Posts Tagged ‘information’

SUPREME COURT RULES FED MUST RELEASE ALL BAILOUT DATA

Courtesy of The Daily Bail

Video – The Fed has 5 days to release all data.

March 21 (Bloomberg) — The Federal Reserve must disclose details of emergency loans it made to banks in 2008, after the U.S. Supreme Court rejected an industry appeal that aimed to shield the records from public view.  The justices today left intact a court order that gives the Fed five days to release the records, sought by Bloomberg.

A huge win for transparency.

Statement from Matthew Winkler, editor in chief of Bloomberg News:

As a financial crisis developed in 2007, "The Federal Reserve forgot that it is the central bank for the people of the United States and not a private academy where decisions of great importance may be withheld from public scrutiny.  The Fed must be accountable to Congress, especially in disclosing what it does with the people’s money."

“The board will fully comply with the court’s decision and is preparing to make the information available,” said David Skidmore, a spokesman for the Fed.

The order marks the first time a court has forced the Fed to reveal the names of banks that borrowed from its oldest lending program, the 98-year-old discount window. The disclosures, together with details of six bailout programs released by the central bank in December under a congressional mandate, would give taxpayers insight into the Fed’s unprecedented $3.5 trillion effort to stem the 2008 financial panic.

“I can’t recall that the Fed was ever sued and forced to release information” in its 98-year history, said Allan H. Meltzer, the author of three books on the U.S central bank and a professor at Carnegie Mellon University in Pittsburgh.

Continue reading at Bloomberg… 


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Wily Wyly’s

Wily Wyly’s

Courtesy of Cassandra Does Tokyo 

Phineas Taylor Barnum (1810-1891) American showman; co-founder of Barnum and Bailey circus. Edward Linley Sambourne cartoon from Punch London 1884 in the Fancy Portraits series showing Barnum as a wily fox exploiting people's phrenological bump of Credulity. At this time Gall and Spurzheim's idea that physical formation of skull was related to mental capacity, Engraving

I used to smile sophmorically at the sight of a Dentist named Dr Fang, or a Plastic Surgery clinic named Dr Tuck, just as I have long-chuckled at the sight of the The Wyly Brothers moniker in print. Monday morning quarterbacking is always easy, but I can tell you that there was always something fishy about the way their stocks traded (both Sterling Software and Sterling Commerce) – and now, of course, we know why.

Wealthy self-made Texans (however grey their machinations), it seems, are inherently disdainful of regulation and authority, and a sucker for low-hanging fruit irrespective of prevailing law. But rather than being "men" about it (so to speak), and simply taking their operation private at an early stage, or checking out and becoming a citizen of Belize (like Tory Chair Michael Ashcroft or paper-cup scion Kenneth Dart) or creating their own island state with its own zero-tax and regulatory regime (like the Berkley Brothers),  the Wyly’s chose to speaketh in forked tongues, milking the system for its benefits, while systematically gaming it in reasonably cynical fashion. Even sadder, they authored a now-dubious book about their formula success – one which undoubtedly excluded a few ignoble "trucs de chef". The Wyly’s, it would seem, expected nothing more than proverbially "having their cake whilst eating it too" versus paying more than their share of tax, forgoing illegal trading gains, or limiting their presence in their beloved fire-ant state to 180 days per calendar year. 

There are lessons for the contrarian here, and ammunition for those trying to explain the price momentum phenomena: The Wyly brothers were not alone. I do not mean "alone" in the sense of being in the company of Mr Waksal or Mrs Stewart. Rather, I mean that their entourage, like the Remoras (or sucker fish) feeding upon their hosts errr umm crumbs, was omnipresent in riding the coat-tails of each abuse of material non-public information.  Indeed, the daisy-chain is unlikely to have stopped there. Humans DO learn quickly where the fish are hiding, and all manner of observant executing trader, back-office clerk, and/or personal assistant, will surely have suspected  the cause and effect of winning trades. Beyond that, information is power, and is often used to curry favor for those looking to reward or impress.

In short, it is a picture-postcard of inside information…
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Goldman’s Prop Trading and Reputational Risk

If you haven’t seen Larry Doyle’s website, Sense on Cents, it’s worth a visit and bookmark. Larry has over 20 years of experience on Wall Street, from trading mortgage-backed securities to serving as National Sales Manager for Securitized Products at JP Morgan Chase. Through his writing and radio program, Larry hopes to help his audience better understand the complexities of the economy, global finance and the markets.  

Larry’s internet radio show, Sense on Cents with Larry Doyle, is on "No Quarter Radio" every Sunday night from 8-9PM. There are links here to previous interviews by Larry with Michael Panzner, and Steve Megremis, founder of The Daily Bail, and many others. - Ilene 

Goldman’s Prop Trading and Reputational Risk

Courtesy of Larry Doyle at Sense on Cents

China Celebrates New Year

On Wall Street, information is everything.

Timely access to information as to who is buying/selling what, how much they are buying/selling, and why they are buying/selling is absolutely invaluable. The Wall Street banks fight tooth and nail to protect their information franchises.

That said, there are supposed to be rules as to how information is handled and processed so that trading complies with the rules of the road. Banks are not supposed to front run clients. Banks are not supposed to give up client names. Do the banks practice what the regulators preach?  

Given the fact that Wall Street banks run both customer operations and proprietary desks, there are supposed to be Chinese walls in place to make sure that information is handled properly between desks. At the firms where I worked, the proprietary desks were either on a different floor from the customer desk or in an entirely different building.

Thank you to a friend of Sense on Cents for sharing a recently released report which would seem to indicate that the Chinese walls at Goldman Sachs would appear to be neither tall nor long (said in jest), but virtually non-existent.

Asset-Backed Alert, a Wall Street trade publication, reports:

Data-Sharing Worries Grip Goldman Clients
Investors are accusing Goldman Sachs of violating Wall Street code by permitting information-sharing between two types of collateralized debt obligation traders: those who work on behalf of clients and those who handle proprietary capital.

Goldman currently has the two desks situated next to each other in its Lower Manhattan headquarters. They also have a common supervisor, managing director Jerry Ouderkirk. Such a lack of separation is


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WSJ: Galleon and the Trouble With Insider Trading

WSJ: Galleon and the Trouble With Insider Trading

Courtesy of Andy Kessler

Wsj_logo
It happened almost every earnings season. Our hedge fund would own a million shares in some company and two weeks before it was to report quarterly earnings, its stock would start dropping. There was no news to explain it. We were in the dark, even though it was my job to know. Inevitably, the company would report a disappointing quarter, missing Wall Street’s earnings expectations by a penny or two. Someone knew. A salesman’s brother-in-law heard a few deals didn’t close. Or maybe an insider was singing.

The recent arrest of Galleon Group hedge fund’s Raj Rajaratnam on insider trading charges puts a spotlight on this game. Is trading on industry knowledge widespread? Absolutely. That’s how many hedge funds and mutual funds get an edge. Is insider trading also widespread? Only the Securities and Exchange Committee’s wire-tappers know for sure.

It’s a short walk from running an information network to being an insider.

Stock markets trade on information. Millions of people generate billions of trades every day. Each trade contains a tiny piece of information built into it. ("I think Apple is killing Nokia" or "I think GM is toast.") Eventually we are proved right or wrong, and we make money or we don’t. In the long run, the market is always right. On any given day, your guess is as good as mine.

As long there have been markets, there have been those who have tried to get an edge. Whoever could get the first news from a battlefield, of an oil discovery, or figure out that a company’s earnings were better than anyone expected could reap almost instant profits. Edward Calahan invented the stock ticker (later improved by Thomas Edison and Alfred Vail) just so J.P. Morgan could sit in midtown and get stock quotes from the New York Stock Exchange faster than anyone else. Everyone else had to wait for the Dow Jones Customers’ Afternoon Letter with closing prices.

Now it has come to the point where firms are spending millions and putting wicked fast computer servers next to exchanges so they can have an edge and, through a system of high-speed or "flash" trading, figure out which way individual stocks or the markets are heading before anyone else.

Can individual


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HOW THE GOVERNMENT RUN RALLY MORPHED INTO THE BANK RUN RALLY

HOW THE GOVERNMENT RUN RALLY MORPHED INTO THE BANK RUN RALLY

Courtesy of The Pragmatic Capitalist

In early March I turned quite bullish for the first time in 2009.  My reasoning behind the bullishness was relatively simple.  The market had overshot the mean to the downside and psychology was far too negative.  This created a market that was like a loaded spring.  All it needed was a catalyst.  That catalyst came in the form of the M2M rumors.   In other words, the government was going to directly intervene in the market and stop the bleeding.  What resulted over the ensuing months was even larger than I ever could have expected.

At the end of March I began referring to the rally as the “government run rally”.   Although the actual underlying fundamentals were not improving, the government had created a series of events and catalysts that forced the shorts out of positions and changed the psychology of the market:

spxrall HOW THE GOVERNMENT RUN RALLY MORPHED INTO THE BANK RUN RALLY

The last of these well crafted maneuvers were the capital raises and the stress tests.   This series of events created a foundation for a market bottom and helped form the most important portion of the current rally in stocks.   It would sound conspiratorial if it weren’t entirely true.  What has ensued since has confounded even the most veteran of traders.  The market has continued higher in a nearly straight line.

recession's historyThere is no doubt that the economy has rebounded sharply from the days of ISM 35 and GDP -6%.  The overshoot to the downside was extreme to say the least, but what is less clear is why the market has rallied an astounding 60% off its bottom and effectively priced in 20%+ earnings growth and 4% GDP going forward when the real underlying problems that caused this entire mess are still apparent.  We have simply implemented the failed Bank of Japan policies of the 90’s combined with the failed bank policies of Maestro Greenspan – crank up the printing press, turn on the liquidity spigot, implement quantitative easing and let the banks earn their way out of their problems.   It sounds great in theory, but Greenspan’s policies failed miserably as did the Bank of Japan’s.  Neither approach proactively attacked the root of the problems.  The results speak for themselves.

Mr. Bernanke has declared an end to the recession, but we continue to…
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Phil's Favorites

Trump gets no special protections because he's president and must release financial records, Supreme Court rules

 

Trump gets no special protections because he's president and must release financial records, Supreme Court rules

Investigators are trying to follow the president’s money, and the Supreme Court just gave them the green light. Alex Wong/Getty Images

Courtesy of Stanley M. Brand, Pennsylvania State University

In a 7-2 decision, the Supreme Court has ruled that President Donald Trump has no immunity, by virtue of being presiden...



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ValueWalk

Second Coronavirus stimulus: how it could affect student loans

By Aman Jain. Originally published at ValueWalk.

The second coronavirus stimulus is largely expected to come sometime later this month. The main talking points so far are stimulus checks and unemployment benefits. Though not much talked about, there is one more segment that lawmakers could focus on with the next coronavirus stimulus, and that is student loans.

Q2 2020 hedge fund letters, conferences and more

How next coronavirus stimulus affects student loans?

The CARES Act, which was passed in ...



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Zero Hedge

Supreme Court Rules Trump Tax Returns Must Be Released To NY Grand Jury

Courtesy of ZeroHedge View original post here.

The Supreme Court on Thursday ruled that a New York Grand Jury can have President Trump's tax records, after Manhattan prosecutor Cy Vance subpoenaed eight years of returns in connection with an investigation into hush money payments made to porn star Stormy Daniels, according to Axios.

The court has yet to rule on whether House Democrats can have access to the records, after the lawmakers issued subpoenas to Deutsche Bank, Capital One, and the president's longtime accounting fi...



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Kimble Charting Solutions

Tech Experiencing A 20-Year Breakout, While Small Caps Are Near 20-Year Lows!

Courtesy of Chris Kimble

Successful investors are often rewarded by owning strength and avoiding weakness.

Could two key sectors be experiencing 20-year strength and weakness extremes at the same time? Yes!

The NDX 100/S&P ratio (left above) is currently experiencing a 20-year breakout at (1).

At the same time, the Russell 2000/S&P ratio is near 20-year lows at (2).

This 2-pack reflects that the place to be at this time continues to be Tech...



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Biotech/COVID-19

5 COVID-19 myths politicians have repeated that just aren't true

 

5 COVID-19 myths politicians have repeated that just aren't true

The purveyors of these myths aren’t doing the country any favors. Brendan Smialowski/AFP/Getty Images

Courtesy of Geoffrey Joyce, University of Southern California

The number of new COVID-19 cases in the U.S. has jumped to around 50,000 a day, and the virus has killed more than 130,000 Americans. Yet, I still hear myths about the infection that has created the worst public health crisis in A...



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The Technical Traders

Credit/Investments Turned Into End-User Risk Again

Courtesy of Technical Traders

Continuing our research from Part I, into what to expect in Q2 and Q3 of 2020, we’ll start by discussing our Adaptive Dynamic Learning predictive modeling system and our belief that the US stock market is rallied beyond proper expectation levels.  The Adaptive Dynamic Learning (ADL) modeling systems attempts to identify price and technical indicator DNA markers and attempts to map our these...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Saturday, 14 March 2020, 05:51:16 PM

Click for popup. Clear your browser cache if image is not showing.


Comment: Crash in perspective - its Bad, and not over!



Date Found: Saturday, 14 March 2020, 07:49:29 PM

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Comment: The Blood Bath Has Begun youtu.be/bmC8k1qmM0s



Date Found:...

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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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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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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

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Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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