Merrill Lynch

Tyler Durden's picture

Frontrunning: July 11





  • Bernanke Supports Continuing Stimulus Amid Debate Over QE (BBG)
  • Portugal president wants 'salvation' deal, including opposition (Reuters)
  • Egypt has less than two months imported wheat left - ex-minister (Reuters)
  • A rise in long-term interest rates is creating challenges and opportunities for the largest U.S. banks. (WSJ)
  • BoJ says Japanese economy is ‘recovering’ (FT)
  • More Chinese cities likely to curb auto sales (Reuters)
  • PC Shipments Fall for 5th Quarter (BBG)
  • Property Crushes Hedge Funds in Alternative Markets (BBG)
  • New aid gives Greece summer respite before showdown (Reuters)
  • Rajoy Punishes Exporters Sustaining Spain’s Economy (BBG)
 
Tyler Durden's picture

Gold Borrowing Costs Hit Post-Lehman High - Hong Kong Jewellers And Banks Face Supply Issues





Gold is little changed near a one-week high, and is marginally higher in dollars as the dollar has retreated from a three-year high, and higher in most currencies. The gold market continues to digest the ramifications of gold borrowing costs surging to the highest since the post-Lehman Brothers scramble for gold bullion. Gold Forward Offered Rates (GOFO) or the cost to borrow gold remains negative and overnight the 1 month GOFO has gone from -0.106% to -0.11167%. Other durations eased marginally. The lack of liquidity in the the interbank London Good Delivery gold market (400 ounce gold bars) has pushed gold forward rates, known as “gofo”, into negative territory, meaning that gold for future delivery is trading at a discount to physical market prices – a rare situation that has occurred only after the Lehman Brothers collapse and near the bottom of the gold market in 1999. The last time forwards were negative was in November 2008, when a scramble for physical gold led a sharp price rally of 46% from $682/oz to over $1,000/oz between October 2008 and February 2009.

 
Tyler Durden's picture

JPMorgan Out-Squids Goldman As Frenkel Tentacles The Bank Of Israel





Following the 'coup' that led to JPMorgan's Matt Zames running the TBAC (and implicitly the US Treasury and Fed if one were inclined to believe that is where the real smarts are), it seems Goldman Sachs has once again been out-'vampire-squid'-ed as Jacob Frenkel - Chairman of JPMorgan Chase International - is set to take back the reins of the Bank of Israel. 

 
Tyler Durden's picture

Frontrunning: June 21





  • Turmoil Exposes Global Risks (WSJ)
  • China Money Rates Retreat After PBOC Said to Inject Cash (BBG)
  • Fed Seen by Economists Trimming QE in September, 2014 End (BBG)
  • Booz Allen, the World's Most Profitable Spy Organization (BBG)
  • Abe’s Arrows of Growth Dulled by Japan’s Three Principles (BBG)
  • China steps back from severe cash crunch (FT)
  • Smog at Hazardous as Singapore, Jakarta Spar Over Fires (BBG)
  • U.S. Weighs Doubling Leverage Standard for Biggest Banks (BBG)
 
Tyler Durden's picture

Japan Central Bank Admits Sending Schizophrenic Signals To Market As JGB Liquidity "Evaporates"





It doesn't take an Econ Ph.D to realize that what Japan is trying to do: which is to recreate the US monetary experiment of the past four years, which has had rising stocks and bonds at the same time, the first due to the Fed's endless monetary injections (and pent up inflation expectations) and the second due to quality collateral mismatch and scarcity and shadow bank system funding via reserve currency "deposit-like" instruments such as TSYs, is a problem. After all, those who understand that the BOJ is merely taking hints from the Fed all along the way, have been warning about just that, and also warning that once the dam breaks, and if (or when) there is a massive rotation out of bonds into stocks, it is the Japanese banks - levered to the gills with trillions of JGBs - that will crack first. Apparently, this elementary finance 101 logic has finally trickled down to the BOJ, whose minutes over the weekend revealed that members are pointing out "contradictions" in the Kuroda-stated intent of doubling the monetary base in two years, unleashing inflation, sending the stock market soaring, all the while pressuring bondholders to not sell their bonds. As the FT reports, "According to the minutes of the April 26 policy meeting, released on Monday, a “few” board members said the BoJ’s original stance “might initially have been perceived by market participants as contradictory”, causing “fluctuations in financial markets”.

 
Tyler Durden's picture

It’s Official: Gold Is Now The Most Hated Asset Class





Not a day passes without the financial media denouncing gold as an investment option and hailing the bureaucrats heading the world's monopolist monetary central planning agencies as superheroes. It began prior to gold's recent breakdown, with widely cited bearish reports on gold published by Credit Suisse and Goldman Sachs, among others. Never mind that most of their arguments were easily unmasked as spurious. It should be no wonder though: gold's rise was the most conspicuous evidence of faith in central banking being slowly but surely undermined. The banking cartel relies on the fiat money system remaining intact; the legal privilege of fractional reserve banking provides it with what is an essentially fraudulent profit center unparalleled by any other in the world (fraudulent in terms of traditional legal principles, but not in terms of the current law of course). As a subtle reminder, in October (before the Nikkei began its 80% rally), a full 76% of the 'big money' fund managers surveyed declared themselves bearish on Japan. Currently, 69% of the managers surveyed in the most recent Barron's poll are bearish on gold.

 
Tyler Durden's picture

11 Reasons Why The Federal Reserve Should Be Abolished





If the American people truly understood how the Federal Reserve system works and what it has done to us, they would be screaming for it to be abolished immediately.  It is a system that was designed by international bankers for the benefit of international bankers, and it is systematically impoverishing the American people. The Federal Reserve system is the primary reason why our currency has declined in value by well over 95 percent and our national debt has gotten more than 5000 times larger over the past 100 years. The Fed creates our "booms" and our "busts", and they have done an absolutely miserable job of managing our economy. So why is the Federal Reserve doing it?  Sadly, this is the way it works all over the globe today.  In fact, all 187 nations that belong to the IMF have a central bank.  But the truth is that there are much better alternatives.

 
Tyler Durden's picture

No Recovery Here Either: Home Renovation Spending Plummets To 2010 Levels





One of the widely accepted misconceptions surrounding the so-called "housing recovery" fanfared by misleading headlines such as this "Remodeling activity keeps up positive momentum", which in reality has merely turned out to be a housing bubble in various liquified "flip that house" MSAs (offset by continuing deteriorating conditions in those places where the Fed's trillions in excess reserves have trouble reaching coupled with ongoing foreclosure stuffing), is that "renovation spending", the amount of cash spent to upgrade and update a fixer-upper, has surged. Sadly, this is merely the latest lie about the US economy: as the attached chart showing renovation spending in the past 6 months, it has absolutely imploded, confirming that not only is a broad housing recovery a myth (instead of localized pockets of bubbly liquidity here and there), but that the US home-owning household is now more tapped out than at any time in the past two years.

 
Tyler Durden's picture

Student Loan Bubble Cracks With Pulled Sallie Mae Bond Deal





In 2007 a small number of French hedge funds imploded over sudden losses stemming from highly leveraged bets made on the unstoppable subprime mortgage market. At the time, a few saw the writing on the wall; but many simply wrote it off as just another over-levered hedge fund and the subprime mortgage market was 'fine'. Fast forward six years and as we have discussed numerous times (most recently here and here) there is a bubble, potentially far bigger than subprime, in student loan debt. As one of the last remaining outlets for state-sanction credit creation, this is a big deal; but, of course, the popping of the bubble (or even a slight leak) is eschewed since there is so much 'reach for yield' and the Fed's got your back. That is until this week. As WSJ reports, Sallie Mae (SLM), the nation's largest non-government student lender just cancelled a $225 million debt offering as investors  decided they simply were not getting paid enough for risk - amid rising student loan defaults. Simply put, there's a limit to what investors will tolerate.

 
smartknowledgeu's picture

Why the Western Banking Cartel’s Gold and Silver Price Slam Will Backfire - And How You Can Protect Yourself from the Blowback





Let's get down to the facts of the recent banker gold & silver paper price smash and the lies about the banker gold & silver paper price smash being propagated by the mass media and banking shills like Paul Krugman so everyone can understand why this smash will blow up in the face of the very bankers that executed it at some point down the road. Retail individuals AND global institutions all around the world are finally beginning to understand that physical ownership of gold and silver is how to counter banker fraud & intervention into the gold and silver markets and this realization is going to produce massive blowback.

 
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