Bank of America

Wells Fargo "Admits Deceiving" U.S. Government, Pays Record $1.2 Billion Settlement

Nearly a decade since the housing bubble burst the dirty skeletons still emerge from the closet, and still nobody goes to jail. In the latest example of how criminal Wall Street behavior leads to zero prison time and just more slaps on the wrist, overnight Warren Buffett's favorite bank, Wells Fargo, admitted to "deceiving" the U.S. government into insuring thousands of risky mortgages. Its "punishment" - a $1.2 billion settlement of a U.S. Department of Justice lawsuit, the highest ever levied in a housing-related matter.

BofA Notices Something Troubling: China's Debt Bubble Has Burst

We have noticed a sharp jump since mid-2015 in the total value of reported defaults of shadow banking products, defined here as non-bank-loan debt instruments that include bonds, trusts, and credit products offered by peer-to-peer (P2P) and various offline wealth management companies (WMCs).... The question is whether the government is closing the stable door after the horse has bolted. We suspect that the answer is yes.

The ECB Effect: European Telecom Issues Largest Ever Junk Bond After More Than 100% Upsizing

The market bond market, which is now frontrunning not just what the ECB has announced it will buy but what it may buy, just led to a record European junk bond issuance, when French cable and telecom operator Numericable "stunned the market" (as Reuters put it), when it upsized what was originally supposed to be a $2.25 deal by more than 100% to a whopping $5.2 billion bond deal on Wednesday. This was the largest single high-yield bond tranche ever issued.

Consumer Spending Falls Again In March According To Latest Credit Card Data

While big banks blame the collapse in Q1 GDP on "residual seasonality" (more on that later), with BofA recently slashing its Q1 estimate from as much as 2.7% to just 0.2%, the reality is that something is not well with the US consumer. The latest proof of this comes from the most recent Bank of America credit and debt card spending data, which reveals that sales were once again down 0.1% yoy.

Japan Prints Additional ¥10,000 Bills As People Scramble To Stash Away Cash

Call it the total failure of Japan's monetary policy: Japan's Finance Ministry plans to increase the number of ¥10,000 bills in circulation, amid signs that more people are hoarding cash. It will print 1.23 billion such notes in fiscal 2016, 180 million more than a year earlier. The number of ¥10,000 bills issued annually leveled off at around 1.05 billion in the fiscal years from 2011 to 2015. The reason: the total amount of cash stashed at home is estimated to have surged by nearly ¥5 trillion to some ¥40 trillion in the past year, Hideo Kumano, chief economist at Dai-ichi Life Research Institute, said.

Frontrunning: April 6

  • Cruz, Sanders score decisive victories in Wisconsin (Reuters)
  • Clinton Can’t Get to New York Fast Enough After New Sanders Win (BBG)
  • Trump, Clinton Have Single-Digit Leads in Pennsylvania (BBG)
  • Panama law firm says data hack was external, files complaint (Reuters)
  • ‘Panama Papers’ Puts Spotlight on Boom in Offshore Services (WSJ)
  • Barclays partners with Goldman-backed bitcoin payments app (FT)

Q1 GDP To Be Revised Even Lower After February Trade Deficit Grows More Than Expected

As of this moment, the Atlanta Fed calculates Q1 GDP to be -0.7% (Bank of America has it at 0.6%). We expect this number to be promptly revised even lower following the latest disappointing trade data from the US, when moments ago the BEA reported that the US February deficit rose from $45.9BN to $47.1BN, missing the $46.2BN consensus estimate. This was the largest monthly deficit since August 2015's $50.5BN, and the number is likely only going to increase as the US is once again forced to start importing more oil with its own shale industry increasingly mothballed.

Was There A Run On The Bank? JPM Caps Some ATM Withdrawals

Under the auspices of "protecting clients from criminal activity," JPMorgan Chase has decided to impose capital controls on . As WSJ reports, following the bank's ATM modification to enable $100-bills to be dispensed with no limit, some customers started pulling out tens of thousands of dollars at a time. This apparent bank run has prompted Jamie Dimon to cap ATM withdrawals at $1,000 per card daily for non-customers. Of course, we are sure this is just another 'storm in a teacup' as why would anyone complain about a bank withholding people's money when they are assuredly tax evaders, terrorists, drug dealers and human traffickers.

On Final Day Of Extremely Volatile Quarter, Futures Trade Modestly Lower

On the last day of an extremely volatile first quarter, following the latest torrid push higher in risk assets over the past two days following Yellen's dovish Tuesday comments, today has seen a modest pull back in risk, whether because the market is massively overbought, because someone finally looked at what record multiple expansion that has taken place in Q1 as earnings are set to collapse by nearly 10%, or simply due to fears that tomorrow's payrolls number will show an abnormal amount of minimum wage waiters and bartenders added.