Bank of America

For First Time Ever, Most Members Of Congress Are Millionaires

A month ago, we showed a chart of median household income in the US versus that just in the District of Columbia. The punchline wrote itself: "what's bad for America is good for Washington, D.C." Today we got official verification that Bernanke's wealth transfer in addition to benefitting the richest 1%, primarily those dealing with financial assets, also led to a material increase in the wealth of one particular subgroup of the US population: its politicians.  According to the OpenSecrets blog which conveniently tracks the wealth of America's proud recipients of lobbying dollars, aka Congress, for the first time ever the majority of America's lawmakers are worth more than $1 million.

Equity Futures Stong On ECB Day Ahead Of Earnings Season Start: Market Recap

The overnight session began on a dour mood, with both the Shanghai Composite and Nikkei sliding (the former once again just barely above 2,000,  latter once again dropping below 16,000), even though Chinese CPI came below expectations suggesting the PBOC has some more room to ease and not rush into liquidity extraction (which just happens to blow out repo rates like clockwork), while in Japan BOJ board member Shirai implied the Japanese QE can be extended and expanded as needed. Europe had a weak start although shortly after 3 am Eastern staged a dramatic turnaround supported by a bounce in the EUR (and ES driving EURJPY) leading to broadly higher stocks, supported by solid demand for Portuguese 5y bond syndication, as well as oversubscribed debt auctions by the Spanish Treasury which sold above the targeted amount and consequently saw SP/GE 10y spread fall to its tightest level since April 2011. At the same time, having been propped up by touted redemption flows ahead of Spanish and French bond auctions, absorption of supply shortly after 1000GMT resulted in an immediate selling pressure on Bunds. Helping lift spirits was a rumored $1 billion trade order in September S&P futures, as well as chatter by the Greek PM that the country was like Portugal and Ireland, prepared to get back into the bond markets.

23 Reasons To Be Bullish On Gold

It's been one of the worst years for gold in a generation. A flood of outflows from gold ETFs, endless tax increases on gold imports in India, and the mirage (albeit a convincing one in the eyes of many) of a supposedly improving economy in the US have all contributed to the constant hammering gold took in 2013. Perhaps worse has been the onslaught of negative press our favorite metal has suffered. It's felt overwhelming at times and has pushed even some die-hard goldbugs to question their beliefs... not a bad thing, by the way. To us, a lot of it felt like piling on, especially as the negative rhetoric ratcheted up. This is why it's important to balance the one-sided message typically heard in the mainstream media with other views. Here are some of those contrarian voices, all of which have put their money where their mouth is...

Frontrunning: January 8

  • Here comes JPM's next multibillion legal reserve: Federal Probe Targets Banks Over Bonds (WSJ)
  • Mulally Bows Out of Microsoft CEO Race, Staying at Ford (BBG)
  • United States sending more troops and tanks to South Korea (Reuters)
  • Eurozone unemployment sticks at record high (FT)
  • China-Japan 'Voldemort' attacks up ante in propaganda war (Reuters)
  • Alternative Lenders Peddle Pricey Commercial Loans (WSJ)
  • John McAfee: glad Intel dropping name from security software (Reuters)
  • Jobless Benefits Bill Stays Alive Amid Talks on Offsets (BBG)
  • Chicago Colder Than South Pole as Frigid Air Clamps Down (BBG)
  • Former Miss Venezuela shot dead in attempted robbery (Reuters)

Forbes Reveals Its "Top 30 Under 30" In Finance

With Trader Monthly magazine having, ironically, gone out business long ago, all those traders whose egos demanded that their insider trading connections put them at least in one of the iconic "Top X under X" league tables, pardon, rankings, had to bide their time in expectation of one day when their prowess to frontrun others or move markets with repeated calls to 555-7617 (with or without references to Anacott Steel) would be appreciated by such sterling Wall Street "experts" as Anthony Scaramucci. Well, for this year's crop of some 30 traders under 30, the day has arrived. And while Forbes may not be Trader Monthly, the amusement, the hubris and the behind the scenes dealing to appear in such a list, sure are still the same...

Frontrunning: January 2

  • Threatening snowstorm may be early test for N.Y. Mayor de Blasio (Reuters), U.S. Northeast Threatened With Blizzard, Travel Delays (BBG)
  • Scarred U.S. consumers a hard sell for traditional retail (Reuters)
  • Edward Snowden, Whistle-Blower (NYT)
  • A Few Brave Investors Scored Huge, Market-Beating Wins (WSJ)
  • Fiat gets full control of Chrysler for $4.35 billion (Reuters)
  • Billions Vanish in Kazakh Banking Scandal (WSJ)
  • SAC’s Cohen Focus of Trial as Martoma Rebuffs U.S. (BBG)
  • World's first state-licensed marijuana retailers open doors in Colorado (Reuters)
  • Hyundai, Kia face fading growth as currency tides buoy Japan rivals (Reuters)
  • Bond investors braced for new year shock (FT)
  • Putin vows total destruction of 'terrorists' after bombings (AFP)

Wall Street's Latest Investment: Ex-Convicts

Either the Volcker Rule is making Wall Street's menu of investment choices so unbearably limited, or traditional assets are so overpriced Wall Street won't even touch them with other people's money, but when it comes to allocating capital the smartest conmen in the room are coming up with some truly unorthodox products. Such as investing in ex-convicts in the form of 2000 newly released prisoners.

'It's Not What You Know, It's Who You Know' As Frat Boys Dominate Wall Street

As students vie for 2014 internships, Bloomberg finds a fraternity-based network whose Wall Street alumni guide resumes to the tops of stacks, reveal interview questions with recommended answers, offer applicants secret mottoes and support chapters facing crackdowns. Despite apparent crackdowns on cronyism, nepotism, and fraternism; it seems nothing has changed as "secret handshakes" and the fraternity pipeline helps undergraduates beat odds three times steeper than Princeton University’s record-low acceptance rate... "People like people who are like themselves," notes one recruiter, seemingly proven by the fact that JPMorgan employs 140 Sigma Phi Epsilon members with BofA and Wells Fargo even more.

On The 100th Anniversary Of The Federal Reserve Here Are 100 Reasons To Shut It Down Forever

December 23rd, 1913 is a date which will live in infamy.  That was the day when the Federal Reserve Act was pushed through Congress.  Many members of Congress were absent that day, and the general public was distracted with holiday preparations.  Now we have reached the 100th anniversary of the Federal Reserve, and most Americans still don't know what it actually is or how it functions.  But understanding the Federal Reserve is absolutely critical, because the Fed is at the very heart of our economic problems. Since the Federal Reserve was created, there have been 18 recessions or depressions, the value of the U.S. dollar has declined by 98 percent, and the U.S. national debt has gotten more than 5000 times larger.  This insidious debt-based financial system has literally made debt slaves out of all of us, and it is systematically destroying the bright future that our children and our grandchildren were supposed to have. The truth is that we do not have to have a Federal Reserve.  The greatest period of economic growth in U.S. history was when we did not have a central bank.  If we are ever going to turn this nation around economically, we are going to have to get rid of this debt-based financial system that is centered around the Federal Reserve.  On the path that we are on now, there is no hope.

Existing Home Sales Tumble, Post First Annual Decline In 29 Months On Day After Taper Begins

If anyone is still wondering why back in June Zero Hedge first presented what the adverse impact on housing affordability as a result of soaring rates, today's NAR release on existing home sales should set all questions to the side. Because after rising in a seemingly relentless fashion, existing home sales have (and this is before the traditional downward revision by Larry Yun's conflicted organization which will expose all of its numbers as flawed regardless) finally hit a brick wall, and not only did November existing home sales tumble from 5.12MM to 4.90MM, missing estimates of 5.02MM, they also posted the first year over year decline in 29 consecutive months of increases.

83 Numbers From 2013 That Are Almost Too Crazy To Believe

During 2013, America continued to steadily march down a self-destructive path toward oblivion.  As a society, our debt levels are completely and totally out of control.  Our financial system has been transformed into the largest casino on the entire planet and our big banks are behaving even more recklessly than they did just before the last financial crisis.  We continue to see thousands of businesses and millions of jobs get shipped out of the United States, and the middle class is being absolutely eviscerated.  Due to the lack of decent jobs, poverty is absolutely exploding.  Government dependence is at an all-time high and crime is rising.  Evidence of social and moral decay is seemingly everywhere, and our government appears to be going insane.  If we are going to have any hope of solving these problems, the American people need to take a long, hard look in the mirror and finally admit how bad things have actually become.

 

Why Obama's Home Affordable Modification Program Failed (Spoiler Alert: Thank Bank Of America et al)

Back when the Executive and Congress at least pretended not to abdicate all power to the Fed, one of the centerpiece programs designed to boost the housing market for the benefit of the poor (as opposed to letting Ben Bernanke make marginal US housing a rental industry owned by a handful of private equity firms and hedge funds), was Barack Obama's Home Affordable Modification Program or HAMP, which attempted to prevent foreclosures by lowering distressed borrowers’ mortgage payments. Under the program, homeowners would be given trial modifications to prove they can make reduced payments before the changes become permanent. The program was a disaster as of the 3 million foreclosures that were targeted for modification in 2009, only 905,663 mods have been successful nearly five years later - a tiny 13% of the 6.9 million who applied (still, numbers which Obamacare would be delighted to achieve). Part of the reason: the program's reliance on the same industry that sold shoddy mortgages during the housing bubble and improperly sped foreclosures afterward. But there was much more. For the definitive explanation of everything else that went wrong, we go to Bloomberg's Hugh Son whose masterpiece released today explains how and why once again the banks - and especially one of them - won, and everyone else lost.

As Bitcoin Transaction Volume Triples Since October, Europe Prepares To Regulate, Tax The Digital Currency

Representing numbers that would put the adoption curve of Obamacare to shame, the Bitcoin equivalents of Paypal, BitPay, announced last week that it has now processed over $100 million in BTC transactions in 2013, has increased its merchant base to over 15,500 approved merchants in over 200 countries, but most importantly, has seen a surge in the number of merchants using its BTC payment pricing plan, by 50% since October while the volume of transactions has tripled. While the surge in the currency adoption has matched the explosive rise in the USD-value of the currency, the news should comfort any lingering doubts whether Bitcoin is a credible payment system. Which explains why Europe, which over a year was the first entity to cry foul about Bitcoin (recall from November 2012: "The ECB Explains What A Ponzi Scheme Is; Awkward Silence Follows") when the USD-price of one BTC was still in the double digits, is doubling down in its fight against the fiat alternative, this time as the European Union's top banking regulator is preparing to actively supervise the virtual currency.