Archive - Mar 30, 2013

With all the recent chatter about an overhaul and dismantling of Too Big To Fail banks (spoiler alert: it will never happen, but it will take a lot of theater before that is made quite clear) many can be excused for believing the balance of power has shifted away from the megabanks (and their tens of trillions in over the counter derivative "weapons of mass financial destruction" so ably facilitating the Stockholm Syndrome of global mutual assured destruction with each passing day) and in the favor of the people, represented by the legislative and the judicial. Last night we got a quick reminder that absolutely nothing has changed in the true lay of the land, that the adjusted golden rule is still in place (yes, the banks still have all the gold and set all the rules), and that banks are still the undisputed rulers of the land when U.S. District Judge Naomi Reice Buchwald agreed to dismiss claims that the 16 banks targeted by various LIBOR lawsuits broke federal antitrust laws. In so ruling, the potential cost to the banks from an adverse overall resolution would be crippled. The ruling also is likely to reduce the financial inventive for new plaintiffs to join investors, cities, lenders and other parties that have already filed lawsuits.  In brief, the banks won again just when it mattered, just when it seemed they may, for once, be on the defensive, and just when the concept of accountability and responsibility for years of conspiratorial and criminal collusion to manipulate a rate impacting hundreds of trillions of IR-sensitive instruments, was about to rear its ugly head. Because in the New Normal crime and punishment is simply a book by Dostoyevsky.

"Cyprus has strict gun control. Private citizens are completely forbidden from owning handguns and rifles in any calber, even .22 rimfire. Only shotguns are allowed, and these require a license. Shotguns are limited to two rounds."

When governments begin doing things that are extreme and outside of the normal patterns of behavior then it is not a stretch to say that they are in trouble. They are responding this way because they are in a critical and perhaps life threatening situation. They do not tell the truth about sovereign finances and cover up everything at the ECB but they must be looking at the real numbers and experiencing some sort of epileptic fit. I would say that you can now speculate in Europe. I would say that you can bet in a manner no different than a casino. Actually no; I would say it is worse. You can put your money down and then the dealer can say, "New Rules, Game Change; all the money on the table is required for the House and it is now mine." If you had suspicions before; they have been confirmed. Anything, everything can and might be done and then justified by the unwillingness of the nations in Europe to pay for any more of a troubled country's difficulties. Whatever boundaries that existed have been breached. There is no Law, no fences and no limits. First Greece and now Cyprus and Pandora has raised the lid on her Box.

An oveview of the technical condition of the major currencies.  Offered as a compliment to macro analysis.