Will These Wall Street Criminals Finally Be Punished?

Seven years have passed since the peak of the2008 financial crisis, and still, not a single too-big-to-fail chief executive officer (CEO) is in jail.
Sure, civil suits have been filed against the guilty Wall Street firms…
Civil suits that result in settlements that barely touchthese global financial institutions’ balance sheets. For instance, the $5.7 billion settlement paid out by five too-big-to-fail banks in May – JPMorgan Chase & Co. (NYSE:JPM), Citigroup Inc. (NYSE: C), Barclays Plc. (NYSE ADR: BCS), UBS Group AG (NYSE: UBS), and Royal Bank of Scotland Group Plc. (NYSE: RBS) – represent the earnings of about a day or two for each bank.
As for the Wall Street criminals behind the toxic loans that tanked the economy in 2008 – the actual people, not the institutions they hide behind – there has never been so much as a wrist slap, let alone a criminal conviction.
When all was said and done, these execs cost the United States nearly 9 million jobs (6% of the workforce), a 30% fall in housing prices, and a 50% dip in thestock market. The estimated total crisis-related loss equals around 40% of 2007’s gross domestic product.

This post was published at Wall Street Examiner by Tara Clarke ‘ November 23, 2015.

Housing Rebound Didn’t Lift Economy as Much as Economists Expected: Why?; Six Questions for Zandi

Home prices are nearly back to where they were before the crash. In some places, home prices are above where they were at the peak of the national boom.
Yet, the impact of rising home prices has not had the economic effect that economists expected.
The Wall Street Journal addresses the issue in Why the Housing Rebound Hasn’t Lifted the U. S. Economy Much.
I think the journal misses the reasons by a mile, as does Moody’s Analytics chief economist Mark Zandi. Let’s take a look.
Home equity has roughly doubled to $12.1 trillion since house prices hit bottom in 2011, according to the Federal Reserve. As a result, a key gauge of housing wealth – homeowners’ equity as a share of real-estate values – is nearing the point seen a decade ago, before the downturn.
Such a level once would have offered a double-barreled boost to the economy by providing owners with more money to tap and making them feel more flush and likely to spend. But today, that newfound wealth has had little effect on behavior.

This post was published at Global Economic Analysis on November 23, 2015.

Gold Daily and Silver Weekly Charts – Comex Option Expiration

There were no deliveries in precious metals at The Bucket Shop on Friday. What a surprise.
There was a little movement in the warehouses.
There will be a precious metals option expiration on the Comex tomorrow.
We will be shifting gears into the big December gold contract at the end of the week.
The US dollar gained a little and the metals were off a little.
The US dollar long trade is a very crowded bus.
I have not yet seen a buy signal for the metals in all this.

This post was published at Jesses Crossroads Cafe on 23 NOVEMBER 2015.

Swiss Bank “Goes There”, Applies Negative Rates To Retail Deposits

Back in September in ‘How Mario Draghi Can Force The Swiss National Bank To Go ‘Nuclear On Depositors,’ we discussed the implications of the ECB’s (likely) decision to plunge further into NIRP-dom at the bank’s December meeting.
In short, DM central banks – with the possible exception of the Fed which is about to create a rather meaningful policy divergence with its core CB brethren – are in a proverbial race to bottom. It’s a beggar-thy-neighbor monetary policy regime and the more stubborn inflation expectations prove to be, the more aggressive the tit-for-tat easing, as everyone involved scrambles to protect their currency in the face of incessant competitive devaluations on all sides.
As we outlined in great detail in the post linked above, the ECB’s ultra dovish lean has the potential to create a lot of problems for the Riksbank, the Norges Bank, and the SNB.
Sweden is running out of options for a QE program that’s already broken once (see here and here) and although Stefan Ingves will probably tell you there’s more room to cut in the event Draghi moves on the depo rate, the Riksbank is already at -0.35 and the housing bubble has reached epic proportions. Of course staying on hold in the event of an ECB cut means the krona will soar and then, well, there goes any hope of hitting the elusive inflation target.

This post was published at Zero Hedge on 11/23/2015.

The Fed Balance Sheet & The Price Of Silver

Something quite interesting happened as the Federal Reserve increased its balance sheet from 2003 to 2012. As the Fed’s balance sheet jumped from $738 billion to $2.8 trillion by 2012, the price of silver increased to $30 that year. However, as the Fed continued to increase its balance sheet by printing money and acquiring worthless assets, the price of silver changed direction and headed lower over the next four years.
According to information and Chart #26 published in THE SILVER CHART REPORT:

This post was published at SRSrocco Report on November 23, 2015.

US Goverment/Central Banks Are Preparing The Final Stages Of The Economic Collapse – Episode 825a

The following video was published by X22Report on Nov 23, 2015
The Recovery in the Euro zone is non existent and the talking heads are now blaming it on the Paris attack. The housing bubble is now ready to pop as prices and existing home sales collapse. US manufacturing PMI collapses to a 25 month low. National economic activity collapses in the last 3 months signalling a major collapse is on its way.

Here’s More Proof That Manufacturing Job Gains Have Been Overstated

Last week, I reported on a set of U. S. government jobs statistics that were new to me, and that painted a decidedly bearish picture of the American employment scene and indeed of the entire economy’s chances of avoiding a recession in the near future. Since then, I’ve learned two other important facts about this data series, which is called the Business Employment Dynamics (BED) series.
First, although it comes out quarterly, and with a two-three-quarter lag, it’s based on a sample more than ten times bigger than that used by the Labor Department’s main jobs statistics – the non-farm payrolls (NFP) numbers that come out in the form of breathlessly followed monthly reports. Second, according to the BED, manufacturing’s jobs gains during the current recovery have been even weaker than described by the NFP numbers. (So, by the way, is overall job creation, at least per the latest first quarter, 2015 BED figures.)

This post was published at Wall Street Examiner by Alan Tonelson ‘ November 23, 2015.

5 Signs Of America’s Decaying Society

While Edward Snowden and Chelsea Manning and John Kiriakou are vilified for revealing vital information about spying and bombing and torture, a man who conspired with Goldman Sachs to make billions of dollars on the planned failure of subprime mortgages was honored by New York University for his “Outstanding Contributions to Society.”
This is one example of the distorted thinking leading to the demise of a once-vibrant American society. There are other signs of decay:
1. A House Bill Would View Corporate Crimes as ‘Honest Mistakes’
Wealthy conservatives are pushing a bill that would excuse corporate leaders from financial fraud, environmental pollution, and other crimes that America’s greatest criminals deem simply reckless or negligent. The Heritage Foundation attempts to rationalize, saying “someone who simply has an accident by being slightly careless can hardly be said to have acted with a ‘guilty mind.’”

This post was published at Zero Hedge on 11/23/2015.


Gold: $1066.80 down $9.60 (comex closing time)
Silver $14.04 down 6 cents
In the access market 5:15 pm
Gold $1069.50
Silver: $14.13
First, here is an outline of what will be discussed tonight:
At the gold comex today, we had a very poor delivery day, registering 0 notice for nil ounces. Silver saw 0 notices for nil oz.
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 200.25 tonnes for a loss of 103 tonnes over that period.
In silver, the open interest surprisingly rose by a large 2975 contracts despite the fact that silver was down 16 cents in Friday’s trading. The total silver OI now rests at 173,524 contracts In ounces, the OI is still represented by .867 billion oz or 123% of annual global silver production (ex Russia ex China).
In silver we had 0 notices served upon for nil oz.
In gold, the total comex gold OI was hit again as this time another 4767 contracts were liquidated as the OI fell to 418,625 contracts. Gold was down by $1.60 in Friday’s trading. It seems the modus operandi of the bandits is to try and liquefy gold/silver OI as we approach first day notice on Monday, November 30. They are succeeding in gold but not silver. The bankers get very nervous when OI is rising despite awful prices for the metals. We had 0 notices filed for nil today. As I know everybody is aware that we are now in the options expiry for the comex gold/silver contracts, our LBMA contracts and OTC contracts.
We had no changes in gold inventory at the GLD/ thus the inventory rests tonight at 660.75 tonnes. The appetite for gold coming from China is depleting not only gold from the LBMA and GLD but also the comex is bleeding gold. Our 670 tonnes of rock bottom inventory in GLD gold has been broken. It looks to me that China has taken the last amounts of physical gold from the GLD. I guess the only place left for China to receive physical gold, after they deplete the GLD will be the FRBNY and the comex. In silver, we had a huge change in silver inventory, a rather large deposit to the tune of 1.053 million oz / Inventory rests at 318.209 million oz.
We have a few important stories to bring to your attention today…

This post was published at Harvey Organ Blog on November 23, 2015.

A Year Of “Pain Trades” And Flash Crashes: 2015 Summarized In 10 Bullet Points

There are still a few more weeks left in 2015, but we can already summarize the main themes of a year that many will be happy to put in the history books. So, without furhter ado, here are the 10 bullet points that capture what 2015 meant to financial professionals everywhere, and why it was such a painful year to most.
2015 ends with the market cap of Amazon & Google exceeding that of every single Chinese company in the MSCI China index… …the US stock market a mere 107 trading days away from becoming the 2nd longest bull market of all-time, with equity leadership driven by ‘growth’ (longest duration of outperformance ever) & ‘quality’ (at all-time relative high)…

This post was published at Zero Hedge on 11/23/2015.

What Recovery? Spanish Wages Tumble To Weakest Since 2007

Amid all the singing and dancing over Spain’s miraculous recovery and Europe’s renaissance on the back of Draghi’s money-printing machine, it appears – just like in America – that below the glossy veneer of engineered equity and bond prices, all is not well. As Xinhua reports, the average wage in Spain has fallen to its lowest level since 2007, according to figures released by the Spanish Ministry of Finance, and after peaking at 19.3 million in 2009, the number of workers is also collapsing.
According to data which is based on the tax returns of nearly 16,900,000 workers in Spain in 2014, the average annual wage now stands at 18,420 euros (around 20,000 US dollars).
The highest salaries are found in the capital city of Madrid, where the average worker takes home 24,576 euros. The lowest salaries are recorded in the rural region of Extremadura, where people’s annual income is as low as 13,559 euros.

This post was published at Zero Hedge on 11/23/2015.

How is it possible that the dollar is rising and falling at the same time?

In astronomy, there’s an important concept known as ‘parallax’, which refers to how a star’s position appears to change based on the position and motion of the observer.
The earth is constantly moving along its orbit around the sun. And as this happens, the position of a star in the night’s sky will appear to change slowly, gradually over time.
There’s a great view of the Southern Cross constellation from our farms in the south of Chile. But as the seasons change, the constellation appears to move very slightly, even though the stars themselves haven’t budged an inch.
Small children discover an earthly example of parallax when they find that the position of an object appears to change slightly as they alternate closing their left and right eyes.
The idea is that the exact same object can appear to be different, even though neither you nor the object has moved an inch.
Examples of parallax are everywhere – just look at China.
If you close your left eye, China appears to be in a massive financial crisis thanks to a bursting credit bubble that has the potential to drag most of Asia, and possibly the world, into an era of massively depressed trade and asset prices.
But if you close your right eye, China has already become the world’s second largest economy (and by some measurements the largest), and has accumulated more savings than every other nation on the planet.

This post was published at Sovereign Man on November 23, 2015.

Treasury Curve Flattest In 7 Months As 30Y Yield Drops Under 3.00%

Treasury yields are at the lows of the day (despite relative equity strength) as this morning’s triple whammy of weak data (CFNAI, PMI, and Existing home sales) confirms fears of Fed policy errors. Theextreme short-positioning across the entire Treasury complex is likely making a few nervous as 30Y yield breaks back below 3.00% for the 3rd time in 3 days.
Aggregating across the entire Treasury future complex, speculators are the most next short since the end of QE1…

This post was published at Zero Hedge on 11/23/2015.

The Social Insecurity System

The Social Security System is actuarially (statistically) bankrupt. It’s only a question of when it will go under, and the form the bankruptcy will take. Without massive monetary inflation, there is no way that someone entering the program today will ever be repaid for the heavy taxes he will shell out. In order to postpone the statistically inevitable, Congress in late 1977 enacted the heaviest peacetime tax increase in U. S. history. Anyone doubting the magnitude of this tax burden need only open the PDF at the bottom of this page and examine the table prepared by Huggins E: Co., consulting actuaries. The table is based on the government’s own figures.
Despite the increases, HEW Secretary Joseph Califano has admitted that the present tax rate is only temporary. It will, at best, keep the system solvent only until the year 2000, assuming that birth rates are as high as the Social Security actuaries predict (they are, in fact, much lower) and that price inflation is held to 4% per annum (it is, of course, presently far higher). In short, Califano’s “pessimistic” prediction is woefully optimistic!
The most honest assessment of what is coming as a result of Social Security’s expenditures was made in 1976 by Sen. William Proxmire. He had an exchange with James Cardwell, the head of the Social Security program (he retired in mid-1978). l need only reproduce this exchange verbatim to give you the picture:
PROXMIRE: There are 37 million people, is that right, that get social security benefits. CARDWELL: Today between 32 and 34 million.

This post was published at Gary North on November 23, 2015.

The most undervalued investment markets in Asia

[Editor’s note: This letter was penned by Tim Price, London-based wealth manager and frequent Sovereign Man contributor.] Seven years on from the collapse of Lehman Brothers, everything has changed, and yet nothing has changed.
There is no longer a perception of panic. $14 trillion of central bank stimulus has seen to that.
But at the same time, a predicament brought to crisis by too much borrowed money has been exacerbated by much more borrowed money: $57 trillion of it, according to the McKinsey Global Institute.
Perhaps the most prescient commentator before the fall of Lehman Brothers was Tim Lee of piEconomics, who wrote the following back in November 2007, fully 10 months before the failure of a second-rate investment bank triggered a global credit crisis:
‘There is little doubt, to my mind, that we are now at a defining moment in financial history, a time that, once it has passed will be referred by economic and market historians in much the same way as the Wall Street Crash of 1929 or the credit and banking crisis of 1973-4 are now.
‘Unfortunately, as is becoming increasingly clear, this crisis is not really just about subprime mortgages. It is much more serious than that. It is the beginning of an inevitable realignment of credit and wealth with incomes and accumulated savings… subprime is merely the first part of the credit edifice to give way, rather than the whole story…’
For seven years and counting, only one question has really mattered to investors: inflation, or deflation?

This post was published at Sovereign Man on November 23, 2015.

Existing Home Sales Decline, NAR Calls Report “Disturbing”; First Time Buyers Decline Third Year; Housing Clearly Weakening

Existing home sales came in a bit under Bloomberg Econoday Consensus, down 3.4% in October. Year-over-year trends are weakening.
Sales of existing homes are not a source of strength for the economy, down 3.4 percent in October to a slightly lower-than-expected annualized rate of 5.36 million. Year-on-year, sales are up only 3.9 percent which is the lowest for this reading since January. Weakness is split roughly even between single-family homes, down 3.7 percent in the month to a 4.75 million rate, and condos, down 1.6 percent to a 610,000 rate.
Lack of homes on the market, in a reflection of price weakness, remains a major factor holding down sales. Supply relative to sales is at 4.8 months, up slightly from the prior month but still below the 5.2 months of October last year. A reading of 6.0 months is considered a balanced market. The number of homes on the market, at 2.14 million, is actually below the 2.24 million this time last year, an unwanted surprise that the National Association of Realtors, which compiles the existing home sales report, calls “disturbing”.
Price data for October are once again weak, down 0.9 percent for both the median (at $219,600) and the average (at $262,800). Year-on-year, the median is up 5.8 percent with the average up 3.4 percent.
Regional sales data show a sharp decline in the West, down 8.7 percent in the month for a year-on-year gain of 2.7 percent. The South, which is the largest housing region, also shows weakness, down 3.2 percent for only a 0.5 percent year-on-year gain. The Northeast and Midwest were little changed in October with year-on-year appreciation very solid for both, in the high single digits.

This post was published at Global Economic Analysis on November 23, 2015.