The SWIFT rebuild will likely require the insights of an outlet such as Hyper Ledger, run by longtime Zero Hedge CDS and commodity trading icorn, Blythe Masters. Hyper Ledger works with a consortium of organizations and corporations tasked with developing systems to offer protection for messages sent between the worlds central banks, which will be based on blockchain technology. A rebuild opens new concerns about the current integrity of the SWIFT platform and what problems may be lurking within it that we have yet to discover.
There was a reason why we warned readers two days ago that "The World's Central Bankers Are Gathering At The BIS' Basel Tower Ahead Of The Brexit Result": simply enough, it was to facilitate an immediate response when a worst-cased Brexit vote hit. And that is precisely what has happened today in the aftermath of the historic British decision to exit the EU. It started, as one would expect, with Mark Carney who said the Bank of England is ready to pump billions of pounds into the financial system as he stands at the front line of Britain’s defense against a Brexit-provoked market crisis.
While hardly coming as a surprise to anyone, moments ago the Fed announced that all 33 banks have enough capital to withstand a severe economic shock, though Morgan Stanley trailed the rest of Wall Street in a key measure of leverage, Bloomberg reports. The biggest bank cleared the most severe scenario handily, with the exception of Morgan Stanley whose projected 4.9% leverage ratio tied for last place alongside a Canadian bank’s U.S. unit, falling within a percentage point of the 4 percent minimum. As a result of today's "test result" many banks will likely win regulators' approval next week to boost dividends.
What do you get when you combine skyrocketing tuition costs, a lack of growth in high-paying jobs, moral hazard, and America’s largest-ever generation of students? A mountain of $1.3 trillion in student loan debt – much of which is not being paid for - and an over-education bubble...
After last week's key event, the retail sales number, which the market discounted as being too unrealistic (and overly seasonally adjusted) after printing at a 13 month high and attempting to refute the reality observed by countless retailers, this week has a quiet start today with no data of note due out of Europe and just Empire manufacturing (which moments ago missed badly) and the NAHB housing market index of note in the US session this morning.
"My fear is that central banks are now taking this too far through negative interest rates in particular and that they’re going to literally destroy their own banking systems. If they’re actually successful in generating higher inflation, then they’re going to destroy their own bond markets... our government officials, and I will include the Federal Reserve in that, have failed the American people."
The overnight session has been one of alternative weakness and strength: it started in China where stocks tumbled 2.8% to a two month low following some unexpected warnings in the official People's Daily newspaper and poor trade data. Concerns about China, however, were promptly forgotten and certainly not enough to keep global assets lower, with European stocks gapping higher at the open and rallying from a one-month low, driven by a "surprising" surge in the USDJPY which has moved nearly 200 pips higher since its post-payrolls low. Another driver is the jump in oil, which rallied just shy of $46 a barrel, buoyed by Canadian wildfires that are curbing production and speculation that the Saudi Arabian oil minister succession will be bullish for oil prices.
HSBC’s main gold vault in London regularly comes under the media spotlight for a number of reasons. These reasons include: a) the HSBC London vault stores a very large amount of gold on behalf of the well-known SPDR Gold Trust (GLD); b) along with the Bank of England vaults and JP Morgan vault, the HSBC vault is one of the 3 largest gold vaults in London; c) the location of the HSBC vault in London is not publicised and so the secrecy creates intrigue; d) HSBC every so often throws out some visual or audio-visual media bait about the vault, most famously in the case of CNBC’s Bob Pisani; Despite all of the above, no one seems to have ever tried to figure out where this gold vault is actually located. Until now.
Ten days ago, in the latest example of how criminal Wall Street behavior leads to zero prison time, Wells Fargo admitted that it deceived and defrauded the U.S. government. Its punishment: a $1.2 billion settlement, one which will ultimately be paid by the bank's shareholders as no executives go to prison. And now, less than two weeks later it's time for Wells to get its reward: the NY Fed just announced it would grant Wells Fargo the much coveted Primary Dealer status.