• Tag Archives Regulation
  • Where US Stocks Are Traded Today

    Last week, the US Treasury Department issued its second of four reports related to President Trump’s Executive Order 13772 (on regulation in alignment with the Core Principles). The first report was on Banking, this report is on the Capital Markets, and other reports will follow over the coming months (including on asset management, insurance, products, vehicles, non-bank financial institutions, financial technology, financial innovation, and others).
    As BofA notes, the main recommendation in this report was to foster growth in-line with the Core Principles. Specifically, the biggest focus was to enhance access to capital and investment opportunities, i.e. increase the number of IPOs. Indeed, the US Treasury recommended changes to encourage companies towards public ownership (particularly given that the number of public companies in the U. S. is down 50% over the past 20 year ), which would create more investment opportunities. In addition, other recommendations including helping entrepreneurs, reviewing proxy advisory firms, and revisiting the accredited investor definition to open private market investment opportunities to more investors.

    This post was published at Zero Hedge on Oct 9, 2017.

  • Bill Blain: “Aside From The Jobs Report, What Else Is There To Say This Morning?”

    ‘You’re a cop. I had your job once. I was good at.’
    Continued Upside! What does it mean? Short term complacency danger, but long term maybe soft bull?
    It’s Payrolls Day! Clue: monthly payrolls are not a particularly reliable indicator, although the data-set has acquired a quasi-religious sentiment status despite being a unreliable single look-back data point amongst the deluge of information we can plough every day. (In fact, pretty much discount today’s payrolls: if they are positive they change nothing, negative and they will be dismissed as ‘hurricane distorted’ – look to the next release in November as more meaningful!)
    Aside from the jobs report, I’m wondering what else there is to say this morning?
    VIX at yet another record low. S&P sustains a record number of record highs. Market fully prepared and ready for a December hike. Even Spain rose yesterday – boosted by the perception of a Catalan pull-back. My bearish stock picking chum Steve Previs had to reset his shorts because of the market’s resilience.. My chums in the financials sector have gone all bullish (again) convinced higher rates are good for banks, ‘synchronised global growth’ means lower NPLs, and now we’ve got potential Fed Chair candidates actively supporting rolling back regulation. What can possibly good wrong?

    This post was published at Zero Hedge on Oct 6, 2017.

  • Watch Live: Janet Yellen Addresses Community Bankers In St.Louis

    Update: Yellen didn’t discuss her outlook for interest rates or the economy in her prepared remarks.
    Bloomberg reports that Federal Reserve Chair Janet Yellen said the U. S. central bank has been working to ensure that regulations are tailored to the size, complexity and roles of the lenders it oversees.
    ‘For community banks, which by and large avoided the risky business practices that contributed to the financial crisis, we have been focused on making sure that much-needed improvements to regulation and supervision since the crisis are appropriate and not unduly burdensome,’ Yellen said Wednesday.
    Yellen didn’t discuss her outlook for interest rates or the economy in her prepared remarks.
    The Fed has ‘an abiding commitment to consider how our decisions affect institutions and the customers they serve,’ she said in a text prepared for delivery at the St. Louis Fed’s annual community banking conference.
    As we detailed earlier, since Janet Yellen last spoke (shifting hawkish), the dollar and bond yields have surged (as have the odds of a Dec rate-hike).
    Since Yellen last spoke…

    This post was published at Zero Hedge by Tyler Durden Oct 4, 2017.

  • Meet The Next Fed Chair: The Definitive Cheat Sheet

    With the race for the next Fed chair in its final stretch as Trump is now expected to make his decision over the next few weeks, and following recent reports from Bloomberg, Politico and the WSJ, the three frontrunners to replace Yellen, according to PredictIt, are Kevin Warsh, Jerome Powell, Gary Cohn and unexpectedly, Neel Kashkari, following yesterday’s endorsement by Jeff Gundlach…

    … Bank of America has put together a handly cheat sheet laying out a summary of the major views by the 4 key contenders.
    Focusing on the top four candidates, BofA, predictably, sees Warsh as the most hawkish and most likely to change the way the Fed conducts monetary policy, leaning toward rules-based policy. BofA also thinks Warsh would favor a lower ultimate size of the balance sheet but would be a strong proponent of deregulation. Meanwhile, Powell is the establishment candidate who won’t ‘rock the boat’ as his stance is consistent with the current framework of the Fed. As for Cohn, he would likely lean a bit more dovish and emphasize putting in place monetary policy to complement fiscal policy reform.
    Here is the full breakdown, according to BofA, which shows just how “unconventional” Warsh is in the context of his peers.

    This post was published at Zero Hedge on Oct 4, 2017.

  • India’s Appetite for Silver

    Indians love gold. Despite rising prices, a tax increase, and government attempts to tighten regulation of the jewelry industry, gold imports into the country nearly tripled year-on-year in August. India ranks as the second largest gold consuming country in the world, trailing only China. But gold isn’t the only precious metal Indians covet. They also buy a lot of silver.
    According to a new report by the Silver Institute, India consumed 160.6 million ounces of silver in 2016, accounting for 16% of global silver demand.
    More than half of the silver flowing into India is used in jewelry and silverware.
    These are traditional markets, though the demand drivers and consumer profile vary considerably between both segments. Typically, silver jewelry is purchased by most income groups in India, whereas silverware is bought by the middle and affluent classes. Since the start of this decade, there has been a large expansion of demand in both markets, from around 39 Moz in 2010 to 88 Moz in 2016. Of note, the Indian silverware market is the largest in the world and its importance is growing, representing 70 percent of the total global demand.’

    This post was published at Schiffgold on OCTOBER 2, 2017.

  • Here Are The Cities Of The World Where “The Rent Is Too Damn High”

    In ancient times, like as far back as the 1990s, housing prices grew roughly inline with inflation rates because they were generally set by supply and demand forces determined by a market where buyers mostly just bought houses so they could live in them. Back in those ancient days, a more practical group of world citizens saw their homes as a place to raise a family rather that just another asset class that should be day traded to satisfy their gambling habits.
    But, thanks to the efforts of global central banks, the days where home prices roughly reflected the ability of the marginal local buyer to afford those homes, is long gone. As a general rule of thumb, a house was historically considered “affordable” if it was less than 2.5 times a family’s annual gross income…by those metrics, at least according to the UBS Global Real Estate Bubble Index released earlier today, the median buyer can’t afford housing in pretty any of the major cities of the world.
    Buying a 60m2 (650 sqft) apartment exceeds the budget of people who earn the average annual income in the highly skilled service sector in most world cities. In Hong Kong, even those who earn twice the city’s average income would struggle to afford an apartment of that size. House prices have also decoupled from local incomes in London, Paris, Singapore, New York and Tokyo, where price-to-income multiples exceed 10. Unaffordable housing is often a sign of strong investment demand from abroad, tight zoning and rental market regulations. If investment demand weakens, the risk of a price correction will increase and the long-term appreciation prospects will shrink.

    This post was published at Zero Hedge on Sep 29, 2017.

  • Throwing Wet Paper Towels Against the Wall

    There are currently about 2,000 ETFs in existence. Many of them are useless.
    This isn’t new to you – many of you who answered my ETF survey said there are just too many.
    Sample Response 1: ‘There are so many ETFs that choosing an ETF mix is now as difficult as choosing individual stocks and other assets.’
    Sample Response 2: ‘Every Tom, Dick and Harry has formed one for something.’
    Some people think there is an ETF bubble, because of all the stupid ETFs that are coming out. When a fund like WSKY (Spirited Funds/ETFMG Whiskey and Spirits ETF) appears on the scene, it’s safe to assume that the top is probably in. Right?
    Actually, that is not the case.
    The thing about ETFs is that they are much cheaper to launch than a traditional open-end mutual fund. It still costs money – in the six figures – but I know rather ordinary people who have done it.
    It’s a lot of work navigating the regulations, working with an index provider, getting people to make markets – but it’s just sweat equity. There simply is not a lot of overhead.

    This post was published at Mauldin Economics on SEPTEMBER 28, 2017.

  • The Political and Economic Mystiques of State Power

    One of the great political mysteries has been the success of governments in ruling over societies with little opposition and resistance from the vast majority of the population, even when those governments have been brutal tyrannies and openly dictatorial in their control.
    This has been true, no less, under democratic regimes, as well, under which levels of taxation have been far higher and the degrees of regulation over personal, social and economic activities often much more intrusive than under tyrants of bygone ages. This has been in spite of the fact that those governments are formally ‘answerable to the people’ through regular elections determining who holds high political office with legitimized power over the electorate’s lives.
    Conquest and Plunder as the Origin of the State It has long been understood by historians that most modern States, such as in Europe, have their origins in conquest and plunder. Invading tribes and bands would vanquish existing rulers and their peoples, and settle down to permanently live off those whom they had not killed during the conquest.

    This post was published at Ludwig von Mises Institute on September 26, 2017.

  • Bitcoin ‘Is A Bubble’ but Gold Is Money Says World’s Biggest Hedge Fund Manager

    – Bitcoin ‘is a bubble’ but gold is money says world’s biggest hedge fund manager
    – Gold is a better ‘store of value,’ Ray Dalio of $160 billion Bridgewater tells CNBC
    – Bitcoin has climbed over 300% this year on speculation and expectation that it will continue to climb
    – Bitcoin is not a valid currency due to volatility and lack of spending ability says Dalio
    – Bitcoin is ‘worse than tulip bulbs’ says JP Morgan’s CEO Dimon
    – Crypto buyers need to be concerned with government regulations
    The manager of the world’s biggest hedge fund, Ray Dalio has declared his preference for gold over bitcoin.
    Earlier this week Dalio, of $160bn Bridgewater Associates, labelled bitcoin ‘a bubble’. Dalio believes the 300% plus rise in price of the most popular cryptocurrency is down to speculation over its expected price rise, as opposed to confidence in its future role as a currency.
    Dalio’s comments come less than a week after J. P. Morgan’s Jamie Dimon said bitcoin ‘is worse than tulip bulbs’ and a month after Professor Robert Shiller said it was the best example of ‘a bubble right now’.
    Bitcoin had a tough week last week, taking a hit following an announcement by Chinese authorities to shut down exchanges. However, it has since begun to recover.
    It’s strong performance this year has prompted many experienced investors and economists to call it out for what it seems to be – a bubble.

    This post was published at Gold Core on September 23, 2017.

  • India Gold Imports Nearly Triple in August Despite Tax Increase and Government Regulations

    Despite rising prices, a tax increase, and government attempts to tighten regulation of the jewelry industry, gold continues to flow into India.
    Gold imports into the country nearly tripled year-on-year in August. An estimated 60 tons of the yellow metal flowed into the Asian nation last month, up from 22.3 tons in August 2017. This continues a trend for the year. Over the first 8 months of 2017, India’s gold imports climbed to 617.5 tons, a 158% increase over 2016.
    As a Reuters report notes, the Indian gold market has an impact on the broader world market.
    Higher purchases by India, the world’s second biggest consumer, could support global prices, trading near their highest level in a year.’
    The continued flow of gold into India demonstrates the resilience of the market in that country. On July 1, the Indian government replaced a labyrinth of taxes with a nationwide 3% Goods & Services Tax (GST). The World Gold Council called it the ‘biggest fiscal reform since India’s liberalization in the early 1990s.’ The WGC said the new tax structure would ultimately increase demand for gold in India, but analysts braced for a short-term dip in imports as the tax went into effect and the market adjusted to the new system.

    This post was published at Schiffgold on SEPTEMBER 18, 2017.

  • Weekly Commentary: Monetary Disorder

    This is a syndicated repost courtesy of Credit Bubble Bulletin . To view original, click here. Reposted with permission.
    Global Credit, Bubble and market analysis is turning more interesting.
    China August Credit data were out Friday. Total (aggregate) Social Financing jumped to 1.48 TN yuan ($225bn), up from July’s 1.22 TN and above the 1.28 TN estimate. New Loans were reported at a much stronger-than-expected 1.09 TN (estimates 750bn yuan), up from July’s 825bn. New loans expanded 13.2% y-o-y. Through August, Total Social Financing is running 18% above 2016’s record pace. Total system Credit growth (‘social financing’ plus govt. borrowings) appears on track to surpass $4.0 TN. While ‘shadow banking’ has of late been restrained by tighter regulation, household (largely real estate) borrowings remain exceptionally strong.
    It was the weaker Chinese economic data that made the headlines this week. Retail sales (up 10.1% y-o-y), industrial production (up 6.0%) and fixed investment (up 7.8%) were all somewhat below estimates. At the same time – and I would argue more importantly – Chinese inflation is running hotter than forecast. Considering the scope of the ongoing Credit expansion, inflationary pressures should come as no surprise.
    September 10 – Bloomberg: ‘Inflationary pressure emanating from the factory to the world is proving more resilient than economists have anticipated. China’s producer-price inflation accelerated to 6.3% in August from a year earlier, exceeding all but one of 38 estimates… That data… followed 5.5% readings in the prior three months… The surprise strength gives support for global inflation spanning from metals to fuel and shows the effects of resilient domestic demand and reduced supplies of some commodities.’

    This post was published at Wall Street Examiner by Doug Noland ‘ September 16, 2017.

  • With a Central Bank, Bank “Deregulation” Can Be a Bad Thing

    Leading Federal Reserve policymaker Stanley Fischer has hit out at plans to unwind banking regulation, calling it a “terrible mistake.”
    President Donald Trump and republican politicians have advocated the repeal of Dodd Frank, a major piece of post-crisis legislation, and the loosening of some capital and liquidity requirements in a bid to ease banks’ ability to lend.
    In an interview with the Financial Times on August 16, 2017, Fischer said that loosening capital and liquidity requirements is dangerous and could lead to a new economic crisis. “I find that really, extremely dangerous and extremely short-sighted.”
    While Fischer is not a friend of a free market, in this case I am in agreement with Fischer’s comment.
    A True Free Financial Environment vs A Central-Bank Controlled Financial System The proponents for less control in financial markets hold that fewer restrictions imply a better use of scarce resources, which leads to the generation of more real wealth.
    It is true that a free financial environment is an agent of wealth promotion through the efficient use of scarce real resources, while a controlled financial sector stifles the process of real wealth formation. The proponents of deregulated financial markets have overlooked the fact that the present financial system has nothing to do with a free market. What we have at present is a financial system within the framework of the central bank, which promotes monetary inflation and the destruction of the process of real wealth generation through fractional reserve banking. In the present system the more unrestricted the banks are the more money out of ‘thin air’ generated and hence greater damage inflicted upon the wealth generation process. (With genuine free banking (i.e., the absence of the central bank) the potential for the creation of money out of ‘thin air’ is minimal).

    This post was published at Ludwig von Mises Institute on Sept 15, 2017.

  • Gold and Bitcoin Surge on North Korea Fears

    If you’re familiar with ABC’s popular reality show Shark Tank, you should already be familiar with the concept behind the San Antonio Angel Network (SAAN). Select entrepreneurs and innovators pitch their startup ideas to accredited investors, who can choose to make early-stage investments in a potentially successful company.
    I attended an SAAN meeting last week at Ferrari of San Antonio, and what struck me the most was how fluid and seamless the whole thing is. Other professionals in attendance, including lawyers and CPAs, had a similar opinion, with some of them saying it was because there wasn’t any bureaucracy or red tape to hamstring the presenters.
    This is unlike the world of mutual funds, which I believe has become excessively regulated.
    As I’ve said numerous times before, regulation is essential, just as referees are essential to a basketball game. No one disputes that, because otherwise there would be chaos.
    Similarly, the new and very unregulated world of cryptocurrencies has grown dramatically, beyond bitcoin and ethereum. Did you know there are over 800 cryptocurrencies? These new initial coin offerings, called ICOs, are like initial public offerings (IPOs) but with little regulation or accountability. As I’ve commented before, if the refs get too powerful or too numerous, and the rules too complex, the game becomes nearly unplayable.

    This post was published at GoldSeek on Tuesday, 12 September 2017.

  • Government Crackdowns and Regulation Could Take Shine Off Cryptocurrencies

    Bitcoin has risen meteorically in recent months. Many investors call cryptocurrency the ‘new gold.’ But at least one analysts sees trouble on the horizon for cryptocurrencies in the form of government crackdowns. A recent announcement in China lends credibility to his warning.
    Bloomberg reports emerging markets fund manager Mark Mobius warned that governments will begin clamping down on digital currencies because of their use in illicit financing, terrorism, and drug trafficking. He said that’s going to mean a rush back to gold.
    Cryptocurrencies are beginning to get out of control and it’s going to attract the attention of governments around the world. You’re going to get a reversion back to gold because people are going to wonder, can I really trust these currencies?’

    As if to confirm Mobius’ prophecy, on Monday the People’s Bank of China announced initial coin offerings (ICOs) are now illegal and ordered the halt of all related fundraising activity. In an ICO, digital currency based on blockchain technology is sold publicly and often traded on secondary exchanges.

    This post was published at Schiffgold on SEPTEMBER 6, 2017.

  • Wyoming’s Money Grab Against VW Dismissed

    A Federal Judge Breyer ruled against Wyoming and in favor of Volkswagen (VW) dismissing the claim that because of VW’s manipulation of diesel emissions, they caused environmental damage and should pay damages to the State in addition to individual car owners. Judge Breyer stated that despite the fact that VW was indeed responsible for manipulation. However, since these were carried out during the production of the diesel cars, the Congress had decided that the EPA, rather than the individual federal states, was in the best position to deal with damage regulations.

    This post was published at Armstrong Economics on Sep 5, 2017.

  • See no evil, speak no evil…

    The Jackson Hole speeches of Janet Yellen and Mario Draghi last week were notable for the omission of any comment about the burning issues of the day: …where do the Fed and the ECB respectively think America and the Eurozone are in the central bank induced credit cycle, and therefore, what are the Fed and the ECB going to do with interest rates? And why is it still appropriate for the ECB to be injecting raw money into the Eurozone banks to the tune of $60bn per month, if the great financial crisis is over?i
    Instead, they stuck firmly to their topics, the Jackson Hole theme for 2017 being Fostering a dynamic global economy. Both central bankers told us how good they have been at controlling events since the last financial crisis. Ms Yellen majored on regulation, bolstering her earlier-expressed belief that financial crises are now unlikely to happen again, because American banks are properly regulated and capitalised.

    This post was published at GoldMoney on August 31, 2017.

  • The One Promise Trump Can Keep

    Broken Promises POITOU, FRANCE – ‘We live in a slow-growth world,’ summarized a canny friend, ‘but with high-growth debt and high-growth asset prices.’ Today, we turn to a report on Zero Hedge for further precision.
    But we’ll get to that in a minute. First, let’s begin with less precision. The promise of the Trump administration was, in a nutshell, that it would look ahead and improve the future before we got there. How?
    Drain the ‘swamp’, cut the regulations, slash corporate tax rates by about 20%, kill O’care, raise tariffs on imports to reduce the trade deficit – these are all measures that were supposed to increase stagnant economic growth rates. Higher growth would then fill the malls and restaurants and make it possible to pay our debts.
    With the exception of the boneheaded proposal for tariff hikes from Trump’s trade czar, Peter Navarro – which would have the opposite effect – these changes might have been successful. Too bad ‘The Donald’ has been able to fulfill so few of his campaign promises.
    We predicted as much. We were right. And many Dear Readers will never forgive us. They seem to think that because we saw it coming, we willed failure upon Team Trump. We deny the charge. We have no such power.

    This post was published at Acting-Man on August 31, 2017.

  • Wall Street Journal Lashes Out At “Our Political Central Bankers”

    While the concept of ‘independence’ among the unelected central bank cognoscenti is as cute as the tooth fairy or santa claus, it is nevertheless defended by those on high as sacrosanct to our very democracy. That is until The Wall Street Journal’s editorial board finally had enough of Fed officials joining the ‘resistance’ against financial reform…
    Via WSJ,
    Janet Yellen didn’t run for President, but you wouldn’t know it from her policy dmarche Friday at the Federal Reserve’s annual Jackson Hole retreat. The Fed Chair unleashed a defense of post-crisis financial regulation that shows how political the world’s central bankers have become.
    ‘Already, for some, memories of this experience may be fading – memories of just how costly the financial crisis was and of why certain steps were taken in response,’ Ms. Yellen said.

    This post was published at Zero Hedge on Aug 30, 2017.

  • Bank of America; “This Could Get Ugly, We Think”

    Instead of finding new and creative ways of BTFD, overnight the BofA credit team did something so few finance professionals bother with these days: they looked at fundamental data to reach a conclusion that is independent of how much AAPL stock the SNB will have to buy to send the Dow Jones green. Specifically, the bank looked at the liquidity situation in the bond market (specifically the IG space), and found that while for the time being there is little to worry about, once the central bank put melts away, that’s when the real test will take place. And, as BofA puts it bluntly, “this could get ugly, we think.”
    As the bank’s credit strategist Hans Mikkelsen explains, high grade corporate bond trading has doubled over the post-crisis years (Figure 1). However, as the size of the market tripled that means the overall market has become less liquid due to a number of post-crisis changes, including financial regulation and most prominently the Volcker Rule, but also less leverage in the system. For example, while annual trading volumes in the HG corporate bond market were 135% of the size of the market back in 2006, that same tracking statistic is only 86% for 2017 (figure 2).

    This post was published at Zero Hedge on Aug 29, 2017.

  • New Proposed Regs You Must Declare if you have more than $10k in Crypto Currencies

    According to the new draft law proposal, all persons who enter the US will have to declare their holdings in crypto currencies with a value over 10,000 dollars. This is the case with larger quantities of cash or precious metals. Naturally, they are calling this money laundering and possible funding of terrorism. It’s really about taxes.
    I have been warning that this would be the next step in government regulation. They are hunting money everywhere. There is no possible way they will allow crypto currencies to beat them. The stories that they cannot stop them are really nonsense. Income taxes are not illegal if you cannot pay, but if you fail to tell them what you made, that is criminal. Applying this same legal approach to crypto currencies is inevitable.

    This post was published at Armstrong Economics on Aug 29, 2017.