I realize the SEC’s task is a gargantuan one, especially considering the severely constrained resources, but there’s just no excuse for things like this. The SEC’s Division of Risk, Strategy, and Financial Innovation – the group created in 2009 to supposedly "enhance our capabilities and help identify developing risks and trends in the financial markets" – does not have anyone running the Office of Data & Data Analytics. How the hell is the Division supposed to do its job if there’s no one analyzing data?!?!?
I’d say to be fair, this website hasn’t been updated since 6/15/2010, but that actually makes this situation WORSE. How dysfunctional does an organization have to be that organization actions are not properly communicated via press releases and modifications to the organization’s website? This is not freaking rocket science!
If you think this is bad, get read, because it gets even worse: The head of the Division, Henry T. C. Hu left this month to go back to academia. According to an article from 1/20/2011 in the WSJ, his temporary replacement is the Division’s former Deputy Director, Jonathan Sobokin. The SEC issued a press release on 11/18/2010 that Hu would be leaving the organization, yet the "News" page of the Division’s website has no mention of Sobokin taking the reins. As a matter of fact, that is the most recent press release that appears on the page!
It’s one thing to suck at organizational communications, its another thing to take at least two months to find a replacement for a very important position, especially when given what appears to be advance notice. And it is another thing entirely to take well over a year to staff the Office tasked with performing the data analysis the Division needs in order to be effective!
The only good thing I can say here is that at least they brought Rick Bookstaber into the fold. I’ve met Rick and he’s a very, very smart man, and while I don’t always agree with him, I’m quite glad he’s at the SEC. Whether or not he has any authority or sway within the SEC is a whole different story upon which I can do little more than speculate…
The law, signed last week by President Obama, exempts the SEC from disclosing records or information derived from "surveillance, risk assessments, or other regulatory and oversight activities." Given that the SEC is a regulatory body, the provision covers almost every action by the agency, lawyers say. Congress and federal agencies can request information, but the public cannot.
That argument comes despite the President saying that one of the cornerstones of the sweeping new legislation was more transparent financial markets. Indeed, in touting the new law, Obama specifically said it would “increase transparency in financial dealings."
Mr. President, you’re a lying sack of crap.
Nor is this theoretical either. Fox News has already had an FOIA denied:
The SEC cited the new law Tuesday in a FOIA action brought by FOX Business Network.
Oh, by the way, this would mean that a Madoff or Stanford "thing" would leave the SEC immune from FOIA requests by the Press (including the "mainstream" along with media folks like myself) to discover whether they had effective and early notice that they intentionally ignored.
Isn’t that convenient, given that they did exactly that with Madoff and, it can be argued, Stanford as well?
Indeed, the SEC, The Fed, and Treasury have all tried to refuse compliance with FOIA requests into the backstories of the financial meltdown.
FOIA requests that could (and in some cases have, when they were forced to be complied with via lawsuits) reveal double-dealing, "sweetheart" treatment, and even willful blindness that, in many people’s opinion (including mine) reaches the level of intentional collusion that, in a private context, would lead to civil and/or criminal racketeering charges.
To President Obama and CONgress for sticking this in FinReg (and yeah, I missed it, even though I read the entire damn thing):
Now that Obama has signed FinReg into law, Roosevelt Institute Fellow Mike Konczal appeared on The Breakdown with Chris Hayes yesterday to discuss the bill. Confused about the entire financial meltdown? Mike’s got you covered. He breaks the crisis down into four interconnected sectors: an exploitative, under-regulated system of consumer finance; dark markets in derivatives; the failures of “too big to fail” banks and the ripple effects they caused; and shadow banks that were able to avoid regulations (and also lacking, as Mike says, the “toilet training” necessary to behave).
These four sectors will also be the basis used for grading the potency of the bill. And as Mike notes, while it offers opportunities for some much-needed changes, it still falls short in several areas.
FinReg may fall short if power is channeled into Geithner’s hands.
More depressing news from the “change” President. The Washington Post has reported that one of the major impacts of the FinReg bill passed last week by Congress is the accretion of new power to Obama’s Treasury Secretary. According to the Post, Tim Geithner stands to inherit vast power to shape bank regulations, oversee financial markets and create a consumer protection agency.
Make no mistake: this is Timmy’s bill, plain and simple, as the Post makes clear: “The bill not only hews closely to the initial draft he released last summer but also anoints him — as long as he remains Treasury secretary — as the chief of a new council of senior regulators.”
The Geithner Treasury repeatedly pushed back against many sensible legislative proposals that would have made significant structural changes to practices that brought about the current economic crisis. And the article itself represents latest in a series of attempts to embellish the Treasury Secretary’s hagiography.
Reading it, one wonders whether the Washington Post inhabits a strange parallel universe. Have the writers actually paid attention to what is truly happening in the economy? The WaPo persists in towing the party line that Geithner’s tenure has been marked with conspicuous success, supposedly by advocating a response to the financial crisis that allegedly later proved correct: “Geithner vigorously resisted calls by some lawmakers and financial experts to nationalize the nation’s largest and most troubled banks during the most perilous days. Instead, he helped get the financial system back on its feet, in particular by pressing for stress tests of big banks.” (my emphasis)
Oh, really? I would argue that Washington continues to allow the big banks to operate “business as usual” and to cook the books to show profits so that they can pay out big bonuses to the geniuses who created the toxic waste that brought on the crisis. Most continue to show profits based not on fundamentally health lending activity, but one-off gains, and accounting gimmickry. Commenting on the latest JP Morgan results, my friend and colleague Randy Wray has noted:
Here's my theoretical question for the day: Why are mules stubborn, and why can't blind jackasses see?
I ask that question in regards to a few recent news articles. One is on Japan, one the US, and one on emerging markets with various overlaps in between.
Let's start with Japan.
Brink of "Technical" Recession
The Financial Times reports Japan on Brink of Technical Recession. Japan is on the verge of a technical recession after data on industrial production raised the prospect of a second consecutive quarter of negative growth. Industrial production for August — a crucial input into gross domestic product — unexpectedly fell by 0.5...
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As Naked Capitalism's Yves Smith notes,Wilkerson describes the path of empires in decline and shows how the US is following the classic trajectory. He contends that the US needs to make a transition to being one of many powers and focus more on strategies of international cooperation.
You have to risk money to make money. You have to make sure you don't risk so much money that you can lose your stake and go out of business as a trader. Bet too little and you never make a good return on your capital. Bet too much and you court career risks. So much of trading success boils down to taking intelligent risks.
Opportunities are knocking at our door friends! I’ve been sharing the Power of the Pattern with customers for the past 20-years. In my humble opinion, some really nice opportunities (based on price, momentum and sentiment) are forming for investors around the world. Below is two of the dozens of rare patterns I am seeing, that I wanted to share with you today.
What would you do with this opportunity?
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As shared above, this asset has fallen around 35% of late. The decline has taken it down to its 4-year rising channel support l...
The Fed’s decision to not raise the fed funds rate at this time was ultimately taken by the market as a no-confidence vote on our economic health, which just added to the fear and uncertainty that was already present. Rather than cheering the decision, market participants took the initial euphoric rally as a selling opportunity, and the proverbial wall of worry grew a bit higher. Nevertheless, keep in mind that markets prefer to climb a wall of worry rather than ride a crowded bandwagon, and I continue to envision higher levels for the markets after further backing-and-filling and testing of support levels (perhaps even including the August lows).
With the VIX index jumping 120 percent on a weekly basis, the most in its history, and with the index measuring volatility or "fear" up near 47 percent on the day, one might think professional investors might be concerned. While the sell off did surprise some, certain hedge fund managers have started to dip their toes in the water to buy stocks they have on their accumulation list, while other algorithmic strategies are actually prospering in this volatile but generally consistently trending market.
Stock market sell off surprises some while others were prepared and are hedged prospering
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Baxter Int. (BAX) is splitting off its BioSciences division into a new company called Baxalta. Shares of Baxalta will be given as a tax-free dividend, in the ratio of one to one, to BAX holders on record on June 17, 2015. That means, if you want to receive the Baxalta dividend, you need to buy the stock this week (on or before June 12).
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 firstname.lastname@example.org 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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