It's jolly good fun to discuss alternatives to the doomed status quo, but what choice do most of us have to participating in the current system, even if we loathe it? The lack of choice is of course a key characteristic of the status quo-- if alternatives were plentiful, how many would opt out of Corporate America and the Financial Nobility's manor house of debt servitude?
"Boy, was I wrong," exclaimed Federal Reserve Vice-Chairman Stanley Fischer, "I thought that when Dodd-Frank started, that the banks would not succeed in influencing it, having lost all the prestige they lost." Just like the Fed's economic and rate forecasts, Fischer's political perspective could not have been more incorrect. Rather stunningly confirming Fischer's admission, The Hill reports JPMorgan Chase CEO Jamie Dimon made calls to lawmakers on Thursday urging them to support the "cromnibus" spending bill, according to no lesser brain-trust than Rep. Maxine Waters. Perhaps Fischer inadvertently summed up the state of reality as WSJ reports, when he opined, "we are two bad decisions away from not being an independent central bank." We might suggest the "two" decisions went by a long time ago.
Following the passage of the Crominbus on Thursday night in a last minute "nailbiter" when the Federal spending bill got just one vote more than the required majority, it was off to the Senate. And late last night, proving that the Senate can work on weekends when a piece of Citigroup-penned legislation is on the table, in a 56-40 vote (21 democrats, 18 republicans, 1 independent voting No), the Senate joined the House in voting itself $1.1 trillion for the next 9 months, with the bill now heading for the final signature: Obama's. There is some argument whether the executive will join the legislative in confirming the US government is now (and always has been) merely a pupet of Wall Street, although we expect all it will take Jamie Dimon is just one more phone call of "encouragement" to Obama to make sure Wall Street's will is done in the White House.
While most Americans are busy Christmas shopping and making preparations for trips to see family, Congress remains hard at work doing what it does best. Giving gifts to Wall Street and trampling on citizens’ civil liberties.
The Federal Reserve and its owners print and party, while the rest of us work and weep..................
I think someone should just take this city and...
Recession is a useless discussion by now. The US is a painted pig, the EU needs to let countries go or they’ll go to war, Japan hung its head in a noose for Halloween and China has its 32nd consecutive month of falling factory-gate prices. Lower oil prices may for now hide some of the pain, but even that is too much for Japan, because of the deflationary effect of even less consumer spending. And it’s that lack of spending that’s everyone’s worst enemy. But you can’t solve that with central bank stimulus. The formerly rich world is loaded with burger flippers, food stamps and underwater homes, and that means less, not more, spending. All ‘formerly rich’ governments have historically unequaled spin doctors on their payroll, so the real numbers across the board are much much worse even then what we are ‘allowed’ to know. And what we do know is already awful once you sweep away the propaganda. You’re only going to be OK as an investor if the Fed continues to hold your hand and lead you softly through the ups and downs. You really think they will? Recession? In your dreams.
- Fed set to end one crisis chapter even as global risks rise (Reuters)... you mean, for the third time?
- Insider-Trading Probe Focuses on Medicare Agency (WSJ)
- He's sorry: Rajoy Apologizes as New Wave of Graft Allegations Hits Spain (BBG)
- China could 'punish' Hong Kong over protests, says ex-HK central bank chief (Reuters)
- Dubai Insists the Boom is Not a Bubble This Time Around (BBG)
- Bank-Data Sharing Accord Expands Push to Find Tax Cheats (BBG)
- Deutsche Bank Sinks to Third-Quarter Loss on Legal Costs (BBG)
- Kim Jong Un Executes 10 Officials for Watching Soap Operas (BBG)
- French drugmaker Sanofi sacks CEO Viehbacher (Reuters)
"Since 9/11, those thank yous have been aimed at veterans with the regularity of the machine gun fire that may still haunt their dreams. Veterans have also been offered special consideration when it comes to applications for mostly menial jobs so that they can “utilize the skills” they learned in the military. While they continue to march in those welcome home parades and have concerts organized in their honor, the thank yous are in no short supply. The only question that never seems to come up is: What exactly are they being thanked for?"
"What everyone wants to believe is that when things reach a tipping point and go from being merely crappy for the masses to dangerous and socially destabilizing, that we’re somehow going to know about that shift ahead of time. Any student of history knows that’s not the way it happens. Revolutions, like bankruptcies, come gradually, and then suddenly."
"as part of its continuous monitoring activities at JPMC, FRBNY effectively identified risks related to the CIO's trading activities, governance framework, risk appetite, and risk management practices in 2010. Additionally, a Federal Reserve System team conducting a horizontal examination at JPMC recommended a full-scope examination of the CIO in 2009. However, FRBNY did not discuss the risks that resulted in the planned or recommended activities... As a result, there was a missed opportunity for the consolidated supervisor and the primary supervisor to discuss risks related to the CIO."
Late into Friday's major market selloff, a completely unfounded rumor emerged out of nowhere, seeking to rekindle the BTFD spirits, that with central bank intervention from both the BOJ and ECB already priced in, and with the Fed still in taper mode (if not for much longer should the S&P dump accelerate), that the last central-planner wildcard, China, would join the fray and a major monetary gusher would come out of Beijing over the weekend to halt the slide. Alas, we have bad news for said BTFDers: just hours before futures are set to open on Sunday afternoon, the chief economist at China’s central bank said Saturday that he doesn’t see any reason for large-scale fiscal or monetary stimulus “in the foreseeable future” despite slowing growth in the world’s second-largest economy and disagreements about the depth and timing of economic overhauls.... Part of China’s “new normal,” he said, is that “big stimulus” won’t be called for every time growth decelerates. “And secondly, the new norm will involve a lot of rebalancing in terms of changing the economic structure.”
Yesterday, in a periodic repeat of what he says every 6 or so months, Jamie Dimon - devoid of other things to worry about - warned once again about the dangers hidden within the shadow banking system (the last time he warned about the exact same thing was in April of this year). The throat cancer patient and JPM CEO was speaking at the Institute of International Finance membership meeting in Washington, D.C., and delivered a mostly upbeat message: in fact when he said that the industry was "very close to resolving too big to fail" we couldn't help but wonder if JPM would spin off Chase or Bear Stearns first. However, when he was asked what keeps him up at night, he said non-bank lending poses a danger "because no one is paying attention to it." He said the system is "huge" and "growing." Dimon is right that the problem is huge and growing: according to the IMF which just two days earlier released an exhaustive report on the topic, shadow banking (which does not include the $600 trillion in notional mostly interest rate swap derivatives) amounts to over $70 trillion globally.