Cohen

There is a saying: if in doubt, ask an economist, and do the opposite.

There is also consensus among the people inhabiting the real world -the one that is found outside the ivory towers of the economics departments of all US and global Tier 1, 2 and 3 universities - that the only reason the world is currently in its sad, deplorable and deteriorating economic state (which however keeps making the rich richer), is precisely due to these same economists, whose tinkering and experimentation with DSGE models, differential equations, curved lines, and all such things all of which have no real world equivalent, and specifically due to economists like Greenspan and Bernanke. These two men, both of whom barely have seen the real world for what it is or held a real job outside of their academic outposts, who surround themselves with brownnosing sycophants and who do the bidding of Wall Street, are the primary reason for the current centrally-planned quagmire. Which is why we wonder: is the fact that some 313 economists (and counting) have signed a petition pushing for Janet Yellen (aka Freudian slip "he" if you are the president), and against Larry Summers, sufficient grounds to actually like the outspoken former Harvard head?

With a US attack on Syria now seemingly inevitable, it is useful to get familiar (and in some cases follow in real time using their "social networking" sites) the US Naval forces amassing around Syria, ready to deliver either a lethal payload of Tomahawk cruise missiles (carried by the four destroyers listed below), a deployment of marines (located in the USS Kearsarge big-deck amphibious warfare ship), or one or more squadrons of airplanes sitting on the deck of the Truman and Nimitz aircraft carriers.

It has been revealed, thanks to Edward Snowden, that Google and other US tech companies received millions of dollars from the NSA for their compliance with the PRISM mass surveillance system. So just how close is Google to the US securitocracy?

"Google is getting WH [White House] and State Dept support and air cover. In reality they are doing things the CIA cannot do"

That Google was taking NSA money in exchange for handing over people’s data comes as no surprise. When Google encountered the big bad world, Google itself got big and bad.

Think the market is liquid? Think again, especially if you are one of the unlucky ones who bought into the SAC get rich quick dream and now just want to get your money out of the world's most notorious hedge fund. According to Bloomberg, the CT firm that has been branded by the government as a "veritable magnet for market cheaters," has "refused clients’ requests that the firm speed up payouts on the billions of dollars earmarked for withdrawals, according to three people familiar with the discussions."

• U.S. Regulator Subpoenas Banks Over Long Warehouse Queues (BBG)
• Apple Said to Prepare Holiday Refresh of IPhones to IPads (BBG)
• Fed's Yellen Says Stance on Banks Hardened (WSJ)
• Mexico opens up its energy sector (FT)
• Spin: Greek GDP marks gradual deceleration of recession (FT) ... spin aside, it dropped 4.6%, and in reality, probably over 10%
• Made-in-Canada Solution For BlackBerry Avoids Nortel Fate (BBG)
• America's Farm-Labor Pool Is Graying (WSJ)
• Video of 'lame' cattle stirs new concern over growth drugs (Reuters)
• Paulson Bid for Steinway Trumps Kohlberg Offer (WSJ)
• Egyptian government yet to decide on pro-Mursi vigils (Reuters)

The time has come to remind Americans that "you can't have 100-percent security and also have 100-percent privacy and zero inconvenience" or, in other words, why only the government can provide a veil of impenetrable protection, and why such things as personal privacy in an age of murderous Al Qaeda (the non-US funded variety, supposedly) terrorists lurking behind corners, are not only unnecessary but unpatriotic. According to CBS, the "terrorist threat prompting the U.S. government to close nearly two dozen embassies and consulates Sunday is the most specific, credible threat information in years" (even more credible than the Boston marathon bombers?) Specific but lacking the actual date, or timing, of an alleged "terrorist attack." Information which, however, can not be shared with the general public for obvious reasons - just trust the government and ignore that spy drone peeking into your window to see if you are dutifully spending your daily quota of "confident consumer" fiat on Amazon.com. 

With euphoria returning to equity markets, it's worth remembering that stocks are unlikely to make you really rich. We have some ideas what might though.

Following that press conference, it seems the sinking ship has had a few more rats quietly slink out through the back door... SAC Capital is a sea of red and grey Bloomberg Terminals that appears to confirm our earlier image of Mr. Cohen among his friends and colleagues.

The US Attorney for the Southern District of New York, Preet Bharara, is about to do what so many iterations of prosecutors have dreamed of doing in the past three decades: announce criminal charges against SAC Capital, if not against its chief Steve Cohen (at least not yet). Watch him do it live at the following webcast.

Following the criminal indictment, Stevie Cohen suddenly finds himself surrounded by all of his newfound friends at Cummings Point Road 72...

Goodbye sweet blue-eyed prince. It's been bittersweet. Just out from Bloomberg and Reuters:

• SAC CAPITAL ADVISORS INDICTED BY FEDERAL GRAND JURY IN NEW YORK
  
• COHEN'S HEDGE FUND, SUBORDINATES SUBJECT OF CRIMINAL INQUIRY
  
• U.S. SEEKS TO FORCE SAC TO FORFEIT ILLEGAL PROFITS STEMMING FROM FRAUD 
  
• U.S. SAYS THAT FROM ROUGHLY 1999 TO 2010, SAC OBTAINED AND TRADED ON INSIDE INFORMATION TO BOOST RETURNS, FEES

Perhaps now is a good time to retreat to the hockey rink behind 9 feet of electrified fence, before the TV newsvans arrive at 72 Cummings Point road. As for what happens to the 5-10% of daily NYSE volume traditionally associated with the SAC, we will find out soon enough.

• The Department of Justice has opened an initial probe into the metals warehousing industry (WSJ)
• Obama Says Budget Debate a Battle for Middle Class Future (BBG)
• Death Toll From Spanish Train Crash Hits 77 (WSJ)
• ‘Fabulous Fab’ takes to witness stand (FT)
• Banks Said to Weigh Suspending Dealings With SAC as Charges Loom (BBG) - what about Anthony Scaramucci?
• How the Muslim Brotherhood lost Egypt (Reuters)
• German Business Confidence Rises for a Third Month (BBG)
• Fraternities Lobby for Tax Break Without Hazing Penalties (BBG)
• China charges Bo Xilai with corruption, paves way for trial (Reuters)
• Airbus Pushes Higher-Density A380 to Counter Luxury Image (BBG)

• Humans Beating Robots Most Since ’08 as Trends Shift (BBG)
• Easing of Mortgage Curb Weighed (WSJ)
• European Banks Face Capital Gap With Focus on Leverage (BBG)
• Signs Suggest China Warming to Idea of Stimulus (WSJ)
• China Coal-Fired Economy Dying of Thirst as Mines Lack Water (BBG)
• Jeans and shoes show criminal underbelly of China-EU trade (Reuters)
• How U.S. drug sting targeted West African military chiefs (Reuters)
• Japan scrambles jets after China plane flies by southern islands (Reuters)
• Apple Plots Return to Growth After Coping With Aging Lineup (BBG)
• AT&T Falls Shy of Analyst Estimates as Discounts Hurt Margins (BBG)
• SAC insider trading case takes twist (FT)

It would appear the camel's back of the career of Steve Cohen and his firm SAC Capital has received its last straw. As the WSJ reports, Federal prosecutors plan to bring criminal charges against the firm as early as this week. This spells trouble for SAC which, while still reeling from the SEC's attempt to effectively shut it down, will now have to fight a two front war; defending its key executives against criminal charges as well, including the risk of jail time for what is most likely going to be a securities fraud charge. While a disgraced Steve Cohen may, in theory, run his or whatever employees' he has left, money as a "family office", it would take a very strong wi-fi signal to do that from even a minimum security prison should he finally suffer Martha Stewart's fate.

• Biggest Banks Face Fed Restoring Barriers in Commodities (BBG)
• SAC to Employees: Cohen Didn't Read Dell Email at Heart of SEC's Case (WSJ)
• Second (and Third) liens are back, and so is 2005: As Banks Retreat, Hedge Funds Smell Profit (WSJ)
• Singapore funds benefit from Asian wealth (FT)
• 2 years later the lies haven't changed one bit - Tepco hit over slow admission of radioactive leak (FT)
• How big tech stays offline on tax (Reuters)
• Hilton Leads Rush to Africa in Fastest Boom (BBG)
• U.S. and UK fine high-speed trader for manipulation (Reuters)
• Key witness takes stand in SEC case against Goldman's Tourre (Reuters)
• Boomer Sex With Dementia Foreshadowed in Nursing Home (BBG)
• Bentley SUV gives £800m boost to UK car industry (FT)