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Goldman Sachs and Helicopter Ben
From The Daily Capitalist
Don't expect a thank you note from Goldman Sachs or any of the other banks that had perfect trading days in Q1. "Perfect" means that they had no days of trading losses for 63 trading days.
Goldman Sachs, which makes more money from sales and trading than any Wall Street firm, reported yesterday that it made at least $25 million trading every single day of the first quarter, the first perfect quarter in the company’s history. The company’s fixed-income, currencies and commodities business, known as FICC, and equities unit generate those returns by making markets for clients rather than betting the firm’s own money, Cohn said.
They weren't alone:
Four of the largest U.S. banks, including Citigroup Inc., racked up perfect quarters in their trading businesses between January and March, underscoring how government support and less competition is fueling Wall Street’s revival. Bank of America Corp., JPMorgan Chase & Co. and Goldman Sachs Group Inc., the first, second and fifth-biggest U.S. banks by assets, all said in regulatory filings that they had zero days of trading losses in the first quarter. Citigroup Inc., the third-largest, doesn’t break out its daily trading revenue by quarter. It recorded a profit on each trading day, two people with knowledge of the results said.
You may ask: how is that possible? Are they that good? The reason is that they are taking advantage of free money from the Fed:
“The trading profits of the Street is just another way of measuring the subsidy the Fed is giving to the banks,” said Christopher Whalen, managing director of Torrance, California-based Institutional Risk Analytics. “It’s a transfer from savers to banks.”
The trading results, which helped the banks report higher quarterly profit than analysts estimated even as unemployment stagnated at a 27-year high, came with a big assist from the Federal Reserve. The U.S. central bank helped lenders by holding short-term borrowing costs near zero, giving them a chance to profit by carrying even 10-year government notes that yielded an average of 3.70 percent last quarter.
The gap between short-term interest rates, such as what banks may pay to borrow in interbank markets or on savings accounts, and longer-term rates, known as the yield curve, has been at record levels. The difference between yields on 2- and 10-year Treasuries yesterday touched 2.71 percentage points, near the all-time high of 2.94 percentage points set Feb. 18.
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Here we go -- news hot off the wire:
http://www.nytimes.com/2010/05/13/business/13street.html?hpw
Prosecutors Ask if 8 Banks Duped Rating AgenciesThe Fed and the big banks are the same entities.
They rob all Americans..that's the name of the game.
Lets remember who owns FED :
http://www.financialsense.com/Market/kirby/2008/0630.html
My last visit to the US in 2004. Even brokers and top people ( Harvard, Stanford) did not know that the Fed was a private bank. Attitude was who cares so long as we make money. Greed and Wall Street are synonymous.
double post
wall street's 'man' is obama. they have their 'guy' on the inside. the seat is occupiedby their' 'gentleman'. boy oh boy oh boy oh boy oh boy. physical gold and silver long.
How many more perfect trading quarters do they need to be solvent? When are they going to unravel their toxic assets with the massive profits they are making? This would help make the economy more stable, but instead they choose to pay outrageous bonuses. They are waiting for housing to rebound so they can unload the crap instead of acting in the interest of National security. This is further evidence that the government doesn't care about national security and neither do the TBTFs.
96-0!!!!! Left, Center, Right!!! America Wants Tough Banking Reform.
http://bit.ly/1ax9Pw
America had tough banking reform from the Depresion Era, but then our US Congressmen revoked it.
What will we all do when GETCO is the Master of the Financial Universe?
this hurts, but I must say it, good post, Econophile.
Crony capitalism, govt run amok, pseudo govt/private institution - the Fed run amok... whatever you call them...they are taking this money straight out of our hands..PARASITES...we need to detoxify
This is why I would give Osama quarter before Bernanke. This man is responsible for theft on a galactic level. Karma will bring him his just desserts for his theft from the middle class and his floating of the slave(debt)masters.
When it all goes down Ben, I'm going to enjoy seeing the laws of the universe shove themselves so far up your ass that you divide.
"just deserts?" A heart attack would suit me just fine.
Too quick.
Give me my money back you bitches
very direct talk for a sheeple...go back to the pasture and graze..ignore the wolf
It is incumbent upon all citizens to un-save. This is your only protection... do what they want. Manage risk and have a lean toward income, but be long GS. Limitless swap lines mean get out of dollars before they kill it again.
You'll be much less angry.
The Fed and BB are killing the middle class and small business. They have decided that the big banks must be "saved" and they will do anything to achieve this objective.
Maybe they can hold it together for a few months or even years. Maybe it will never crash, who knows. But the long term liabilities foisted upon the next generation(s) will insure dramatically lower standard of living and maybe something entirely worse.
This is all so wrong.
sschu
I don't disagree with anything you said at all. It is so wrong.
The question is how can you protect those you love when the Fed is deliberately destroying your savings to bail out banks and deadbeats. Seems to me smart to avoid the next stage of dollar destruction ensured by a the swap lines set up by the Fed.
The "system" has been this way from the beginning. Its true nature was obscure but now easy to see because things are coming apart at the seams. Change isn't option. It would just mean a new set of thieves in charge.
If banks didn't have trading profits, they wouldn't have any profits. Especially if FAS 157 applied as written. The Fed requires solvent big banks as a matter of economic and national security. The Fed will ensure that banks have capital for trades in order to keep the US economy from falling into an abyss. As mentioned often in this space, the bid is in. Failure is not an option and the Fed will see to it by protecting bank profits, even if it involves keeping an asset bubble in place as a national treasure.
i would almost be "ok" with this plan. but the so called National security argument is being compromised by the syphoning into the employee bonuses.
I don't like the name "Helicopter Ben"....
Can't we change that into "CHINOOK BEN"?
I'm getting really really tired of these people....
I'm ashamed of myself, this nation, and our government. Stand up and fight. Are you just going to let them rape you?
Pistol Grip Pump - Rage Against The Machine
http://www.youtube.com/watch?v=RRkvg_LuZvk&feature=related
Pistol grip pump on my lap at all times
Pistol grip pump on my lap at all times
Pistol grip pump on my lap at all times
They can be fucking with other niggaz shit, but they can’t be fucking with mine
"now I'm rollin' down Rodeo with a shotgun."
This is the pro-establishment response from our dear ZH contributor, Leo Kovilakis, to similar sentiments yesterday:
(Please note that I do NOT agree with such a shamelessly spineless attitude myself.)
Now tell me, they did this perfect trading through the winter "dip", and all of THIS is not orchestrated?
(Added to Article).....
"Then they take the float, gun tha market, wash tha profits from tha float and whateverthafuckelse and repo it back to tha Fed do it again and in tha meantime plan on using tha profits to pay their Billion$ in bunu$e$. Straight from your parents and childrens'pockets to them. Ain't life grand AmeriKa !"
Seems like money laundering.
When the government do it, it's not money laundering. There is no law against the Fed. Therefore it's all legal.
So, the helicopters are in the air, but not over Main Street.
Ben never said what the flight plan was....
Nobody cornered him on that minor detail.
BEING BEN BERNANKE:
http://williambanzai7.blogspot.com/2010/05/bening-ben-bernanke.html
THE NEVER ENDING BAILOUT:
http://williambanzai7.blogspot.com/2010/05/neverending-bailout.html
LOL!!!! "The Never Ending Bailout" definitely one of your finest.