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Frontrunning: October 12

Tyler Durden's picture

  • Marc Faber Says World Heading for "Major Inflection Point" (Bloomberg)
  • French Strikes Disrupt Air and Rail Travel (NYT, BBC)
  • Jobless America threatens to bring us all down with it (Telegraph)
  • Will they be paid in gold? Fed's latest reflation attempt comes via Wall
    Street, which is expected to pay $144 billion in bonus this year (WSJ) - this number represents 8% of M1
  • Two Faces: Demystifying the Mortgage Electronic Registration System's Land Title Theory, Christopher Lewis Peterson, University of Utah (SSRN, h/t Karl Denninger)
  • States to Probe Mortgage Mess: Attorneys General Hope Lenders Will Re-Write Loans With Troubled Documents (WSJ)
  • Citigroup Stops Using Foreclosure Law Firm Facing Florida Probe (Bloomberg)
  • CalPERS Says it is cutting ties with La Jolla advisor Pacific Corporate Group (WSJ), many more severed relations to follow
  • Pfizer to Acquire King Pharmaceuticals, Inc. (PR Newswire)
  • Bernanke needs inflation for QE2 to set sail (FT)
  • Three Weeks That Will Rock Wall Street (Forbes)
  • Blow to plans for dealing with bank crisis (FT)
  • Chris Whalen: Fed's Zero Rate policy is destroying America (IRR)
  • US warning to China on maritime rows (FT)
  • Republicans Prove Unpopular With Voters Against Obama in Poll (Bloomberg)
  • Google to map inflation using web data (FT)
  • Regulators Could Seize Control of Failing Banks Under EU Plan (Bloomberg)

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Tue, 10/12/2010 - 08:33 | Link to Comment John McCloy
John McCloy's picture

Anyone else awake for this mornings 4am futures magic?

Markets were down S&P 9.80

Tue, 10/12/2010 - 08:50 | Link to Comment Cookie
Cookie's picture

Yep, in the real world whilst America slept, common sense was in control. Then Ben's boys started getting their early morning alarm calls.....

Tue, 10/12/2010 - 08:58 | Link to Comment rocker
rocker's picture

Check out what Marc Faber said. He has been so right for over two years. He said the Bernanke put is real. Personally, I would rather short stocks than buy. But you can't fight the FED. So if anything, I'll play the commodity markets and consider only value stocks with high cash inflows and very low PE's, (less than 9). Commodities PE, (less than 12).

Tue, 10/12/2010 - 08:36 | Link to Comment The Rock
The Rock's picture

$144B bonus huh? For workers that bring nothing of value to this society. FUCK THEM ALL!!!!!

Tue, 10/12/2010 - 08:45 | Link to Comment rocker
rocker's picture

But hey, it was less than expected. Or, as they would say, "Better than expected".

Tue, 10/12/2010 - 09:37 | Link to Comment Bob
Bob's picture

BUT 8% OF M1!!!!

This is bank robbery by the banksters themselves. 

Tue, 10/12/2010 - 12:44 | Link to Comment cougar_w
cougar_w's picture

Wall Street uploading the last of the TARP hot money before going Bk.

"You ain't gett'n none of it back, suckers."

Tue, 10/12/2010 - 08:37 | Link to Comment Jake Green
Jake Green's picture

Long, but well written article about foreclosure-gate

Tue, 10/12/2010 - 08:42 | Link to Comment snowball777
snowball777's picture

I hope $144 billion buys them enough coke to stroke out.

Tue, 10/12/2010 - 08:48 | Link to Comment Diggintunnels
Diggintunnels's picture

$144B huh...Why on earth do we continue to bail out the banks with the FED window? 

Tue, 10/12/2010 - 08:50 | Link to Comment rocker
rocker's picture

Because the FED mandates it. GS and JPM are leaders of the pact. Lord Blankfein is now a angel. Don't you know.

Tue, 10/12/2010 - 08:52 | Link to Comment snowball777
snowball777's picture

So was Satan.

Tue, 10/12/2010 - 09:02 | Link to Comment HEHEHE
HEHEHE's picture

I like Faber but lately he's changing his advice week to week.

Tue, 10/12/2010 - 12:45 | Link to Comment cougar_w
cougar_w's picture

It just means he doesn't know what to say, but he has to say something to get paid. Sign of the times.

Tue, 10/12/2010 - 09:03 | Link to Comment overmedicatedun...
overmedicatedundersexed's picture

The fed are a punch drunk pug..they will do what a busted fighter does and go down swinging in the set up of the century.  Benny never had a chance," I coulda been a contenda" was his last words..roll the waterfront docks fade to black.

A new world currency is now talked about much too much to be an idle threat. (by timmy boy no less.) invest to protect nominal wealth, got silver?
Tue, 10/12/2010 - 09:07 | Link to Comment M.B. Drapier
M.B. Drapier's picture

From the MERS paper:

Instead, MERS invites financial companies to enter names of their own employees into a MERS webpage which then automatically regurgitates boilerplate “corporate resolutions” that purport to name the employees of other companies as “certifying officers” of MERS.23 These certifying officers also take job titles from MERS stylizing themselves as either assistant secretaries or vice presidents of the MERS, rather than the company that actually employs them.

So the Mortgage Conspiracy is a 2U rackmount server buried in some data centre, bestowing titles of office and degrees of exaltation on a cabal of RE administrators throughout the USA via HTTP webforms? MERS seems to have escaped from the pages of an Illuminatus! pastiche.

Tue, 10/12/2010 - 09:50 | Link to Comment Lux Fiat
Lux Fiat's picture

The abstract touches on the issue of local recording fees/tax avoidance, which in my mind was one of the major reasons for MERS.  In addition to trying to keep track of which mortgage belonged where, it was designed (perhaps not very well) to get around county real estate recording fees.  Add tax fraud to the list of ills stemming from MBS innovation.

Tue, 10/12/2010 - 12:13 | Link to Comment Printfaster
Printfaster's picture

The bell rang here:

"it was designed (perhaps not very well) to get around county real estate recording fees."


I can see where this is going:  MERS will buy off the local governments for back fees, and then run the foreclosure.


Tue, 10/12/2010 - 09:18 | Link to Comment Silverhog
Silverhog's picture

Bloomberg has become the #1 Kool-Aid stand.

Tue, 10/12/2010 - 09:21 | Link to Comment HEHEHE
HEHEHE's picture

Also re Wall Street comp; there's a Crains article refuting the WSJ article:

Many Wall Streeters still in denial on bonuses
Banking pros haven’t gotten memo on how much lower their year-end pay will be, a survey says. The new reality: Go back 20 years, when bonuses were about one tenth what they were last year.

Tue, 10/12/2010 - 09:30 | Link to Comment RocketmanBob
RocketmanBob's picture

So Wall street bonuses were 8% of M1.

Does anybody know off hand what percentage of GDP those same firms accounted for; estimates to date I mean, since 2010 GDP won't be fully known for a while yet.


Just curious if that amount of bonus, while sounding staggeringly high, is in line with what value, if any, they add to the economy.


But I will say that, regardless of that fact, the optics of such large bonuses, when there are forces that would love an excuse to get thier hands on that cash abound, is bad politics.

Tue, 10/12/2010 - 09:49 | Link to Comment viator
viator's picture

Janet Yellen, in her first public remarks as the Federal Reserve’s vice chairman, said low interest rates may give firms the incentive to engage in excessive risk-taking.

“It is conceivable that accommodative monetary policy could provide tinder for a buildup of leverage and excessive risk-taking in the financial system,” the 64-year-old central banker said in a speech today in Denver.

“Our goal should be to deploy an enhanced arsenal of regulatory tools to address systemic risk,” Yellen, the former president of the San Francisco Fed, said in a luncheon address to the National Association for Business Economics. “We need macroprudential policy makers ready to take away the punch bowl when the party is getting out of hand.”

“Monetary policy cannot be a primary instrument for systemic risk management,” Yellen said in the text of her speech. Still, “I cannot unequivocally rule out the possibility that situations could emerge in which monetary policy should play some role in reining in risk-taking behavior,” she said.

Yellen said “a top priority” of regulators assigned to monitor systemic risks should be determining whether asset prices are signaling the emergence of a bubble. She added that surveillance of emerging risks is likely to focus in part on the accumulation of credit and funding risk inside systemically important firms, and counterparty risks.

“A first-order priority must be to engineer a stronger, more robust system of financial regulation and supervision, one capable of identifying and managing excesses before they lead to crises,” Yellen said.

“We know that market participants won’t take kindly when limits are set precisely in those markets that are most exuberant, the ones in which they are making big money,” she said. Even so, “discretionary interventions will inevitably play a part in macropruential supervision.”

"Turn out the lights
The party's over
They say that
All good things must end
Call it tonight
The party's over
And tomorrow starts
The same old thing again

But the crazy crazy party
Never seen so many people
Laughing dancing
Look at you you're having fun
But look at me
I'm almost cryin'"


Tue, 10/12/2010 - 09:57 | Link to Comment Jim B
Jim B's picture

Good Piece by Chris Whalen, the FED is killing savers, encouraging risk and debt!  Good Job Ben!

Tue, 10/12/2010 - 09:57 | Link to Comment Lux Fiat
Lux Fiat's picture

Very interesting story from the FT about the GPI.  Hand in hand with the Bernanke/Congressional attempts to reduce debt via inflation, will be indirect attempts to cut entitlement spending through similar methods.  Much lower political pain threshhold than telling seniors to buck it up.  Shadowstats hasn't gotten much (if any) traction in the MSM with their take on things.  Will be interesting to see if the GPI winds up being a canary that sings loudly, or if it gets coopted.  

Tue, 10/12/2010 - 10:31 | Link to Comment vegaspilot03
vegaspilot03's picture

and the one liner of the day goes to..... YOU!

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