Wall Street Journal
Demand Surge and Shortages of Bullion as Stocks Fall Sharply, Gold Outperforms All Assets In August
After forensically analyzing Morgan Stanley's balance sheet (which is very much like the rest of Wall Street's balance sheet) I can draw direct parallels to that of Lehman and Bear Stearns in 2007. It's a party!
Margin Calls Mount On Loans Against Stock Portfolios Used To Buy Homes, Boats, "Pretty Much Everything"Submitted by Tyler Durden on 08/27/2015 15:40 -0400
"In a securities-based loan, the customer pledges all or part of a portfolio of stocks, bonds, mutual funds and/or other securities as collateral. But unlike traditional margin loans, in which the client uses the credit to buy more securities, the borrowing is for other purchases such as real estate, a boat or education..." The result was "dangerously high margin balances,' - the products became “the vehicle of choice for investors looking to get cash for anything.” Mr. Sica and others say the products were aggressively marketed to investors by banks and brokerages.
Flawed Fundamentals, Nasty Macro, Structural Industry Change: For Wall Street Banks It Really Is Different This TimeSubmitted by Reggie Middleton on 08/26/2015 09:39 -0400
This time, it really is different. It's "Structural", not "Cyclical". It's actually a very big difference, and banking will never be the same.
With professionals proclaiming yesterday's meltdown "historic," and generously telling investors "don't try to overthink what you're seeing," it is clear that the real impact of the carnage wrought by a combination of Fed-indiced crowded trades and HFT illiquidity-providers is yet to be fully appreciated. While Financial advisers, almost unanimously, have cautioned clients not to panic... As one retail investor exclaimed, yesterday's open "was a life-changing 20 minutes."
Gold appears to have once again anticipated the crisis and is acting like a safe haven in recent days - just at the moment when western investors need a safe haven and wealth preservation most.
A non-bombastic discussion of market forces and what to expect next
America’s next president could be eased into office not just by TV ads or speeches, but by Google’s secret decisions, and only a few obscure researchers would know how this was accomplished.
...Perhaps the most effective way to wield political influence in today’s high-tech world is to donate money to a candidate and then to use technology to make sure he or she wins. The technology guarantees the win, and the donation guarantees allegiance, which Google has certainly tapped in recent years with the Obama administration...
HFT critics are crowing over the ITG confession. You see! HFT is front running, plain and simple! Told you! And HFT defenders are largely silent because... well, you can’t defend the indefensible. However, if history is any guide at all, the existence of a clearly identifiable small-v villain will forestall the unmasking of what we believe is a Big Bad... the subterranean influence, bordering on control, of human investment behaviors by firms controlling advanced inference machines.
Imagine a real estate market with the rate of interest on mortgages as high as it could possibly go.
As if in complete defiance of the extensive contention at home and abroad, the Pentagon announced plans this week to dramatically ramp up global drone operations over the next four years. Daily drone flights will increase by 50% during this time, and will include lethal air strikes and surveillance missions to deal with the increase in global hot spots and crises.
It cannot be stressed enough how important Greece is to freedom, liberty and civilization across the globe. Greece is not a one-off, or merely a small nation in big trouble that holds little relevance for the rest of us. Greece is everything. What is happening to Greece follows the exact same game plan of what will eventually happen to every other supposedly sovereign nation. And it appears The Greeks are actively seeking alternatives...
In the event you were becoming concerned that the U.S. government might be backing away from its longstanding policy of endless violence, militarism and bloodshed, fear not. If we know one thing for sure, it’s that defense contractors and the military-intelligence-industrial complex must earn. And continue to earn it will.
As the U.S. economic expansion ages and clouds gather overseas, policy makers worry about recession. But, as WSJ's Jon Hilsenrath warns, their concern isn’t that a downturn is imminent but whether they will have firepower to fight back when one does arrive. "The world economy is like an ocean liner without lifeboats,” economists at HSBC Bank explained, and as looming threats are a reminder that the slow-growing global economy is just a shock away from peril, with rates already at zero, Douglas Elmendorf, the recently departed director of the CBO, warned, "policy makers are thinking about their backup, backup plans."
Everyone seems to focus on gold's price while forgetting its value as a diversification.