Wells Fargo

• Russia bans all U.S. food, EU fruit and vegetables in sanctions response (Reuters)
• Snowden receives three-year Russian residence permit (Reuters)
• Headline of the day: Europe's Recovery Menaced by Putin as Ukraine Crisis Bites (BBG)
• Americans worry that illegal migrants threaten way of life, economy (Reuters)
• Almost 90% of Uninsured Won't Pay Penalty Under the Affordable Care Act in 2016 (WSJ)
• Germany’s Bond Advance Sends 2-Year Note Yield Below Zero (BBG)
• Gaza War’s Critics in Crosshairs as Israelis Back Offensive (BBG)
• The 1% May Be Richer Than You Think, Research Shows (BBG)
• Bank of America Near $16 Billion to $17 Billion Settlement (WSJ)
• Deep Water Fracking Next Frontier for Offshore Drilling (BBG)

• So that's what Obama meant by "costs" - Italy Recession, German Orders Signal Euro-Area Struggle (BBG)
• Russia worries, weak German data weigh on Europe (Reuters)
• Hedge Funds Betting Against Banco Espírito Santo in Line for Big Gains (WSJ)
• Bankers Called Up for Ukraine War as Rolls-Royce for Sale (BBG)
• Double Punch for 'Inversion' Deals (WSJ)
• Statist Strongmen Putin-Xi See History’s Capitalism Clash (BBG)
• China bans beards, veils from Xinjiang city's buses (Reuters)
• BATS to Settle High-Speed Trading Case (WSJ)
• Second Ebola patient wheeled into Atlanta hospital for treatment (Reuters)

• 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)

• Moscow fights back after sanctions; battle rages near Ukraine crash site (Reuters)
• On Hold: Merkel Gives Putin a Blunt Message (WSJ)
• Argentina’s Default Clock Runs Out as Debt Talks Collapse (BBG)
• Argentina braces for market reaction to second default in 12 years (Reuters)
• Banco Espirito Santo Plunges After Posting 3.6 Billion-Euro Loss (BBG)
• Adidas Plunges After Cutting Forecast on Russia, Golf (BBG)
• GOP Says Lerner Emails Show Bias Against Conservatives (WSJ)
• Londoners Cashing in Flee to Suburbs as Home Rally Wanes (BBG)
• BNP Paribas Reports Record $5.79 Billion Quarterly Loss (WSJ)
• Swiss Banks Send U.S. Client Data Before Cascade of Settlements (BBG)
• Putin Sows Doubt Among Stock Bears Burned by 29% Rebound (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)

We have been warning for years that as a result of the Fed's disastrous policies, America's middle class is being disintegrated and US adults are surviving only thanks to insurmountable debtloads. But not even we had an appreciation of how serious the problem truly was. We now know, and it is a shocker: according to new research by the Urban Institute, about 77 million Americans have a debt in collections.

• EU finalises Russian sanctions as BP warns of impact on business (FT)
• Geopolitical Risk Rises for Global Investors (BBG)
• Jaded Argentines brace for looming debt default (Reuters)
• In Argentina, Mix of Money and Politics Stirs Intrigue Around Kirchner (WSJ)
• Mom ‘Trusting God’ for Ebola-Infected U.S. Doctor’s Life (BBG)
• Thanks NSA: Tech Companies Reel as NSA's Spying Tarnishes Reputations (BBG)
• Goldman unit eyes foray into China amid metals financing scandal (Reuters)
• Cash out time: London’s Gherkin Tower Offered for Sale by Its Lenders (BBG)
• Apenomics strikes again: McDonald’s Japan axes profit guidance amid food safety scandal (FT)
• Do you see what happens Larry when you are the only USDJPY bid? Nomura Profit Falls More Than Estimated on Broking Slump (BBG)

• The market in one sentence: Buying on Dips Pays Most in Five Years as Stocks Rebound (BBG)
• Europe subdued, Russia shares tumble on new sanctions (Reuters)
• Chinese Data Don’t Add Up (WSJ)
• Argentine Default Drama Nears Critical Stage (WSJ)
• Global Pressure Mounts on Israel to End Gaza Fighting (BBG)
• Ukraine troops advance as experts renew attempt to reach crash site (Reuters)
• Prospects Brighten for Republicans to Reclaim a Senate Majority (WSJ)
• Europe’s banking union faces legal challenge in Germany (FT)
• Investors Bet on China's Large Property Developers (WSJ)
• Hague court orders Russia to pay over $50 billion in Yukos case (Reuters)

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 to weigh extensive sanctions on Russia (FT)
• U.S. lifts flight ban to Israel (Reuters)
• Russia says will cooperate with MH17 probe led by Netherlands (Reuters)
• Norway faces ‘concrete and credible’ terrorist threat (FT)
• Don’t Tell Anybody About This Story on HFT Power Jump Trading (BBG)
• But... but... PMI: Unilever Sales Growth Misses Estimates on Asian Slowdown (BBG)
• World’s Biggest Wealth Fund Reviews $8 Billion Russian Stake (BBG)
• Qualcomm latest US tech company to reverse in China (FT)
• Hamptons Home Sales Rise as Buyers Find More Inventory (BBG)

• Here come the gates which we predicted in 2010: SEC Is Set to Approve Money-Fund Rules (WSJ)
• Dick's cuts 400 jobs as golf now less popular (MW)
• Kerry arrives in Israel, pushes for peace (Reuters)
• Pay Penalty Haunts Recession Grads as U.S. Economy Mends (BBG)
• Appeals Courts Issue Conflicting Rulings on Health-Law Subsidies (WSJ)
• Rebel Stronghold Donetsk Holds Breath as Shellfire Mounts (BBG)
• Business executive wins Georgia Republican runoff in U.S. Senate race (Reuters)
• Five held in China food scandal probe, including head of Shanghai Husi Food (Reuters)
• Jobs Hold Sway Over Yellen-Carney as Central Banks Splinter (BBG)

• 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)

• Fighting erupts in Ukraine as crash investigators arrive (Reuters)
• Russian Billionaires in ‘Horror’ as Putin Risks Isolation (BBG)
• Israel kills militants entering from Gaza, death toll tops 500 (Reuters)
• The other Gaza: In violent weekend, at least 40 people shot in Chicago (Reuters)
• Barclays Dark Pool Drew Early Alarms (WSJ)
• Finance Industry Bonus Hit in Poll as Revenue Disappoints (BBG)
• Severstal to Sell North American Units (WSJ)
• Yum, McDonald's apologize as new China food scandal brews (Reuters)
• Yellen Wage Gauges Blurred by Boomer-Millennial Workforce Shift (BBG)
• Ukraine Offers to Hand Over Malaysia Airlines Probe to Dutch (WSJ)

It has been over six months since we first highlighted the growing deterioration in the quality of auto loans and mentioned the 's' word (subprime) as indicative that we learned nothing from the financial crisis. Since then, auto loans (and especially subprime in the last few months) have surged to record highs; and most concerning, recently has seen delinquencies and late payments spike. The reason we provide this background is that, thanks to The NY Times, this story is now hitting the mainstream media as subprime-quality car buyers (new and used) realize the burden they have placed on themselves thanks to exorbitantly high interest rates (and a rapidly depreciating 'asset'). As one car 'owner' exclaimed, "buying the car was the worst decision I have ever made."