Economy
Related: About this forumSTOCK MARKET WATCH -- Monday, 21 May 2012
[font size=3]STOCK MARKET WATCH, Monday, 21 May 2012[font color=black][/font]
SMW for 18 May 2012
AT THE CLOSING BELL ON 18 May 2012
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[font color=green]30 Year 2.80% -0.01 (-0.36%) [font color=black]
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Financial Sector Officials Convicted since 1/20/09 = [/font][font color=red]12[/font]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
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Demeter
(85,373 posts)THE ELECTION MUST BE TIGHTER THAN THEY LET ON
http://www.nakedcapitalism.com/2012/05/mirabile-dictu-the-sec-finally-investigates-magnetar.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29
More than four years after Serena Ng and Carrick Mollencamp of the Wall Street Journal first took notice of the highly destructive ways of the Chicago hedge fund Magnetar, which created a series of toxic CDOs, the SEC finally appears to be taking a serious look at some of their deals. More accurately, it seems to be dusting off and perhaps expanding a probe that it started last June (hhm, wonder if this flurry of activity has anything to do with polls showing how independents in swing states are giving Obama thumbs down for his complacency on Big Finance?) The SEC is also reportedly looking at the deceptive role played by collateral managers, something we discussed in ECONNED and that Tom Adams has written about extensively on this blog.
The short version of the story is that Magnetar constructed the perfect trade. It would fund the equity tranche of CDOs, usually 4-5% of their total value. Deal sponsors like Magnetar got significant influence over the deal, at a minimum veto rights over the assets chosen to go into the CDO. Magnetar took a much bigger short bet on these same CDOs (either by buying the CDS that were the majority of the assets in these deals) or by buying CDS on the CDO itself. The equity paid a very high interest rate (15% to 20%) until the deal started to fail. The interest on the equity funded the CDS premiums on the short bet. But these deals paid big money only if they failed, which they did with impressive speed. (For more background, see this post: http://www.nakedcapitalism.com/2011/01/fcic-report-misses-central-issue-why-was-there-demand-for-bad-mortgage-loans.html ).
Key points from the Wall Street Journal article:
If the SEC were to file civil charges, it would be its first enforcement action against hedge funds related to CDOs. No decision has been made on whether to file charges, the people said…
Investigators are looking at whether Magnetar had such a strong influence in designing any of the deals that in effect it took over the role of collateral manager, a person familiar with the probe said.
The article then discusses at some length a lawsuit filed by Rabobank against Merrill Lynch on a Magnetar-sponsored CDO called Norma. That suit was settled but the SEC is apparently looking into that deal. It is also possible that a suit by Intesa over another Magnetar deal, Pyxis, got the SEC’s attention. Here is the guts of the argument, per Bloomberg:
Putnam was also named as a defendant in the case.
“The scheme was designed by Magnetar,” Intesa alleged. “Calyon collected fees on the deal and, through the Pyxis swap, shifted losses on the CDO which it would have otherwise borne itself.”
The Intesa filing is a road map for SEC action. It is detailed and solid on the tradecraft:
SEE FILING AT LINK
Demeter
(85,373 posts)The hedge fund Magnetar helped create billions of dollars' worth of risky deals called collateralized debt obligations, many of which failed spectacularly in the financial crisis. Magnetar, meanwhile, had taken positions that allowed the firm to profit when many of those same CDOs collapsed. Since ProPublica reported on Magnetar's dealings two years ago, there's been a long line of investigations and settlements related to the hedge fund. Magnetar itself has never been charged with wrongdoing, and it has always maintained that it did not have a strategy to bet against CDOs they were involved with. But today’s Wall that Magnetar is indeed under investigation by the SEC...What might come of the investigation is unclear. Unlike the banks that have been charged with misleading investors, Magnetar never sold or marketed CDOs, and never made representations about them to customers. But the Journal reports that the SEC's investigation is looking into whether Magnetar took such a prominent role in structuring some of the CDOs in which it invested that it became a de facto collateral manager, responsible for selecting the assets in a CDO. If that were the case, Magnetar might have some responsibility to all the investors in the deal. The SEC has been circling around the Magnetar deals for some time, hitting some of the investment banks and managers involved. Here's a roundup of all the charges, settlements, and investigations that we know of stemming from Magnetar deals:
Settled:
June 2011: JPMorgan agrees to pay $153.6 million to the SEC to settle allegations that it misled investors by not telling them that Magnetar was involved in the creation of a CDO called Squared CDO 2007-1. In reaching the settlement, JP Morgan did not admit or deny the SEC's allegations.
February 2012: State Street Global Advisors pays the state of Massachusetts $5 million to settle allegations that it did not disclose to investors that Magnetar was involved in constructing the CDO Carina CDO Ltd. State Street did not admit or deny Massachusetts' allegations.
Charged:
June 2011: The SEC files a complaint against manager Edward Steffelin for his involvement in structuring JPMorgan's Squared CDO 2007. In October 2011, a judge threw out part of the SEC's case, ruling that Steffelin had not engaged in "fraud or deceit." Other charges are still pending. A lawyer for Steffelin declined to comment on an ongoing case.
Under investigation:
June 2011: The SEC is reportedly investigating Merrill Lynch and the firm NIR Capital Management over the Magnetar CDO called Norma.
September 2011: The SEC is reportedly investigating the Japanese Bank Mizuho and an executive there, Alexander Rekeda, over the making and marketing of the CDO Tigris, another Magnetar deal. Mizuho did not immediately respond to our requests for comment on the current status of the investigation.
September 2011: The SEC warns it may bring charges against the Ratings Agency Standard & Poor's, which abruptly downgraded a Magnetar CDO called Delphinus CDO 2007-1. (In an SEC filing in February, S&P's parent company, McGraw Hill, said that the SEC's warnings "have no basis and they will be vigorously defended."
February 2012: The SEC warns Alexander Rekeda that it may bring charges against him for misleading investors about Magnetar's role in creating Delphinus. Rekeda, who is now at the investment firm Guggenheim Capital, could not be reached today for comment.
May 2012: According to the Wall Street Journal, Magnetar itself is under investigation by the SEC. Magnetar told ProPublica in our original story that the SEC was "looking broadly" at CDOs and had requested information from Magnetar, but said that they were unaware of a particular target of the investigation.
The Journal also reports that the SEC continues to investigate NIR and its founder, Corey Ribotsky, for its role in creating Norma with Merrill Lynch. NIR did not respond to our requests for comment, but a lawyer for NIR and Ribotsky told the Journal that the firm had not acted improperly in selecting Norma's assets. A spokesman for Bank of America, which now owns Merrill Lynch, declined to comment.
Po_d Mainiac
(4,183 posts)Like Paulson and Abacus.....?
tclambert
(11,085 posts)Sounds like a name out of Transformers, or some sci-fi movie.
Demeter
(85,373 posts)It was one of the first big (ignored) scandals.
Demeter
(85,373 posts)Jamie Dimon, John Stumpf, and to a lesser extent, Vikram Pandit and Bryan Moynihan, are running massive hedge funds. They’re placing enormous, incredibly risky bets. “Hot money” investors are giving them the cash to gamble because they all understand that you and me will make good on any losses, since we’ve started guarantying the banks-turned-hedge-funds as “Too big to fail.”
The money flowing to these gamblers-in-chief is growing by double digit percentages, and includes so much borrowed money the “leverage” may be six times what Lehman Brothers was doing when it flamed out. As long as this situation continues, a new financial crisis is inevitable, and the risks of it grow faster every day. There’s only one solution: cut these gamblers off from public support. The market will do the rest.
We cut them off by reinstating Glass-Steagall, a depression era law that kept the bankers in check for decades, until their Clinton-era lobbying prowess repealed it. Senate Candidate Elizabeth Warren has a petition going to do just that. Please sign it.
“Deposits”, the Word that’s Hiding the Hedge Funds
The information on the bailed out bankers’ hedge funds I just summarized comes from this incredibly important Bloomberg interview of Amar Bhide. (H/T to Yves Smith at Naked Capitalism.) Bhide is a professor at Tufts University who knows a lot about the financial services industry, as the excerpts I discuss below make clear. In a little more than four minutes, Bhide detailed how and why JPM “is a systemically important, structurally defective bank. As are all the other megabanks.”
MORE
Demeter
(85,373 posts)Will Jamie Dimon go down in history as the John Meriwether of this generation? Or perhaps the Nick Maounis of our time? Either metaphor can’t make the current CEO of JP Morgan feel very good about his legacy. And if I understand the trade properly, the end of the story is nowhere near being written.
Banks hedge risks. This is what they are supposed to do. And when they don’t, the results have been disastrous (see: the failure of the S&Ls when their long-dated mortgage books were suddenly funded with short term, de-regulated deposits in the sharply rising rate environment of the 1970s). The best way to hedge is always through the cash markets, e.g., I loan out money for a period of time and assume credit risk, interest rate risk, liquidity risk and timing risk, but match fund the loan and mitigate three of the four risks (with only credit risk remaining, the precise thing that banks should get paid to do). The problem is, with the scale of banks and the increasing range and complexity of both business and retail products, match funding is a thing of the past. This risk gap is generally managed using derivatives. There is nothing inherently wrong with this. However, problems arise when hedging strategies become excessively complex in their attempt to be as close to costless as possible and overly precise. As a long-time risk manager, the goal should be to mitigate risk to an acceptable level but to place a premium on hedge liquidity, transparency and simplicity. While a hedge might effectively hedge “delta” but not “gamma,” the best way to address this is to simply take on less gamma, not try to construct a sickeningly complex and illiquid hedge that models out beautifully but is essentially a custom suit on a person whose weight fluctuates wildly. Sometimes the suit fits, sometimes it looks like crap. And in JP Morgan’s case, they are sporting one of the ugliest suits we’ve seen in quite some time.
It actually reminds me a lot of LTCM. Super smart team. Could likely have put a man on the moon all by themselves. However, the bridge between theory and practice broke down in such a way that the global financial system was clearly at risk. Over a trillion dollars of notional risk supported by less than $5 billion of capital. And the strategies broke down in spectacular fashion because of what? Lack of liquidity and rising correlations. Hmm, lack of liquidity and rising correlations…that sounds a lot like what JP Morgan is facing at this very minute. And there is one other dimension that hastened LTCM’s decline and why the JP Morgan story isn’t close to being done - market knowledge. Once the market knew that LTCM was in trouble, the leaned hard against their positions until they cracked. Now LTCM’s capital base is a tiny fraction of JP Morgan’s, but what if $2 billion turned into $5 billion? Or $10 billion? Every sophisticated market participant is causing JP Morgan maximum pain, and it is simply a question of high-stakes poker. But let me assure you, JP Morgan is not holding many cards right now. The JP Morgan debacle also reminds me of Amaranth. While Nick Maounis didn’t run the firm-destroying natural gas trade (a trader named Brian Hunter did), he certainly must have known about it and if he didn’t, he should have known about it. There was a total breakdown of communication, risk management and accountability. Regardless of whether the Managing Partner made the trades, what does it say about their culture that a trader was allowed to put a bet-the-shop position on of that magnitude that blew through billions of dollars of LP capital? One could say the same thing about JP Morgan, Jamie Dimon and the CIO’s office. While the transactions in question may have been for hedging purposes, the risk rebalancing exercise rapidly grew to a scale that placed the firm’s capital position at risk. That this was allowed to continue in the face of rising market awareness (which serves to exacerbate the problem) is incomprehensible, at least to this former Wall Streeter.
I understand why Dimon continues to lobby against the strictest elements of the Volcker Rule, because banks should be allowed and, in fact, have to be allowed, to hedge their books. But when bank managements’ lose sight of the hedging mission and risk management and common sense discipline break down, they shouldn’t be allowed to lead. This is what the Volcker Rule should really be getting at.
I DON'T BUY THIS. I THINK DERIVATIVES ARE THE EQUIVALENT OF NUCLEAR POWER...UNSAFE AT ANY LEVEL OF EXPERTISE AND TRAINING...SUITABLE ONLY FOR THE VACUUM OF DEEP SPACE.
Demeter
(85,373 posts)Simon Johnson is the Ronald A. Kurtz Professor of Entrepreneurship at the M.I.T. Sloan School of Management and co-author of “White House Burning: The Founding Fathers, Our National Debt, and Why It Matters to You.”
**************************************************************************************
JPMorgan Chase is too big to fail. As the largest bank holding company in the United States, with assets approaching $2.5 trillion as reported under standard American accounting principles, it is inconceivable that JPMorgan Chase would be allowed to collapse now or in the near future. The damage to the American economy and to the world would be too great.
The company’s recent trading losses therefore call for greater public scrutiny than would be the case for most private enterprise – and demand an independent investigation into exactly what happened. (Dennis Kelleher of Better Markets has already called for exactly this.) The investigation begun by the F.B.I. is unlikely to be sufficiently public. Given the strong political connections between JPMorgan Chase and the Obama administration, it would also be better to have an investigation led by a completely independent counsel.
Hopefully, too-big-to-fail is not forever. The Federal Deposit Insurance Corporation is working on a mechanism that could conceivably allow that agency to handle the “failure” of a bank holding company while protecting the creditors of operating subsidiaries – limiting the potential contagion effect. But this mechanism is not yet in place. It does not now apply to cross-border banking (remember that JPMorgan Chase’s losses are in London), and even the F.D.I.C.’s acting chairman, Martin J. Gruenberg, was careful in describing its likely efficacy in a speech last week.
(Disclosure: I’m on the F.D.I.C.’s Systemic Resolution Advisory Committee, and I’ve worked with the F.D.I.C. with some outreach activities intended to help the agency receive constructive feedback on resolution. I am not paid by the F.D.I.C.)
In effect, JPMorgan Chase operates with the implicit backing of the United States government – primarily in the form of actual and potential access to borrowing from the Federal Reserve, with the implication that the Treasury could also provide support. Being effectively backed by the full faith and credit of the government is a great help; it lowers a bank’s financing costs because it reduces the risk to creditors. JPMorgan Chase and the other big banks in the American economy are effectively government-sponsored (and subsidized) enterprises. There is no kind of market involved in determining the franchise value of mega-banks; this is a government subsidy scheme, pure and simple. People on the right of the political spectrum understand this, as do people on the left; see my blog post last week on the extent of cross-partisan agreement on this issue. I would add to that list former Gov. Mike Huckabee, the Arkansas Republican. When I appeared on his radio show on Monday afternoon, we were in complete agreement on the need to break up or otherwise constrain the size of big banks...
Here are five questions that an independent investigation should consider:
1. What exactly was the trade? Who approved and reviewed the trade?
2. To what extent were the mistakes encouraged or condoned by particular quantitative models — for example, those popularly known as value-at-risk? (For a critique, see Pablo Triana’s book, “The Number That Killed Us.”)
3. What did Mr. Dimon know and when did he know it? Was there disclosure to the board and to shareholders with appropriate timing? This is among the specific concerns raised by Mr. Kelleher.
4. Does the board have adequate depth of experience along the relevant dimensions of risk management?
5. What interactions did Mr. Dimon or any of his colleagues have with the Federal Reserve Bank of New York before and while these losses were incurred? Mr. Dimon is on the board of that institution, where his role is described as advisory. But on what exactly did he advise them in recent months and years, particularly with regard to risk management and capital levels in systemically important banks?
MORE
Demeter
(85,373 posts)J.P. Morgan Chase Chairman and Chief Executive Officer James Dimon had just committed the most expensive blunder of his 30-year career, failing to detect the risk of trades that had begun to generate huge losses at the bank. On April 30, associates who were gathered in a conference room handed Mr. Dimon summaries and analyses of the losses. But there were no details about the trades themselves. "I want to see the positions!" he barked, throwing down the papers, according to attendees. "Now! I want to see everything!" When Mr. Dimon saw the numbers, these people say, he couldn't breathe.
Those trading positions have produced losses that could total as much as $5 billion, tarnishing the record of an executive who had thrived through the global financial crisis and who has long been known for paying close attention to the bank's trading activity, its risk profile and the activities of its senior employees. J.P. Morgan, the nation's largest financial firm by assets, is struggling to contain the damage, which already has shaved off more than $25 billion in shareholder value.
This behind-the-scenes account of the disaster—based on interviews with numerous J.P. Morgan executives and with officials on Wall Street and in Washington—provides new details about the drama inside the bank as executives sought to understand the scope of the losses and decide what to do about them. Among other things, Mr. Dimon initially resisted ousting the executive at the center of the mess, confided in his wife that he had "missed something bad," and expressed regrets with his colleagues one night over vodka about how they had all let the firm down...
WHAT FOLLOWS IS A GOOD FIRST APPROXIMATION OF DIMON'S OBIT...AT LEAST, HIS PROFESSIONAL ONE.
Demeter
(85,373 posts)2012 presumptive Republican presidential nominee Mitt Romney this week defended JP Morgan Chase’s $3 billion trading debacle as just “the way America works.” He denied that the episode makes the case for stronger regulations to rein in banks’ risky trading.
Overall, of course, Romney has shown little interest in diagnosing or addressing the causes of the 2008 financial crisis, and the role of the nation’s biggest banks in nearly sinking the global economy. And the banks surely appreciate it, considering that employees of the biggest financial, as the Boston Globe noted today:
The top five donor groups in Romney’s campaign are individuals and political action committees associated with large financial institutions, led by Wall Street giants Goldman Sachs and JPMorgan Chase, according to information compiled by the Center for Responsive Politics, a nonpartisan research group that tracks campaign donations.
The Globe actually got it a bit wrong: the top six donors to Romney come from the biggest banks— Goldman Sachs, JP Morgan Chase, Bank of America, Morgan Stanley, Credit Suisse, and Citigroup. And the finance/insurance/real estate industry is far and away the largest donor to Romney’s campaign, giving him $18 million. Of course, banks also throw money at the Democrats, but in this cycle, they’ve clearly favored the GOP.2
Demeter
(85,373 posts)Marx famously said that the bourgeoisie unwittingly produces its own gravediggers. Marx was convinced that capitalism inexorably gives rise to an elite social class whose members create an economy that contains the seeds of its own destruction. The prime movers in Marx's theory of history – a.k.a., dialectical materialism – assumed the form of a rising middle class of merchants who, in Marx's time, were emerging as the industrial giants he called "monopoly capitalists". Capitalism in its advanced stages produced a few big winners and multitudes of losers, the latter constituting a vast underclass of exploited workers who were increasingly impoverished, alienated, and dehumanized.
The super-capitalists who emerge as the champions of the new economic order soon come to abhor the very system that creates them. Once ensconced at the commanding heights of the economy they naturally want to eliminate competitors. They want control. To protect their wealth, they need power. Power to minimize risks and flatten out the business cycle. They understand all too well that the power to tax is the power to destroy (or to create tax loopholes). They want the state to stay out of the economy, but protect business from "unfair" competition and encroachments of all kinds. And from the workers.
But that was then and this is now. Today, Communism and Marx are equally discredited. Right? The failure of Communism according to Wall Street's grand princes, corporate raiders, the conservative press, the elite business-school professoriate, and a host of other apologists for Capitalism proved that Marx was wrong – about everything. But clearly Marx's critics protest too much. In fact, the failure of Communism proved nothing of the kind. Communism as it was radically reinterpreted and applied by Lenin and Stalin in the Soviet Union used Marx as a fig leaf for a totalitarian political order that was, ironically, unsustainable because it attempted to run the economy without any reference to market forces or economic "laws". Which is not to say that Marxism offers a coherent set of prescriptions to cure all the ills of modern society – indeed, Marx himself had surprisingly little of interest to say about how to set things right. But Marx was right in his analysis of what was wrong with capitalism and the kind of representative democracy James Madison enshrined in the Federalist Papers (especially #10). In focusing on the tendency of capitalism to reproduce the extreme inequality associated with feudalism, Marx had an insight that deserves far more attention than it has gotten in the United States, especially since it's now clear that Madison's "cure" for factions isn't working.
Madison recognized the danger and identified its source: The most common and durable source of factions has been the various and unequal distribution of property. Those who hold and those who are without property have ever formed distinct interests in society." His solution was to create a large republic encompassing a great variety of interests and parties. Of course, unlike Europe, democracy in America makes room for only two viable political parties; these two parties, Republicans and Democrats are so entrenched, and the legislative process so sclerotic, that virtually nothing creative or restorative ever emerges from the U.S. Congress now – quite the opposite. And starting in the 1980s the Reagan Revolution crushed what remained of the free-wheeling, faction-friendly pluralism Madison imagined. Face it: in the USA today, the nice idea of a political order equally friendly to a diversity of interests – or even opinions – is dead....
Demeter
(85,373 posts)Nasdaq says it was "embarrassed" by the delay to Facebook's IPO on Friday, and has revealed that it is in discussion about a monetary resolution with affected traders and regulators.
More to come
Read more >>
http://link.ft.com/r/ZE9K33/KQ2YGW/JQU4J/JETSEY/L978XC/SN/t?a1=2012&a2=5&a3=20
SO WHAT? ARE THEY AFRAID THEY WILL BE UN-FRIENDED?
Fuddnik
(8,846 posts)Talk about a company that's better prepared to implode than any other company in history.....
DemReadingDU
(16,000 posts)
Tansy_Gold
(17,856 posts)Zuckerman/berg/WTFever and his Brazilian/American/Brazilian partner are bazillionaires. Everyone else is just zuckers. (will that be a new addition to the urban dictionary? "To zucker: sell billions of dollars in stock of a completely worthless company to gullible saps."
Po_d Mainiac
(4,183 posts)Demeter
(85,373 posts)Thanks Po. I keep losing this kind of info....15 banks in Michigan....
Ghost Dog
(16,881 posts)The euro has weathered the worst financial crisis since the Great Depression, bailouts of Greece, Ireland and Portugal, and falling interest rates. Now, investors are betting like never before that a Greek exit would be too much to keep the 17-nation currency above its long-term average.
Hedge funds and other large speculators, which pared trades that would profit from a drop in the euro to the lowest levels since November, rebuilt them to a record high last week, figures released May 18 by the Washington-based Commodity Futures Trading Commission showed. The premium for options that grant the right to sell the euro has more than doubled since March.
Through most of the financial and political turmoil in Europe, the euro held above the average since its January 1999 start as investors put their faith in German Chancellor Angela Merkel to keep the monetary union in place. While they currently forecast little change in the euro versus the dollar, a majority of the world’s biggest foreign-exchange trading firms surveyed by Bloomberg News say the loss of even a weak member such as Greece would risk more departures and send the currency lower.
“Financial markets’ great fear is that if one country left, it would not necessarily be the last,” Alan Ruskin, the head of Group of 10 foreign-exchange strategy in New York at Deutsche Bank AG, the largest currency dealer as ranked by Euromoney Institutional Investor Plc, said in a May 14 telephone interview. “Removing one country, however weak, would not be a route to a stronger common currency.”
/... http://www.bloomberg.com/news/2012-05-20/hedge-funds-rebuild-bearish-euro-bets-for-greek-exit-banks-weigh.html
Demeter
(85,373 posts)The world’s first concrete plans are being devised to protect the broader financial system in the event that any of seven leading cross-border groups were to collapse
Read more >>
http://link.ft.com/r/WDI4RR/JE2INN/CWSVD/OR63OP/MSMOUN/1G/t?a1=2012&a2=5&a3=21
Demeter
(85,373 posts)War chest built up to purchase loans as many of the continent’s stricken lenders seek to sell assets and shrink their way to health
Read more >>
http://link.ft.com/r/WDI4RR/JE2INN/CWSVD/OR63OP/PFWVLZ/1G/t?a1=2012&a2=5&a3=21
Demeter
(85,373 posts)Controversial proposals are back on the agenda. They were backed by some leaders in the past but forced off the agenda by the German chancellor’s objections
Read more >>
http://link.ft.com/r/DHGUVV/VLIUON/NRHD3/30D2Y6/97HFKL/7V/t?a1=2012&a2=5&a3=21
Demeter
(85,373 posts)MERKEL MUST BE FEELING A BIT LIKE JULIUS CAESAR BY NOW--ET TU, DEUTCHLAND? SO, SHE CAN RETIRE AND WORK FOR THE IMF....
http://truth-out.org/news/item/9253-thousands-march-against-austerity-in-frankfurt
Thousands of people on Saturday marched through the heart of Frankfurt, Germany’s financial capital and the home of the European Central Bank, to protest against unchecked capitalism and Chancellor Angela Merkel’s insistence on austerity measures for much of Europe.
The peaceful event, called Blockupy, in a nod to the Occupy movement, was the culmination of four days of demonstrations and drew about 20,000 protesters to Frankfurt, the police and organizers said.
The protest, which drew supporters from across Europe, was meant to send a “clear and visible signal of international solidarity against the authoritarian crisis management and the poverty inducing policies of the European Union, the European Central Bank and the International Monetary Fund,” organizers said....
Ghost Dog
(16,881 posts)and call early elections, if that is permitted under the Federal constitution. And if not permitted: change the constitution.
That way she would go down in history with great respect. Otherwise, no.
Fall 2013 will be way too late.
Ghost Dog
(16,881 posts)... German Finance Minister Wolfgang Schaeuble will for the first time discuss the 17-nation currency with his newly installed French counterpart, Pierre Moscovici, in Berlin today as European Union leaders prepare for a summit meeting in Brussels on May 23. After three shorter meetings in the last week, Chancellor Angela Merkel and French President Francois Hollande will seek to balance France’s desire to jump-start growth with Germany’s preference for spending cuts.
The euro has lost 3.5 percent against the U.S. dollar this month and almost $4 trillion has been wiped from equity markets amid concerns over Greece. Schaeuble said May 18 the turmoil could last another two years. Yields on Spanish 10-year bonds climbed to close at 6.27 percent last week. That figure slid to 6.26 percent at 10:56 a.m. Madrid time, while the euro traded down 0.01 percent to $1.2769 in Frankfurt.
President Barack Obama joined G-8 leaders including Hollande and Britain’s Prime Minister David Cameron in embracing a renewed focus on growth, underlining the isolation of Merkel, who maintained resistance to new spending. At the president’s Camp David retreat in Maryland, G-8 leaders said in their final statement that “the right measures are not the same for each of us.”
As EU leaders prepare for their informal dinner, French Prime Minister Jean-Marc Ayrault told Liberation that no potential solutions involving Greece should be rejected. Leaders shouldn’t rule out measures such as state borrowing from the European Central Bank, he said...
/... http://www.bloomberg.com/news/2012-05-20/euro-crisis-resolution-sought-by-france-germany-following-g-8.html
Ghost Dog
(16,881 posts)(Reuters) - European shares look cheap according to some traditional measures but investors are finding it hard to judge whether they are a good buy given the potential damage to companies and economies if Greece were to leave the euro zone.
Anyone focused on the often-used measure of how the price of a company's stock compares with the earnings that analysts expect the firm to report in a year's time might think it is time to find a bargain.
That is because the price/earnings comparison is 8.5 for the fifty biggest euro zone blue chip stocks, lower than the average of 9.8 over the past five years.
However, few are relying on such indicators these days. Speculation about Greece's future, general political and economic turmoil in Europe and uncertain global economic prospects mean investors are making several other checks before buying into a stock, sector or index.
"Equities are cheap, no doubt. They can, however, remain cheap: cheapness does not mean one should buy," said Societe Generale's global head of asset allocation, Alain Bokobza.
Investors are looking further back in history than they normally would because of the unprecedented nature of some of the potential shocks, notably a Greek exit from the euro.
/... http://www.reuters.com/article/2012/05/21/us-markets-stocks-valuations-idUSBRE84K0FM20120521
Ghost Dog
(16,881 posts)(Reuters) - Bank of England policymaker Adam Posen said on Monday that the euro zone crisis calls for governments' active role to recapitalise and clean up the region's banking system, saying monetary policy alone won't solve structural problems.
"The biggest thing you need is forcefully injecting enough capital into the banking system," Posen said at a Tokyo conference on global financial regulation hosted by the Columbia Business School.
"The source of current problems is not Greece... The source of current problems in the euro zone is that various financial exposures we all have in the interbank market are not yet resolved because certain financial institutions are insufficiently capitalised, insufficiently disciplined," he said.
The failure in Athens to form a government has stoked fears of a disorderly Greek exit from the common currency that could trigger meltdown of the global banking system...
..."Good monetary policy will not solve structural problems, bad monetary policy will make all structural problems insoluble... Institutions require very active government intervention," he said.
While Japan made headway in cleaning up its banking system after a crisis in the 1990s and the United States and Britain have partially resolved recent woes, "it is a path far from under way in the euro area," he said, adding that countries need not be afraid to nationalise banks.
/... http://uk.reuters.com/article/2012/05/21/uk-britain-boe-posen-idUKBRE84H09U20120521
More, updating, here: http://www.telegraph.co.uk/finance/debt-crisis-live/9278960/Debt-crisis-live.html
Demeter
(85,373 posts)"Good monetary policy will not solve structural problems, bad monetary policy will make all structural problems insoluble... Institutions require very active government intervention,"
xchrom
(108,903 posts)
Demeter
(85,373 posts)Now we are in a dry patch. I have to water everything!
xchrom
(108,903 posts)i don't ever remember a lot of rain in peoria in the winter.
we could have rainy autumns -- but at some point it just got too cold for rain.
Demeter
(85,373 posts)so it rained, instead.
xchrom
(108,903 posts)but it's funny how something like that can really throw a person off.
Fuddnik
(8,846 posts)Pretty much a drought. Tomatoes are frying on the vine. I'm ready to rip out everything but the peppers.
xchrom
(108,903 posts)not what i was expecting to hear.
we can't seem to put together 3 days of sunshine in a row. and this is not that far from you -- NC.
Fuddnik
(8,846 posts)It rains in South Florida.
It rains in Central Florida.
But not here.
xchrom
(108,903 posts)Ghost Dog
(16,881 posts)I've seen photos from 50 years ago: when the sky (in a flash) really opens, well, we know what to expect.
Another hurricane would be weird, here, though.
http://www.imdb.com/title/tt0088184/
xchrom
(108,903 posts)Despite official claims to the contrary, the governments of the euro zone are threatening to kick Greece out of the currency union. At a meeting of euro-zone finance ministers last Monday in Brussels, it was made clear to Greek Finance Minister Filippos Sachinidis just how serious the situation had become.
"If we now held a secret vote about Greece staying in the euro zone," Euro Group Chairman Jean-Claude Juncker warned his Greek colleague, "there would be an overwhelming majority against it." Other participants in the meeting also had harsh words for Sachinidis, with particularly strong criticism towards Athens coming from Portugal and Ireland, countries that have also accepted bailouts in the crisis.
The countries say it is unacceptable that they have made serious efforts to fulfil the European Union's guidelines for consolidating their budgets while Greece incessantly breaks its reform agreements. It was the Greeks, they noted, who poured oil on the flames and repeatedly caused the whole euro zone to catch fire with their repeated negligence, other ministers added.
Juncker, who is also Luxembourg's prime minister, added that new elections on June 17 would be Greece's last chance. If the country is unable to form a government that respects the conditions for previously agreed to financial aid to Greece set by the European Union, the International Monetary Fund and the European Central Bank, "then it is over."
Demeter
(85,373 posts)Demeter
(85,373 posts)Students are known for having an abundance of ideals, but not much money or power. But student organizations around the country are finding ways to put thousands, sometimes millions of dollars behind sustainable companies.
At Middlebury College, members of the school’s Socially Responsible Investing (SRI) club are working to guide the school’s $900 million dollar endowment towards more sustainable investments.
They’ve joined a growing number of other schools in invoking the kind of ownership rights seldom embraced by the left: the right to influence the world through the tools of Wall Street, using their role as investors to spur change in powerful corporations.
“Colleges have the opportunity to be leaders in socially responsible investing because we combine liberal ideals with a huge amount of money,” says Olivia Grugan, a Middlebury senior and president of the SRI club...
Demeter
(85,373 posts)...December 2011, European Central Bank president Mario Draghi, former vice president of Goldman Sachs Europe, was able to approve a 500 billion Euro bailout for European banks without asking anyone’s permission. And in January 2012, a permanent rescue-funding program called the European Stability Mechanism (ESM) was passed in the dead of night with barely even a mention in the press. The ESM imposes an open-ended debt on EU member governments, putting taxpayers on the hook for whatever the ESM’s Eurocrat overseers demand. The bankers’ coup has triumphed in Europe seemingly without a fight. The ESM is cheered by Eurozone governments, their creditors, and “the market” alike, because it means investors will keep buying sovereign debt. All is sacrificed to the demands of the creditors, because where else can the money be had to float the crippling debts of the Eurozone governments? There is another alternative to debt slavery to the banks. But first, a closer look at the nefarious underbelly of the ESM and Goldman’s silent takeover of the ECB . . ..
The Dark Side of the ESM
The ESM is a permanent rescue facility slated to replace the temporary European Financial Stability Facility and European Financial Stabilization Mechanism as soon as Member States representing 90% of the capital commitments have ratified it, something that is expected to happen in July 2012. A December 2011 YouTube video titled “The shocking truth of the pending EU collapse!”, originally posted in German, gives such a revealing look at the ESM that it is worth quoting here at length. It states:
[Article 9]: “. . . ESM Members hereby irrevocably and unconditionally undertake to pay on demand any capital call made on them . . . within seven days of receipt of such demand.” . . . If the ESM needs money, we have seven days to pay. . . . But what does “irrevocably and unconditionally” mean? What if we have a new parliament, one that does not want to transfer money to the ESM? . . . .
[Article 10]: “The Board of Governors may decide to change the authorized capital and amend Article 8 . . . accordingly.” Question: . . . 700 billion is just the beginning? The ESM can stock up the fund as much as it wants to, any time it wants to? And we would then be required under Article 9 to irrevocably and unconditionally pay up?
[Article 27, lines 2-3]: “The ESM, its property, funding, and assets . . . shall enjoy immunity from every form of judicial process . . . .” Question: So the ESM program can sue us, but we can’t challenge it in court?
[Article 27, line 4]: “The property, funding and assets of the ESM shall . . . be immune from search, requisition, confiscation, expropriation, or any other form of seizure, taking or foreclosure by executive, judicial, administrative or legislative action.” Question: . . . [T]his means that neither our governments, nor our legislatures, nor any of our democratic laws have any effect on the ESM organization? That’s a pretty powerful treaty!
[Article 30]: “Governors, alternate Governors, Directors, alternate Directors, the Managing Director and staff members shall be immune from legal process with respect to acts performed by them . . . and shall enjoy inviolability in respect of their official papers and documents.” Question: So anyone involved in the ESM is off the hook? They can’t be held accountable for anything? . . . The treaty establishes a new intergovernmental organization to which we are required to transfer unlimited assets within seven days if it so requests, an organization that can sue us but is immune from all forms of prosecution and whose managers enjoy the same immunity. There are no independent reviewers and no existing laws apply? Governments cannot take action against it? Europe’s national budgets in the hands of one single unelected intergovernmental organization? Is that the future of Europe? Is that the new EU – a Europe devoid of sovereign democracies?
Last November, without fanfare and barely noticed in the press, former Goldman exec Mario Draghi replaced Jean-Claude Trichet as head of the ECB. Draghi wasted no time doing for the banks what the ECB has refused to do for its member governments—lavish money on them at very cheap rates. French blogger Simon Thorpe reports:
The money was gobbled up virtually instantaneously by a total of 523 banks. It's complete madness. The ECB hopes that the banks will do something useful with it - like lending the money to the Greeks, who are currently paying 18% to the bond markets to get money. But there are absolutely no strings attached. If the banks decide to pay bonuses with the money, that's fine. Or they might just shift all the money to tax havens.
At 18% interest, debt doubles in just four years. It is this onerous interest burden, not the debt itself that is crippling Greece and other debtor nations. Thorpe proposes the obvious solution:
Why not lend the money to the Greek government directly? Or to the Portuguese government, currently having to borrow money at 11.9%? Or the Hungarian government, currently paying 8.53%. Or the Irish government, currently paying 8.51%? Or the Italian government, who are having to pay 7.06%?
The stock objection to that alternative is that Article 123 of the Lisbon Treaty prevents the ECB from lending to governments. But Thorpe reasons:
At least if the ECB was working under the supervision of elected governments, we would have some influence when we elect those governments. But the bunch that now has their grubby hands on the instruments of power are now totally out of control.
SEE LINK FOR ALTERNATIVE
Demeter
(85,373 posts)Activists, theorists, organizations and ordinary citizens are rebuilding the American political-economic system from the ground up...The broad goal is democratized ownership of the economy for the “99 percent” in an ecologically sustainable and participatory community-building fashion. The name of the game is practical work in the here and now—and a hands-on process that is also informed by big picture theory and in-depth knowledge.
Thousands of real world projects -- from solar-powered businesses to worker-owned cooperatives and state-owned banks -- are underway across the country. Many are self-consciously understood as attempts to develop working prototypes in state and local “laboratories of democracy” that may be applied at regional and national scale when the right political moment occurs.
The movement includes young and old, “Occupy” people, student activists, and what one older participant describes as thousands of “people in their 60s from the '60s” rolling up their sleeves to apply some of the lessons of an earlier movement...
SEVERAL PAGES OF EXAMPLES AT LINK (INCLUDING MONDRAGON, TANSY)
xchrom
(108,903 posts)The new president of France, François Hollande, wants to press German Chancellor Angela Merkel to drop her opposition to introducing jointly issued euro bonds as a way of tackling the debt crisis.
Hollande said after a G-8 summit in the United States on Saturday that he would propose euro bonds at an informal summit of European Union leaders on Wednesday in Brussels.
"I will outline all growth proposals at this informal meeting on May 23," Hollande told reporters at Camp David, Maryland. "Within this packet of proposals there will be euro bonds and I will not be alone in proposing them. I had confirmation on this at the G-8."
The Brussels meeting is expected to focus on the French president's call for measures to boost growth across the EU, especially in the 17 nation euro zone, while maintaining efforts to cut budget deficits.
Reports said Italian Prime Minister Mario Monti and British Prime Minister David Cameron back Hollande's call for the bonds that would be issued and guaranteed by all euro-zone states.
Demeter
(85,373 posts)
xchrom
(108,903 posts)Tansy_Gold
(17,856 posts)(Wish I coulda found that for the front page!!!)
Ghost Dog
(16,881 posts)... continues, apparantly, in willing junk US MSM.
Strauss-Kahn facing another rape investigation
CHICAGO (MarketWatch) -- A French prosecutor on Monday said an investigation has been opened into charges that former International Monetary Fund head Dominique Strauss-Kahn was involved in a gang rape in a Washington hotel, the Associated Press reports. The new probe comes after a request by the judges looking into Strauss-Kahn's possible involvement in a prostitution ring in the northern French city of Lille. The incident in the U.S. capital is said to have taken place in December 2010, when he was still head of the IMF. Strauss-Kahn maintains that anything that occurred was consensual and he denies any violent acts, the wire service noted. He was accused of sexually assaulting a hotel maid in New York last year but charges were later dropped.
Meanwhile, let's get serious, ladies...
Note: the link is from "Marketwatch", for some calculable reason, I guess:
http://www.marketwatch.com/story/strauss-kahn-facing-another-rape-investigation-2012-05-21?siteid=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A%20marketwatch%2Fmarketpulse%20%28MarketWatch.com%20-%20MarketPulse%29
Demeter
(85,373 posts)I just wish it had been a lot sooner. There ought to be a death penalty for a serial rapist.
Ghost Dog
(16,881 posts)And there's no excuse. Even if money changed hands.
I'm a weak fool because I still feel, you know, love.
So vulnerable.
xchrom
(108,903 posts)Germany has again stated its opposition to so-called eurobonds as the new French finance minister prepares to meet his German counterpart for the first time.
Pierre Moscovici will meet German Finance Minister Wolfgang Schaeuble in Berlin and is expected to press for measures that would boost growth.
Eurobonds are a proposal to issue debt on behalf of all 17 euro countries.
But a German minister said they would be "a prescription at the wrong time".
"We have always said that as a first step we need solidity in European finances, and that is the fiscal compact," said Steffen Kampeter, a deputy finance minister, referring to the budget pact that 25 out of 27 European Union countries agreed to abide.
Roland99
(53,342 posts)Po_d Mainiac
(4,183 posts)Couple days of 'risk on' coming.
Demeter
(85,373 posts)WE HAVE A FALL GUY--WHO MIGHT ACTUALLY DESERVE IT
http://www.bloomberg.com/news/2012-05-20/jpmorgan-cio-risk-overseer-said-to-have-record-of-trading-losses.html
Irvin Goldman, who oversaw risks in the JPMorgan Chase & Co. (JPM) unit that suffered more than $2 billion in trading losses, was fired by another Wall Street firm in 2007 for money-losing bets that prompted a regulatory probe, three people with direct knowledge of the matter said.
JPMorgan appointed Goldman in February this year as the top risk official in its chief investment office while the unit was managing trades that later spiraled into what Chief Executive Officer Jamie Dimon called “egregious,” self-inflicted mistakes. The bank knew when it picked Goldman that his earlier work at Cantor Fitzgerald LP led to regulatory sanctions against Cantor, according to a person briefed on the situation.
JPMorgan’s oversight of risk in its chief investment office has become a key issue as U.S. authorities examine the incident and lawmakers debate how to prevent banks from making wagers that might endanger depositors. Goldman was given the risk- oversight job after his brother-in-law, Barry Zubrow, 59, stepped down in January as JPMorgan’s top risk official, according to a person briefed on the matter. Less than a week after the loss became public, the bank stripped Goldman of those duties, appointing Chetan Bhargiri to succeed him...
KEEPING IT ALL IN THE "FAMILY" EH?
Demeter
(85,373 posts)INSIDE POLITICS ON SECURITIZATION SCANDALS
Po_d Mainiac
(4,183 posts)If the 'hedge' position blew up, what's the position/risk being covered?
Can't get this worm outa me cranium..Why did Blythe Masters go public denying 'proprietary' commodity positions just prior to the CIO telling the world they'd shit in their own dinner pail?
Me thinks there is a connection.
Tansy_Gold
(17,856 posts)If the thing that blew up was a hedge against losses on something else, what's the something else, and what happened to it? and why did they think they needed to hedge it?
wankers. they're all wankers, every last one.
Demeter
(85,373 posts)When it's an excuse to try to gull people out of their fortunes.
Demeter
(85,373 posts)Demeter
(85,373 posts)President Barack Obama on Saturday called on the U.S. Congress to back his efforts for tough new financial industry oversight, saying a $2 billion trading loss at JPMorgan underscored the need for such regulation.
"We've got to finish the job of implementing this reform and putting these rules in place," Obama said in a weekly radio address that accused some on Wall Street of causing the 2007-2009 economic crisis because they "treated our financial system like a casino."
In a jab at Republicans who have been critical of banking industry reforms his administration is in the process of implementing, Obama said lawmakers should "stand on the side of reform, not against it." The Democratic president, seeking re-election on November 6, is seeking to show he is willing to take a hard stance against Wall Street excesses but without being seen as discouraging investment.
Many Republicans in Congress have taken aim at Wall Street reform measures, saying they are unwieldy and could end up slowing investment and economic growth. Obama said that while JPMorgan had the resources to handle losses of more than $2 billion, smaller banks might not have been able to do so. Without the new banking industry reforms, Obama said U.S. taxpayers could again "be on the hook for Wall Street's mistakes." The deep economic recession the United States has recently begun climbing out of brought U.S. government bailouts of some large financial institutions, as well as heavy job losses, business failures and home mortgage foreclosures as the downturn spread.
The Dodd-Frank financial oversight law enacted in response to the financial crisis includes the Volcker rule, which bans banks from making speculative bets with company money. But it includes an exemption for trades done to hedge risk. The Wall Street Journal reported on Wednesday that the JPMorgan loss prompted the White House to encourage Treasury Department officials to ensure tough enforcement of Dodd-Frank. Obama complained that Republicans in Congress, in tandem with financial industry lobbyists, "have actually been waging an all-out battle to delay, defund and dismantle Wall Street reform."
Saying he backed free-market forces, Obama said some safeguards needed to be put in place to guarantee fair play.
"Unless you run a financial institution whose business model is built on cheating consumers or making risky bets that could damage the whole economy, you have nothing to fear from Wall Street reform," he said.
HE'S WASTED IN POLITICS...HE SHOULD BE DOING STANDUP.
Demeter
(85,373 posts)The House on Friday approved a sweeping defense authorization bill for 2013 that calls for the construction of an East Coast missile defense system in the United States by the end of 2015. The bill obligates $100 million next year to plan for the site, but the project would cost billions of dollars in later years that has yet to be funded.
The language was derided by a House Democrat as an "East Coast Star Wars fantasy base" but nonetheless escaped further scrutiny during floor debate Wednesday and Thursday on amendments to the National Defense Authorization Act (NDAA).
Friday afternoon, members approved the bill in a 299-120 vote after approving dozens of amendments, some after fierce debate that revealed disagreements on issues such as detainee policy, nuclear cooperation with Russia and the speed of the U.S. military withdrawal from Afghanistan. Seventy-seven Democrats support the bill, while 16 Republicans opposed it...
DOESN'T THAT MAKE YOU FEEL ALL WARM AND SAFE AND TOASTY, PO?
Demeter
(85,373 posts)If the eurozone is to save itself, it will have to face the real crisis: its banking sector. Far too much time has been spent on fiscal policy when the existential threat to the eurozone is the ongoing collapse of bank lending in the weak economies
Read more >>
http://link.ft.com/r/R5WAEE/7A1A95/ULCJB/8Z94HX/L97VO3/28/t?a1=2012&a2=5&a3=21
TALK ABOUT HAVING IT ALL BACKWARD...TO SAVE THE EUROZONE---SAVE THE PEOPLE!
THE COLLAPSE OF EVERY BANK IN EUROPE WOULD BE LESS TROUBLE ALL AROUND...THE CONTINENT COULD START OVER WITH SENSIBLE FISCAL SYSTEMS.
xchrom
(108,903 posts)Hedge funds reduced wagers on a rally in commodities to the lowest this year on mounting speculation that Greece will leave the euro, slowing global growth and curbing demand for everything from copper to soybeans.
Money managers reduced net-long positions across 18 U.S. futures and options by 15 percent to 616,841 contracts in the week ended May 15, the lowest since Dec. 27, Commodity Futures Trading Commission data show. Gold bets fell for a second week and to the lowest since December 2008, while copper holdings tumbled 69 percent, the most in five weeks. Cotton wagers dropped to the lowest in five years.
About $4 trillion was erased from the value of global equity markets this month as Europe’s debt crisis escalated. Moody’s Investors Service lowered debt ratings on 16 Spanish banks on May 17, while Fitch Ratings cut Greece’s credit rating on concern that the country may be the first to exit the 17- nation currency bloc. Home prices in China, the biggest metals consumer, fell in a record number of cities last month, government data showed.
“The outlook for commodities is not good,” said Eric Sprott, who runs Toronto-based Sprott Asset Management LP, which manages $9 billion of assets. “The world economies are slowing down. China’s growth rate is softening, and it’s not even debatable whether there will be a recession in Europe.”
xchrom
(108,903 posts)Nguyen Thi Ha sighs as she looks at the dust and cobwebs covering crates full of colorful, enameled tiles in her factory by Hanoi’s Red River.
“We’re struggling to keep our business alive,” said Ha, who laid off more than half of her 60 employees this year as luxury hotels in the beach resort of Danang halted orders. “If the situation doesn’t improve, it will be hard for us to hold out beyond this year.”
Ha’s factory is among thousands in Vietnam that cut production or closed this year after policy makers curbed a lending spree and bad debts mounted. As demand also slows from Europe to China, the shakeout of businesses that mushroomed during the 2002-2007 boom is slowing economic growth and may temper a stocks rally that made Vietnam the world’s third-best performer this year.
“There’s no way we can meet the economic growth target of 6 percent this year when so many companies are in serious trouble,” said Le Dang Doanh, an economist who has advised Prime Minister Nguyen Tan Dung and who estimates 2012 expansion may slow to as low as 5 percent, the least since 1999. “Many businesses are on their last breath.”
xchrom
(108,903 posts)
Zambians gather to welcome home the national soccer team in Lusaka. (AP)
LUSAKA, Zambia -- The teenagers started arriving at the Arcades outdoor shopping center here just as the sun began to set. They took over the parking lot first, then the sidewalks. Within half an hour, the strutting and preening groups occupied just about every available pedestrian space.
Joshua Banda, a 15-year-old who wore green Converse All Stars with matching laces, sat with two friends at the edge of a gurgling fountain, surveying the crowds of girls. He proclaimed himself a fan of Lil Wayne and then told me he wants to be a lawyer.
Joshua's parents moved to a Lusaka shanty when he was small. His father is a watchman, his mother cleans offices. Seeing Joshua's education as the best guarantor of their own future, they saved from their measly earnings to pay for school for him and an older brother. Joshua has learned a bit about sacrifice as well, though of a different sort. Since he can't afford a cell phone on his own -- and since, in Lusaka, teenagers are nobodies without cell phones -- he shares one with his best friend.
The new mall culture in Zambia's capital, which I've watched expand almost exponentially in visits over the last three years, is booming all over Africa, in places like Accra and Dakar, Windhoek and Gaborone, Nairobi and Maputo. Driving it are young people like Joshua and his friends, a generation that is growing up like none that preceded it: a bulging new cohort of young people with disposable income, however modest, a keen and up-to-the-minute sense of youth trends and of consumerism around the world, and, most importantly, the expectation that life that will continue to get better and richer and fuller of choices.
xchrom
(108,903 posts)UPDATE:
As we wrote about in the original post below, Facebook plunged below the IPO price in the early going, and the route continues now that the official start of trading has begun.
It's now off over 8% to around $35/share, well below the $38/share IPO price.
ORIGINAL POST: Facebook shares have fallen to $36.50 in the pre-market.
Remember, on Friday the stock went public with a shockingly small pop.
And that pop quickly evaporated, and the only reason it didn't fall below the $38 level is that the underwriters put in a mammoth bid at $38.
But obviously the underwriters are done supporting the stock, as it's now going down.
Adding insult to injury, futures are up nicely this morning, so the mood is generally positive. But people don't want Facebook.
Wow!
Read more: http://www.businessinsider.com/facebook-breaks-the-ipo-price-2012-5#ixzz1vVmKkiNr
Po_d Mainiac
(4,183 posts)
girl gone mad
(20,634 posts)Either they're too broke to bet on this crap or they've finally wised up to one of WS's longest running cons.
tclambert
(11,085 posts)DemReadingDU
(16,000 posts)5/20/12 Dancing Shoes
So many shoes are dropping out there that reality is starting to look and sound like the tap-line in a Busby Berkeley production number. The meme-scape, too, is humming with viral transmissions of dire doings. Is JP Morgan unwinding like a 1911 knitted woolen Yale varsity sweater? Did it booby-trap the credit default swap universe in the process, and is that getting ready to blow? The whole world is hanging by its fingernails, refusing to be dragged into the future.
That future is all about contraction. We could navigate our way into it but we don't want to. We want to stay right where we are with all our stuff and no need to make new arrangements and we are trying every last trick to do that. Can you not sense a terrible tidal surge of implacable forces under the headlines' placid surface? I do offer Mark Zuckerberg best wishes on his nuptials, but I think he set himself up for one of fate's great pranks as FB stock goes to 99 cents while he's still on his honeymoon (playing Frogger in a super deluxe hotel suite).
Does anybody really believe that the European money problem has any other ending except massive repudiation of obligations and epic political realignment? Or that the USA isn't caught in the undertow. The only real question now is how the civilized world might remain civilized while it rebuilds its money system. Money, after all, is a representative of reality and the representations by nations and person and institutions have been so false for so long that, for practical purposes, there is no consensual reality anymore.
more...
http://kunstler.com/blog/2012/05/dancing-shoes.html
Demeter
(85,373 posts)DemReadingDU
(16,000 posts)5/21/12 Bank Accountability Advocates Show Up at Geithner’s House
The protests at the NATO summit in Chicago weren’t the only ones over the weekend. A group of about 1,000 bank accountability advocates drove to the front of Timothy Geithner’s house in Bethesda, Maryland, on Sunday, and tried to get an impromptu meeting with the Treasury Secretary. Nobody answered the door, however.
Geithner actually met with several National People’s Action members about a year ago, so I guess they didn’t appreciate the lip service and decided to request a follow-up. They specifically focused on investigations of Wall Street (I’m not sure Geithner’s the best contact for that) and a financial transactions tax (which Geithner has specifically shut down, so they’re on target right there). Really, Geithner should be reminded every day that his friends on Wall Street broke the law, and most of the public believes they should be brought to justice.
more...
http://news.firedoglake.com/2012/05/21/bank-accountability-advocates-show-up-at-geithners-house/
video...
5/20/12 Knocking on Tim Geithner's door - National People's Action
Over 1,000 of us made an unannounced visit to Secretary of Treasury Tim Geithner's home to demand he support a Robin Hood tax--a tiny tax of less than 0.5% on Wall Street transactions--and a thorough investigation of the bankers who caused this crisis.
&feature=player_embedded
pictures...
http://www.flickr.com/photos/nationalpeoplesaction/sets/72157629823279332/
Fuddnik
(8,846 posts)My whole friggin' face is pre-cancerous?!?!?!
I just got back from the Dermatologist. I decided that I should get a melanoma screening. And it seems that all those little rough, patches on my face are pre-cancerous.
But, he says that's ok. They don't have to take them off with acid and a jackhammer any more. Just a two hour solution and blue light procedure, then stay out of the sunlight for two days.
He froze a bunch of spots on my hands and arms. Says my body and Irish skin remember all the golf and stuff I used to do in the sun.
And, I was thinking about buying a kayak this morning.
Demeter
(85,373 posts)Good for you!
Irish are very vulnerable to sun cancers...that's why they lived in Ireland.
You've won you NO DENIAL Medal of Honor
(I'm still working on mine)
DemReadingDU
(16,000 posts)Both located above upper lip on right side. For several months, the spots would peel, heal, then peel again, then heal, over and over. And the spots 'stung', not really painful, but irritating.
So finally went to doctor who 'froze' the spots. Once those scabs healed, then I had to put on Efudex for couple weeks. It is impossible to apply directly to those tiny spots, and ended up with most of the surrounding area a giant scab too. UGLY. And this was between Thanksgiving and Christmas.
Last week, I had a follow-up appointment. The area healed up very nice, no more spots, the stinging gone too. However, the doctor said to return in 6 months, when he will likely have my use Efudex on the entire face.
I'm thinking, no, no, no. I'll just wait until some other area gets a spot that doesn't heal properly before I go thru having my entire face looking like Frankenstein.
Fuddnik
(8,846 posts)It's a topical solution activated by a Blu U light. So, from the looks of it, from the pics in the brochure, I may have a few marks and red blotches for a few weeks.
I don't want them putting anything with a Fudd in it on me.
I made the appointment for 8:30am Wed. morning.
Like they say, I guess it beats the fuck out of chemo.
Po_d Mainiac
(4,183 posts)DemReadingDU
(16,000 posts)That is most unpleasant.
Demeter
(85,373 posts)JPMorgan Chase is suspending its share buybacks, chief executive Jamie Dimon said on Monday – the latest fallout from a shock $2bn trading loss in the bank’s chief investment office.
The bank was given permission by the Federal Reserve in March to return more capital to shareholders after it successfully passed “stress tests” on its balance sheet.
Announcing the suspension of the buyback at a conference hosted by Deutsche Bank, Mr Dimon said “obviously we’re not going to make as much money”.
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http://link.ft.com/r/KC2844/VLILSC/87I64/DWNIUA/II2O6U/VU/t?a1=2012&a2=5&a3=21
NEXT IT WILL BE THE SOFA CUSHIONS IN THE WAITING ROOMS
just1voice
(1,362 posts)as FB is down 10%, LOL. Good thing our "free" markets kept all us riff-raff out as we really would have ruined everything for them.
Fuddnik
(8,846 posts)Sit on my Facebook. On second thought, don't.
http://marketday.msnbc.msn.com/_news/2012/05/21/11795748-after-facebook-ipo-debacle-finger-pointing-begins?lite
By msnbc.com staff
Facebook stock's slide continued Monday, leaving some investors wondering about the outlook for the newly public social network.
Facebook's stock tumbled below its $38 IPO price on its second day of trading. By Monday afternoon the company’s share price was down 10 percent from Friday’s closing price of $38.23. (You can track the performance of Facebook’s stock price here.)
When a stock falls below its offer price so soon after an IPO it is considered a disappointment for the company, particularly when the IPO is the most heavily traded ever and concerns such a high profile company.
A number of reasons for the stock decline were offered by observers. Some pointed to underwriters offering too many shares, while others blamed an overly strong IPO price and worries about slowing revenue growth at the social network.
Investors and technology industry watchers are closely tracking the Menlo Park, Calif.-based company's shares. Facebook's initial public offering was one of the most anticipated ever and now serves as a bellwether for other social media companies.
