Karl Denninger presents a compelling argument that market makers should not be exempt from rules preventing short-selling shares that cannot be borrowed (naked short selling). Because the quantity of a given stock in "float" is fixed, traders and market makers should not be allowed to create unreal and illogical bets on stocks that result in perversion of market dynamics and wild price swings. That’s my summary, Karl explains in detail. – Ilene
Matt Taibbi once again writes in Rolling Stone, this time on naked short sales, and while he gets a good part of the issue right, he (and many others who have opined on this situation over the years) miss the forest for the trees.
But the most damning thing the attack on Bear had in common with these earlier manipulations was the employment of a type of counterfeiting scheme called naked short-selling. From the moment the confidential meeting at the Fed ended on March 11th, Bear became the target of this ostensibly illegal practice — and the companies widely rumored to be behind the assault were in that room. Given that the SEC has failed to identify who was behind the raid, Wall Street insiders were left with nothing to trade but gossip. According to the former head of Bear’s mortgage business, Tom Marano, the rumors within Bear itself that week centered around Citadel and Goldman (GS). Both firms were later subpoenaed by the SEC as part of its investigation into market manipulation — and the CEOs of both Bear and Lehman were so suspicious that they reportedly contacted Blankfein to ask whether his firm was involved in the scam. (A Goldman spokesman denied any wrongdoing, telling reporters it was "rigorous about conducting business as usual.")
Matt gets so close, but fails in the closing.
See, there are two area of naked shorting that nobody wants to really deal with, yet both have to be if we are ever to make a difference. Let’s deal with them in turn.
The first, the writing of "naked" swaps, is one that I’ve written about before. The essence of a "credit default swap" is a contract whereby the buyer of protection insures…
Yesterday, we reported that four Iranian ships carried out a "high speed intercept" of a US destroyer, the USS Nitze, in the Strait of Hormuz, an incident that the official dubbed "unsafe and unprofessional", cited by Reuters. The four vessels belonging to the Islamic Revolutionary Guard Corps "harassed" a U.S. destroyer on Tuesday by carrying out a "high speed intercept" in the vicinity of the Strait of Hormuz, a U.S. Defense official said on Wednesday.
We’ve gone electric, and there’s no going back at this point. Lithium is our new fuel, but like fossil fuels, the reserves we’re currently tapping into are finite - and that’s what investors can take to the bank.
You may think lithium got too popular too fast. You may suspect electric vehicles are too much buzz and not enough real future. You may, in short, be a lithium skeptic, one of many. And yet, despite this skepticism, lithium demand is rising steadily and sharply, and indications that a shortage may be looming are very real.
It won’t be a shortage in terms of ‘peak lithium’; rather, it will be a game of catch-up with the electric car boom, with miners hustling to explore and tap into...
The latest index reading comes in at 16.4, up from the previous week's revised 14.5.
RecessionAlert has launched an alternative to ECRI's Weekly Leading Index Growth indicator (WLIg). The Weekly Leading Economic Index (WLEI) uses fifty different time series from these categories: Corporate Bond Composite, Treasury Bond Composite, Stock Market Composite, Labor Market Composite, Credit Market Composite. RecessionAlert emphasizes that WLEI is a growth index and its data is no more than a week old, as is ECRI's WLIg.
By The Foundation for Economic Education. Originally published at ValueWalk.
Don’t Blame Capitalism For Your Pricey EpiPen
In South Park: Bigger, Longer, and Uncut, offensive television characters Terrance and Phillip inspire moral indignation within a small Colorado town, sparking a movement of outraged parents who actively organize to censor the actors. Rather than focusing their energy on the individuals in question, the parents launch into an over-the-top campaign (complete with song and dance) targeting the entire country of Canada, where Terrance and Phillip live. Their crusade to “Blame Canada” drives the plotline to equally comedic and ridiculous lengths.
We have a similar short fuse in the United States. Though we don’t launch into full-scale invasions of our quiet northerly neighbors (at least, not yet), many Americans ...
Gold mining stocks have had a great year 2016. From the lows, GDX is up over 100%, remaining inside of a steep rising channel. The rising channel GDX has been in during this historic sharp rally, could be breaking.
CLICK ON CHART TO ENLARGE
GDX has remained inside of the blue rising channel for the majority of 2016. This channel has contained a 100% rally in the past few months.
The rally took GDX up to an unfilled GAP, just below its 38% Fibonacci retrac...
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Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer. One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."
Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.
Genetic components are the DNA sequences that are 'inherited.' Some of these genes are stronger than others in their expression (e.g., eye color). Yet, some genes turn on or off due to external factors (environmental), and it is und...
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