion in transactions. It is used to set interest rates for things such as credit cards, student loans, mortgages, corporate bonds and hundreds of trillions of dollars in derivatives. Libor stands for the London Inter-Bank Offered Rate. It is supposed to be an estimate of what it would cost for some of the biggest banks in the world to borrow money from one another. Sixteen global banks are involved in setting the rate, three of which are in the U.S. (JP Morgan, B of A, and Citi.) It was recently revealed by Barclays Bank (in the UK) that this key interest rate quoted by most of these banks was nothing more than a gigantic rate rigging scheme.
In a financial system reeling from one fraud after another, this is the mother of all rip-offs by the banksters. Karl Denninger of Market-ticker.org calls this, “the largest organized theft ever committed in human history.” This has already brought out lawsuits by the dozens from investors and institutions who say they were cheated by Libor rate rigging. Who’s suing the big banks? A better question might be who’s not suing? Let’s start with investors both big and small. CNN reported last week, “With Libor’s alleged suppression, Charles Schwab says, it was deprived of the higher interest payments it deserved. In another complaint, individual investor Ellen Gelboim claims she purchased corporate bonds that paid variable interest based on Libor, and suffered lower returns as the banks held the rate down.” (Click here for the complete CNN story.) These lawsuits and others have been combined into one in federal court in New York, but avalanches of new cases are coming.
Several state AG’s are also suing, right alongside municipalities and cities around the country, and that is just in the U.S. Remember, this scandal is global. Hedge funds trading in derivatives are going to line up to sue the big banks if they were on the losing end of a trade. Libor affects $550 trillion in derivative contracts. Some investors got hurt when Libor was manipulated up, and some took losses when Libor was manipulated down. There is something for everyone, and that equates to very big exposure to the banks involved in the alleged rate rigging. If the banks are responsible for just 1/10 of one percent of the $800 trillion in Libor transactions, it would represent $800 billion in liability to the banks. I’ll bet the total cost will be much higher, and some banks will go under as a result of litigation and loss of reputation. Ron Hera of Hera Research told me last week, “Truth is, if you take back more than 1% of what the banks have stolen, they’re busted.”
More…
This Major Fed Move Is About To Create An Explosion In Gold CIGA Eric
Liquidity is the only tool left in the policy bag that can combat the forces of deflation. How long can the Fed stare down market forces before the vicious, self-reinforcing cycle of deflation takes hold and cannot be reversed? If Pento is right in that “I believe the cyclical period of deflation that I warned about several months ago is now close to an end.” the invisible hand’s net long position as a percentage of open interest (NL%OI) has to be at or near its highest level since 2001.
The money flow below confirm this expectation.
Chart 1: Gold London P.M Fixed and the Commercial Traders COT Futures and Options Net Long As A % of Open Interest
The scramble to cover in the relatively tight and small silver market is even more noticable and urgent.
Chart 2: Silver ETF (SLV) and the Commercial Traders COT Futures and Options Net Long As A % of Open Interest
The setup is simple. Money moves first, then the explanations or events come out later.
Headline: This Major Fed Move Is About To Create An Explosion In Gold
I believe the cyclical period of deflation that I warned about several months ago is now close to an end. The Fed, foolishly, feels compelled to stop the rise of the U.S. dollar, and will soon opt to follow the lead from the ECB and stop paying interest on excess reserves. That move will not increase bank lending to the private sector, as much as it will force banks into purchasing even more sovereign debt. If the Fed does indeed go down that road, I would expect to see U.S money supply growth increase significantly. This will cause gold and commodity prices to soar and the dollar tank. I would also expect to witness the global economy sink ever further into the stagflationary abyss.”
Source: kingworldnews.com
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Jim,
Arab Spring is going to turn into a cold winter.
I love the disinformation that this is going exactly as planned by Washington.
CIGA David Madisonstyle
‘Monica, Monica’ Chants Taunt Clinton in Egypt SUNDAY, JULY 15, 2012
US Secretary of State Hillary Clinton was taunted by chants of "Monica, Monica" by tomato-throwing demonstrators as she visited the Egyptian port city of Alexandria on Sunday.
An embarrassed Egyptian security official said they were chanting "Monica, Monica" and "Irhal, Clinton" (Get out, Clinton.)
Tomatoes, shoes and a water bottle were thrown at part of Clinton’s motorcade as it pulled up, protected by riot police, although a US official said Clinton’s own vehicle was not hit.
The protest appears to have been the result of suspicions that Washington had helped the Muslim Brotherhood win elections in Egypt in the wake of last year’s ouster of president Hosni Mubarak after 18 days of massive street protests.
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and defray the operational costs. Paypal, a leading provider of secure
online money transfers, will handle the donations. Thank you for your
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