• Pivotfarm
    04/18/2014 - 12:44
    Peering in from the outside or through the looking glass at what’s going down on the other side is always a distortion of reality. We sit here in the west looking at the development, the changes and...

Tyler Durden's picture

Bank Of America Cutting 5% Of Capital Markets' Personnel, Firing 400 Employees Globally, Many More To Come...Er... Go

The much anticipated "low volume market" casualties are accumulating. As we noted first a few weeks ago, and subsequently picked up by other MSM publications, it was only a matter of time before Wall Street, which earlier in 2010 decided to foolishly lever up on the economic "reflation" myth and hire tons of people, is once again preparing to fire in droves, a phenomenon which traditionally is the best indicator a given economic cycle's peak has come and gone. Bloomberg has just disclosed that Bank of America is following similar actions from RBS disclosed earlier, and is firing as many as 400 employees in global banking and markets division. Charlie Gasparino, who first broke the news, also added the twist that the departures are taking place now "so as to deprive the unlucky employees year-end bonuses." Gotta love Wall Street's code of ethics. At least in the past layoffs would wait until after year end. No such luck anymore, now that most other banks are also likely considering comparable steps, and news of terminations start flooding in.



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BIS' Report On The Irreconcilable Differences Between The US And Japanese Household

The compare and contrast between Japan and the rest of the developed world is a topic that will only get more and more attention as increasingly more pundits debate America's plunge into a deflationary spiral (sorry, with $2.1 trillion in shadow debt evaporating YTD, it is inevitable. It is the economy's reaction to the Fed's response, i.e., the nuclear option, at that point that is the topic of most contention - whether it will rekindle hyperinflation or have no impact on the deflationary collapse into a Keynesian black hole). The latest to chime in, interestingly, is the all important Bank of International Settlements, recently best known for promoting the regulatory farce that is Basel III. A just released paper by Shinobu Nakagawa and Yosuke Yasui looks at the nuances of Japanese household debt, and how its build up, concentration and composition is uniquely Japanese, and why Japan, unlike the US, has traditionally had the capacity of falling back on its domestic population to bid up its sovereign bonds (which is all in flux currently, as the Japanese savings rate is plunging, as the demographic shift so well covered in the past by Dylan Grice is currently taking place). Here are the findings of the BIS economists, which may provide some insight on how America's upcoming fight with deflation could proceed. Of particular note is just how skewed US society (based on GINI scores and the distribution of net worth) is compared to Japan. It also explains why America is now a democracy only on paper, while in fact it merely caters to the interests of the top 1% of the population.



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Grayson Sends Letter Demanding Halt Of Illegal Foreclosures, Calls Out "Largest Seizure Of Private Property Ever Attempted By Banks And...

The key story from this morning was the Bloomberg report that GMAC Bank had halted foreclosures in 23 states, following disturbing news from last week that rekindled the latent debate over whether servicer banks do in fact own deeds to mortgages on which they foreclose on, and whether the entire foreclosure process is in fact fraudulent (one judge found it to be so, creating a massive headache precedent for the banker community). Yet the company which initially agreed with Bloomberg's version of events, is now retracing and claiming that foreclosures are in fact continuing... with a footnote. Reuters reports: "GMAC Mortgage, a unit of Ally
Financial Inc, is continuing with all new residential
foreclosures despite a report it had stopped them, a
spokeswoman said on Monday. But some evictions have been suspended while the company
reviews its internal procedures, the company said.
" Maybe the company can clarify just what event catalyzed the decision to suspend evictions, and specifically which "internal procedures" are being reviewed. Also, it is about time for the ABA to step in and share some insight on a topic that has millions of Americans suddenly in arms. And since that won't happen, it is up to the one or two politicians who are not in the bankers' (and the Fed's) pockets to raise some noise. Enter Alan Grayson who in a letter just released to a Florida Supreme Court Justice says:"If the reports I am hearing are true, the illegal foreclosures taking
place represent the largest seizure of private property ever attempted
by banks and government entities.
"



RANSquawk Video's picture

RANsquawk Market Wrap Up - Stocks, Bonds, FX etc. – 20/09/10

RANsquawk Market Wrap Up - Stocks, Bonds, FX etc. – 20/09/10



Tyler Durden's picture

Insider Selling Outpaces Buying By Over 290-To-1 In Past Week

According to Bloomberg,
for the week ended September 17, corporate insiders bought $1.4MM in
shares in a whopping 7 different companies. This was just marginally offset by sales of $441MM in 98 different companies, a ratio of 290 to 1 of stock notional sold to bought. But wait: this is GREAT NEWS: last week the ratio was 650 to 1! So this is a huge improvement and certainly yet another reason for today's rally, even though last week total notional sold was $332 million, or just under 25% lower, and sellers came in well lower at "just" 72. But who needs details when you have the Fed... Certainly not retail, which has now pulled money out of domestic stock funds for 19 straight weeks. So for those wondering just who is orchestrating today's move higher, please let us know if you find out.



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Guest Post: Those Who Don't Build Must Burn

Ray Bradbury wrote his dystopian novel Fahrenheit 451 in 1950. Most kids were required to read this book when they were seventeen years old. Having just re-read the novel at the age of forty-seven makes you realize how little you knew at seventeen. It is 165 pages of keen insights into today’s American society. Bradbury’s hedonistic dark future has come to pass. His worst fears have been realized. The American public has willingly chosen to be distracted and entertained by electronic gadgets 24 hours per day. Today, reading books is for old fogies. Most people think Bradbury’s novel was a warning about censorship. It was not. It was a warning about TV and radio turning the minds of Americans to mush.



Tyler Durden's picture

Divergence Update

Ha Ha



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Munger Tells 25 Million Americans To "Suck It In", And To "Thank God For Bank Bailouts" As BRK Benefits From $95 Billion Of TARP...

There is a reason why many countries institute mandatory retirement age: it is so that when dementia strikes, and people spout any damn thing that comes to mind, only the nearest four walls are subject to their insanity. Alas, when it comes to Berkshire Hathaway, no such luck. And while we have extensively discussed Warren Buffett's recent inexorable decline from merely a successful rider of the biggest cheap credit bubble in history to a captured puppet of Wall Street courtesy of his tens of billions of Wall Street-related investments, little has been said about his even older, and apparently even more affected by the unpleasant side-effects of a public televised senescence, sidekick, Charlie Munger. Luckily, courtesy of Bloomberg we now know just how deep the rot runs in the Berkshire family. During a discussion at the Universtiy fo Michigan, the 86 year old told the 25 million of Americans who comprise the 16.7% of the underemployed population in the country, to "suck it in and cope." Not only that, but apparently, all those who have been without a job for 99 weeks and more and no longer have recourse to insurance benefits, should "thank God for bank bailouts." Why of course he would say that: after all $26 billion worth of direct BRK investments were the recipient of over $95 billion in bailouts. So when it comes to him, thank god for the bailout indeed... But when it comes to the little man, old Charlie is all about doing the right thing.



Tyler Durden's picture

Daily Divergence Dementia Update: Crazy Pills Time

WTF is going on here? Did someone feed booze to the collocated computers? Someone smarter than us please explain this.



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Greek PM Says "Won't Come To Bond Market Now", Claims Greece Has Been "Undervalued"

Just headlines for now, but this likely means the Greek bond roadshow has been cancelled as not even the world's best underwriters were able to generate enough interest for the imminent disaster that will be Greek bonds. One can only imagine how much horror must have gotten uncovered during the roadshow process if investors, even with the backstop of the ECB's endless guarantees, have said "no mas." Luckily, Moody's earlier gave a provisional rating of AAA to the European Financial Stability Fund (EFSF), which it now appears will be used imminently, first for Greece, then Ireland, and then everyone else who comes to the trough. If this news doesn't send the S&P over 1,220, nothing will.



Tyler Durden's picture

Deutsche Bank Fixes Price For Share Sale At €33/Share, To Issue 308.6 Million New Shares

The bank notes it will issue 308.6 million shares for total gross proceeds of €10.2 billion. This is somewhat perplexing as the bank currently trades at €46.88 on the XETRA. In other words, DB is selling one third of itself on a pro forma basis. Of course, this will mean a bloodbath for all the smaller banks once they commence their Basel III required capital raising activities as their discount will have to be far greater than DB's.



Tyler Durden's picture

BofA's Head Technician Calls For Market Correction

BofA's chief technical research analyst Mary Ann Bartels has released a note in which she demonstrates the bullish and bearish technicals currently in the market (although with the only thing mattering anymore is when and how big any given Fed permanent open market operation will be, we question the utility of technicals even). While Bartels is still holding on the a call for a "deeper equity market correction" while noting the obvious ("The equity market this year has frustrated both the bulls and the bears, and this is likely to continue into year-end, in our view") she points out that the broader market signals are mixed. She points out that "most short-term indicators have generated a sell signal and Net Tab is not oversold. We still need to break and hold above S&P 500 1150 to invalidate a potential head and shoulders distribution top. A test of the July low (1010) is still not ruled out. A break above1150 would point to a test of the April high of 1220." Today's action shows just how hard the market is trying to breach the upside resistance and disprove all the economic fundamentals that unequivocally point to an ongoing and accelerating deterioration in the economy. Below are the key charts supporting Bartels' call.



Tyler Durden's picture

Guest Post: The Plot Thickens: How Will Japan's Largest Pension Fund Find Room To Maneuver?

The WSJ is out with a short piece about new rumblings coming from Japan's $1.43T public pension fund, Japan's Public Pension Weighs New Investments. If I may be so bold as to impersonate the Japan deflation-blogger Mish for a moment, let's take a look at a few of the dynamics at play as reported by the WSJ. I'll provide some commentary along the way.



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Live Coverage Of Major Fire Cutting Metro North Traffic In And Out Of Manhattan

A major fire has erupted under the Harlem River bridge, where a wooden train trestle is in flames. All traffic in and out of New York via Metro North has been suspended. Watch live coverage via Fox News here.



Tyler Durden's picture

Gold Surges To Fresh All Time High As Stocks Priced In Gold Are Now Down Only 12.65% YTD

As stocks continue surging higher on absolutely no news (let along good ones), the one and only natural offset to the demented and deranged actions now undertaken by all central banks continues to be gold, which just moments ago touched on new all time spot highs at $1283.80. And while the president is touting Brian Sack and Ben Bernanke's fantastic handling of the stock market year to date, perhaps he or one of the other members of his shrinking economic team can explain why the S&P in terms of gold is down 12.65% Year to Date!



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