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Frontrunning: August 31
- Bernanke, Printing and Press LLC makes $14 billion profit on $X trillion in AUM: we have still not seen the investor letter (Reuters)
- Time to get tough with AIG (Reuters)
- Wall Street stealth lobby defends $35 billion derivatives haul (Bloomberg)
- The FDIC is so generous with our money - Raft of deals for failed banks puts U.S. on hook for billions (WSJ)
- Shipping rates seen falling 50% on China, fleet size (Bloomberg)
- Evans-Pritchard: Our quarter-century penance is just starting (Telegraph)
- Fed's Dudley: early to mull curbing security purchases (Reuters, this should be a 2099 headline)
- Baker Hughes to buy BJ Services for $5.5 billion (Bloomberg)
- Chris Flowers down 60-70%: time to throw in the towel (CNNMoney)
- Fekete: Gold is pale because it has so many thieves plotting against it (Financial Sense)
- Quayle to the rescue after all: Cerberus to raise new funds after $4.8 billion in redemptions (Bloomberg)
- The message from Jackson Hole (Morgan Stanley)
- Hudson Institute: Weekly economic report (HI)
»
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the top article about the gains on the Fed's purchases are indicative of the next wave of propaganda - to convince the public how great all these bailouts were. The NYT has another article this morning about how the government is making money from all the guys who have paid back TARP... they fail to highlight that all the money made from the guys who DO payback the money won't make up for the few who do NOT payback the money (FNM, FRE, AIG)
Every patriotic American should read this Blog at Reuters. If,after reading the blog, some of you feel like doing something nasty to that old slob who is out-of-the-country permanently, I won't be surprised. Can someone tell me WHY this guy is being paid 7MIO for this job??? what a rip-off!!!!
http://blogs.reuters.com/commentaries/2009/08/28/time-to-get-tough-with-aig/?p=3251?tempedition=debatehub
This one from the telegraph page. Shocking to say the least.
Nobel Laureate Paul Krugman said the US needs another fiscal blast for "political reasons", alluding to the Great Depression. It was Phase II from late 1931 to early 1933 that tipped half Europe into fascism and brought America soup kitchens. Although such a fate has been averted this time by government action, the Atlanta Fed says the true rate of US unemployment is already 16pc (not 9.4pc), worse than early 1931 levels. Official youth unemployment is 34pc in Spain, 28pc in Latvia, 25pc in Italy, 24pc in Sweden, Hungary, and Greece.
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If the Fed had invested the same amounted loaned out in three-month Treasury bills since August 2007, it would have earned $5 billion in interest, the FT said.
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Hahahha its so obvious this is just a massive check-kiting scheme between Treasury and Fed. Fed prints money. Treasury prints IOU. Fed loans money-out-of-thin-air to Treasury -- Treasury gives Fed the IOU. Treasury pays 'interest' on hallucinated computer pixels to blood-sucking central bank called Fed. Rinse, repeat.
I recommend reading the article listed above: Fekete: Gold is pale because it has so many thieves plotting against it
If the Fed had invested the money gifted to thieves, multinationals and banks to America's small businesses, the recession would have ended months ago.
Instead, the banks are forcing their small commercial accounts to shed jobs (customers) and cut expenses (customers), they are also forcing small business owners to deplete their savings and pledge any paid-for personal assets for outstanding loans.
The obvious check kiting and bs cannot go on forever, when the end comes - as it always does - it is going to be a horror. And I just don't think 99% of us realize how this horror will play out.
Does anyone here know how much Madoff returned to his investors after their initial investment?I believe that most of investors had good returns at least in the first couple of years........
IMO, the Fed's profit leak means that :
1. The market has peaked
2. The Fed fully expects to lose its appeal, and is trying to spin (part of) the issue ahead of time.
I think the FT should know better than to print the same story, though. I think their standards have gone way downhill.
RE: Chris Flowers - CNNMoney.
Not much there until halfway through it. Oh, by the way, Ken Lewis hired Flowers to advise B of A, as part of its due diligence, on the Merrill acquisition. Flowers spent an "entire weekend" on it. $20 million fee. Result: yes, indeed, A-OK to pay a 70% premium for Merrill. (It's just B of A stock anyway).
Just to connect a few more dots... Mr. Flowers is a former partner of Goldman Sachs.
I would suggest if the Fed and Treasury do not pull back soon on their creative games we will see a true Black Swan event reflecting the loss of confidence in Govt debt that will make last fall appear as child's play!
good articles; good articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions
Grrrrrrrrrrrrrrrrrr that top story makes me livid. $14 billion instead of $5billion from TBills? TBills paying 1/4% = $5bn, so the Fed made 0.7% per annum? Inflation was more than 1.4% over two years, so they lost money. Give a monkey 1.75 trillion and see how much they would make? How many hours does it take to print $14bn in $100 notes? How much has the Fed cost the economy with its dumbass "subsidise banks to rip off consumers with a practical ZIRP whilst charging >5% mortgages and 15% credit card". I hope the Fed doesnt need the money, either the writer of this article is an anarchist stirring up trouble, or we are all in trouble, cos the Fed is a monopolistic corporation.
So the Fed made money?
Too bad the Treasury didn't make it.
The Fed stock holders must be very happy to get their 6%, eh?