The gold price manipulation scheme will go down as the biggest financial market scandal in US history for numerous reasons. They include the destruction of the free market system in the United States.
- As we predicted yesterday, the "big" Gaza ceasefire lasted all of a few hours (Reuters)
- To Lift Sales, G.M. Turns to Discounts (NYT)
- Espirito Santo Family’s Swift Fall From Grace Jolts Portugal (BBG)
- Argentine Debt Feud Finds Much Fault, Few Fixes (WSJ)
- Fiat Says Ciao to Italy as Merger With Chrysler Ends Era (BBG)
- Euro zone factory growth eases in July as inflation fades away (Reuters)
- CIA concedes it spied on U.S. Senate investigators, apologizes (Reuters)
- Ukraine Reports Losses After Pro-Russian Ambush Near Malaysia Airlines Flight 17 Crash Area (WSJ)
- U.S. says India refusal on WTO deal a wrong signal (Reuters)
- Why Putin Has 2006 Flash Before His Eyes After Sanctions (BBG)
- Fed Decision-Day Guide: QE Tapering to Inflation Debate (BBG)
- Obama says strains over Ukraine not leading to new Cold War with Russia (Reuters)
- Siemens to BP Prepare for Downward Russia Business Spiral (BBG)
- Paying Ransoms, Europe Bankrolls Qaeda Terror (NYT)
- Argentina Banks Preparing Bid to Help Argentina Avoid Default (WSJ)
- Obama Weighs Fewer Deportations of Illegal Immigrants Living in U.S. (WSJ)
- India Warships Off Japan Show Rising Lure as China Counterweight (BBG)
- Hong Kong Popping Housing Bubbles London Can’t Handle (BBG)
- Carnage at U.N. school as Israel pounds Gaza refugee camp (Reuters)
That will teach them! Having received full credit for for co-operation and suspending some individuals, Lloyds Bank has been fined the staggeringly wrist-slap-like sum of $105 million for the "manipulation, attempted manipulation, and false reporting of Libor." As WSJ reports, the British bank becomes the seventh financial institution to strike a deal with U.S. and U.K. authorities who are conducting a long running probe into allegations of widespread attempts to manipulate Libor. With no less than the head of the Bank of England calling the bank's actions (mainpulating JPY Libor for at least 2 years) "reprehensible," and the CFTC adds individuals bevahior was a "gross breach of trust." Well we are sure after this they will never manipulate another market ever again...
Let's take a look at the amount of settlements/fines from various banks and financial institutions around the world since the crisis.
- Argentine holdout NML says government "choosing" to default (Reuters)
- Crunch time for Gaza truce talks as death toll passes 800 (Reuters)
- Don’t Tell Anybody About This Story on HFT Power Jump Trading (BBG)
- U.S. Accuses Russia of Shelling Eastern Ukraine (BBG)
- France’s Wheat Exports in Question as Rain Spoils Quality (BBG)
- Tapering in action: Lower printer sales hurt Xerox's revenue (Reuters)
- No liquidity? No Problem, there's an ETF for that: Bond ETFs Swelling in Europe as Trading Debt Gets Tougher (BBG)
- Herbalife hires ex-Biden chief to fend off regulators (NYPost)
- GM recalls far from calamity for some dealers who find new customers, business (Reuters)
- Bad weather likely cause of fatal Air Algerie crash: French officials (Reuters)
- EU Works to Punish Russia as MH17 Bodies Leave Rebel Area (BBG)
- Bodies From Malaysia Airlines Flight Begin Long Trip to Netherlands (WSJ)
- Israel pounds Gaza as Kerry arrives (Reuters)
- U.S. judge dismisses Republican lawsuit over Obamacare subsidy for Congress (Reuters)
- Israel Soldier Missing Amid Assault on Hamas in Gaza (WSJ)
- Detroit Retirees Vote in Favor of Pension Cuts (WSJ)
- Russia Axes 1st Bond Sale in 3 Months as Ukraine Drives Up Yield (BBG)
- Wall Street Cut From Guest List for Jackson Hole Fed Meeting (BBG)
- Credit Suisse to Exit Commodities, Posts Big Quarter Loss (BBG)
- Draghi Cedes Euro Control to Yellen on Fed Rate Wagers (BBG)
Since we first exposed to the world that yet another market (foreign exchange) was manipulated by nefarious traders over a year ago, the grand total of prosecutions for market rigging is... zero. As Bloomberg notes, however, more than 25 FX traders have been fired, suspended, or put on leave in that same period. While regulators appear incapable of discovering the truth, the market manipulation probes just got serious..."The [UK] Serious Fraud Office has today opened a criminal investigation into allegations of fraudulent conduct in the foreign exchange market."
- BRICS set up bank to counter Western hold on global finances (Reuters)
- Fed's Yellen Hedges Her View on Rates (Hilsenrath)
- China GDP Grows 7.5% in Second Quarter (WSJ)
- Get More Acquainted With Your Knees as Boeing Reworks 737 (BBG)
- Israel Warns Gazans of New Attack After Hamas Rejects Truce (WSJ)
- Israel poised for Gaza incursions after truce collapses (Reuters)
- China Housing Sales Fall in First Half of 2014 (WSJ)
- IBM to offer iPads and iPhones for business users (Reuters)
- Fed's George says strengthening economy warrants quick rate rise (Reuters)
In another indication that the ongoing FX probe is picking up steam, or at least preparing for primetime public PR consumption, the FT reports that US prosecutors are offering immunity deals to junior traders in London. The quo for this quid: rat our the senior staff involved in what has previously been reported to be years of currency manipulation (recall "How Wall Street Manipulates Everything: The Infographics"). And continuing the tradition of the DOJ only focusing on European banks, because apparently nobody in the US ever engaged in manipulation of anything, ever, the "US Department of Justice staff have flown to the UK in recent weeks to interview foreign exchange traders, who have been offered partial immunity in exchange for volunteering information about superiors, people familiar with the situation said."
2014 has not been kind to Barclays: first, the UK bank proved countless goldbugs right when it was first caught rigging the gold market (the first documented case, not the last) and a few short weeks later, the New York Attorney General crucified the bank for misleading its Dark Pool clients, and letting their order flow be, quite lucratively, front run by "aggressive" predatory algos - something it explicitly had stated it won't allow. So with one after another revenue stream crashing before its eyes, what is the Chairman of the scrambling bank to do? Why beg to at least keep the FX manipulation going. What follows is not from The Onion.
We already know that Wall Street manipulates everything (not conspiracy theory, but now open conspiracy fact), but Reuters' Jamie McGeever exposes the ugly chatroom realities of just how FX traders shared orders, split trades, front-ran clients in million of electronic messages providing fresh evidence of collusion among top currency traders. Traders pooled order details and discussed the 'spread' they would offer, "I don't like this guy...I'd show 6 to good guys but guys like that I'm going to show 7 in future," the trader added. Unrigged?
This week brings some key events and releases in DMs, including US FOMC (Goldman expects $10bn tapering, in line with consensus), IP, CPI, and Philly Fed (expect 13.5), EA final May CPI (expect 0.50%), and MP decisions in Norway and Switzerland (expect no change in either).
Promises, promises! We’ve heard it all before. ‘We’re gonna get you, guys’. We know the song it’s just the words that get changed from time to time, but anyone can hum along to it these days. The bankers, those banksters are gonna get their comeuppance. Trouble is: they never do. It’s just getting boring now.