By Jake Towne, the Champion of the Constitution. "As always, unlike the NFL, the author grants full permission to allow any accounts of, rebroadcasts, retransmissions, repostings of this article to your blog or anywhere else in order to promote the Restoration of our Republic."
"Banking was conceived in iniquity and was born in sin. The Bankers own the Earth. Take it away from them, but leave them the power to create deposits, and with the flick of the pen they will create enough deposits to buy it back again. However, take it away from them, and all the great fortunes like mine will disappear, and they ought to disappear, for this would be a happier and better world to live in. But if you wish to remain the slaves of bankers and pay the cost of your own slavery, let them continue to create deposits."
– Josiah Stamp, President of the Bank of England in the 1920s
[This article is updated with more infomation and the March 2009 figures released from this February article in response to a couple press requests. The figures were calculated from the FED data here, using the same method described here.]
So, who owns the Federal Reserve? Well, it certainly is not the US government, as many would suppose. In fact, I have found that quite a few – including myself last year – who are roughly aware of how the FED works but believe that the owners of the FED is a secret. Well, it is not. The FED’s Purposes and Functions (page 21/146) reads:
"As of March 2004, of the nation’s approximately 7,700 commercial banks approximately 2,900 were members of the Federal Reserve Systema – approximately 2,000 national banks and 900 state banks. Member banks must subscribe to stock in their regional Federal Reserve Bank in an amount equal…
First, I have respect for Dennis – he lays out his beliefs (regardless if these beliefs are based on completely flawed foundations or not) and defends them, on prime time TV, in a “financial news” medium whose very existence every viewer realizes is contingent on not only the continued viability of massively bad debt-laden GE (due to its inextricable ties with GE Capital, which lent out more toxic second liens than virtually any other entity), but by implication, the well-being of the overall economy, as well as the continued financial support by PIMCO and other financial company sponsors who have explicit and implicit ties with the current administration, and who profit exclusively from a rising market. In retrospect, one can see where Dennis’ viewers may get confused by the blurry line between a hopelessly severe conflict of interest and honest personal opinion.
Second, I want to address some points that Dennis made in his monologue. Zero Hedge received an invite from Dennis’ producer Dave at 1:34 pm to appear on the show. Of course, our frequent readers realize this is a non-starter for anyone at Zero Hedge due to the nature of our operation. We countered by offering a telephonic interview at an indeterminate point in the future (and desirous of at least a 24 hour advance notice: again, frequent readers will attest that I tend to post constantly, for about 18 hours a day), and even offered Dennis a forum on Zero Hedge to directly address our readers, whom he, we assume affectionately, had some florid words for. Nowhere did we give the impression we would have a call today, and offered up a date in two weeks for an extended call, which would take place upon my return from a reconnaissance trip to Europe (ironically to check up on some of GECC’s major investments in the region: stay tuned for my observations). Our overture was denied, yet somehow Dennis decided to make a point of misrepresenting the communication that took place. We provide a transcript of the email exchange earlier for our readers’ convenience.
As Cap and Trade races through Congress, here is a question – Who will benefit? The environment and us or Government Sachs?
Courtesy of Jake Towne. "As always, unlike the NFL, the author grants full permission to allow any accounts of, rebroadcasts, retransmissions, repostings of this article to your blog or anywhere else in order to promote the Restoration of our Republic."
Last week the House voted 219-212 to pass HR 2454, the American Clean Energy and Security Act of 2009, whose intent is to "create clean energy jobs, achieve energy independence, reduce global warming pollution and transition to a clean energy economy." I’ve only had time to browse the 1,092 page bill and sincerely believe it will not achieve a single one of its purposes.
The creation of clean energy jobs is very vague and the parts that are clear center not on industry but on educating people about global warming – this appears to signal the creation of a new class of bureaucrat-teachers, not industrial jobs.
Energy independence? Transition to a clean energy economy? Get real, there is nothing of substance in the document that details such a plan, and this is a pipe dream for government to create this. What will you ask? Only a free market, driven by the consumer and free from government interventions can do so, in my opinion.
"Reduce global warming pollution?" Somehow I missed the scientific debate where the global warmers square off against the global coolers and those who believe that ‘the weather just changes, weather you want it to or not’ as I suggested here "Anthropogenic Global Warming or an Ice Age, Which Is It? (PART 2/2)". Is carbon dioxide really a pollutant? Don’t plants need it to live and don’t we all respire it? It would be a lot cheaper and a lot more useful than HR 2454!
My own private analysis of HR 2454 can be summarized up with:
Inefficient energy sources will instead be propped up and buffered from free market competition by the government.
The taxed companies will pass down the taxes to We the People, and energy costs will rise for us, the consumers.
The State will subsidize and hence sponsor, mandated education that "global warming" is fact, stifling debate.
Wall Street will have a great time doing all the carbon credits trading using
In approving the mergers, the directors considered, among other things, each fund’s investment objectives, net asset value and stock price performance, income-generating strategy and expenses, and potential cost savings based on operational efficiencies. The mergers will permit fund shareholders to pursue substantially similar investment objectives in a larger fund that has similar investment policies and anticipated lower expenses.
Zero Hedge is anxiously waiting to see the proxy information that will accompany this transaction in order to get justification for the move.
The board also has approved removal of UTF’s 20% limit on investing in foreign securities, so that the fund can invest without limit in foreign securities, including securities of companies in emerging market countries, to the extent consistent with the fund’s investment objective and other investment policies. The changes will broaden UTF’s geographic investment universe and open up potentially higher-growth sub-sectors while maintaining similar investment characteristics.
Nothing like having no size limits in a $1.4 billion fund. Visions of Bill Ackman’s PSIV (Target) adventure, and its dramatic returns, start floating. Of course, one needs dry powder for when Merrill strats upgrading and issuing secondaries for the Honduras mall REIT that is ‘almost’ guaranteed to generate 1000% return once the Honduras SEC pulls all borrow.
An unexpected drop in consumer confidence data saw equity indices fall on concerns the economic recovery will be slow. Lower WTI prices weighed on the major US averages after the release of consumer confidence sparked a flight to safety in the USD. In turn this saw Exxon (-0.95%) top the laggers table in the S&P 500 index. Following the initial downward move in equity indices, prices were range bound and trading sideways, though did move slightly higher after positive comments on the economy by Fed’s Bullard. Finally, at the closing bell DJI closed down 0.96% at 84447.53, S&P 500 closed down 0.85% at 919.34 and NASDAQ100 closed down 0.44% at 1477.25
Treasury prices came under pressure in the closing stages of the session to finish lower after Fed’s Bullard said that Fed’s exit strategies are ‘unclear’. Initially, at the open prices plunged after a better than expected improvement in Case-Shiller housing data, though retraced that downward move after the release of disappointing consumer confidence data. Also, the Fed carried out its first coupon purchase of the week which yielded a lower than expected offer/cover ratio and supported a lift in prices. Finally, the closing hour saw Treasuries retreat on the back of comments from Fed’s Bullard after he said demand for liquidity programs is diminishing. At the pit close T-notes finished down 6+ ticks at 116.085.
More and more economic data manipulation is coming to the fore, none of which as blatantly obvious as the California housing market. Some of it is palatable, but when home sales in San Diego get revised from 89% to 6.5% due to a “data glitch”, it is no wonder that increasingly more Americans realize every single day they are being blatantly lied to by an Administration whose sole purpose in life is to give out 10 pair of rose-colored glasses to every possible voter in the next election. For the most recent take on this the WSJ chimes in:
The California Association of Realtors expects to make sharp downward revisions in its recent monthly reports of soaring home sales in the San Diego area, Robert Kleinhenz, deputy chief economist of the trade group, said in an interview. Those revisions will mean modest downward revisions in statewide sales, he added.
The revisions are likely to be announced in late July, when the Realtor group reports home sales for June. The problem resulted from a glitch in data from a multiple-listing service in San Diego, Mr. Kleinhenz said. He said a change in computer systems used there resulted in incorrect data being sent to the Realtor association over the past year or so.
Thomas Lawler, an independent economist in Leesburg, Va., who tracks home sales nationwide, raised questions about the San Diego data in a report last week. Mr. Lawler noted that the numbers reported by the Realtors vastly exceeded those from MDA DataQuick, a research firm in La Jolla, Calif., and other sources.
The California Realtors have reported that San Diego sales in April were up about 63% from a year earlier. Mr. Kleinhenz said that is expected to be revised downward to a gain of about 20%. For May, the group reported an 89% increase in sales in San Diego; that will be slashed to about 6.5%, the economist said.
As a result, he said, the state-wide sales gain for May — reported last week as 35% — also will be revised down, though it probably will remain above 30%,
Zero Hedge is happy to present readers with the NYSE’s response to the earlier post on dropping program trading data. I would love to see clarity on what it is that the NYSE classifies “account type indicator data” as opposed to old reliable DPTR. I sure hope this does not mean the source will be the actual account as opposed to the Exchange sourcing the data. I imagine there will be significant statistical data adjustment post fact.
Furthermore, in allowing the SLP program to go into effect on an expedited basis, the SEC said it did so because the program did not affect the protection of investors and impose any significant burden on competition. See page 2 of the linked doc.
“The Exchange believes that this rebate program will encourage the additional utilization of, and interaction with, the NYSE and provide customers with the premier venue for price discovery, liquidity, competitive quotes and price improvement.”
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NYSE–2008–108. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any
This is outrageous. Do what you can, there are numbers at the bottom to call to voice your opinion. Update: Here’s a subsequent note from ZH – The NYSE Responds to Zero Hedge - I read but did not understand it. Update 2: It seems they are proposing another type of tracking with no details.
In a move set to infuriate and send many Zero Hedge readers over the top, the NYSE has taken action to make sure that nobody will henceforth be able to keep track of the complete dominance that Goldman Sachs exerts over the New York Stock Exchange. This basically ends our weekly Program Trading updates disclosed every Thursday indicating that Goldman has singlehandedly captured all of NYSE’s program trading.
The New York Stock Exchange LLC (“NYSE”) will be decommissioning the requirement to report program trading activity via the Daily Program Trading Report (“DPTR”), which was previously approved by the Securities and Exchange Commission (the “Commission”).1 The last trade date for which member organizations will be required to file the DPTR with the Exchange will be July 10, 2009 and therefore the last required date to submit the DPTR will be July 14, 2009.
In the 2007 rule filing, the Exchange proposed to eliminate DPTR. The 2007 filing noted that there was some duplication between the DPTR data and the audit trail information that member organizations provide to the Exchange via account-type indicators at the time that they submit program trades to the Exchange… [A]fter consulting with the SEC, the Exchange announced that it would delay implementation of the two redefined account type indicators, and pending such implementation, member organizations would be required to continue filing the DPTR with the Exchange. The current delayed implementation date of the redefined J and K account type indicators is June 30, 2009. Accordingly, the Exchange still requires member organizations to submit DPTR.
The Exchange has filed with the SEC to implement the decommissioning of the
If the S&P 500 does not have a 5% correction this year, it will be the first time in 20 years. And it's been 3.6 years since the last 10% correction. And trailing and forward PEs are relatively high. In the low interest rate environment, higher-than-normal stock prices are the new normal, but how much higher? And should we expect a reset with the Fed's plans to ease the interest rate higher?
Deutsche Bank is out with a piece of research this weekend mentioning the fact that the S&P 500 has just broken a record high thanks to a median trailing PE ratio of over 18 – the highest we’ve seen since...
The default countdown is about to go under 10 days and it is becoming increasingly apparent that both Greece and its creditors have had enough.
Months of tense negotiations have gone nowhere and yielded exactly nothing and it now looks like PM Alexis Tsipras and FinMin Yanis Varoufakis may be willing to miss a June 5 payment to the IMF if it means proving they are serious about keeping their campaign promises and forcing the troika to the bargaining table. The implications of a missed payment aren’t entirely clear but Athens is keen to predict the worst as it tries to squeeze concessions from creditors. ...
763 followers 76 copiers A solid jump in both followers and copiers from the start of the month. This was in large part to my top-10 ranking in their People screener. Having said that, last week finished very poorly for me. Overtraded and wa...
Reminder: Pharmboy is available to chat with Members, comments are found below each post.
Understanding the new normal of a business model is key to the success of any company. The managment of companies need to adapt to the changing demand, but first they must recognize what changes are taking place. Big Pharma's business model is changing rapidly, and much like the airline industry, there will be but a handful of pharma companies left at the end of this path.
Most Big Pharma companies have traditionally done everything from research and development (R&D) through to commercialisation themselves. Research was proprietary, and diseases were cherry picked on the back of academic research that was done using NIH grants. This was in the heyday of research, where multiple companies had drugs for the same target (Mevocor, Zocor, Crestor, Lipitor), and could reap the rewards on multiple scales. However, in the c...
Stocks closed last week on a strong note, with the S&P 500 notching a new high, despite lackluster economic data and growth. I have been suggesting in previous articles that stocks appeared to be coiling for a significant move but that the ingredients were not yet in place for either a major breakout or a corrective selloff. However, bulls appear to be losing patience awaiting their next definitive catalyst, and the higher-likelihood upside move may now be underway. Yet despite the bullish technical picture, this week’s fundamentals-based Outlook rankings look even more defensive.
Reminder: OpTrader is available to chat with Members, comments are found below each post.
This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).
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Bitcoin, the virtual digital currency, has been called the future of banking, a dangerous fad, and almost everything in between, but we're finally about to get some solid data to help settle the debate.
On Monday, the Nasdaq (NDAQ) stock exchange said it would ...
Chris Kimble likes the idea of shorting the US dollar if it bounces higher. Phil's likes the dollar better long here. These views are not inconsistent, actually, the dollar could bounce and drop again. We'll be watching.
Phil writes: If the Fed begins to tighten OR if Greece defaults OR if China begins to fall apart OR if Japan begins to unwind, then the Dollar could move 10% higher. Without any of those things happening – you still have the Fed pursuing a relatively stronger currency policy than the rest of the G8. So, if anything, I think the pressure should be up, not down.
UNLESS that 95 line does ultimately fail (as opposed to this being bullish consolidation at the prior breakout point), then I'd prefer to sell the UUP Jan $25 puts for $0.85 and buy the Sept $24 call...
Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself.
Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene
The replay is now available on BNN's website. For the three part series, click on the links below.
Part 1 is here (discussing the macro outlook for the markets)
Part 2 is here. (discussing our main trading strategies)
Part 3 is here. (reviewing our pick of th...
This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible. Feel free to contact me directly at email@example.com with any questions.
Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts. After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.) Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.
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