• Tag Archives Bailout
  • Barclays, Former CEO Criminally Charged Over Qatar Fundraising

    Two familiar names are in the news this morning, after the UK’s Serious Fraud Office filed criminal charges against Barclays Plc and four former executives, including former CEO John Varley, for conspiracy to commit fraud regarding the bank’s 2008 capital raising from Qatar. The SFO said Tuesday that former Chief Executive Officer John Varley, former chairman of investment banking for the Middle East Roger Jenkins, ex-deputy head of investment banking Richard Boath and ex-wealth chief Thomas Kalaris face charges along with the bank.
    The SFO allegations focus on how Barclays arranged two capital injections from Qatari investors during the 2008 financial meltdown, when the bank raised 11.8 billion ($15 billion) to prop it up and avoid a state bailout unlike peers RBC and Lloyds. Barclays said it paid 322 million in ‘advisory services’ to Qatari investors, which wasn’t initially disclosed after the capital was raised. The SFO charged the individuals and the bank with conspiracy to commit fraud. Two individuals, including its former Chief Executive John Varley, were also charged with the provision of unlawful financial assistance. Additionally, the SFO’s charges also relate to a $3 billion loan facility Barclays made to the State of Qatar acting through the ministry of economy and finance in November 2008, just after its second capital raise.
    The WSJ adds that the case marks the first time that top executives at a U. K. bank face criminal charges for their actions during the financial crisis. If Barclays is found guilty it faces a fine but wouldn’t lose its banking license. Barclays said in a statement it is ‘considering its position in relation to these developments.’
    More from the WSJ:

    This post was published at Zero Hedge on Jun 20, 2017.


  • Global Equity Markets Firmer As Oil Stabilizes, Greece Gets Bailout Money

    (Kitco News) – World stock markets were mostly higher overnight. Crude oil prices are firmer today, which helped out the equities. Also, Greece’s creditors approved another release of bailout money for the indebted country, which assuaged European investors. U. S. stock indexes are pointed toward slightly higher openings when the New York day session begins.
    Gold prices are modestly up in pre-U. S. market trading, on a technical and short-covering bounce from solid selling pressure seen earlier this week.
    In overnight news, Russia’s central bank cut its key interest rate by 25 basis points. The Russian ruble rallied on the news.
    The Bank of Japan held its regular monetary policy meeting Friday and made no major changes in its policy.
    The Euro zone’s consumer price index for May was reported down 0.1% from April and up 1.4% from a year ago. The numbers were right in line with market expectations but down from the European Central Bank’s target rate of around 2.0% annual inflation.

    This post was published at Wall Street Examiner on June 16, 2017.


  • Stock Prices Fall as Senate Passes Russia Sanctions Bill

    In Dow Jones news today, stock prices fell as the Senate passed a bill that would place new sanctions on Russia.
    Here are the numbers from Thursday for the Dow, S&P 500, and Nasdaq:
    Now here’s a closer look at today’s most important market events and stocks, plus Friday’s economic calendar.
    The Five Top Stock Market Stories for Thursday
    European finance ministers debated another round of debt relief for the embattled Greek economy and decided to offer a bailout of 8.5 billion euros ($9.5 billion). Greece’s current bailout program is the third effort by international finance leaders since the nation fell into economic calamity in 2010. Crude oil prices cratered and hit a seven-month low on news of a huge spike in U. S. gasoline inventory levels and expectations that OPEC will not be able to balance supply and demand. Crude oil prices are now off more than 12% since May 25. The WTI crude oil price today fell 0.7%. Brent crude dipped 0.2%.

    This post was published at Wall Street Examiner on June 15, 2017.


  • EU Reach Bailout Deal With Greece Once Again

    #IMF Managing Director Christine Lagarde to propose approval in principle of new Stand-By Arrangement for #Greece. #Eurogroup pic.twitter.com/6yfuRHRjXd
    — Manos Giakoumis (@ManosGiakoumis) June 15, 2017

    Update: it appears there isn’t really a deal, but merely a can kicking. As the WSJ adds, the Greek “agreement” merely unlocks a key disbursement of bailout fund but puts a decision on debt relief off until next year. Specifically, the agreement reached in Luxembourg among the finance ministers of the eurozone unlocks 8.5 billion for Greece and puts off a final decision on debt relief until August of next year.
    In other words, Europe agrees to pay Greece so Greece can then turn around and repay Europe the July 7 billion debt payment; meanwhile no firm, long-term deal has been reached.
    As the WSJ put its, “the creditors’ refusal to lighten the burden of Greece’s crushing debt reflects a mix of mistrust and indifference that leaves the depleted country with bleak prospects for the future and at risk of needing yet another bailout.”

    This post was published at Zero Hedge on Jun 15, 2017.


  • The Next Financial Crisis Has Already Arrived In Europe, And People Are Starting To Freak Out

    Did you know that the sixth largest bank in Spain failed in spectacular fashion just a few days ago? Many are comparing the sudden implosion of Banco Popular to the collapse of Lehman Brothers in 2008, and EU regulators hastily arranged a sale of the failed bank to Santander in order to avoid a full scale financial panic. Sadly, most Americans have no idea that a new financial crisis is starting to play out over in Europe, because most Americans only care about what is going on in America. But we should be paying attention, because the EU is the second largest economy on the entire planet, and the euro is the second most used currency on the entire planet. The U. S. financial system is already teetering on the brink of disaster, and this new financial crisis in Europe could turn out to be enough to push us over the edge.
    If EU regulators had not arranged a ‘forced sale’ of Banco Popular to Santander, we would probably be witnessing panic on a scale that we haven’t seen since 2008 in Europe right about now. The following comes from the Telegraph…
    Spanish banking giant Santander has stepped in to the rescue ailing rival Banco Popular by taking over the failing lender for 1 in a watershed deal masterminded by EU regulators to avoid a damaging collapse.
    Santander will tap its shareholders for 7bn in a rights issue to raise the capital needed to shore-up Popular’s finances in a dramatic private sector rescue of Spain’s sixth-largest lender.
    It will inflict losses of approximately 3.3bn on bond investors and shareholders but crucially will avoid a taxpayer bailout.

    This post was published at The Economic Collapse Blog on June 12th, 2017.


  • LTCM Is Back: One Hedge Fund Uses 25x Leverage To Beat The Market

    Before we start, a little history lesson…
    At the beginning of 1998, Long-Term Capital Managementhad equity of $4.72 billion and had borrowed over $124.5 billion with assets of around $129 billion, for a debt-to-equity ratio of over 25 to 1.
    It was run by finance veterans, PhDs, professors, and two Nobel Prize winners. Everyone on Wall Street wanted a piece of their profits.
    But by 1998, that firm was primed to expose America’s largest banks to more than $1 trillion in default risks. The demise of the firm, LTCM, was swift and sudden. In less than one year, LTCM had lost $4.4 billion of its $4.7 billion in capital.
    The disaster had all the players – the Federal Reserve, which finally stepped in and organized a bailout, and all the major banks that did the heavy lifting: Bear Stearns, Salomon Smith Barney, Bankers Trust, J. P. Morgan, Lehman Brothers, Chase Manhattan, Merrill Lynch, Morgan Stanley, and Goldman Sachs.
    In desperate need of a $4 billion bailout, the crumbling firm was at the mercy of the banks it had once snubbed and manipulated.

    This post was published at Zero Hedge on Jun 11, 2017.


  • Is Another Spanish Bank about to Bite the Dust?

    Stockholders and junior bondholders fear a ‘bail-in.’
    After its most tumultuous week since the bailout days of 2012, Spain’s banking system is gripped by a climate of fear, uncertainty and distrust. Rather than allaying investor nerves, the shotgun bail-in and sale of Banco Popular to Santander on Tuesday has merely intensified them. For the first time since the Global Financial Crisis, shareholders and subordinate bondholders of a failing Spanish bank were not bailed out by taxpayers; they took risks in order to make a buck, and they bore the consequences. That’s how it should be. But bank investors don’t like not getting bailed out.
    Now they’re worrying it could happen again. As Popular’s final days showed, once confidence and trust in a bank vanishes, it’s almost impossible to restore them. The fear has now spread to Spain’s eighth largest lender, Liberbank, a mini-Bankia that was spawned in 2011 from the forced marriage of three failed cajas (savings banks), Cajastur, Caja de Extremadura and Caja Cantabria.

    This post was published at Wolf Street by Don Quijones ‘ Jun 10, 2017.


  • Canada Unveils $650 Million Lumber Industry ‘Bailout’ “To Stand Up To US”

    Canada’s Natural Resources Minister Jim Carr just announced C$867 million (around $650 million) in financial supports for softwood lumber producers and the communities where they are based…’Canada is standing up to the U. S., Canada is standing up for Canadians.’
    On Wednesday, the Conference Board of Canada released a report saying Canadian softwood producers would pay $1.7 billion in duties a year and cut 2,200 jobs and $700 million in U. S. exports over the next two years before the dispute is settled.
    And perhaps on the basis of that report, as Canadian Press reports, the package includes loans and loan guarantees to help cushion the blow for forestry companies and to help them exploring new markets and innovations.

    This post was published at Zero Hedge on Jun 1, 2017.


  • Greek Deal on Debt Relief Founders as Talks Stretch to June

    Euro-area finance ministers gathering in Brussels on Monday failed to break an impasse on debt relief for Greece, delaying the completion of the country’s bailout review and the disbursement of fresh loans needed to repay obligations in July.
    After nearly eight hours of talks and multiple draft compromises, Athens and its creditors couldn’t reach an accord that would ease Greece’s debt and that would convince the International Monetary Fund to agree to help finance the country’s bailout.
    ‘The Eurogroup held an in-depth discussion on the sustainability of Greece’s public debt but did not reach an overall agreement,’ said Jeroen Dijsselbloem, the Dutch finance minister who presides over meetings with his euro-area counterparts. Work will continue in the coming weeks with the aim of reaching a conclusion on June 15 at the next meeting of ministers, he said.
    The IMF has been seeking more debt relief for the country, pushing euro-area creditors to ensure the sustainability of Greece’s 315 billion ($354 billion) of obligations before it participates in the program. Some nations including Germany object to a debt restructuring while also insisting that the Washington-based fund join the program to lend credibility to the bailout.

    This post was published at bloomberg


  • We Are Now Witnessing The Total Break Down Of The System – Episode 1287a

    The following video was published by X22Report on May 23, 2017
    UK’s consumers are tapped out and the retail industry was just hit and the entire market is now slowing. The EU will not let the UK exit they want 112 Billion Euros to leave. Greek bailout is not working out, Greece is now back in a recession, which they never really left. Soft data, hard data, all pointing to the same thing the system is breaking down. New home sales crashed, the real estate market is starting to fall apart. The average GDP numbers of the 30 match the average GDP number today, this means we are in a depression.


  • Mnuchin Comments On Trump’s “Historic” Budget Proposal: “It Will Prevent Taxpayer Bailouts”

    In a statement issued moments ago discussing Trump’s proposed, if completely impossible, budget proposal, Treasury Secretary Steven Mnuchin said that Trump’s “budget will achieve savings through reforms that prevent taxpayer bailouts and reverse burdensome regulations that have been harmful to small businesses and American workers.” Translation: taxpayer bailouts are imminent, especially now that the current economic cycle is the 3rd longest of all time and a recession grows likelier with every passing day.
    Mnuchin also said that Trump’s proposed initiatives “coupled with comprehensive tax reform and other key priorities, will move America one step closer to sustained economic growth of 3 percent or higher.”
    While we will clearly take the under, what we find most amazing about Trump’s budget proposal, is that it does not anticipated a recession until 2027. That would imply 18 years of economic growth since the 2009 recession, without a single contraction! Good luck with that.

    This post was published at Zero Hedge on May 23, 2017.


  • Greek Debt Relief Deal Fails In Last Minute, As Germany, IMF Clash Again

    Stop us if you’ve heard this story before.
    Insolvent Greece, having last week voted itself into even more austerity in hopes of unlocking some of the money promised it by Brussels so it can then use it to repay debt maturities owed to the ECB (whether it will actually follow through with said austerity measures remains unclear, though most likely not), is dragged to the finish line of yet another Euro finance minister negotiating session with promises that this time a debt relief deal is virtually guaranteed, and then… it all falls apart.
    That’s what again happened today, when Euro-area finance ministers gathered in Brussels with hopes, at least for the Greek delegation, to come home with a signed agreement, only to fail to break the impasse on debt relief for Greece, delaying the conclusion of the country’s bailout review and the disbursement of fresh loans needed to repay obligations in July.
    ‘The Eurogroup held an in-depth discussion on the sustainability of Greece’s public debt but did not reach an overall agreement,’ said Jeroen Dijsselbloem, the Dutch finance minister who presides over meetings with his euro-area counterparts, and who again failed to reach a solution after another hardline stance by his German colleague, Wolfgang Schauble, prevented any potential concessions. As a reminder, ever since the 3rd Greek bailout in the summer of 2015, rhe IMF and Germany have been at odds over Greece’s economic outlook and the amount of debt relief required to assure economic stability: it was the same debate, that prevented a deal from being inked on Monday.

    This post was published at Zero Hedge on May 22, 2017.


  • Greek Authorities To Launch Mass Confiscation Of Safe Deposit Boxes, Securities, Homes In Tax-Evasion Crackdown

    Last week, the Greek parliament once again approved more austerity to unlock withheld Greek bailout funds in Brussels: a symbolic move, which has little impact without any actual follow through, like for example, actually imposing austerity. And while Greeks have been very good in the former (i.e. promises), they have been severely lacking in the latter (i.e. delivery).
    That may be changing. According to Kathimerini, Greek Finance Ministry inspectors are about to start seeking out the owners of all local undeclared properties, while the law will be amended to allow for financial products and the content of safe deposit boxes to be confiscated electronically. The plan for the identification of taxpayers who have ‘forgotten’ to declare their properties to the tax authorities is expected to be ready by year-end, according to the timetable of the Independent Authority for Public Revenue.
    What follows then will be a wholesale confiscation by the government of any asset whose source, origins and funding can not be explained.

    This post was published at Zero Hedge on May 22, 2017.


  • California is Highest Taxes State in USA and should join the EU

    Governor Jerry Brown never saw a problem that could not be solved by just raising more taxes. This time, the state pension fund is going broke as we have been warning with the building Pension Crisis thanks to mismanagement and low interest rates thanks to Larry Summers. California has already increased its gasoline tax by 50% in the past decade. Now to bailout the state employee Pension fund, Gov. Brown has proposed a 42% increase in gasoline taxes and, get this, a 141% increase in vehicle registration fees. Nobody talks about cutting government employee pensions. NEVER! Why when you have a population to milk like the cow.

    This post was published at Armstrong Economics on May 14, 2017.


  • “Canada Hasn’t Seen A Bank Run Such As This In Decades” – Finance Minister Says Home Capital Bailout Is Possible

    When we first said three weeks ago that the spectacular, sudden implosion of Canada’s largest alt-lender Home Capital Group or HCG – whose fate we had followed closely since 2015 – was Canada’s own “New Century Moment“, the parallels were more than just the obvious: like in the US, it took the market nearly a year to realize the full implications of the subprime collapse which first manifested in the failure of New Century and its subprime lender peers. When all was said and done, the world’s central banks had to pump (and still do) trillions into the financial system to stop it from disintegrating.
    Slowly but surely, Canada is starting to appreciate just how serious the Home Capital failure is, and how the unprecedented bank run that has led to 94% of retail deposits fleeing the troubled lender…

    This post was published at Zero Hedge on May 13, 2017.


  • Greek Stocks Drop After Longest Winning Streak In 26 Years

    After 13 straight days higher – the longest streak since 1991 – the greek stock market fell today. This drop comes a day after we warned of the misplaced confidence surrounding the Greek government’s decision to issue debt once again…
    As Bloomberg reports, the benchmark ASE Index fell on Friday, breaking its longest winning streak in 26 years. It rallied 19 percent from April 21 through Thursday, while investors poured money into a fund tracking the country’s shares, as Greece reached an agreement with its creditors on the technical issues of a second bailout review.

    This post was published at Zero Hedge on May 12, 2017.