STOCK MARKET WATCH -- 7 June 2012

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Thursday, 7 June 2012[font color=black][/font]

SMW for 6 June 2012

AT THE CLOSING BELL ON 6 June 2012
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Dow Jones 12,414.79 +286.84 (2.37%)
S&P 500 1,315.13 +29.63 (2.30%)
Nasdaq 2,844.72 +66.61 (2.40%)


[font color=red]10 Year 1.66% +0.10 (6.41%)
30 Year 2.74% +0.12 (4.58%) [font color=black]


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[font size=2]Market Conditions During Trading Hours[/font]
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]

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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
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[font color=black][font size=2]Handy Links - Economic Blogs:[/font][/font]
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The Big Picture
Financial Sense
Calculated Risk
Naked Capitalism
Credit Writedowns
Brad DeLong
Bonddad
Atrios
goldmansachs666
The Stand-Up Economist
The Automatic Earth
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[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
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[font color=black][font size=2]Handy Links - Videos:[/font][/font]
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Charlie Rose talks with Roubini
Charlie Rose talks with Krugman
William Black: This Economic Disaster
Bill Moyers with Kevin Drum and David Corn
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Financial Sector Officials Convicted since 1/20/09 = [/font][font color=red]12[/font]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison



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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red][font color=black]

[westerebus]

1. I'm in...

and it is 12 am/pm somewhere in the galaxy as if that's ever stopped me from being a day late or a dollar short or what ever.

[Tansy_Gold]

2. Well, it's kind like what my father-in-law used to say.

You'd ask, "Is today Monday?"

And he'd reply, "Yeah, if it don't rain."

Then you'd ask, "So, if it rains, what day is it?"

And he'd reply, "Well, the next day. Because on the farm, if it rains, you can't do much so it might as well be tomorrow."

[westerebus]

3. Makes sense to me.

It's the weeks with two Tuesday's I really don't care for. And thanks for the Cob pictures. They are a blast to ride.

[Demeter]

4. Tansy Sweetie

the PD isn't even doing that much.

[Demeter]

5. Chewing the Fat on JPMorgan

JPM Loss Raises Risk Questions, Curry Says

http://www.businessweek.com/news/2012-06-05/jpmorgan-loss-raises-risk-management-questions-curry-says

JPMorgan Chase & Co. (JPM) (JPM)’s trading loss of more than $2 billion raises “questions about the adequacy and rigor” of the bank’s risk-management practices, according to U.S. Comptroller of the Currency Thomas J. Curry.

The OCC, JPMorgan’s prudential regulator, is “actively examining” the New York-based bank, which disclosed the losses from its chief investment office on May 10, Curry said in remarks prepared for a Senate Banking Committee hearing tomorrow. The agency has learned that the bank’s position “deteriorated rapidly” at the end of April and during the first days of May, he said.

“Since that time, the OCC has been meeting daily with bank management with respect to the bank’s response to this situation, to re-evaluate the risk-management activities and controls of the bank and how they applied to its CIO function, and to determine what additional action is necessary,” Curry said in his statement.

The hearing will be the first public airing of the roles played by the OCC, the Federal Reserve, the Federal Deposit Insurance Corp. and the Treasury Department in the period before JPMorgan Chairman and Chief Executive Officer Jamie Dimon disclosed the trading losses tied to credit derivatives....

SOMEBODY SHOW TOM CURRY WHERE THE LITTLE BOY'S ROOM IS...HE HAS AN URGENT NEED.

After Loss, JPMorgan Regulators in Spotlight

http://dealbook.nytimes.com/2012/06/05/jpmorgan-regulators-in-spotlight-after-firms-huge-loss/?ref=business

JPMorgan Chase’s regulators will be in the spotlight here on Wednesday, when they testify before Congress on the bank’s multibillion-dollar trading blunder and its implications for the future of Wall Street regulation.

One of the bank’s primary regulators, the Office of the Comptroller of the Currency, will face particular scrutiny for its oversight of the JPMorgan unit responsible for a trading loss of more than $2 billion.

JPMorgan disclosed the loss from its chief investment office last month. Just months earlier, top executives from the chief investment office had traveled to Washington to persuade the comptroller that new trading restrictions threatened the future of the bank. The executives argued that the so-called Volcker Rule could prevent the powerful unit from hedging risk throughout the bank.

“This is important to maintaining the safety and soundness of JPMorgan,” Ina R. Drew, then the head of the chief investment office, told comptroller officials, recalled one person who attended the meeting.

Ms. Drew was joined by five other JPMorgan executives who echoed her concerns about the Volcker Rule, saying the regulatory crackdown “could restrict or cast in doubt strategies” that the bank “successfully employed during the financial crisis,” according to a memo summarizing the meeting....None of the more than 100 regulators embedded in JPMorgan’s Manhattan headquarters kept daily watch over the chief investment office, people briefed on the matter have said, raising questions about gaps in oversight.

[Demeter]

22. JPMorgan: If This Is a Financial Fortress, Run For the Bunkers

http://www.alternet.org/story/155773/jpmorgan%3A_if_this_is_a_financial_fortress%2C_run_for_the_bunkers?page=entire

The U.S. Senate Banking Committee spent over two hours on Wednesday proving to the American people that any shred of confidence they might still have in our financial markets is misplaced. Just as with the six recent hearings on the collapse of MF Global and its $1.6 billion of missing customer funds, five different regulators could not, or would not, reveal anything useful to the public on how JPMorgan, the largest bank by assets in the U.S., was permitted to blow up billions in depositor funds in an outpost in London.

Thomas Curry, head of the Office of the Comptroller of the Currency (OCC) since April 9 of this year, did confirm one important detail during the hearing: the reckless derivative trading at JPMorgan’s London office occurred in a unit of the national bank (not the broker-dealer), using insured deposits of bank customers, while 65 of the OCC’s examiners sat in offices of JPMorgan in New York, where they are permanently stationed...The OCC oversees all national banks, including those deemed systemically important. From 2005 through 2010, when banks built up reckless derivative trades that eventually collapsed the financial system, the OCC was headed by a former bank lobbyist, John C. Dugan, a partner of the law firm Covington and Burling. JPMorgan Chase was a client of the firm. Dugan has returned to that law firm and chairs the firm’s Financial Institutions Group. ANDThe U.S. Attorney General, Eric Holder, who has been widely criticized for not bringing any criminal prosecutions against those responsible for the financial crisis on Wall Street, spent the prior eight years as a partner at Covington and Burling.

Jamie Dimon, chairman and CEO of JPMorgan Chase, sits on the board of his primary regulator and open purse for bank screw-ups, the Federal Reserve Bank of New York, which offered zero insight into how the losses occurred at today’s hearing.

Elizabeth Friedrich, a member of Occupy the SEC, offered the following insight into these dangerous conflicts of interest:

“During the savings and loan crisis of the 1980s, there were 1,110 cases referred to prosecutors, resulting in more than 800 bank officials going to jail…Last month, a $3 billion trading loss took place and that is just one example of the fraudulent misconduct embedded in our financial system. Today, we cannot indict one single CEO/CFO with more money lost and corruption committed than in the 1980s. The reason: the regulators are not stepping up. This is due to the regulatory revolving door from Wall Street. We are seeing these white-collar hustlers get a slap on the wrist and business continue as usual. It is the public's job to make these people and institutions accountable.”

In anticipation that we would learn nothing useful from the keepers of the public trust, this report was prepared over the past month...MUCH MORE

[Demeter]

28. JP Morgan Under OCC Investigation for Serious Debt Collection Abuses; Warnings Ignored for 2 years

http://www.nakedcapitalism.com/2012/03/jp-morgan-under-occ-investigation-for-serious-debt-collection-abuses-warnings-ignored-for-over-two-years.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

I bet JP Morgan wishes it never hired Linda Almonte.

American Banker has released the first in what will be a series of stories on debt collection abuses by the New York bank. It confirms critics’ worst accusations against the financial services and belies Jamie Dimon’s tiresome assertions that JP Morgan is better than its peers. Dimon may still be right if you think excelling in abusing and extorting customers is commendable.

The American Banker story discusses the operations of a unit that handled delinquent credit card borrowers. Handling these accounts involved using three different computer systems that communicated reasonably well on current borrowers but not with delinquent or defaulted ones. As a result, the operation had involved a high level of manual checks to make sure the amounts borrowers owed were accurate before they were sent off to collection (which in high population states, was an in-house operation, but for most, involved the use of outside law firms.

In 2008, JP Morgan installed new management in the San Antonio operation that oversaw ligitigation, including the verification of borrower information. Edmond Helaire came in as the lead, and the story makes clear that his newly hired deputy Jason Lazinbat went on a campaign to improve results, procedures be damned. Linda Almonte, who was a process specialist who had worked at WaMu, joined in 2009 and was fired, as she charged in a wrongful termination lawsuit, for refusing to send files to collection that has obvious problems in them. Almonte filed a whistleblower complaint with the SEC in 2010 (see an Abigail Field story for more detail). Her charges:

1. Chase Bank sold to third party debt buyers hundreds of millions of dollars worth of credit card accounts. . .when in fact Chase Bank executives knew that many of those accounts had incorrect and overstated balances.

3. Chase Bank executives routinely destroyed information and communications from consumers rather than incorporate that information into the consumer’s credit card file, including bankruptcy notices, powers of attorney, notice of cancellation of auto-pay, proof of payments and letters from debt settlement companies.

4. Chase Bank executives mass-executed thousands of affidavits in support of Chase Banks collection efforts and those Chase Bank executives did not have personal knowledge of the facts set forth in the affidavits.

MUCH MORE

THIS IS FROM MARCH

[Demeter]

6. China investment in Europe triples

Chinese direct investment into Europe tripled in 2011 to $10bn, according to a new study that estimates Chinese companies are in the early stages of a global shopping spree that could see them spend as much as $500bn a year in the region by 2020

Read more >>
http://link.ft.com/r/4RNQTT/U1I016/IEP5S/ZG416B/HYASTW/4O/t?a1=2012&a2=6&a3=6

AM I CORRECT IN ASSUMING THAT "DIRECT INVESTMENT" MEANS BUYING TANGIBLES LIKE REAL ESTATE AND COMPANIES? NONE OF THOSE WORTHLESS PIECES OF PAPER, TO BE SURE...

[Demeter]

7. Europe weighs up limited Spanish rescue

European officials are weighing up a bailout programme for Spain that would provide aid focused on its teetering banking sector but only impose “very limited conditionality” on Madrid, a concession that could make a reluctant Spanish government more willing to accept international assistance

Read more >>
http://link.ft.com/r/YIQXNN/4CP4LY/JQU4J/B5R2W7/TUEBZH/HK/t?a1=2012&a2=6&a3=6

"MOM" ALWAYS LIKED YOU BETTER!



SPAIN___________________________GREECE

[Demeter]

14. Spain Holds a Trump Card in Bank Bailout Negotiations

http://www.nytimes.com/2012/06/07/world/europe/spain-holds-a-trump-card-in-bank-bailout-talks.html

...The question has seemingly become one of when, and not if, Spain’s banks will receive assistance from European countries, with investors on Wednesday predicting an imminent rescue and pushing up stocks and bonds on both sides of the Atlantic. Spain, the euro zone’s fourth-largest economy, is too big to fail and possibly too big to steamroll, changing the balance of power in negotiations over a bailout. Political leaders in Madrid are insisting that emergency aid to their banks avoid the stigma in capital markets that has hobbled countries like Greece, Portugal and Ireland after accepting tough rescue terms. They are also fighting to slow the pace of austerity and economic change that have pushed those smaller countries into deeper recessions.

Spain has the added advantage of seeking help in a changed political environment in which calls for growth have begun to outweigh German insistence on austerity. Unlike Greece, Spain’s government did not run large budget deficits before the crisis, giving it leverage to argue that European aid to its banks should not come weighed down with a politically delicate loss of decision-making power over its own economic and fiscal policies. Madrid’s trump card in this latest game of euro-zone poker is that the consequences of a Spanish default and exit from the euro zone would probably be so catastrophic that policy makers in Berlin will be willing to bend their bailout rules for Spain, and are on the verge of doing just that. German officials have said they are prepared to weather a Greek exit from the euro if necessary, but no such claims are made about Spain. As such, Spanish leaders, who feel Madrid has already made many painful changes and spending cuts, are holding out for a deal that requires only a tightening of oversight on the financial sector and no strings attached to the country’s budget powers.

Spain also appears to be forcing a reckoning about the expensive steps political leaders in Europe need to take if they want to hold the euro zone together. Hopes that the European Central Bank would ride to the rescue, as it did with two waves of generous loans to Europe’s banks in December and March, or at the very least cut interest rates, now at 1 percent, were dashed when the bank’s president, Mario Draghi, said Wednesday that he did not “think it would be right for monetary policy to fill other institutions’ lack of action....Some of these problems in the euro area have nothing to do with monetary policy,” Mr. Draghi said at a news conference, his message to European leaders boiled down to: “Your problem, not mine.”

The wrangling over Spain underlines the way the European Union stumbles to solutions for each problem as it arises. Frustration has grown over the uncertainty afflicting the global economy as a result of Europe’s instability and the toll it takes on an already slowing growth rate. “The strategy of plugging holes only works for so long,” said Friedrich Mostböck, chief economist and head of research for the Erste Group in Vienna. “Eventually, you come to the point where a common euro area requires a common fiscal policy.”...The ultimate solution will hinge on Germany and how much its leaders are willing to bend. Berlin has an incentive to get the Spanish problem under control before Greek parliamentary elections on June 17, to help contain contagion in the event of instability after the vote, said Holger Schmieding, chief economist at Berenberg Bank...

MUCH MORE TEA LEAF READING AT LINK

[Demeter]

61. Cleaning Up the Mess: What to Do About Teetering Eurobanks?

http://www.nakedcapitalism.com/2012/06/cleaning-up-the-mess-what-to-do-about-teetering-eurobanks.html

...On the one hand, the Spanish government is in a position to tell the Eurocrats that it will consider only a bank bailout and not be required to take on further austerity measures. Given that retail sales have fallen nearly 10% year to year, it’s hard to see how anyone could expect more austerity to be a good idea.

On the other hand, although markets reacted as if a deal was imminent, the FT makes it sound as if quite a few details need to be ironed out. And no wonder: the ECB, the one institution that could act unilaterally, has indicated it will only play a limited role and is leery of making long-term loans to Spanish banks or buying their debt. In addition, Spain appears to be taking an unwise posture, of asking for as little money for its banks as it thinks it will need. Rumors from Spanish officials come in at €40 billion, while European officials are looking at numbers more than twice that large. The big rule of fundraising is always raise a good bit more than you think you need in the first round; it will be vastly more expensive if you need to come to the well later.

Given that the shape of a Spanish bank rescue is very much in play, posts by European experts may well influence the outcome. While some of these recommendations might sound like the banking versions of apple pie and motherhood, it’s important to recognize that few of these basic principles have been adopted in recent bailout programs...

SUMMARY FOLLOWS

[Demeter]

62. from VoxEU

http://www.voxeu.org/index.php?q=node/8069

In Greece, the problem is an insolvent government bringing down the banks. In Spain, the problem is now insolvent banks bringing down the government. This column argues that despite their differences, the potential costs to the rest of Europe mean that both problems require a European solution.

The diabolic loop between the solvency of the banking system and the sovereign fiscal position is now apparent (Lane 2012).

In Greece, it is the insolvency of the government that has sunk the banks;
In Spain, the banks are sinking the government.

What is common in both countries is that savers are running away when they see the banks and the sovereign propping each other up. Unless the banks in both Greece and Spain are soon recapitalised, the on-going gradual deposit flight might turn quickly into a classic run, the consequences of which are hard to imagine.

We argue that in the case of Spain’s banks, their dire need of capital can only be provided by a European institution, the European Stability Mechanism (ESM). Likewise, given that the Greek government is in no position to prop up its banks, only the ESM can save the Greek banking system. In both cases the ESM, the ECB, and the national central banks should then take control over the banks they have recapitalised, probably best achieved through a new special purpose vehicle (staffed by experts from European Banking Authority)....MORE

[Demeter]

8. Greece and the Euro: Fifty Ways to Leave Your Lover

http://truth-out.org/news/item/9611-greece-and-the-euro-50-ways-to-leave-your-lover

The euro zone is proving to be a marriage of incompatible partners. A June 1 article in the UK Telegraph titled "The Triumph of Margaret Thatcher: Why Europe's Love Affair with the European Project Is Ending" reported that two-thirds of 9,000 respondents thought that having the euro as their single currency was a mistake.

For the Greeks, the euro love affair is over, but breaking up is hard to do. Defaulting on their debts will force them out of the euro zone and back to issuing drachmas, which could get brutally devalued by speculators as soon as they are traded on foreign exchange markets.

Fortunately, there are alternatives to an ugly divorce. The treaties binding the 17 member nations are just a set of rules, entered into by mutual agreement, and rules can be bent, broken or stretched, especially in crises. The European Central Bank (ECB) has already broken a litany of rules to save the banks, and so has the Federal Reserve, which found multiple ways to do what it initially said it couldn't do to save Wall Street in 2008. Rules that can be bent for banks can be bent for the people - not just the Greeks, but the Irish, Italians, Spaniards, Portuguese and others lined up behind them.

Here are some creative alternatives that have been proposed:

1. The Open Marriage: Return to the Drachma Without Abandoning the Euro

2. Keep Separate Bank Accounts: Fire Up the Printing Presses at the Greek Central Bank

3. Divorce: Turn and Walk Away

4. Spousal Support: The Public Bank Option

5. The Dowry: Impose a Financial Transaction Tax

Where There Is a Will, There Is a Way...MUCH MORE DETAIL AT LINK

[Demeter]

39. Greece sinks to its knees

http://www.telegraph.co.uk/news/worldnews/europe/greece/9107647/Greece-sinks-to-its-knees.html


The recent bail-out, which imposes strict new austerity measures on the Greeks, will deepen a crisis that has already driven up the suicide rate by 40 per cent. David Blair reports from Athens on a nation that eyes the future without hope...If popular protest in the graffiti-stained heart of Athens is the most obvious sign of Greece’s burgeoning crisis, a handful of volunteers gathered inside a suburban office provides a quieter, but no less painful, symbol of the country’s agony. These restrained, dedicated people meet in the modest headquarters of Klimaka, a mental health and social integration charity serving as Greece’s version of the Samaritans.

In a country where suicide is so vehemently stigmatised that it amounts to the social problem that dare not speak its name, a specialised telephone service offering counselling to those in despair began as recently as 2007. Today, the psychiatrists and psychologists who answer whenever someone dials “1018” are busier than ever. As the national economic crisis has worsened, so the volume of calls has grown. In 2010, the service spoke to 2,500 people judged to be contemplating suicide. Last year, Greece’s first euro bail-out failed and the country’s unemployment rate rose by half in the space of 12 months, climbing from 13.9 to 20.9 per cent. As more and more people confronted redundancy and destitution, the plaintive calls to Klimaka more than doubled: 5,500 people thought to be at serious risk rang in 2011.

Today , the German parliament will vote on whether to endorse a second bail-out that was agreed by eurozone finance ministers last week on condition that Greece implements some of the harshest austerity measures ever imposed on a Western democracy. After five years of recession, Greece must now endure almost a decade of further economic self-flagellation in order to reduce its national debt from 160 per cent of gross domestic product to 120.5 per cent in 2020. That is the language of Brussels communiqués and central bankers; but the true voice of economic crisis is heard by Klimaka’s volunteers every day.

Eleni Bekiari, a calm, elegant and softly spoken psychiatrist, answers many of the calls. “They give many reasons, but a common one is financial problems: the crisis, unemployment, losing their job or being fearful of losing their job, a cut in salary so they cannot afford everyday responsibilities,” she says. Once, the volunteers spoke mainly to callers with a record of depression or an undiagnosed mental disorder. Today, more and more have no such history and once led ordinary lives. “They are not depressive, they are not psychotic. More of the people who call us do not have a disorder,” says Ms Bekiari. “Anybody can reach a position where they think about suicide.”

Greece has always had one of the lowest suicide rates in Europe. The uncompromising stance of the Greek Orthodox Church, which will not bury those who take their own lives, has helped make the stigma attached to suicide particularly visceral here...

[Demeter]

40. Are Greeks the hardest workers in Europe? FROM FEBRUARY

http://www.bbc.co.uk/news/magazine-17155304

...the statistics suggest the country has not lost its way due to laziness. If you look at the average annual hours worked by each worker, the Greeks seem very hard-working.

Figures from the Organisation for Economic Co-operation and Development (OECD) show that the average Greek worker toils away for 2,017 hours per year which is more than any other European country.

Out of the 34 members of the OECD, that is just two places behind the board leaders, South Korea.

On the other hand, the average German worker - normally thought of as the very epitome of industriousness - only manages 1,408 hours a year. Germany is 33rd out of 34 on the OECD list (or 24th out of 25 looking at the European countries alone)...

[Demeter]

9. By Robert Reich: The Big-Lie Coup d’Etat

http://truth-out.org/opinion/item/9622-the-big-lie-coup-detat

JP Morgan Chase, Goldman Sachs, BP, Chevron, WalMart, and billionaires Charles and David Koch are launching a multi-million dollar TV ad buy Tuesday blasting President Obama over the national debt....Actually, I don’t know who’s behind this ad because there’s no way to know. And that’s a big problem. The front group for the ad is Crossroads GPS, the sister organization to the super PAC American Crossroads run by Republican political operative Karl Rove. Because Crossroads GPS is a tax-exempt nonprofit group, it can spend unlimited money on politics — and it doesn’t have to reveal where it gets the dough. By law, all it has to do is spent most of the money on policy “issues,” which is a fig leaf for partisan politics.

Here’s what counts as an issue ad, as opposed to a partisan one. The narrator in the ad Crossroads GPS is launching solemnly intones: “In 2008, Barack Obama said, ‘We can’t mortgage our children’s future on a mountain of debt.’ Now he’s adding $4 billion in debt every day, borrowing from China for his spending. Every second, growing our debt faster than our economy,” he continues. “Tell Obama, stop the spending.”

This is a baldface lie, by the way.

Obama isn’t adding to the debt every day. The debt is growing because of obligations entered into long ago, many under George W. Bush – including two giant tax cuts that went mostly to the very wealthy that were supposed to be temporary and which are still going, courtesy of Republican blackmail over raising the debt limit. In reality, government spending as a portion of GDP keeps dropping.

As I said, I don’t know who’s financing this big lie but there’s good reason to think it’s some combination of Wall Street, big corporations, and the billionaire Koch brothers...MORE

[Demeter]

10. Raw Video: Police Drag Occupy DC Activists to Break Home Eviction Blockade

http://truth-out.org/news/item/9606-raw-video-police-drag-occupy-dc-activists-to-break-home-eviction-blockade

An effort to prevent a home eviction in Washington, DC, Tuesday turned ugly when US Marshals and local police officers armed with guns and riot shields forcefully removed members of Occupy DC who sat on the front steps of the property to prevent an eviction team from entering the home. Occupy DC activists chanted, "Homes not banks" as officers dragged apparently peaceful protesters off the property. In the video posted by activists, at least one protester appears to be injured and possibly unconscious before an ambulance eventually arrives. Activist Sam Jewler Tweeted this about the injured protester, who was apparently locked down in the blockade: "Marc is starting to wake up! Says cops pulled him by the head, then sat on his head while trying to break the pipe. Ambulance here."

Police reported that no arrests were made, but two protesters in the video appear that they are being taken away in handcuffs, according to The Washington Post. The Occupy DC protesters were protecting the home of Dawn Butler, who lost her latest court case over the property Tuesday and was evicted. Occupy DC and Occupy Our Homes have worked with Butler to save her home for months. US Marshals supervised the removal of Butler's belongings from the home...SEE VIDEO AT LINK

[Demeter]

11. The 1 Percent’s Problem By Joseph E. Stiglitz

http://www.vanityfair.com/politics/2012/05/joseph-stiglitz-the-price-on-inequality

Adapted from The Price of Inequality, by Joseph Stiglitz, to be published in June by W.W. Norton & Company, Inc. (U.S.), and in July by Allen Lane (U.K.); © 2012 by the author.

************************************************************************

...There are good reasons why plutocrats should care about inequality anyway—even if they’re thinking only about themselves. The rich do not exist in a vacuum. They need a functioning society around them to sustain their position. Widely unequal societies do not function efficiently and their economies are neither stable nor sustainable. The evidence from history and from around the modern world is unequivocal: there comes a point when inequality spirals into economic dysfunction for the whole society, and when it does, even the rich pay a steep price...

TODAY'S MUST READ!

[jtuck004]

12. Ohio Employee Ownership Center

here: http://www.oeockent.org/

In the mission on their home page they state

"The OEOC's work rests on a simple philosophy: broader ownership of productive assets is a good thing for employees, communities, and our country."

And in the sidebar low on the right side is a handbook for cooperative ownership.

I kinda think that people with assets aren't troubled by politicians (they buy them) or protesters (they buy the police if nothing else works).

What they are troubled by are assets they can't control or profit from. People who own those, especially in a coop, may be smaller, but can moderate the effect of the big $ on their work easier than can underpaid employees of a greedy corporation.

And here is an org that looks for opportunities that people can undertake to gain those assets, and actively facilitates their adoption.

It will help some.

[Po_d Mainiac]

13. Good to see a manual being put together

Too often, employee buy-outs fail due to "unforeseen" events, that could/should have been planned for.

[Demeter]

15. How Far Have Home Prices "Really" Fallen?

http://globaleconomicanalysis.blogspot.com/2012/03/how-far-have-home-prices-really-fallen.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+MishsGlobalEconomicTrendAnalysis+%28Mish%27s+Global+Economic+Trend+Analysis%29

ANALYSIS THAT TAKES INFLATION INTO ACCOUNT--GRAPHIC PORN AND EXPLANATIONS AT LINK

SHORT ANSWER--TO 1998, NOT 2002 AS IS ADVERTISED

[Demeter]

16. Silicon Valley’s undeserved moral exceptionalism By Rob Cox

AN INTERESTING ANALYSIS OF HOW SILICON VALLEY IS A NEST OF ROBBER BARONS...

http://blogs.reuters.com/breakingviews/2012/03/12/silicon-valleys-undeserved-moral-exceptionalism/

[Demeter]

17. Jeffrey Sachs - How to have growth beyond stimulus

Keynesian economists blame the sluggish US growth and lack of job creation on the insufficiency of stimulus measures. If only Congress had agreed with President Obama to greater stimulus, they say, the current US recovery would have been much stronger. This is a dubious proposition. The deeper problem lay in the limitations of fiscal stimulus as a response to the 2008 crisis.

Read more >>
http://link.ft.com/r/NA70KK/FK0NM3/GYN7Q/WT73BX/KQMP15/50/t?a1=2012&a2=6&a3=7

YOU MEAN--LIKE PROSECUTING CRIMINAL FRAUDS?

[Demeter]

18. Federal Reserve set to unveil capital proposals

The central bank is to reverse a policy that has helped shield US bank capital levels from volatility, exempting them from having to deduct unrealised losses from their capital

Read more >>
http://link.ft.com/r/G8OTZZ/7ALYQV/Z87P0/VL71EL/2OPAB7/MQ/t?a1=2012&a2=6&a3=7

I'LL BELIEVE IT WHEN I SEE IT

[Demeter]

19. Galleon made $1.2m on Goldman tip

An FBI agent testifies that the hedge fund associated with Raj Rajaratnam profited from a flurry of buying in Goldman Sachs shares on a tip from a bank director

Read more >>
http://link.ft.com/r/G8OTZZ/7ALYQV/Z87P0/VL71EL/5VLM6D/MQ/t?a1=2012&a2=6&a3=7

MERE PEANUTS! GO AFTER THE WHALES, NOT THE MINNOWS!

[Demeter]

20. Whitman warns of long HP recovery

Speaking in her first extended interview since taking over as HP’s fourth chief in less than two years, the former eBay head seeks to buy time

Read more >>
http://link.ft.com/r/G8OTZZ/7ALYQV/Z87P0/VL71EL/8ZBWCD/MQ/t?a1=2012&a2=6&a3=7

A SPECIFIC RECOVERY, WITHOUT A GENERAL RECOVERY, WOULD BE A NEAT TRICK TO PULL OFF...

[Egalitarian Thug]

75. See, this is what happens when you push all the smart people out and let the Greeks take over. n/t

[Demeter]

93. Did you mean Geeks?

I hadn't heard of the Spartans invading HP....

And what really happened, is the bean counters took over, and the crony capitalist lackeys. The Geeks retired and cashed out.

[Egalitarian Thug]

97. No, the Fraternity/Sorority set. Idiots with MBA's and a spreadsheet, but no idea about the

businesses they're running. HP used to be a great company run by engineers and scientists.

[Demeter]

98. Ah. Then We concur.

I used to be a EE

[DemReadingDU]

99. Ah. I have several trinkets with eagles from when I was a programmer

with E.D.S., now merged into HP.

[Egalitarian Thug]

100. LOL! I should have guessed. The EE and CS programs shared many classes at my college,

so I've known many of you guys. Thanks for all the help on the calculus and you're welcome for the programming tips.

[Demeter]

21. Nasdaq offers $40m over Facebook losses

The rare move by an exchange to volunteer such a large sum in compensation failed to mollify one of the largest stock exchange customers over a glitch it said cost them $35m

Read more >>
http://link.ft.com/r/G8OTZZ/7ALYQV/Z87P0/VL71EL/B56DAJ/MQ/t?a1=2012&a2=6&a3=7

IF YOU GIVE A MOUSE A COOKIE....HE'S GOING TO WANT A GLASS OF MILK...

[Demeter]

23. 10 Reasons Not to Get Married

http://www.alternet.org/story/155766/10_reasons_not_to_get_married?page=entire

1. You are focused on your career. (AND YOU WANT TO EAT)

2. You have standards.

3. You can't afford it....It's not even that women don't want to get married, as much as men don't feel ready to propose until they have the cash to support a family. There is no special Spanx you can buy that will bolster a man's self-esteem to convince him that you don't care he is broke. Many people are still tied to the idea that men have to out earn women, even though you have a job (remember that you are mega-focused on) and could probably support the both of you. Plus, the average cost of a wedding is 27, 000 dollars. Yes, you read that right.

4. You are waiting until all people can get married.

5. You don't need or want a symbolic public ceremony to celebrate something you already have.

6. You've got a life and friends that you are happy with. (THIS MUST BE THE HUMOR SECTION)

7. Monogamy just doesn't work for you.(MORE LIKELY, IT DOESN'T WORK FOR HIM)

8. You are sexually liberated.(WHOA! SERIOUS EMOTIONAL PROBLEMS HERE)

9. You have "issues." (SOUNDS LIKE A MULTI-YEAR SUBSCRIPTION)

10. You legitimately just don't want to get married. (IT IS A FOOLISH THING TO DO, ECONOMICALLY, MOST OF THE TIME...UNLESS HE'S A BILLIONAIRE AND DOESN'T BELIEVE IN PRE-NUPS).

[Demeter]

26. More Americans Rejecting Marriage in 50s and Beyond

http://www.nytimes.com/2012/03/02/us/more-americans-rejecting-marriage-in-50s-and-beyond.html?pagewanted=all&src=ISMR_AP_LO_MST_FB

WELL, FINANCIALLY, IT USUALLY DOESN'T PAY...UNLESS S/HE'S A BILLIONAIRE AND DOESN'T BELIEVE IN PRE-NUPS...

...the growing number of men and women in their 50s and 60s who are opting out of marriage and venturing into old age on their own. Over the past 20 years, the divorce rate among baby boomers has surged by more than 50 percent, even as divorce rates over all have stabilized nationally. At the same time, more adults are remaining single. The shift is changing the traditional portrait of older Americans: About a third of adults ages 46 through 64 were divorced, separated or had never been married in 2010, compared with 13 percent in 1970, according to an analysis of recently released census data conducted by demographers at Bowling Green State University, in Ohio. Sociologists expect those numbers to rise sharply in coming decades as younger people, who have far lower rates of marriage than their elders, move into middle age.

Susan L. Brown, co-director of the National Center for Family & Marriage Research at Bowling Green State, said the trend would transform the lives of many older people. The elderly, who have traditionally relied on spouses for their care, will increasingly struggle to fend for themselves. And federal and local governments will have to shoulder much of the cost of their care. Unmarried baby boomers are five times more likely to live in poverty than their married counterparts, statistics show. They are also three times as likely to receive food stamps, public assistance or disability payments.

“We can’t just say that older people don’t get divorced or that middle-aged people won’t grow old alone,” said Dr. Brown, who analyzed the census data with I-Fen Lin, an associate professor of sociology at Bowling Green State. The research was published online in The Gerontologist. “Now we actually need to pay attention to it, not only to the factors that precipitate it, but also to the consequences,” Dr. Brown said.

The surge in the number of older, unmarried Americans has been driven by several factors, including longevity, economics and evolving social mores, according to sociologists. People are living longer, and many couples in their 50s and 60s — faced with the prospect of a decade or more in unhappy marriages — are reluctant to stay the course. Women, who are increasingly financially independent, are more willing and able to go it alone. And many baby boomers, who came of age during the sexual revolution of the 1960s and ’70s, feel less social pressure to marry or stay married than their parents and grandparents did. (Only about 17 percent of adults over 64 in 2010 were divorced, separated or had never been married, census data show.) Being divorced or single later in life also no longer carries the stigma that it did for previous generations.

Even as they mourn their marriages and worry about financial security and retirement, many divorced people describe a sense of liberation. Ms. Dunn, who has two children, wept through her divorce proceedings. She and her husband, a carpenter whose business was battered by the recession, grew apart after 18 years of marriage, despite their efforts to reconcile. “I always wanted to be with someone for the long haul,” she said...

[tclambert]

24. Ah, wouldn't it be sweet to be rich like the Koch brothers?

I'd like to buy my own state, too. I'll bet no police in Wisconsin would ever give me a speeding ticket. More like a police escort everywhere. Middle class suckers, even powerless union members, would have to pay for my tax cuts. And to have the power to make the President of the United States cringe, afraid of my unlimited campaign ad money. Ha! Fear me, Mr. President. Fear me.

Yeah, that would be the life.

[Demeter]

31. I wouldn't know

and given my leftist pinko tendencies, I'd probably bollix it all up anyway.

[xchrom]

25. good morning...

[Demeter]

27. Morning, X!

The Unending Spring continues... 40's at night, 70's max during the day.

I'm running out of news. My sources must be all holding their breath, waiting on events. And NOTHING"S HAPPENING...that anyone will admit to. You know what that means: major skulduggery's afoot!

Yes, some real unholy bargains are being made as we sit here pondering how to get to the end of the week in one piece. I hope these deals shoot the dealers in the heart. I would normally settle for foot-shootings, but they are messing with people's lives and fortunes way too much to be tolerated now.

I'm sure we will find out what the bastards are up to, eventually. With any luck, they can't actually do any more damage, and that's their problem....

[xchrom]

29. the news is notably mundane -- and everything is 'ok'.

still sweatshirt weather --- we had rain yesterday morning -- cool here this morning.

[westerebus]

36. That was a nice contact high, thanks,

[xchrom]

30. Stocks Shoot Up After Shock Chinese Rate Cut -- And This One Is A Big Deal

http://www.businessinsider.com/china-cuts-benchmark-interest-rates-by-25-basis-points-2012-6

China cut benchmark interest rates by 25 basis points.
You hear a lot about Chinese rate cuts, but this is a different one.
Most rate cuts are cuts to the reserve requirement ratio, which is a modest move.
This time it's the first straight up rate cut since 2008.
Futures are ripping higher on the news...
But this is a sign that growth is not happening at the pace that Beijing is looking for.
It will also let banks offer a 20% discount from the benchmark rate.
The news came out right at 7:00 AM ET, right when the Bank of England made its rate announcement. It did nothing.
The PBOC move continues the theme for the week: Central bank activity. The big show is later today when Bernanke speaks on the hill.


Read more: http://www.businessinsider.com/china-cuts-benchmark-interest-rates-by-25-basis-points-2012-6#ixzz1x6e0M400

[xchrom]

32. Nasdaq offers $40m for Facebook losses

http://www.irishtimes.com/newspaper/breaking/2012/0607/breaking15.html

Facebook investors have been offered $40 million (€31.8 million) by the Nasdaq stock exchange for a computer glitch that stopped them trading during the social networking site's initial public offering.

Nasdaq OMX Group Inc said it will offer $40 million in cash and rebates to clients harmed by its mishandling of Facebook's market debut.

The opening of trading on May 18th got off to a shaky start as the Nasdaq was delayed following a hitch in delivering trade execution messages related to its IPO.

Nasdaq yesterday said $13.7 million (€10.9 million) would be paid to its affected member firms and the balance would be credited to members to reduce trading costs, with all benefits expected to be awarded within six months.

[xchrom]

33. fresh air

[Roland99]

34. Today's Economic Reports (Unemployment Claims) >>>>

* U.S. jobless claims fall by 12,000 to 377,000
* Continuing claims climb 34,000 to 3.29 million
* Four-week claims average rises 1,750 to 377,750

[bread_and_roses]

35. The world is too much with me

this AM - I'm sick of all of it. So I'm watching Secretariat's Triple Crown run - this might be the best quality of the videos available on youtube - much better, sharper footage than most.

When we get to the otherworldly Belmont, I always start crying.

One of my favorite photo of the Immortal though is the one from the Preakness, when he makes the remarkable leap on the turn as he begins his run. The statue at Elmont Park in NY

http://www.flickr.com/photos/36598222@N05/4744840586/

where the Belmont is run is modeled on this photo:

http://www.ebay.com/itm/Secretariat-Preakness-Stakes-Photo-1-8x10-/370140415443

[xchrom]

38. i just love that horse -- so remarkable. nt

[AnneD]

59. Secretariat.....

Now THERE was a horse. I actually cried when he died. Also check out Pharr Lap, he is an Australian legend. Some will say both were genetic anomalies;large heart sizes. I say they were gifts from God.

I am a Quarter Horse-Mustang person. My history I guess. But that has never stopped me from loving any beautiful representative of the Equus branch.

[xchrom]

63. i remember pharr lap! nt

[bread_and_roses]

81. Phar Lap was a wonder - and THAT movie

is very good!

[Egalitarian Thug]

76. The film pissed me off. They made the story of Seabiscuit into a very good film, likable and

engaging throughout. But Secretariat was flat with terrible direction. Doing this to what is unquestionably one of the most exciting and unlikely true stories of our times should be a crime, not to mention wasting all that talent. Closer to a mediocre documentary than a major motion picture.

[bread_and_roses]

80. The Secretariat film was an abomination - but I didn't like Seabiscuit either

Far too much time spent on Jeff Bridges mug. And don't even get me started on the Secretariat movie which was dishonest, unjust to the marvelous Sham, and boring as hell - the director was far more concerned with his Plucky Penny/family/god agenda than with anything to do with Secretariat.

[Roland99]

85. Secretariat was more about Chenery and her story than it was the horse and its accomplishments

I know Disney "Disneyfied" some things but I quite enjoyed the film.


Ever see HBO's America Undercover: Jockey?

[Demeter]

94. Not another underwear documentary!

Boxers or briefs is so 80's....

[Roland99]

96. heh...actually, it shines a light on the dirty, physically and emotionally harmful lives they lead.

[Roland99]

86. Watching that Belmont run gives me goose bumps every time.

I still cringe, too, in remember the Affirmed/Alydar Triple Crown series. I was pulling so hard for Alydar in every race but he was just a bit too outmatched (and/or outwitted by a very young Cauthen)

[AnneD]

89. I always remember Barbaro....

The owners went above and beyond to save Barbaro and give him every chance. The trainer of I'll Have Another has a rep around the track of juicing his horses and they have a high injury rate. The owner is not any better.

I hope there is no Triple Crown winner this year. There are trainers and owners more worthy. Just MHO.

[Roland99]

91. I do seem to recall some talk about that this year at the Derby.

[Roland99]

101. Well, you can SCRATCH a Triple Crown this year. I'll Have Another is out.

[AnneD]

102. No offense to the horse....

but I am sure the trainer couldn't get him to pass the drug test. Colour me happy

[xchrom]

37. SPAIN Our time is nearly up

http://www.presseurop.eu/en/content/article/2127941-our-time-nearly

The political climate surrounding the euro crisis has changed almost imperceptibly in recent days. From a certain consensus on the idea that Spain, caught in the eye of the storm, could expect nothing before June 17, the date of the second Greek elections following the failure of the first to come up with a government, the mood has shifted to “Something – anything – has to be done before then.” Panic or a simple forecast?

The most obvious symptom of this new environment was the videoconference held yesterday by the G7 finance ministers, which was an unusual event and one that until now has always been the prelude to concerted action by the major central banks. And that could happen precisely today, the day that also sees a meeting of the governing council of the European Central Bank (ECB), that great white hope of those who are calling for clear action to defend the single currency.

Bound hand and foot
Two trends are converging on Spain: one, the absolute and mounting distrust of the markets in the sustainability of Spain’s public, state and private debt (banks); and two, a certain feeling that the eurozone – which for the purposes of what is being discussed these days means Germany – would be willing to take action to stave off the disaster that would follow if Spain were to fall into a tailspin. The stock markets and currencies are dancing up and down throughout the day to the the rumours that tip the balance toward one side or the other.

It’s time to pick up the pieces. Luis de Guindos, the Finance Minister, wants the Spanish banking sector to be able to capitalise on European money without bringing down intervention on their heads. The latter would mean the political end of the Mariano Rajoy government and a huge sacrifice for the Spanish people, who would be subject to the dictates of creditors.

[xchrom]

41. Ballyhea protestors go to Frankfurt

http://www.presseurop.eu/en/content/news-brief/2134531-ballyhea-protestors-go-frankfurt

Every Sunday, after mass, the citizens of Ballyhea in southern Ireland march silently from one end of their tiny village to the other. Their protest is against the rescue of the country’s banks, which crashed after the Irish property bubble collapsed in 2008. The billions needed to keep these banks afloat, all at the taxpayer’s expense, eventually led the Irish government to seek the €85 billion EU/ECB/IMF bailout of 2010.

66 weeks into a weekly march in a country wracked by austerity budgets, mass unemployment and emigration, their anger took on an international dimension as 15 amongst them flew to Frankfurt with a letter for Mario Draghi, chief of the European Central Bank. According to the Irish Examiner –

The long white document, stuck with blu-tack to the glass doors of the soaring office block that is the European Central Bank, greeted the mandarins of the euro when they arrived for work.

Like Martin Luther’s Theses nailed to the door of the Church in Wittenberg almost 500 years ago, the Ballyhea protesters hope their statement will bring about a reformation, too.

[...] While Martin Luther objected to indulgences being sold to pay for building St Peter’s in Rome, the Irish protesters explained that the country’s future was being sold to pay for bankers.
For the protestors – “greeted with unexpected civility by the citizens of Frankfurt and the staff of the ECB” –

The ECB is to blame for our soaring bank debt. The ECB has been abusing its financial muscle and forcing a weak Irish government to assume for the Irish people a debt burden that is not ours.

[Tansy_Gold]

44. Some questions

Did the banks used to have money?

If so, where did it go?

If it went out in fraudulent loans, why can't the banks just go after the borrowers to pay up or seize the collateral?

If it's because the collateral isn't worth what the banks lent on it, isn't that just the risk of doing business?

And if the risks were entered into with the assumption that someone else would bail them out. . . .


Or am I missing something?

[Demeter]

46. You are missing the political payoffs

Can't exactly claw back that money, now, can we?

[Tansy_Gold]

49. No no no no no

I just want the facts of the business dealings. It's always been my contention that the assholes in charge make everything too complicated for real people to understand. My job is to take everything back to the KISS principle.

So, the #1 assumption is that the banks had money at some point, and now they don't, but they want some.

If the banks used to have money, what did they do with it?

If they lent it out, why were the loans not repaid?

If they made bad loans, tough shit. Go after the borrowers or get the collateral back. If the loans were made without collateral, that's the bank's fault. Tough shit. If the collateral lost value, tough shit.

Someone, somewhere, has the banks' money and/or the collateral pledged as security for the loans. The banks need to run their businesses like real businesses, and either get the borrowers to repay their loans or foreclose on the collateral. There is no reason for the taxpayers to bail out the banks.

Unless I'm missing something in the basic business model. (political contributions, lobbyists, etc., are simply part of the normal business operations, and are not subject to clawback any more than non-exempt employees' wages are. CEO bonuses, on the other hand. . . . . )

[DemReadingDU]

51. Check the pockets of Angelo Mozillo, Richard Fuld, Jon Corzine, Jamie Dimon, etc

[Demeter]

54. Fraud cannot be undone without clawbacks

which is why the payoffs to politicians for "get out of jail free" cards. And that's not a "cost of doing business" size amount, either....

They weren't practicing BANKING, they were committing FRAUD. It is a CRIME. There's no getting it back, because it didn't exist in the first place.

[Tansy_Gold]

60. And that's my point -- exactly.

IF they were just practicing normal banking business, all of my KISS details apply.

You do business, you make loans.
You do business, you collect loan repayments.
You do business, you go after deadbeat borrowers.
You do business, you make bad loans, tough shit.
You do business, you don't get sufficient collateral, tough shit.
You do business, the collateral loses value, tough shit.

The point is, the banks are asking for payment from the taxpayers because THEY WERE NOT DOING BANKING BUSINESS.

Well, excuse me, you wanking banking assholes, TOUGH SHIT.


But it's exactly like the birther bullshit. You go up to a birther and you ask him, "What would it take to convince you Obama was born in Hawaii, is a natural-born citizen, and is eligible to be president? Set the bar wherever you want, but once it's set, you can't change it." They'll move the bar. Every fucking time. Because it's not about Obama, it's about THEM and their irrational but desperate need to not have a Black Man, a Black Democrat, in the White House. There is no evidence whatsoever that will change their minds. None. Do not try.

It is not about the banks, it is about the BANKERS. It is not about the banks not being able to lend, it is about the bankers' bonuses. It is not about TBTF or TARP or FUBAR. It's about fleecing the working classes to put more money in the hands of the aristos.

And I'll tell you something else, SMW friends, this is exactly why GM should have been allowed to fail. It wouldn't have failed. The money would have been found because if it had failed, the aristos wouldn't have been able to keep their own gravy train going. Someone somewhere is going to have to call their bluff. On B of A, on Corzine, on AIG, on JPM, on Bernake, on someone or something, the bluff is going to be called. Because that's the nature of the ponzi scheme, the poker game that's being played with all our lives. At some point the money runs out and all the cards have to be put on the table.

Economics really is the little guy behind the curtain, not the smoke and mirrors great and powerful oz.

[Demeter]

64. Okay Tansy

Here's a bell, there's the cat...go to it!




Belling the Cat is a fable also known under the titles The Bell and the Cat and The Mice in Council. Although often attributed to Aesop, it was not recorded before the Middle Ages and has been confused with the quite different fable of Classical origin titled The Cat and the Mice. In the classificatory system established for the fables by B. E. Perry, it is numbered 613, which is reserved for Mediaeval attributions outside the Aesopic canon...

The story is used to teach the wisdom of evaluating a plan not only on how desirable the outcome would be, but also on how it can be executed. It provides a moral lesson about the fundamental difference between ideas and their feasibility, and how this affects the value of a given plan.

The story gives rise to the idiom "to bell the cat", which means to attempt, or agree to perform, an impossibly difficult task. Historically it was the basis of the nickname given the Scottish nobleman, Archibald Douglas, 5th Earl of Angus. In 1482, at a meeting of nobles who wanted to depose and hang James III's favourite, Robert Cochrane, Lord Gray remarked, Tis well said, but wha daur bell the cat? The challenge was accepted and successfully accomplished by the Earl of Angus. In recognition of this, he was always known afterwards as Archie Bell-the-cat.

http://en.wikipedia.org/wiki/Belling_the_cat

PS: We'll get a critical mass, and do it as a joint grassroots project.

And no, I don't think they would have found the money to fix GM...they were in over their heads and the heads of all of us. The problem wasn't GM, it was their vainglorious attempts at being a shadow bank.

[Tansy_Gold]

87. It's not a matter of belling the cat.

Old story, well known, even by me.


What I'm saying is, if you separate the activities the banks should have been engaging in -- legitimate lending, collecting payments, foreclosing on collateral if necessary to secure repayment -- it's all very straightforward. We have an FDIC to protect depositors, and banks like any other business should be operating at their own risks for everything else. If they want to make questionable loans at high interest rates to iffy borrowers, that should be their choice. But then they have to live with the results of their choices. If they want to stay in business, then they have to operate in a manner that will ensure the continuation of their business.

But as you correctly point out, that's not what they were doing. They were hiding their real, and very questionable, operations behind the facade of legitimate banking. They were taking what should have been their legitimate assets -- the notes for the monies they had lent and the documentation for the collateral that secured those loans -- and turning them into poker chips (aka "tranches&quot at a very pricey casino (aka "the derivatives market&quot . Furthermore, they were taking the legitimate profits from the legitimate banking operations and handing those bazillions on silver platters to their executives, who had no vested interest in seeing the banks continue to do banking business. All these vampires, er, executives wanted was to bleed the banks dry.

OF COURSE there's fraud. That's the whole point of what you're saying and what I'm saying.

We all know that credit unions, which function as legitimate lenders and vehicles for savings deposits, i.e. real banks, do not have these problems. Therefore the problems do not arise from normal banking operations but from SOMETHING ELSE, and that SOMETHING ELSE should never be protected by guarantees of taxpayer bailouts.

What the pukes and far too many Dems have done is use this whole thing to monger more and more fear, to the point that 90% or more of the general population sincerely believes that JPMChase the Impaler or MorganStanula or GoldmanSucks require bailing out because the economy is in the pits, when the very simple truth is that it's the other way around. This all, of course, goes back to Phil and Wendy Gramm and the repeal of Glass-Steagal (thank you, Billy Clinton, you ass wipe).

It is one thing to "rescue" the victims of disaster beyond their control or beyond their means to rescue themselves. If the banks had stuck to banking business, neither they nor we would be in this pickle. They got themselves (and us) into this fucking mess, and I think it's absolutely unconscionable for them (or anyone in the Obama administration, including the O man himself) to even consider handing over taxpayer money to the vampires.

But they will do it, because that's the one thing the Dems have been good at -- creating the same kind of fear the pukes do, for the same reasons: siphoning money out of the economy and into the coffins, er, coffers of the rich.

[Roland99]

57. I've been working on tracing it all...

so far, many signs point to some guy named "Peggy" working some rinky-dink call center in eastern Europe....

[DemReadingDU]

50. and who would go after the banksters and politicians?

DOJ, SEC, Obama?

[Tansy_Gold]

90. . . .

:crickets:

[Demeter]

45. THE REFORMATION CAME FROM "OUTSIDE" THE CHURCH

The dispossessed intellectuals of the Church and the oppressed peasantry together said Enough is Enough.

Nuns, priests and laity left to found their own religions, and there were many variations, some better than Holy Mother Church, some even worse (Calvinism), but apparently each one meeting some psychological need, and all still going strong today. I don't know of any religion that has gone out of business, with the possible exception of those founded by people who have been wiped out by genocide. Topic for research...

But nothing happens from the top down. The Top is very happy with the way things are, they got theirs...and in that spirit of Reformation, individuals, peoples and nations must leave the global bankster/multinational unholy alliance and form their own economies. It will be another grassroots revolution, the only kind that lasts.

It is only by repudiating Globalism and Capitalism that we can "reform" them, or at least, hold them in check.

[Demeter]

42. Judge Rules Refusing to Decrypt Hard Drive is Covered by Fifth Amendment

I SHOULD THINK SO--IF NOT THE FOURTH AND NINTH AND ALL THE REST

http://www.geekosystem.com/fifth-amendment-decryption/

...This ruling dates back to a 2010 child pornography case with a defendant we’ll refer to as John Doe. Long story short, a few questionable YouTube videos and some IP tracking lead law enforcement to Mr. Doe’s hotel room door where they seized 2 laptops and 5 external hard drives, a total of 5 terabytes of data. All of Doe’s data, however, was encrypted with TrueCrypt, ostensibly in order to protect himself from identity theft (not that his intent really matters anways). When the court asked him to decrypt the hard drives, he plead the Fifth, at which point the court found him in contempt and threw him in jail.

Now, 2 years later, the 11th Circuit Court of Appeals has ruled that Doe was not actually in contempt and had every right to refuse. Naturally this is going to complicate the prosecution’s case a bit. And that’s not the only thing it complicates. Fifth amendment law as it applies to cyber-security is already complicated, and this decision only serves to make it moreso.

Traditionally, the Fifth Amendment doesn’t cover physical acts. For instance, if you’re asked unlock a safe or open a door, the Fifth Amendment doesn’t have your back. At least if the there is a key involved, relaying a combination, on the other hand, is technically testimony. This ruling equates decrypting a computer with telling something a the combination to a safe. The court’s decision describes it as follows:

We hold that the act of Doe’s decryption and production of the contents of the hard drives would sufficiently implicate the Fifth Amendment privilege. We reach this holding by concluding that Doe’s decryption and production of the contents of the drives would be testimonial, not merely a physical act; and the explicit and implicit factual communications associated with the decryption and production are not foregone conclusions.

To further complicate the matter, full disk encryption is a tough nut to crack. Whereas a safe can be cracked or a door broken down (I’ll admit I’m not sure about the legal implications of warranted forced entry) encryption can be practically foolproof. Depending on the strength of your encryption, it might be impossible to crack a password in less than several hundred years, so if a defendant isn’t compelled dole out the key, the data is effectively off the table for lifetime of all parties involved.

As if this wasn’t complicated enough already, there is already an example — two, actually — where encrypted data was not covered by the Fifth Amendment. Just last month, a defendant in a mortgage scam case was forced to decrypt his laptop after a ruling by a different federal judge. Likewise, a defendant in a 2009 child pornography case in Vermont was compelled to decrypt his drive although in that case, the evidence was found by customs officials while the device while it was on, and the issue of decryption became an use when later on, during the trial, the computer was off.

The last messy thing about this whole deal is that it’s dealing with child pornography, one of the touchiest subjects relating to cyber-security, and just in general. Pleading the Fifth already carries connotations of guilt, and adding child pornography into the mix makes it really easy to appeal to fear or disgust. Fifth Amendment cases have a history of being messy, though. After all, those “Miranda Rights” you’ve probably memorized while watching Law and Order? They became law when the Supreme Court reversed the conviction of a man who confessed to kidnapping a raping a woman. Yeah. Not pretty either, although it’s worth noting that Miranda still wound up in jail.

All that being said, this issue will probably continue to be hotly debated considering the contradicting precedents and the fact that handing over an encryption password is just ever so slightly different from opening a combination lock if it is even different at all. That’s a distinction that may have to be made by an even higher court a few more years down the line.

[Roland99]

43. U.S. pension funding level lowest since Dec. 2007

http://www.marketwatch.com/story/us-corporate-pension-funded-status-falls-bny-2012-06-07?link=MW_home_latest_news

[Demeter]

47. Because the paper is worthless

Garbage in, garbage out.

[Roland99]

48. Market Exhuberance!!!

http://nicktoons.nick.com/videos/clip/happy-happy-joy-joy.html

[Roland99]

55. well...someone must have told them to suck an egg

lost half of the day's gains already.

[Roland99]

56. Guess it was Chopper Ben. He's speaking. Markets falling back to flat (NASDAQ in the red)

[Demeter]

68. Bernanke says European crisis poses risks

Federal Reserve chairman Ben Bernanke said the European crisis poses “significant risks” to the US economy but offered no direct hint of Fed action, in his testimony to the Joint Economic Committee in Washington.

“The situation in Europe poses significant risks to the US financial system and economy and must be monitored closely,” said Mr Bernanke in prepared testimony to Congress.

“As always, the Federal Reserve remains prepared to take action as needed to protect the US financial system and economy in the event that financial stresses escalate.”

The cautious remarks may suggest that Mr Bernanke prefers not to act preemptively against risks from Europe but instead to intervene robustly if the outcome across the Atlantic is bad.

Read more >>
http://link.ft.com/r/9ULF66/16FWKE/GYN7Q/NJ6S56/SPI87Z/4O/t?a1=2012&a2=6&a3=7

“The cat, having sat upon a hot stove lid, will not sit upon a hot stove lid again. But he won't sit upon a cold stove lid, either.”

Mark Twain (American Humorist, Writer and Lecturer. 1835-1910)

HOT ENOUGH FOR YOU, BEN?

[Demeter]

69. Bernanke sours bank rally, financials still ahead

http://www.marketwatch.com/story/top-us-banks-rise-ahead-of-bernanke-testimony-2012-06-07-91034933?siteid=YAHOOB

The nation’s biggest bank stocks surrendered strong early gains at midday Thursday after Fed Chairman Ben Bernanke told Congress that the European debt crisis threatens the U.S. financial system, but gave no indication of imminent stimulus...

Bank of America Corp. BAC -1.11% , J.P. Morgan Chase & Co. JPM +1.03% , Goldman Sachs Group Inc. GS -0.22% , Morgan Stanley MS -1.54% and Citigroup Inc. C +0.44% gave up most or all of their earlier gains following Bernanke’s testimony, after rising as much as 2% to 3% ahead of his appearance.

U.S. financial stocks opened with solid gains in the morning, with the banks leading the rally and mirroring advances in Asia and Europe, triggered by a surprise Chinese rate cut as well an expected Bank of England move to hold rates steady. But sector investors balked at keeping the rally running after failing to get material commitments from Bernanke about any further economic stimulus.

[Demeter]

70. Fed ready to act if stresses mount: Bernanke

REALLY? TRAGEDY, LIKE "OTHELLO"? COMEDY, LIKE "AS YOU LIKE IT"? OR ANGST, LIKE "WAITING FOR GODOT"?

http://www.marketwatch.com/story/fed-ready-to-act-if-stresses-mount-bernanke-2012-06-07?siteid=YAHOOB

The Federal Reserve stands ready to act to protect the financial system and the economy in the event that financial stresses from the European crisis escalate, Fed Chairman Ben Bernanke said Thursday.

“The situation in Europe poses significant risks to the U.S. financial system and economy and must be monitored closely,” Bernanke said in testimony prepared for delivery to the Joint Economic Committee of Congress.

He called on European leaders to do much more to stem the crisis.

Action is needed to stabilize euro-area banks, calm market fears about sovereign finances, set in place a workable fiscal framework and lay the foundation for long-term growth, he said.

Bernanke’s testimony was largely in line with expectations. Fed watchers did not expect the Fed chairman to show his hands about what the Fed might do at its next policy meeting on June 19 and 20....

OR I SEE! MIME!

[Demeter]

52. The wealth of nations: An alternative approach to measuring national well-being

http://www.economist.com/blogs/graphicdetail/2012/06/daily-chart-1

GROSS DOMESTIC PRODUCT, better known by its initials, GDP, has been economists' chosen measure of a nation's well-being for over 70 years. But it has limitations; it takes no account of environmental degradation and excludes unpaid services such as volunteering and housework, for example. In the words of Bobby Kennedy, speaking in 1968, "it measures everything...except that which makes life worthwhile." In an attempt to address these shortcomings the OECD, a mainly rich-country think-tank, has created the "Better-Life" index. Now in its second year, the index uses 24 variables (which include both hard data and survey data) across 11 sectors to create a measure of welfare for 34 of its member countries, plus Brazil and Russia. The Economist has grouped these 11 sectors into four broader categories. America excels most in money and jobs, Switzerland in health and education. This year the OECD has adjusted the index for equality to give an estimate for the top and bottom 20% of each country's population. America scores particularly poorly on this account, with the bottom 20% having an index score some 25% below that of the top 20%.



SEE ALSO: http://www.oecdbetterlifeindex.org/ A FASCINATING WEBSITE FOR LIFESTYLE DESIGN

[Demeter]

53. Americans Cling to Jobs as U.S. Workforce Dynamism Fades

http://www.bloomberg.com/news/2012-06-07/americans-cling-to-jobs-as-u-s-workforce-dynamism-fades.html

After 4 1/2 months of meetings, interviews and hand-holding, personnel recruiter William Rowe thought he had sealed the deal...The senior executive of a major corporation Rowe had been courting finally agreed to take a top post at a venture capital- backed technology firm in California. Then four days after giving notice, the mid-to-late 40-year-old executive had second thoughts about leaving the security of his company and returned to his old job. “He decided to go back to the mother ship” and not uproot his family to take a chance on joining a new firm, said Rowe, vice chairman of Pearson Partners International Inc., a search firm in Dallas.

The deepest economic slump since the Great Depression has left its mark on both job seekers and job creators, making them more wary about taking risks in a slowly recovering labor market. Spooked by the severity of the recession and stuck with underwater home mortgages, Americans are less inclined to leave their jobs and less willing to strike out on their own to build businesses, government data show. Even with swelling profits, companies are holding back on hiring, complaining that they can’t find skilled workers for positions they do have open.

As a result, the labor market is losing some of the dynamism for which it’s long been known. And the trend predates the recession: An aging population and the growth of two-income households have reduced Americans’ mobility to about half of what it once was, while technological gains and globalization have led to a loss of middle-income jobs. The economic slump only exacerbated the loss of vigor. (SO MOVE THE BUSINESS TO WHERE THE PEOPLE ARE! SHEESH! IT'S NOT ROCKET SCIENCE.--DEMETER)

‘Major Hollowing Out’

“The U.S. labor market is becoming more sclerotic,” said Harvard University Professor Lawrence Katz, a former chief economist at the U.S. Labor Department. “We’re seeing less gross job creation and job destruction, and we have a major hollowing out of jobs in the middle.” The diminishing vibrancy matters because the less job turnover there is, the harder it is for others, particularly younger people, to find work. Unemployment among 16- to 24-year- olds was 16.1 percent in May, about double the 8.2 percent rate for the population as a whole. Also holding them back are older workers staying on the job longer after seeing their savings eroded by the housing market bust and financial crisis. Americans who are thrown out of work in such an environment also are finding it tougher to get jobs. The average duration of unemployment was 39.7 weeks in May, more than double the 18.8- week average since 1990 and not far below the record 40.9 level set in November last year. American employers added 69,000 workers last month, the fewest in a year. “We have certainly moved” in the direction of Europe, with a less-dynamic labor market, Steven Davis, professor at the University of Chicago Booth School of Business, said in an email. He ticked off the similarities: “higher unemployment rates, longer unemployment spells, steep falls in the employment rate in the working-age population, a slower pace of worker flows, and a slower pace of job creation and destruction.”

AND THERE'S A WHOLE LOT MORE AT THE LINK...SOME OF IT ABOUT 99% TYPE PEOPLE, EVEN (NONE OF IT GOOD FOR THE 99%, OF COURSE).

[Demeter]

58. Wisconsin Recap: Thanks to Obama, American Left Lies in Smoldering Wreckage By Matt Stoller

http://www.nakedcapitalism.com/2012/06/wisconsin-recap-thanks-to-obama-american-left-lies-in-smoldering-wreckage.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on Twitter at http://www.twitter.com/matthewstoller.

********************************************************************

On Tuesday, Wisconsin Republican Governor Scott Walker humiliated his Democratic opponent, Tom Barrett, by easily turning back a popular recall attempt sponsored by unions and liberal activists. The numbers in the election, which were supposed to be close, were ugly, in favor of the Republican. But this wasn’t just any Republican, Scott Walker is THE Republican, the politician who made his governorship a referendum on a hard right agenda, in a blue state. Walker waged a direct and very public attack on the major constituencies of the Democratic Party, rolling back rights for women, the working class, and the young with measures such as ending collective bargaining for state employees, privatizing state assets, and repealing Wisconson’s equal pay provisions for women. His agenda provoked a fierce reaction – – Wisconsin citizens occupied the Statehouse for months - and then a recall. Tuesday, Walker’s agenda was ratified by the voters of Wisconsin, the state where public sector unions were born. It’s hard to overstate how bad this is – Wisconsin is now on the road to becoming a right-to-work state, in what is likely to become a right-to-work country. Right-to-work laws are provisions that allow individual employees to withdraw from unions, and they make it much harder for unions to organize.

And the deeper you look into the race, the worse it looks. By calling for a recall instead of a general strike after Walker stripped collective bargaining rights and cut benefits for workers, labor and Democratic leadership in the state diverted and then subverted populist energy, channeling it into an electoral process (at least one union, one very active in the occupation of the Capitol, stood apart from the electoral stupidity). Then, Barrett, an anti-labor centrist, won the Democratic primary by crushing his labor-backed opponent, Kathleen Falk. Finally, Barrett himself was destroyed by Scott Walker, who outspent Barrett 7-1 with corporate money. In other words, first, liberals lost a policy battle, then they failed to strike, then they lost a primary election, then they lost a general election to the most high-profile effective reactionary policy-maker in the country. The conservative beat the moderate who beat the liberal. And had Barrett won, he wouldn’t even have rolled back Walker’s agenda. Somehow, in a no-win electoral situation, Democrats and labor managed to lose as badly as they possibly could.

What happened?

I wish I could say I had a new insight, but it’s basically the same problem I’ve been writing about for years. Put simply, it’s that Obama’s policy framework is now the policy framework of the Democratic Party, liberals, and unionism. Up and down the ticket, Democrats are operating under the shadow of the President, associated with unpopular policies that make the lives of voters worse and show government to be an incompetent, corrupt handmaiden to big business. So they keep losing. [b]It should be obvious that if you foreclose on your voters, cut their pay, and legalize theft of their wealth by Wall Street oligarchs, they won’t be your voters anymore. Somehow, Democratic activists continue to operate as if policy doesn’t matter to voters, or that policy evaluation is a Chinese menu of different stuff, some of which you like and some of which you don’t, as in “Oh I’ll take a pro-choice moderate, with a bailout, and gay rights. And a Pepsi”. But that’s not how it works – voters’ lives get better, or they don’t. And under Obama, stuff has gotten worse. Obama’s economic policies have made economic inequality sharper than it was under Bush, due to his bailout of banks and concurrent elimination of the main source of wealth of most Americans, home equity. With these policy choices, Obama destroyed the Democratic Party and liberalism – under Obama’s first two years, the fastest growing demographic party label was “former Democrat.” Liberalism demands that people pay for a government, but why should anyone want to pay taxes for the terrible governance Obama has implemented?

........................................................................................

But it’s not complete to say this is just Obama’s doing. Obama has done everything he’s done with the support of labor leaders, Democratic supportive groups like Moveon, foundations, liberal pundits, African-American church networks, feminist groups, LGBT groups, and technology interests. Any of these could have stopped him by withdrawing support and overtly attacking him, but only the LBGT community fought for their rights. This American labor bureaucracy, which simply does not strike and therefore has no leverage against capital, operates largely as a group of fragmented business unionists. Unfortunately, business unions don’t exist when business decides it doesn’t want unions. And that’s what global business elites have decided, as this piece published on this very site titled The Liquidation of Society versus the Global Labor Revival shows.

http://www.nakedcapitalism.com/2011/02/matt-stoller-the-liquidation-of-society-versus-the-global-labor-revival.html



Thanks to Doug Henwood for the invaluable chart on strikes.

MUCH MORE GALL AND BRIMSTONE AT LINKS

[bread_and_roses]

83. Oh Amen, amen -

this is an unmitigated disaster - as I wrote yesterday - talk about neutered. Talk about impotent. Talk about dead wo/men walking.

[Demeter]

65. Michael Olenick: How Banks and Their Lawyers Win at the Expense of Investors and Homeowners

http://www.nakedcapitalism.com/2012/06/michael-olenick-how-banks-and-their-lawyers-win-at-the-expense-of-investors-and-homeowners.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Michael Olenick, creator of FindtheFraud, a crowd sourced foreclosure document review system (still in alpha). You can follow him on Twitter at @michael_olenick or read his blog, Seeing Through Data

*******************************************************************

The focus of news stories on mortgage abuses often focus on the immediate victims, the borrowers, but that’s far from a complete tally of the losers. And they also typically fail to look hard enough at the winners and the way they are able, again and again, to burn everyone but themselves.

Our latest case study is a modest, non-descript one-story house in Seminole, Florida. Its owners, Suzanne and Luis Guerrero, did not set out to take a two-way trip through hell to win a free house as their prize for being tortured, but that is how their foreclosure case turned out. And as a result of bad conduct by local and the big ticket national law firm brought in to fight the Guerreros, the investors in Ace Securities Home Equity Loan Trust 2007-HE4 — even though they don’t know it, at least until now — get to pay the greatly magnified bill. Ocwen Loan Servicing, the most culpable party in this fiasco, also managed to emerge unscathed....On Dec.7, 2006, at the height of the bubble, the Guerrero’s took out two loans for the same property, a first loan for $232,936 and a second loan for $58,234. Both loans were funded by Resmae Mortgage Corporation then later both the first and second lien were securitized into ACE 2007-HE4. The Guerreros are anything but fast-and-loose condo flippers; they paid for two years before suffering an economic setback, making payments high enough to dent some principal. After defaulting they repeatedly engaged in good-faith negotiations with loan servicer Ocwen — offering to short-sell the house or modify the loan — and were repeatedly rebuffed despite that this would have lessened losses to investors. When the Guerreros were unable to negotiate a modification directly with their lender, they hired not one but two separate attorneys on two separate occasions. Only after the modification efforts failed did they hire a third lawyer to defend their case. Elements of their case that should surprise have become the new normal. An assignment of their mortgage from Resmae to ACE 2007-HE4 was dated Feb. 27, 2007, notarized Jan. 9th, 2009, and recorded May 22, 2009, long after the 2007 cut-off date for conveying the note and with it, the mortgage (the lien) to the trust. This dubious assignment was “signed” by Ocwen employee Scott Anderson and notarized by Ocwen employee Leticia Arias.

The Guerrero’s new attorney, an experienced trial lawyer, quickly noticed that something was wrong with the documents. When pressed by the Guerrero’s attorneys, Anderson, testifying under oath, wasn’t sure whether a signature labeled “Scott Anderson” was his. Anderson explained he “delegated” signing authority to a “small group,” that could have been up to any of the 3,500 people working for him. When asked how many documents bear his signature he was “not sure” if it was more than seven, an odd statement since he is a prolific robosigner. Notary Leticia Arias had a better memory; she notarized more than a hundred documents and remembered it is Ocwen employee Naomi Morales who often signs for Anderson....

THERE'S SO MUCH MORE SLEAZE AT LINK!

********************************************************************

Perjury, forgery, blatantly ignoring rules requiring lawyers to report fraudulent documents to the court, refusing to mitigate a breach leading to much steeper damages, misleading investors in both initial filings and follow-up reporting, fraud on borrowers, fraud on investors, and fraud on the court system....It appears this “unseemly” affair could not get worse, except that it does. Like many trusts ACE2007-HE4 is likely to take a catastrophic loss on its formerly AAA-rated tranches, including tranche A-2D, CUSIP 00442LAE9. Tranche A-2D is no ordinary sub-prime tranche because it is one of twenty in ABX.HE.AAA.07-2 index, one of the core sub-prime indexes. Part two of this “unfortunate” story will highlight other inexplicable patterns that should send shivers down the spine of investors, economists, and public policy makers.

[Demeter]

66. Michael Crimmins: What the Press Refuses to See in JP Morgan and MF Global Scandals

http://www.nakedcapitalism.com/2012/06/michael-crimmins-what-the-press-refuses-to-see-in-jp-morgan-and-mf-global-scandals.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Michael Crimmins has worked on risk management and Sarbanes Oxley compliance for major banks

****************************************************************

Two former finance and political influence gods (Jon Corzine and Jamie Dimon) have tumbled back to earth. Yet, troublingly, the mythology that’s cowed the political establishment and the financial press for so long remains very much intact. Almost without exception, mainstream commentators are still desperately trying to frame the train wrecks at MF Global and JP Morgan as outliers, tail risk situations, if you like. They seem unable to acknowledge that that these were simple cons, while dutifully reporting them as examples of ‘regulatory arbitrage’. The term is appropriate, but it’s fancy enough to be off-putting to the folks who can spot a con a mile off and who would normally be enraged enough to take to the streets if these scams were framed in simpler terms.

Consider the backhanded compliment the financial press and the regulators, even PBS, bestowed on Occupy the SEC and the OWS Alternative Banking group. These outlets acknowledged that the barriers to entry to protest against bankster abuse can be breached, yet missed the real point: those barriers are lower than the banks and politicians believe they are. The various specialist groups in Occupy Wall Street prove that opposing a corrupt oligarchy isn’t attractive only “dirty hippies” but also to academics (Simon Johnson and Amat Admati), former and current regulators (Sheila Bair, Andrew Haldane) and industry professionals (the members of the aforementioned OWS groups); They also fail to get on board with the concept that the banksters’ line should be challenged even though that’s supposed to be the role of a free press….The OSEC comment letter was wonky enough to ensure it couldn’t be ignored, but the real objective was to call the too-clever-by half banking lobby and their enablers out in plain language. As a first step in alerting the powers that be that the Occupiers and the folks they represent will be heard, I like to think it was effective.

Dimon and Corzine have made the second step, translating the fancy regulatory arbitrage language into plain English, much easier.

In Corzine’s case, the entire business model for MF Global was built on a simple scam. Pretend that one part of MFG took a huge and risky position and ‘sold’ it, or as accountants call it, “de-registered” it. The fact that it sold it to itself could and would be ignored by most everybody that mattered. From a US perspective, all appeared to be well. It doesn’t matter too much that the MFG London guys were stuck with the risk, since there was a side deal with the US that’s not reported anywhere, that the US unit will (wink) cover London’s risk. This is bucket shop level scamming and its good work if you can get it, until those greedy London counterparties start making margin calls. Shit hits fan and you end up with dopes like assistant Treasurer Edith O’Brien pleading the Fifth. Every back office in every major bank is fully staffed with ambitious enablers like O’Brien who convince themselves that they have the goods on their bosses. It’s hard to find clearer signals that this is a third rate con, even if you can’t quite put your finger on exactly where the legal liablilty is.

In Dimon’s case the con was more complex, but no more elegant than Corzine’s. Dimon controlled a book that was larger than the combined trading books of his entire mega-bank’s trading operation. The fact that this book wasn’t even on the radar screen of it primary regulator, the OCC, screams for a Saturday night massacre purge of the staff incoming OCC head Thomas Curry has inherited, beginning with General Counsel Julie L. Williams...In his testimony today, Curry signaled that he was the new sheriff in town at the OCC and that he was cognizant of its reputation as the coziest-to-bankers regulator. William’s lurking and agitated (and kind of creepy) presence over his left shoulder was great theater, but I’m not sure what it was meant to project. Retiring her tomorrow would be my highest priority if I were in his shoes....Dimon’s scam is actually easier to debunk than Corzine’s. There was an over $300 billion ‘investment portfolio’ that needed to be hedged. Apparently it had been managed, until the Treasurer quit in 3Q 11 (quietly- although the regulators are notified of key-man gaps, so JPMs regulators were aware there were significant control gaps at YE). This wager looks a lot like AIG’s gamble that writing CDS was free money. This risk position was housed in the CIO but was additive and unrelated to the hedging of the $300 billion investment portfolio. This portfolio is Dimon’s great crime and scam, in my mind. It was not a hedge of the tail risk of the $300+ billion investment portfolio. Nor was it a hedge of the tail risk the rest of JPM’s banking book. It was purely a gambler’s flyer (with the backing of the US government’s full faith) that heads I win tails you lose. And the media has not focused on the fact that the risk in this portfolio eclipsed the risk taken in the rest of JP Morgan.

I think its past time to ask Jamie to retire.

For me the bottom line is simple. If I could convince the regulators that the law (Dodd-Frank- Volcker) gave me free rein to do what ever TF I wanted to, then I would be tempted to do that. If I could convince the rulemakers that what I was complying with the letter of the law and making money, I would do that. If it came to light that I was actually losing money because you dopes let me do that, I’d blame it on you.

I’m a bankster. Catch me if you can.

[Demeter]

67. Gold is Dropping Like a Stone

The rush to dollars continues unabated.

If the Chinese had better timing, they could have benefited from all this panic...of course, they don't want a strong currency, so I guess they are happy the way things are.

[Demeter]

71. Treasurys recover after Bernanke, China rate cut

http://www.marketwatch.com/story/treasurys-lower-before-bernanke-after-chinas-cut-2012-06-07?siteid=YAHOOB

Treasury prices recovered Thursday, pushing benchmark 10-year yields back down slightly, after Federal Reserve Chairman Ben Bernanke tames investor expectations that the central bank was planning to ease policy soon

In zigzag trading, bonds gave up earlier gains after China’s unanticipated cut in interest rates sent investors back to equities and commodities and out of safe-haven assets...

[Demeter]

72. You Guessed It: Mortgage Rates Hit Another New Low

http://www.npr.org/2012/06/07/154506527/you-guessed-it-mortgage-rates-hit-another-new-low?ft=1&f=1001

Average U.S. rates on 30-year and 15-year fixed mortgages this week fell to fresh record lows for the sixth straight week. Cheap mortgages continue to help boost prospects for home sales this year.

Mortgage buyer Freddie Mac says the average rate on the 30-year loan dropped to 3.67 percent. That's down sharply from 3.75 percent last week and the lowest since long-term mortgages began in the 1950s.

The 15-year mortgage, a popular refinancing option, declined to 2.94 percent. That's down from 2.97 percent last week.

Rates on the 30-year loan have been below 4 percent since early December. The low rates are a key reason the housing industry is showing modest signs of a recovery this year...

[Egalitarian Thug]

77. No, they don't, and even less so right now as their economy is beginning to tank. n/t

[Eugene]

73. Fitch cuts Spain rating by three notches to 'BBB'

Source: Reuters

Fitch cuts Spain rating by three notches to 'BBB'

NEW YORK | Thu Jun 7, 2012 12:54pm EDT

(Reuters) - Fitch Ratings cut its rating on Spain's government debt by three notches to 'BBB' on Thursday and signaled it could lower it further by putting the country on negative outlook.

The new rating was Spain's lowest among the three main ratings agencies.

Fitch said in a statement that Spain was especially vulnerable to a worsening of the euro zone crisis due to a high level of net foreign indebtedness.

(Reporting by William Schomberg; Editing by Chizu Nomiyama)

http://www.reuters.com/article/2012/06/07/us-spain-fitch-idUSBRE85610M20120607

[Eugene]

74. U.S. rating faces 2013 cut if no credible plan: Fitch

Source: Reuters

U.S. rating faces 2013 cut if no credible plan: Fitch

By Jed Horowitz

NEW YORK | Thu Jun 7, 2012 12:20pm EDT

(Reuters) - Fitch Ratings reiterated on Thursday it would cut its sovereign credit rating for the United States next year if Washington cannot come to grips with its deficits and create a "credible" fiscal consolidation plan.

It also said it would immediately cut the credit ratings on Cyprus, Ireland, Italy, Spain and Portugal if Greece were to exit the euro zone. Additionally, all euro zone nations would have their ratings put on its negative ratings watch list, setting a six-month time frame for a potential downgrade.

Europe's ongoing sovereign credit crisis undermines already below-trend growth seen in the United States, the world's biggest economy.

[font size=1]-snip-[/font]

Read more: http://www.reuters.com/article/2012/06/07/us-usa-rating-fitch-idUSBRE8560YL20120607

[xchrom]

78. State prosecutor opens criminal probe into Bankia

http://elpais.com/elpais/2012/06/06/inenglish/1339002579_185035.html

The state prosecutors office’s has opened a probe to determine whether any crimes were committed in the establishment of ailing lender Bankia, an amalgam of seven savings banks, that was nationalized last month, Attorney General Eduardo Torres-Dulce said.

In an interview with Spanish newswire Efe published on Wednesday, Torres-Dulce said the prosecutor has requested a series of documents from Bankia itself and the Bank of Spain. The investigation was opened on May 28, prior to the filing of suit by individuals against Bankia’s corporate activities.

The attorney general said that independently of the strong “public demand” for an investigation into Bankia’s affairs, the prosecutor decided to initiate the case on its own “merits.”

The ruling Popular Party has blocked calls by opposition parties for Bankia chairman Rodrigo Rato, a former IMF managing director and economy minister in the previous PP government, and Bank of Spain governor Miguel Ángel Fernández Ordóñez to appear in Congress to field questions on Bankia. The PP also used its absolute majority to throw out lawmaker calls for Congress to set up a commission to examine the case.

[xchrom]

79. IMF to report that Spanish banks need 40 billion euros in aid

http://elpais.com/elpais/2012/06/07/inenglish/1339083804_463849.html

An International Monetary Fund report on Spanish banks will show the country's troubled lenders need a cash injection of at least 40 billion euros, Reuters on Thursday quoted unnamed sources in the financial sector as saying.

The report, due to be published next Monday, will also outline overall needs of 90 billion euros to clean up Spain's entire banking sector, with healthy lenders covering a big chunk of this sum, one of the sources said.

"The capital shortfall for the Spanish banks will be around 40 billion euros after taking into account the capacity from some of the entities to cover expected losses with their own resources," the source told Reuters.

Government sources declined to confirm the figures and one source who has been briefed on the matter cautioned that the IMF may not have finalized its estimates.

[bread_and_roses]

82. Sorry for all the OT posts

I'll stop now. Promise.

[Demeter]

95. You aren't off topic, b&r

not even with horses, to keep us in touch with nature. We can't go off topic...by definition!

[Roland99]

84. Fed News (capital buffer requirements) (triggering slide in the markets) >>>>

* Fed to hike set asides for commercial real estate
* Fed Basel III rules to require 7% capital buffer

[Roland99]

88. Ben Bernanke Babble Busts Bullish Bubble

S&P and NASDAQ in the red. DJIA only up 0.25%.

[Fuddnik]

92. B B B Blasphemy!