Treasury Department

You will not be warned of the risks to your wealth by anyone in a position of power in the political financial hierarchy.

No, Ben S. Bernanke will be someday remembered as the world’s most destructive battleship admiral. Not only was he fighting the last war, but his whole multi-trillion money printing campaign after September 15, 2008 was aimed at avoiding an historical Fed mistake that had never even happened!

1,426. That’s the number of Americans who renounced their US citizenship last quarter according to the US government’s report just released this morning. That’s a record high for a single quarter, easily beating the last record high set earlier this year, which beat the previous record high set in 2013.

• China economic growth seen slowing despite policy easing (Reuters)
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• Obama to slow pace of withdrawal of U.S. troops from Afghanistan (Reuters)
• Corporate America's Epic Debt Binge Leaves $119 Billion Hangover (BBG)
• Islamic State battles insurgents as Syria army prepares assault (Reuters)
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The warnings are getting louder.  Is anybody listening?

The phrase “crossing the Rubicon” has stuck for more than 2,000 years, signifying a risky and dangerous point of no return. This week, the United States government crossed the Rubicon. In a fit of complete arrogance, a federal judge ruled that he has ‘jurisdiction’ over one of the biggest banks in mainland China, Bank of China (BOC), and demands that the bank turn over financial records to his court.

"The think tanks do not disclose the terms of the agreements they have reached with foreign governments. And they have not registered with the United States government as representatives of the donor countries, an omission that appears, in some cases, to be a violation of federal law, according to several legal specialists who examined the agreements at the request of The Times... As a result, policy makers who rely on think tanks are often unaware of the role of foreign governments in funding the research."

With the "above the law" Federal Reserve coming under increasing pressure to answer a Senate investigation's questions about the 2012 "leak", it appears the proximity of the probe to Janet Yellen, has forced The Fed to 'fess up and throw someone under the bus. Meet Seth Carpenter, a nominee for assistant Treasury secretary for financial markets...

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• Volkswagen Emissions Investigations Should Widen to Entire Auto Industry, Officials Say (WSJ)
• Germany's Bosch makes VW's U.S. diesel components (Reuters)
• Volkswagen scandal will have personnel consequences - state economy minister (Reuters)
• Glencore Falls to Record as Mining Shares Lead Stock Losses (BBG)
• Despite Slump, China’s Xi Jinping Pledges Economic Reforms (WSJ)

Perception is everything in contemporary economics and the Fed is the center of perception; the medium has become the message. The truth is more this: the Fed no longer reacts to the waxing and waning of animal spirit-led demand. In the current monetary regime it exists to create and maintain animal spirits with a secular policy centered on ever-expanding credit, but it is very aware that admitting it’s centrality would defeat its purpose.

When we say that the rule of law is dead in America, we are not exaggerating. Civil asset forfeiture is one of the most unethical and barbaric practices routinely performed by law enforcement in these United States today. Naturally, the Department of Justice is doing everything it can to protect the practice.

The build up took months... but then the whole mess came crashing down in one weekend. By then it was too late to get your money out...

While we already knew that China was selling - and following the record selling of FX reserves in August, so does everyone else - an even more interesting question emerged: who is buying? Thanks to the WSJ we now know the answer: "A little-known New York hedge fund run by a former Yale University math whiz has been buying tens of billions of dollars of U.S. Treasury debt at recent auctions, drawing attention from the Treasury Department and Wall Street."

Banks in the US and Europe are trying to develop a cashless transactions system. The concept is to establish a comprehensive ledger for a business or a person that records everything received and spent, and all of the assets held – mortgages, investment portfolios, debts, contractual financial obligations, and anything else of market value. There would be no need for cash because the ledger would tell you and anyone you were considering a transaction with how much is available and would be transactable at any specific moment. This is not a dreamy idea. Blythe Masters is leading a new business effort to develop a universal cashless system. Not only is she gathering significant investor interest, but the Federal Reserve and various US Government agencies have become keenly interested in the potential usefulness and efficiencies of a universal cashless system

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