U.S. Banks Told to Prepare for Collapse

by Brittany Stepniak, Wealth Wire:

Regulators have instructed five of our nation’s biggest banks to develop some serious plans to ward off collapse in lieu of major problems. U.S. regulators were sure to remind these banks that they should not count on any government assistance this time.

Bank of America Corp (BAC.N), JPMorgan Chase & Co (JPM.N), Goldman Sachs Group Inc (GS.N), Citigroup Inc, (C.N), Morgan Stanley (MS.N).

Perhaps those running these banks have learned from the mistakes of Lehman Brothers CEO Dick Fuld who was not quick enough to action, not decisive enough to stave off serious bank problems in the midst of financial crisis.

Reuters reports:

The two-year-old program, which has been largely secret until now, is in addition to the “living wills” the banks crafted to help regulators dismantle them if they actually do fail. It shows how hard regulators are working to ensure that banks have plans for worst-case scenarios and can act rationally in times of distress.

The documents obtained by Reuters indicate that the Federal Reserve and the U.S. Office of the Comptroller of the Currency first directed the five big banks to design some realistic recovery plans back in May of 2010.

Read More @ WealthWire.com

Fed Orders Banks To Create 'Super Secret, Entirely Useless' Plan To Avoid Blowing Each Other Up

Just when you had got over the entirely inane creation of a living-will that purports to solve the taxpayer's dilemma should a large SIFI hit an iceberg; Reuters reports - this time super secret - the Fed, in 2010, asked for a plan from the US' Big 5 Banks for staving off collapse if they faced serious problems - critically emphasizing that the banks can't rely on government help. Read that again and we dare you not to laugh. It seems regulators are trying hard to ensure banks have plans for worst-case scenarios - in order to act rationally in times of distress. Recovery plans differ from living wills, also known as 'resolution plans', and are about protecting the crown jewels - the shareholders - while a resolution plan is about protecting the system, taxpayers and creditors; of course it's all ridiculous smoke and mirrors. Interestingly, Reuters has uncovered an 'Orderly Liquidation of a Failed SIFI' presentation - embedded below  - sponsored by JPMorgan which is reassuringly positive of this end of the world contagion scenario.

Referendum: Is Germany Preparing For The Nuclear Option?

from Zero Hedge:

Two months ago, in the aftermath of the “surprising victory” for the Italian PM from the June 29 European summit, which the media mistakenly interpreted as successful for Monti and Rajoy, whose hijacking tactics merely led to even more European animosity and instability in a system that is beyond fragile (i.e., Europe), we proposed an entirely different explanation, namely that “Merkel’s Surprising “Defeat” was Merely A Gambit For A German Referendum?” To wit: “it appears that events over the past week may have been merely a gambit for something that Schauble and Weidmann have already hinted at: a popular referendum that decides the fate of Europe once and for all, washing Merkel’s hands and letting the people decide if they want the European experiment to continue or not.” Turns out we were right.
Read More @ Zero Hedge.com

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The Broken Market Chronicles: 200% Of Man United's Float Will Trade In A 10 Cent Interval Today

With 26 million shares traded and two more exhausting market-making hours to go for MANU's underwriters, it is clear that more than double the 16.67 million share float will be 'rotated' at least twice and yet stay in a 10 cent interval (with well over 95% of that within a minute 5c interval). What is perhaps more stunning is the massive bid at exactly $14 - the IPO price - as if they will never learn. Of course there are buyers for every seller and many algos played all day but with a massively dominant bid soaking up any and all offers near $14.00, we suspect the underwriters of the MANU IPO are 'pulling-a-facebook' and onboarding whatever they have to. There has now been 9.5 million shares bid at $14.00 (and none asked) - more than half the float alone! It seems increasingly self-evident that IPOs are simply weath transfer mechanisms - no win-win - and that the value-add from 'stock exchanges' is rapidly converging to zero.

The Insanity Intensifies

Dave in Denver at The Golden Truth - 27 minutes ago

*Here's the exact quote from Marc Faber: "If you put a gun on my head and you said 'you must choose either Mr. Obama or Mr. Romney,' I'd say 'please shoot.'"* That's a game we used to play in the late 90's in which someone holds a gun to your head and says, "you have to sleep with either Oprah or Hillary Clinton," and the correct answer was "pull the trigger..." I wanted to briefly touch on three issues which were exposed this week and which need to be rectified. First, Obama gave a speech in Ohio in which he claimed to have saved the U.S. auto industry and the associated jobs. ... more » 

 

Gold right at the Top of its Recent Trading Range

Trader Dan at Trader Dan's Market Views - 1 hour ago

Gold has pushed to the very top of its recent trading range as it works within the confines of its consolidation pattern noted on the chart below. It either mounts a solid breakout this time around or it will fall back towards $1600 and slightly below once again. I have noted that for the last 5 weeks or so, the lows have been slowly creeping higher hinting at market strength. It simply needs a spark, something to ignite it and push it past the strong selling pressure emerging between $1620 - $1630. Today's strength is predicated on news out of China showing its economy slowing... more » 

Are You Better Off Than You Were Four Years Ago?

The phrase "Are You Better Off Than You Were Four Years Ago?" and "It’s the Economy, Stupid" have become standards of American election discourse in recent decades. And seemingly for good reason. Although it is rare to unseat an incumbent, poor economic performance seems to play a role. We are less than four months away from the US Presidential election. Financial and economic developments have caused surprise political outcomes around the world from time to time.  UBS took a look back at the first terms of the nine presidents that preceded President Obama to determine if the performance of economic variables had any predictive power in determining the odds of re-election for a second term. The news is not good, from GDP growth to real disposable income, and from unemployment to the Misery Index, it seems the bailer-out-in-chief may just have an uphill battle.

Egan Jones Downgrades Goldman Sachs From A- To BBB+

The juggernaut continues as Egan Jones exposes a key issue we have been discussing: namely that in the absence of actual trading, banks, which can no longer rely on Net Interest Margin, will have to get smaller, leaner and more efficient, or else lose some of the competition. Such as Bear. Such as Lehman. Maybe, even, such as Knight.

Reality Check: Fast and Furious Operation Was Really About U.S. Supporting A Drug Cartel?

from BenSwannRealityCheck:

Ben Swann Reality Check takes a look at some stunning new accusations by a high ranking member of the Sinaloa Drug Cartel that Fast and Furious was about the U.S. supporting one cartel while attempting to shut down others.

Ron Paul’s Legacy: A Complete Audit Of The Secretive Banking Cartel?

from Testosterone Pit.com:

They only bubble up rarely, these scandals at the Federal Reserve System, but when they do, they’re doozies, involving huge amounts of money, massive conflicts of interest, all-out manipulation, collusion, favoritism, dizzying cronyism…. And yet, over the 100 years that the Fed has existed, it has done an excellent job in one of its other primary functions, maintaining the dollar, which has lost only 96% of its value—instead of 100%.
The latest scandal is the Libor fiasco that is spawning worldwide investigations of the largest banks, going back years. The New York Fed under its President Timothy Geithner knew of the manipulations as early as 2007, and knew it involved banks of which it was one of the regulators. There were some hush-hush contacts with British regulators, and that was it. Nothing changed. Status quo maintained.
Just about then, the financial crisis began to expose the house of cards that financial institutions had become. Bear Stearns was saved. During the ensuing bailout mania of 2007 – 2009, the New York Fed, under the same management, handed trillions of freshly printed dollars to the same banks that it knew were manipulating Libor. It was done in secret, and the public wouldn’t have known who got what, how the decisions were made, why Lehman wasn’t bailed out though Goldman was, had it not been for the audit by the Government Accountability Office (GAO) as authorized by the Dodd-Frank financial reform act [for some gory details, read... The GAO Audit of the Fed Doesn’t Call It ‘Corruption’ but it should].
Read More @ TestosteronePit.com

Privacy invasion – Police and firefighter drones raise huge concerns

by J. D. Heyes, Natural News:

Lawmakers and privacy advocates are becoming increasingly concerned about the rising number of drones used by federal, state and local governmental entities, an effort that is being coordinated through the Department of Homeland Security.
According to the nation’s foremost anti-terrorist agency, DHS officials say drone use is accelerating among police and fire departments especially, in a bid to detect fires, radiation leaks and other potential security threats, but the increased use is not coming without some heartburn from privacy advocates. Once used exclusively to hunt militants and terrorists in Iraq and Afghanistan, drones of all sizes are now being employed domestically in greater numbers.
The effort to broaden usage within the United States began in earnest a few years ago with an initiative launched by DHS to test the efficacy of the unmanned aircraft in a domestic capacity. In 2010, the Los Angeles County Sheriff’s Department conducted a test in conjunction with DHS officials who used a drone to locate a device the size of a pack of cigarettes that was emitting a safe pulse of low-grade radiation that was hidden on a chaparral-covered hillside 40 miles north of the city, Los Angeles Times reported recently.
Read More @ NaturalNews.com

We Are Now Seeing Huge Orders For Physical Gold & Silver

from KingWorldNews:

Today forty year veteran of the metals markets Bill Haynes told KWN, “Right now we are seeing very large physical orders for both gold and silver. It is very interesting because these are entities with large existing holdings of both physical gold and silver, but for some reason, right here, right now they are adding sizable quantities to their existing positions.
These are wealthy individuals that are very strong hands and they are taking the metal right out of the market, and believe me, these individuals are never sellers. They see gold and silver as a hard asset that has been money for thousands of years, and they are pulling it out of the market and putting it away.
It is also very interesting that we are seeing an equal amount of money going into both gold and silver….”
Bill Haynes continues @ KingWorldNews.com

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