Another day, another too-big-to-fail bank gets slapped on the wrist after being busted for blatant rigging of the market. The CFTC Order finds that from Jan 2007 to Jan 2012, Citibank on multiple occasions attempted to manipulate, and made false reports concerning, the U.S. Dollar International Swaps and Derivatives Association Fix (USD ISDAFIX), a global benchmark for interest rate products. Notably, while a handful of European banks have already settled criminal or civil claims tied to Libor rigging, Citi is the first U.S. bank to do so. Citi will pay a combined $425 million to resolve this manipulation, and as they proudly note in the press release, with today's actions, CFTC has imposed over $5.08 billion in penalties in 17 actions against banks and brokers to address rigging and manipulation in ISDAFIX, FX, and LIBOR benchmarks.
How Is This Not Criminal: Goldman Underwrites $2 Billion Tesla Stock Offering Hours After Upgrading Stock To A BuySubmitted by Tyler Durden on 05/18/2016 18:16 -0400
Call it criminal deja vu, all over again: "Morgan Stanley and Goldman, Sachs & Co. are acting as lead joint book-running managers for the offering, with Deutsche Bank Securities, Citibank, and BofA Merrill Lynch acting as additional book-running managers."
Following SCOTUS' decision not to hear a case making it easier to get rid of student debt, and The White House's push to ease student loan 'burdens', WSJ reports a federal judge ruled law-school graduates who file for bankruptcy protection can cancel the debt they racked up while studying for the bar exam. Once again - a poor outcome from a seemingly-easy decision (suggested by, and made easy by government) is made consequence-free by America's government (on behalf of US taxpayers). One wonders if the law graduates in question should receive "participation trophies" also as they enter the workforce (as Baristas).
Approximately 50 tonnes of BCV gold has been exported from Venezuela to Switzerland within the first 10 weeks of 2016. How much longer can this outflow continue? This gold is being exported by the BCV in order to participate in swaps (or maybe even outright sales) in order to provide external financing to the Venezuelan Government. The fact that the gold is being picked up by Brinks Switzerland suggests it is being brought to a Swiss gold refinery. The main reason gold is sent to Switzerland is so that it can be refined or recast.
In the end, the oil attrition wars may lead us not into a future of North American triumphalism, nor even to a more modest Saudi version of the same, but into a strange new world in which an unlimited capacity to produce oil meets an increasingly crippled capitalist system without the capacity to absorb it. Think of it this way: in the conflagration of the take-no-prisoners war the Saudis let loose, a centuries-old world based on oil may be ending in both a glut and a hollowing out on an increasingly overheated planet. A war of attrition indeed.
"central bankers seem ever intent on going lower, ignorant in my view of the harm being done to a classical economic model that has driven prosperity – until it reached a negative interest rate dead end and could drive no more."
Venezuela has already started moving much of its gold reserve to Europe where it will be located closer to swap-provider and ultimate custodian, and liquidator, Deutsche Bank, by way of Switzerland. According to BullionStar, Switzerland has imported a net of 35.8 tonnes of gold from Venezuela in January 2016.
"The world has fundamentally shifted over the last decade, especially since we’ve emerged from the Great Recession... But the professional class has been very slow to understand what is going on, not just quantitatively but qualitatively in a new generational configuration that I call the Fourth Turning. They don’t accept the new normal. They keep insisting, just two or three years out there on the horizon, that the old normal will return – in GDP growth, in housing starts, in global trade. But it doesn’t return."
Short-term, oil prices are a function of sentiment and manipulation. Here's how that works.
Venezuela's central bank has begun negotiations with the suddenly troubled Deutsche Bank to carry out gold swaps "to improve the liquidity of its foreign reserves as it faces heavy debt payments this year", payments which it won't be able to fund unless it manages to "liquify" its gold. "One of the sources said the central bank has taken an unspecified amount of gold out of the country so that it can be certified, which is required for gold that is used in such swaps."
Meltdown-Mode: European banking stocks are imploding, CDS spreads are exploding.
Remember the mass layoffs of 2008-2009? The US economy shed millions of jobs quickly and relentlessly, as companies died and the rest fought for survival. Then the Fed and the US government flooded the banks and the corporate sector with bailouts and handouts. The nightmare of 2008 soon became a golden era of 'recovery'. Well, 2016 is showing us that that era is over. And as stock prices cease to rise, and in fact fall within many industries, layoffs are beginning to make a return as companies jettison costs in attempt to reduce losses.
Please, take umbrage of my experiences before you decide it's time to press the button on your SHTF nuclear option plan and retreat into the bunker.
Remember when Bitcoin and its digital currency cohorts were slammed by authorities and written off by the elite as worthless? Well now, as the war on cash escalates, officials from The IMF to China are seeing the opportunity to control the world's money through virtual (cash-less) currencies. Just as we warned most recent here, state wealth control is the goal and, as Bloomberg reports, The PBOC is targeting an early rollout of China's own digital currency to "boost control of money" and none other than The IMF's Christine Lagarde added that "virtual currencies are extremely beneficial."