About Those Handcuffs…

So let me see if I get this right.
Wells Fargo put in place an extremely aggressive “cross-selling” requirement for their associates — basically, to keep your job and advance you were required to sell customers new products, which means that as an associate you had to be openly pushy to the point of hostility in order to keep your job.
Employees found this, obviously, to not work so well. You see, there’s a point at which pestering customers who come into your bank to cash a check or similar in an attempt to sell them something else, whether it be a credit card account or some other financial product, get very tired of this crap and instead of transacting the business they intended they pull all their money out and close their accounts instead, going next door to the other bank (and there always is one.)
So to combat that problem these employees — 5,300 of them — committed open, outrageous and I might mention illegal acts. They signed up customers for “new services and fees”, in some cases transferring money into accounts they had never requested or opened.
Now let’s think about this for a minute. If you have money in some place and it is moved without consent that is both fraud and theft. If you are charged money for something you never requested or ordered, and the funds are taken, that too is fraud and theft.

This post was published at Market-Ticker on 2016-09-09.

[Chart] Speculative Trading on U.S. Markets Is at a Dangerous High

This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
Speculative trading on so-called long contracts, or long-term bets that the markets will rise, has reached a startling high this year.
On Wednesday, analyst David Rosenberg at Gluskin Sheff found that speculative long contracts on the Dow reached a record high of 38,382. Long contracts for the S&P 500 also hit their highest level since June 2013 at 38,083, according toYahoo Finance.

This post was published at Wall Street Examiner by Cameron Saucier ‘ September 9, 2016.

Meanwhile, The Democrats Are Getting Worried

Given that Donald Trump is the ‘devil incarnate’ if one listens to any of the Clinton surrogates, Democrats are growing more and more concerned as Hillary’s ‘insurmountable’ lead has collapsed to its lowest since the conventions. With her campaign reportedly warning media to ‘tread carefully’ on health concerns, The Hill reports anxiousDemocratic senators are urging Clinton to “be more open, show your soul, focus on the economy and talk about blue-collar jobs.”

This post was published at Zero Hedge on Sep 9, 2016.

Note on the Bonds

There seems to be a growing line of thought that the Fed may go with a rate hike this month. Traders are apparently looking at these various Fed governors’ speeches and coming to a conclusion that they are trying to prep the markets for a rate increase.
Boston Fed Governor Rosengren commented this AM about the risk of waiting too long to hike rates. He had tightening labor markets in mind. Then we had an announcement that another Fed governor, Ms. Brainard is set to deliver a speech late Monday afternoon. Since she has been a fairly vocal dove, traders are speculating that she might change her tune somewhat.
Also, Dow Jones is citing an upcoming 3-year and 10-year Treasury note auction scheduled for Monday which is due to be finished up shortly before Brainard gives her speech.
In yesterday’s comments on the bonds I noted that perhaps Draghi’s comments yesterday were also instrumental in the bond selloff. The line of thinking is that the Central Banks are perhaps reaching the end of monetary policy limits.

This post was published at Trader Dan on September 9, 2016,.

Equality and The American Democrat

James Fenimore Cooper, America’s first national novelist, lived during our first great groundswell of political populism during the Jacksonian era. Egalitarian language and imagery fanned enthusiasm for democracy. Cooper saw serious dangers from this impulse toward majority rule as a panacea for every complaint, and that without strict limits on what majorities were allowed to decide, it was inconsistent with the equality of unalienable rights our founders proclaimed.
Cooper devoted much of The American Democrat (1838) to the appropriate understanding of equality under our Constitution. It is ignored today, in the swelling cacophony of pleas for special treatment in the name of equality. However, his understanding, based on the insight that ‘The denial of a favor is not an invasion of a right,’ merits renewed attention.
Among Cooper’s many insights are these:
All men are not ‘created equal’…unless we limit the signification to one of political rights. As regards all human institutions, men are born equal.

This post was published at Ludwig von Mises Institute on Sept. 9, 2016.

Descendants Of Slaves Owned By Georgetown University Want $1 Billion

Last week we noted that Georgetown University President, John DeGioia, announced plans to grant preferential admission consideration to descendants of slaves formerly owned and sold by the university in 1838 (see “Georgetown To Grant Admission Preference To Slave Descendants“). According to a report of a special “Working Group” of the university, two priests who served as president back in 1838 orchestrated the sale of 272 slaves netting the university $115,000 ($3mm in current dollars) which was used to pay off school debts. The “preference in admissions,” along with an official apology from President DeGioia, was part of the
school’s effort to “atone” for profiting from the sale of enslaved
people.
As part of our note, we suggested that Georgetown should post their “bid” of “preference in admissions” to the officialReparations website so that an official market could be established (see “There Is Now A Marketplace For White People To Make Reparations Payments“). Now, less than a week later, we have an official “offer” from thedescendants of the slaves formerly owned by Georgetown who want “preference in admission” plus a mere $1 billion. Up until now, the 15 point spread on the Ford term loan back in October 2008 was about the most egregious bid/ask gap we’d ever seen but this puts that market to shame.
Per the Washington Post, the descendants of the 272 slaves sold by Georgetown University have already raised $115,000 so they really only need help with the incremental $999,885,000.

This post was published at Zero Hedge on Sep 9, 2016.

Negative Rates Will Kill Growth

For years I have argued that ultra-low interest rates act more as an economic sedative than a stimulant. This idea has elicited laughter from the economic establishment. But it is becoming clearer that rates set by central banks that are far below the levels that free markets would have otherwise determined have dragged the world into the economic mud. The simple proof is currently arising in Europe where negative interest rates are now transforming companies from agents of growth, production, and employment into financial sloths that exist solely to borrow money. In a September 7 front page article, the Wall Street Journal reported that as of September 5, 706 billion worth of investment-grade European corporate debt, or roughly 30% of the market, according to trading platform Tradeweb, was trading at negative yields, an increase from just 5% in January. These negative yields were the result of intense activism on the part of the European Central Bank (ECB). For years the ECB had been trying to stimulate growth by buying trillions of euros’ worth of sovereign debt. But as these programs proved ineffective to wake up the EU economy from its long economic slumber, this year they began moving into the corporate market. Most of this buying has occurred on the secondary market, for bonds that had previously been issued at positive rates. The central bank buying raised prices of these bonds sufficiently to push yields into negative territory. It also has drawn in speculators who have bought low yielding bonds not because they are good investments but because they are convinced that the ECB will one day buy them out at a premium.

This post was published at Euro Pac on Friday, September 9, 2016.

Why Does Propaganda Work? Some People Want It

Submitted by Daniel Lattier viaThe Foundation for Economic Education,
There’s a principle in hypnotism that goes like this: A person cannot be hypnotized against his will. He must be a willing subject. He must be fully cooperative.
So it goes with propaganda. For propaganda to be effective, it requires submissive subjects. As Professor Nicholas O’Shaughnessy wrote, propaganda is a ‘co-production in which we are willing participants.’
Propaganda is typically defined as the dissemination of particularly biased information in support of a political or ideological cause. In his 1965 book Propaganda: The Formation of Men’s Attitudes, philosopher Jacques Ellul provided us with some of the basic characteristics of propaganda: it thwartsdialogue, it is geared toward the masses, it utilizes various media, it is continuous, it is not intended to make one think.
Disable the Brain
If these are the characteristics of propaganda, then it is no exaggeration to say that we are surrounded by it today. Most news organizations have become partisan shills and propagandists. They provide viewers with a steady stream of videos, audio clips, images, and articles – most lacking nuance and of dubious intellectual merit – that serve the intended purpose of promoting an ideology while fueling disdain for the ‘opposition’. And they have become very successful doing it.

This post was published at Zero Hedge on Sep 9, 2016.

SEPT 9/BOND PRICES COLLAPSE GLOBALLY AS ALL YIELDS RISE HUGELY/USA PASSES BILL ALLOWING FOR LAWSUITS AGAINST SAUDI ARABIA: NOW UP TO OBAMA/WELLS FARGO CREATED MILLIONS OF FAKE ACCOUNTS AND ARE NO…

Gold:1330.10 down $6.70
Silver 19.28 down 32 cents
In the access market 5:15 pm
Gold: 1328.20
Silver: 19.06
THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON
.
The Shanghai fix is at 10:15 pm est and 2:15 am est
The fix for London is at 3 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 45 minutes before London’s first fix.

This post was published at Harvey Organ Blog on September 9, 2016.

Market Talk September 8th, 2016

Secondary economic data in Japan coupled with slight dovish comments BOJ comments and the Nikkei started to drift lower. At worse the index was down around 1% but a lack of follow through volume saw a reasonable bounce into the close. Eventually, the Nikkei closed down 0.3% which, around mid afternoon looked very unlikely. The JPY again saw an active day but this time in the opposite direction. Having spent a lot of the morning with a 101 handle it was not until the European session that it moved to the mid 102’s. Still the talk is around the BOJ’s uncertainty towards additional monetary policy but given the ECB address today and the reaction Bunds and peripheral market had, it should be no surprise JPY was hit. Shanghai and Hang Seng were both better bid with HSI the best of the two closing 0.75% better.

This post was published at Armstrong Economics on Sep 8, 2016.

German Exports Plunge 10% Overall, 14% to Non-EU Countries

Something doesn’t add up. Germany’s export-focused economy has been showing some signs of weakness, but no signs of an outright Financial-Crisis type collapse. So this data set released today by the German Statistical Agency doesn’t match those trends, and it doesn’t fit into the scenery. It could be an outlier, a statistical quirk, something that will be adjusted out of the way later. Or it could be a very unpleasant warning sign.
The German Statistical Agency today reported that, based on preliminary data, exports in July plunged 10% compared to July last year (not seasonally adjusted), to 96.4 billion.
And imports dropped 6.5% (not seasonally adjusted) year over year, to 76.9 billion. This slashed Germany’s trade surplus for July by 21% to 19.5 billion.
Exports to the 28-member European Union plunged 7.0% to 56.3 billion, while imports from EU countries dropped 4.5% to 51.3 billion.

This post was published at Wolf Street on September 9, 2016.

“It’s Never Different This Time” PIMCO Warns “The Tides Of Risk Will Flow Eventually”

Authored by Harley Bassman, originally posted at PIMCO.com,
he old Wall Street expression is ‘They don’t ring a bell at the top.’ This snarky adage is usually employed by those saddened financial managers who ride a successful investment to a peak and then watch in horror as it reverses course to a level below their cost basis. They lay the blame at the feet of the amorphous market that failed to signal it was time to exit the ride.
A pity this notion is misguided, since the market frequently ‘rings the bell.’ It is just that most market participants are not listening. Perhaps they should be listening now.
As I have detailed in the past, there are effectively only three risk vectors in the fixed income markets: duration, credit and convexity. I like to summarize these divining risk characteristics as ‘When investors receive their returns,’ ‘If investors receive their returns’ and ‘How investors receive their returns.’
Duration risk is usually measured as a function of the shape of the yield curve (as opposed to yield level): the greater the absolute shape (steep or inverted), the larger the embedded risk of an interest rate change. (See Viewpoint – October 2014, ‘ Financial Market Cognitive Dissonance.’) An investment’s credit risk tends to be assessed via its spread to a benchmark Libor rate. Finally, an investment’s convexity risk, often associated with its exposure to path dependency (via embedded or explicit optionality), is usually summarized as a single measure of implied volatility.

This post was published at Zero Hedge on Sep 9, 2016.

Charles Bolin’s September Investment Outlook

Summary
Investment Climate is moving sideways Data does not indicate a cause for optimism I will continue to be conservative through the end of the year. Introduction
Of the monthly data that I track, 46% are trending negative compared to 62% last month. Of the quarterly data, 67% is trending worse. The chart below shows my Investment Indicator for the average of the Technology and Financial corrections (dark red line) and the current Indicator (light red). The Investment Climate was trending along the same path as it did during the previous two corrections until about April when it started flattening. The Wilshire 5000 (bright red) began increasing as the indicator stopped declining. The Indicator took a breather the second quarter since its year-long decline. I am not convinced that it is improving or will continue it’s decent after the election.

This post was published at FinancialSense on 09/09/2016.

Weekend Reading: A Market In Stasis

Submitted by Lance Roberts via RealInvestmentAdvice.com,
The market hangs in a virtual stasis. Over the past couple of months, we have continued to drift from one economic report, or Central Bank meeting, to the next. Each report and meeting have continued to leave market participants confused as to what is going to happen next.
Is the economy improving? Or not?
Will the Fed hike rates? Not?
The bulls and the bears have met at the crossroad. However, neither is ready to commit capital towards their inherent convictions. So, for 43-days, and counting, we remain range bound waiting for what is going to happen next.

This post was published at Zero Hedge on Sep 9, 2016.

Belgium Threatens To Sue Caterpillar For “Brutal, Cruel And Heartbreaking” Decision To Fire 2,000

While Caterpillar may be Deutsche Bank’s latest darling, with the German bankrecently initiating coverage on the heavy machinery equipment maker with a Buy and a $98 price target, the company – which has not seen a positive retail sales month in nearly 4 years and which has been on a substantial firing spree, got into hot water when Belgium’s government announced it was considering legal action against Caterpillar over the U. S. heavy equipment maker’s decision to close a manufacturing site and lay off more than 2,000 workers.

This post was published at Zero Hedge on Sep 9, 2016.