Warren Mosler is "an economist specializing in monetary policy and running for Senator Dodd’s Senate seat in the November elections." He has written the following piece for the Huffington Post. He is so incredibly off the mark that I thought a bit of correction to that spin might help his thinking before he hits the campaign trail.
Mr. Mosler. I have been following this case closely. No one atGATA, or anyone else looking at the state of the regulatory climate in Washington and the quality and tarnished reputation of US markets, is complaining about the normal sort of trading that has been going on ‘for thousands of years.’ Most of the people with whom I have spoken and questioned are seasoned traders with a profound understanding of the commodity markets, and equity markets, and derivatives.
What many people are complaining about is fraud. In this case fraud can loosely be defined as doing something and then lying about it. Saying you did not do something, or disguising the nature of what you have been doing, can turn even a prima facie benign action into a fraud, depending on the intention and degree.
Many people around the world are not complaining that the US has lent out its gold, and the ‘depositories are filled with paper,’ which may some day be replaced by gold again. Although they do point out that it will be replaced at MUCH higher prices if their suspicions are correct. They are pointing out that government officials have said repeatedly that they have never lent it out in the first place but refuse to submit to audits and transparent accounting. And if it did occur, such lending may be of questionable legal status, which is why so many have denied it has occurred. Only the Congress can allow for the attachment of binding claims to sovereign assets. Have they? And if, in exercising some new presidential prerogative, the executive has done so, where is the public disclosure? Where is the law?
And further, in the case of commercial entities like the TBTF bullion banks JPM and HSBC, they are not complaining about short selling that is backed by physical metal, duly paid and accounted for. They are asking questions about what appear to be enormous…
Do we have another Harry Markopolos here, describing in detail the manipulation of the silver markets by J.P. Morgan to the CFTC? How does this square with the testimony today from the CFTC Commissioners, who seem to indicate that the markets are functioning extremely well, and that investor can have full confidence in them?
I am led to understand that Mr. McGuire had offered to testify before the CFTC today, and that he was refused admittance. I do not know him, or the position he is in within the trading community. I cannot therefore assess his credibility or the validity of any evidence which he may present or possess. But I have the feeling that nothing will come of this.
Remember, there was no action on the Madoff scandal until AFTER his fraud collapsed, and the government was forced to acknowledge Markopolos’ existence. He had been ignored and dismissed by the bureaucrats at the SEC for years because of Madoff’s power and standing with the trading establishment. And of course by those who had an interest in hiding Madoff’s scheme, if nothing else, to promote ‘confidence’ in the markets.
What seems particularly twisted about this is that JPM is the custodian of the largest silver ETF (SLV). Is anyone auditing that ETF, and watching any conflicts of interest and self-trading? Multiple counterparty claims on the same bullion?
If you ever wanted to see a good reason for the Volcker rule, this is it. These jokers are one of the US’ largest banks, with trillions of dollars in unaudited derivatives exposure, and they seem to be engaging in trading practices like Enron did before it collapsed.
Have they lost their minds, or are they just that reckless, immature, short term, and arrogant? Morgan practically holds the keys to the US Treasury, a recent recipient of billions in taxpayer support, and still receiving signficant subsidies from the Fed. They seem to be in dire need of adult supervision. Blatantly and clumsily rigging the silver market, and then bragging about it to people outside their company. What’s next, bumping off grannies for their Social Security checks? Three card monte games on the boardwalk?
I was trying to understand why this item struck me so hard this evening. It shocked me in a…
Growing evidence, number trails and a culture of greed support a connection between high frequency program trading and market manipulation and, by all appearances, the pumping up of stocks of troubled financial companies… – Ilene
TRIN appeared to be broken because we were getting huge swings in its values from moment to moment in the market. It would swing wildly, sometimes going far above 1.0 and sometimes far below. I pointed out that, from a purely mathematical vantage point, this could only occur if a disproportionate share of NYSE volume was occurring in one or a handful of stocks.
Further inquiry revealed that this was, indeed, the case: I found that, not only were the trading volumes of such stocks as C, AIG, FNM, and FRE elevated, as noted the by Big Picture blog, but that their composite volumes (their volumes traded across all exchanges) exceeded that of all other NYSE stock trading! Indeed, I discovered that the 20-day TRIN was at its lowest level since 2000 because volume was highly concentrated in rising stocks. This was not just unusually heavy volume; it was unusually heavy to the buy side.
Since this volume was directional--all of these stocks had made spectacular percentage gains--and because the highly unusual activity was unique to troubled financial firms (not stable companies such as GS and JPM), I surmised that something might be afoot: a systematic attempt to bolster the shares of taxpayer supported companies that--for political reasons--could not return to the bailout well. Why such an attempt? Perhaps to reimburse the largest shareholder of the institutions and position these companies to raise capital on their own. They certainly weren’t going to raise their own capital as languishing two-dollar zombie…
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Auto sales in the U.S. economy look solid on the surface. According to Autodata, in November, the annual rate of auto sales in the U.S. economy was 16.41 million units. In October, the annual rate of auto sales was reported to be 15.23 million and in the same period a year ago (November 2012), it was 15.32 million. (Source: Autodata web site, last accessed December 10, 2013.) Cleary, auto sales are increasing.
By looking at the auto sales numbers, one could be easily tempted to suggest consumer spending is increasing. But this is not the case. A deeper look at the numbers reveals a large increase in subprime lending to finance consumer auto purchases.
According to Experian, an information services company,...
Absent the "obvious" bubble in the late 90s, the US equity market is at its most expensive valuation since right before the '30s crash. As Bloomberg notes, thanks to the exuberance of stocks in the last quarter, Pavilion Global Markets has calculated Tobin's Q (a valuation indicator based on market 'price' versus 'asset value' for non-financial companies) has only been higher at the peak of bubble exuberance. Still want to BTFATH? Afraid of missing out?
The index posted a dramatic 7.5% rise in Q4 so far pressing it to near-record levels absent the euphoria of the late 90s.
Unless a farm bill passes by the end of the year, the crop subsidy program will revert to 1949 policies and the government would be required to stockpile milk until it reached $37.20 per hundred pounds. The current price is about $19.00.
Why our legislators would write ridiculous laws like this is totally beyond me, but they did.
The House wants to pass an extension to resolve the issues, but the Senate says no. So here we sit wondering if the price of milk is going to double.
Bloomberg reports Extension of Farm Subsidies Rebuffed by Senate Democrats An extension of U.S. agriculture subsidies to late January was rebuffed yesterday by Senate Democrats, who said they won’t pass any House plan for ...
SHANGHAI, China, Dec. 11, 2013 (GLOBE NEWSWIRE) -- JA Solar Holdings Co., Ltd. (Nasdaq: JASO) ("JA Solar" or the "Company"), one of the world's largest manufacturers of high-performance solar power products, today announced changes to its management team, effective January 1, 2014.
Mr. Herman Zhao has been appointed the Company's new chief financial officer ("CFO"). Mr. Min Cao, the Company's current CFO, will assume the role of chief strategy officer upon Mr. Zhao's appointment.
Concurrently, Mr. Jian Xie, the Company's current chief operating officer ("COO"), will assume broader leadership at the Company as its president, and current chief technology officer Mr. Yong Liu will become the Company's COO.
Investors lost their enthusiasm on Tuesday as the December 13 budget deadline approached with more dysfunction on Capitol Hill.
The S&P 500 Index retreated from Monday’s record high on Tuesday, as investors watched another budget battle unfold in Washington, with the clock ticking down to the December 13 deadline. Although this latest battle appears less toxic than the previous episodes, investors obviously remained skeptical as the major stock indices fell into the red.
The Dow Jones Industrial Average (NYSEARCA:DIA) lost 52 points to finish Tuesday’s trading session at 15,973 for a 0.33 percent decline. The S&P 500 (NYSEARCA:SPY) fell 0.32 percent to close at 1,802....
IEP – Icahn Enterprises L.P. – Shares in Icahn Enterprises fell 10% to $133.67 on Tuesday morning after the company yesterday announced the sale of 2,000,000 depositary units. Shares in IEP yesterday rose to an all-time high of $149.77.
The sizable move in the price of the underlying sparked heavier than usual options activity on the stock today, with overall volume approaching 5,000 contracts as of 11:20 a.m. EST versus average daily options volume of around 1,400 contracts. The largest increase in open interest in IEP options overnight was in the Dec $145...
Today, with very little market moving news, the S&P 500 closed at 1808.4, yet another new closing daily high. The index did touch the 1811 area on at least three distinctly different time slots creating a new resistance level. But after last week’s bevy of positive economic surprises, the sharp gain of 1.1% on Friday, leaving the index just a tiny point away from its ninth consecutive up week, we can’t be too quick to suggest today was a topping rally. For one thing, volume was quite low as traders seemed to be trying to sort out the odds on the earliest date of Fed tapering. Estimates range from this month to March and even later. But it’s going to happen…so why so much emphasis on when? Perhaps protection of end-of-the-year profits in so many fund managers portfolios? ...
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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).
We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options.
Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.
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These rallies are becoming familiar. In early July we saw a streak of 12 of 13 sessions in a row up, early September 11 of 12, and mid October 11 of 13 (current streak). It is a bit uncanny the similarities and how the escalator goes straight up in vertical ascent as we see indexes come out of mini corrections during QE. So we are about at the same stage where the last two began to tire, so it will be interesting if this is similar or if the current consensus of the market that there is nothing to worry about until next year as the Fed and D.C. are both off the table and this 3% annual growth rate in earnings we are now seeing in the S...
Welcome to the fouth update of the IRA Virtual Portfolio. First I am going to summarize the current state of the Portfolio then I will get into all the activity we had during September expiration.
Profit and Loss – Net of closed positions the portfolio is up a total of $769
Market Commentary – Last expiration I said, "I would like to put a total of $20,000 to work by the end of SEP expiration. If the VIX pops up to around 20 I plan to put about $50,000 total to work." The market didn't quite reach the goal but I did manage to deploy $15,000 of buying power. I still feel the market is too high and expect a correction during October. If the vix pops up to around 20 I still plan to put about $50,000 to work. If a correction doesn't happen I still plan to have a total of $25,000 in buying power put to work by October expiration. Now on to the act...
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Come and get it! Read all about it! Biotechs, biotechs and more biotechs to buy buy buy for your portfolio! To date, almost 30 biotech companies have hit the market. Most of the time, there are fewer than 10-12!
For the last five years, biotechs have had issues obtaining offer prices above expectations. In 2013, that trend looks to be broken. According to BiotechNow, the offer prices are 4% above expectations! In addition, biotechs are going public with little more than a wing and a prayer (pre-clinical or Phase 1 data only). Really? What this means is that the drug or technology looks good in mice, rats, or dogs, etc, but there is no smidgen of evidence that it will work in humans. That's what is called an appitite for RISK!
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