Posts Tagged ‘bank runs’

Break Up The Banks

Break Up The Banks

banksCourtesy of Robert Reich  

A fight is brewing in Washington – or, at the least, it ought to be brewing – over whether to put limits on the size of financial entities in order that none becomes “too big to fail” in a future financial crisis.

Some background: The big banks that got federal bailouts, as well as their supporters in the Administration and on the Hill, repeatedly say much of the cost of the giant taxpayer-funded bailout has already been repaid to the federal government by the banks that were bailed out. Hence, the actual cost of the bailout, they argue, is a small fraction of the $700 billion Congress appropriated.

True, but the apologists for the bailout leave out one gargantuan cost — the damage to the economy, which we’re still living with (witness the latest unemployment figures). Leave it to the Brits to calculate this. Andrew Haldane, Bank of England’s Financial Stability Director, figures the financial crisis brought on by irresponsible bankers and regulators has cost the world economy about $4 trillion so far.

So while the bailout itself is gradually being repaid (don’t hold your breath until AIG and GM repay, by the way), the cost of the failures that made the bailout necessary totals vast multiples of that.

Needless to say, the danger of an even bigger cost in coming years continues to grow because we still don’t have a new law to prevent what happened from happening again. In fact, now that they know for sure they’ll be bailed out, Wall Street banks – and those who lend to them or invest in them – have every incentive to take even bigger risks. In effect, taxpayers are implicitly subsidizing them to do so. (Haldane figures the value of that implicit subsidy to be about $60 billion a year for each big bank.)

Congress and the White House tell us not to worry because financial reform legislation will contain what’s called a “resolution” mechanism allowing regulators to wind down any big bank that gets into trouble. (Think bankruptcy with more safeguards against runs by bank by creditors wanting to get their money out right away.) By virtue of this resolution authority, they say, future bank creditors will have to price in the possibility of the bank being allowed to fail. Hence, the implicit subsidy for…
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SOME THOUGHTS ON THE CURRENT STATE OF AFFAIRS

SOME THOUGHTS ON THE CURRENT STATE OF AFFAIRS

Woodrow WilsonCourtesy of The Pragmatic Capitalist

As I ponder the implications of the Fed’s printing press and the potentially disastrous bank run rally I question the actions taken by our Central Bank.  Reader Finn posted some excellent quotes the other day.  Fortunately for the reader these quotes/thoughts are from men far more intelligent than I.  To say that these comments have withstood the test of time is a great understatement:

“We have come to be one of the worst ruled, one of the most completely controlled governments in the civilized world – no longer a government of free opinion, no longer a government by a vole of the majority, but a government by the opinion and duress of a small group of dominant men.

“Some of the biggest men in the United States, in the field of commerce and manufacture, are afraid of something. They know that there is a power so organized, so subtle, so watchful, so interlocked, so complete, so pervasive, that they had better not speak above their breath when they speak in condemnation of it”
- Woodrow Wilson

“These international bankers and Rockefeller-Standard Oil interests control the majority of newspaper and the columns of these papers to club into submission or drive out of public office officials who refuse to do the bidding of the powerful corrupt cliques which compose the invisible government.”
Abraham Lincohn-Theodore Roosevelt

“I have two great enemies, the Southern Army front of me and the financial institution in the rear. Of the two, the one in my rear is my greatest foe.”
-Abraham Lincoln

“Gentlemen, I have had men watching you for a long time and I am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter, I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves.”
– Andrew


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Zero Hedge

Toshiba Shareholders Vote To Oust Chairman In Rare Blow To Management

Courtesy of ZeroHedge View original post here.

Rebukes of corporate leaders in Japan are rare, but on Friday, shareholders of Toshiba - one of Japan's most important and most well-known tech giants - voted to oust Chairman of the Board Osamu Nagayama (along with a member of the board's audit committee) after an independent investigation uncovered that the company had wrongly colluded with other insiders to try and influence last year's board selection.

The vote comes just months after Toshiba investors backed Singapore-based hedge fund Effissimo Capital Management's call for a probe into the 2020 annu...



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Phil's Favorites

The PhilStockWorld com LIVE Weekly Webinar 06-23-2021

 

For LIVE access on Wednesday afternoons, join us at PSW! 

The PhilStockWorld com LIVE Weekly Webinar 06-23-2021

 

Major Topics:
00:00:13 - Checking on the Market
00:00:33 - DJIA
00:03:16 - S&P 500 / Russell 2000
00:04:43 - Bitcoin 
00:08:21 - Natural Gas / Energy
00:11:25 - Gasoline / Crude Oil
00:12:34 - EIA Report
00:18:44 - Inflation
00:24:28 - Natural Gas
00:28:26 - Lumber
00:29:38 - Sugar
00:30:16 - Orange Juice
00:31:36 - Cotton
00:31:54 - USD / Orange Juice
00:34:08 - Coffee...



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Biotech/COVID-19

The FDA's weak drug manufacturing oversight is a potentially deadly problem

 

The FDA’s weak drug manufacturing oversight is a potentially deadly problem

Though drug recalls are relatively uncommon in the U.S., reduced inspections increase the likelihood of manufacturing errors that slip through the cracks. AP Photo/Rafiq Maqbool

Courtesy of Adrian V. Hernandez, University of Connecticut and C. Michael White, University of Connecticut

The ...



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Digital Currencies

Will Bitcoin Crash the Stock Market?

 

Will Bitcoin Crash the Stock Market?

Courtesy of 

When the S&P 500 fell in March last year, it brought Bitcoin down with it. So if stocks can bring down Bitcoin, it’s reasonable to ask if Bitcoin can bring down stocks.*

If you thought the Bitcoin run-up to 60k was emblematic of investor** euphoria, then you probably wondered what would happen if it were to come crashing down. Would that take other high-flying areas of the market down with it?

It might be premature, but as of now, the answer is no.

...



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Chart School

RTT Plus Bulletin

Courtesy of Read the Ticker

RTT Plus private blog answer these questions over the last two weeks.

Ending: 2021-06-19

- Metal stocks very bullish after gold smash
- FED taper talk vs Basel 3
- Dollar devaluatioin before end of 2021
- COVID, Vaccine insight (off topic)
- The next play for the deep sate (off topic)
- The debt loaded USA can not break these economic stats


RTT Plus membership required to review.

RTT Plus members can include chart building services if you wish. If you you do not want chart building services select 'RTT Plus' only during the membership sign up process.

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Politics

The Ukraine Fallacies (with Victor Rud)

 

The Ukraine Fallacies (with Victor Rud)

Americans are confused about the history of Ukraine. That's just how Russia wants it.

Courtesy of Greg Olear, at PREVAIL

Greg is the author of Dirty Rubles: An Introduction to Trump/Russia 

...

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Promotions

Live Webinar with Phil on Option Strategies

 

June is TD Bank's Option Education Month, and today (Thursday, June 10) at 1 pm EST, Phil will speak with host Bryan Rogers about selling options and various option strategies that we use here at Phil's Stock World. Don't miss this event!

Click here to register for TD's live webinar with Phil.

 

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Kimble Charting Solutions

Crude Oil Cleared For Blast Off On This Dual Breakout?

Courtesy of Chris Kimble

Is Crude Oil about to blast off and hit much higher prices? It might be worth being aware of what could be taking place this month in this important commodity!

Crude Oil has created lower highs over the past 13-years, since peaking back in 2008, along line (1).

It created a “Double Top at (2), then it proceeded to decline more than 60% in four months.

The countertrend rally in Crude Oil has it attempting to break above its 13-year falling resistance as well as its double top at (3).

A successful breakout at (3) would suggest Crude Oil is about to mo...



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ValueWalk

Managing Investments As A Charity Or Nonprofit

By Anna Peel. Originally published at ValueWalk.

Maintaining financial viability is a constant challenge for charities and nonprofit organizations.

Q4 2020 hedge fund letters, conferences and more

The past year has underscored that challenge. The pandemic has not just affected investment returns – it’s also had serious implications for charitable activities and the ability to fundraise. For some organizations, it’s even raised doubts about whether they can continue to operate.

Finding ways to generate long-term, sustainable returns for ...



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Mapping The Market

Suez Canal: Critical Waterway Comes to a Halt

 

Suez Canal: Critical Waterway Comes to a Halt

Courtesy of Marcus Lu, Visual Capitalist

The Suez Canal: A Critical Waterway Comes to a Halt

On March 23, 2021, a massive ship named Ever Given became lodged in the Suez Canal, completely blocking traffic in both directions. According to the Suez Canal Authority, the 1,312 foot long (400 m) container ship ran aground during a sandstorm that caused low visibility, impacting the ship’s navigation. The vessel is owned by Taiwanese shipping firm, Evergreen Marine.

With over 2...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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