Dow Closes Strong – Higher Highs or Lower Lows?
The Dow Closed above 16660 and this now opens the door for a rally to test the 17000 level reaching a high perhaps on Thursday. We need the see a closing ABOVE at least 17010 to imply that the test of the Weekly Bearish Reversal that held at 15960 may hold. The major support lies in the 14000-15000 zone regardless of the timing. In any event, the computer at least picked the day of the low with good precision.
Now we have been looking at the week of 10/27 in many markets and the week of 11/03. It appears that exceeding this past week’s high may produce the intraday high this coming week. However, we have a Directional Change and a return to high volatility starting the week of 11/03. Therefore, that week may simply be a return of a correction rather than the low.
Here is one of the older charts published. Note the point at which the Breakout to the upside would begin. This now become the support at the max on the downside.
The market is still dancing and getting ready for a major move. The Bond Bubble is the danger and when the bonds go first – that is when capital shifts wildly to the private sector. This is where we could see the Dow rise dramatically still doubling again going into 2017-2018 if Hillary does not confiscate all wealth and hand it to Washington – except her own of course.
Hillary – Says Business does NOT Create Jobs – Washington Does?
We have a very serious problem with Hillary. I was asked years ago to review Hillary’s Commodity Trading to explain what went on. Effectively, they did trades and simply put winners in her account and the losers in her lawyer’s. This way she gets money that is laundered through the markets – something that would get her 25 years today.
People forget, but Hillary was really President – not Bill. Just 4 days after taking office, Hillary was given the authority to start a task force for healthcare reform. The problem was, her vision was unbelievable. The costs upon business were oppressive so much so that not even the Democrats could support her. When asked how was a small business mom and pop going to pay for healthcare she said if they could not afford it they should not be in business. From that moment on, my respect for her collapsed. She revealed herself as a real Marxist.
Now, that she can taste the power of Washington, and I dare say she will not be a yes person as Obama and Bush seem to be, therein lies the real danger. Giving her the power of dictator, which is the power of executive orders, I think I have to leave the USA just to be safe.
Hillary has stated when she ran the White House before regarding her idea of healthcare, “We can’t afford to have that money go to the private sector. The money has to go to the federal government because the federal government will spend that money better than the private sector will spend it.” When has that ever happened?
Hillary believes in government at the expense of the people. I do not say this lightly, because here she goes again. She just appeared at a Boston rally for Democrat gubernatorial candidate Martha Coakley on Friday. She was off the hook and amazingly told the crowd gathered at the Park Plaza Hotel not to listen to anybody who says that “businesses create jobs.”
“Don’t let anybody tell you it’s corporations and businesses create jobs,”Clinton said.
“You know that old theory, ‘trickle-down economics,’” she continued. “That has been tried, that has failed. It has failed rather spectacularly.”
“You know, one of the things my husband says when people say ‘Well, what did you bring to Washington,’ he said, ‘Well, I brought arithmetic,’”Hillary said.
I wrote an OpEd for the Wall Street Journal on Clinton’s Balance Budget. It was smoke and mirrors. Long-term interest rates were sharply higher than short-term. Clinton shifted the national debt to save interest expenditures. He also inherited a up-cycle in the economy that always produces more taxes.
Yet she sees no problem with the math of perpetually borrowing. Perhaps she would get to the point of being unable to sell debt and just confiscate all wealth since government knows better. Their job on keeping Ebola out is just fantastic so far? Just a few people popping up here and there. Maybe everyone from New York should get a free weekend to visit Washington.
Politicians Gone Wildly Insane – Taxing 50 cents to Transer 1 Gigabyte on Internet
Politicians are just insane and Hungary illustrates how desperate governments can get. They are proposing to impose a new tax on Internet data transfers in the 2015 tax bill that was just submitted to parliament. This amazingly stupid move could devastate the Internet and telecoms providers as well.
The draft tax code actually proposes a provision for Internet providers to pay a tax of 150 forints (about 50 cents) per gigabyte of data traffic. Forget about the tax level for a minute and just figure out how in hell will they enforce it?
These people cannot grasp that they are the problem and taxing the people to line their pockets is not going to fly much longer. When the economy turns down hard, that is when the civil unrest will rise in strength. This is what we get when politicians are so disconnected from reality.
Looks like Hungarian bonds will become a GIANT short position.
Something Is Dangerously Wrong at the New York Fed
In a speech this week, New York Federal Reserve Board President William Dudley addressed pervasive misconduct within the financial industry, refusing to dismissively lay the blame on a few bad apples. “The problems originate from the culture of the firms, and this culture is largely shaped by the firms’ leadership,” Dudley said.
He offered some interesting suggestions on industry compensation practices, but his main message was a warning: If nothing changed, regulators would have to conclude that large
financial institutions are too big to manage, and “that your firms need to be dramatically downsized and simplified so they can be managed effectively.”
Related: Are Regulators About to Let Another Bank Get Too
Big to Fail?
financial institutions are too big to manage, and “that your firms need to be dramatically downsized and simplified so they can be managed effectively.”
Related: Are Regulators About to Let Another Bank Get Too
Big to Fail?
These were notable words from someone in the actual position to undertake a big bank breakup. But Dudley added a little caveat, as typical for such speeches: “What I have to say today reflects my own views and not necessarily those of the Federal Reserve System.” He would have to say that, because the organization he runs hasn’t practiced what he preached.
In recent weeks, multiple allegations show that the New York Fed, the largest and most important of the regional Federal Reserve banks, would rather allow financial institutions to
conduct their business unencumbered than break them up. Last month, former employee Carmen Segarra released secretly recorded tapes to public radio’s This American Life, showing that the New York Fed worked diligently to avoid confrontation with Goldman
Sachs over the investment bank’s admittedly “shady” practices.
This week, more embarrassment arrived in a Federal Reserve Inspector General’s report.
The report concerns the disastrous “London Whale” trade, carried out in 2012 by the Chief Investment Office of JPMorgan Chase, which lost the bank over $6 billion. The Inspector General surveyed the years leading up to the trade, and while the public was only treated to a summary rather than the full report, it contains enough information to present the failure of the New York Fed’s bank supervision practices.
Employees at the New York Fed identified risks at the Chief Investment Office as far back as 2008. They planned multiple examinations of the unit’s proprietary trading activities (which have since been limited by the Dodd-Frank Act’s Volcker rule).
In recent weeks, multiple allegations show that the New York Fed, the largest and most important of the regional Federal Reserve banks, would rather allow financial institutions to
conduct their business unencumbered than break them up. Last month, former employee Carmen Segarra released secretly recorded tapes to public radio’s This American Life, showing that the New York Fed worked diligently to avoid confrontation with Goldman
Sachs over the investment bank’s admittedly “shady” practices.
This week, more embarrassment arrived in a Federal Reserve Inspector General’s report.
The report concerns the disastrous “London Whale” trade, carried out in 2012 by the Chief Investment Office of JPMorgan Chase, which lost the bank over $6 billion. The Inspector General surveyed the years leading up to the trade, and while the public was only treated to a summary rather than the full report, it contains enough information to present the failure of the New York Fed’s bank supervision practices.
Employees at the New York Fed identified risks at the Chief Investment Office as far back as 2008. They planned multiple examinations of the unit’s proprietary trading activities (which have since been limited by the Dodd-Frank Act’s Volcker rule).
And a separate Federal Reserve team similarly recommended a “full-scope investigation” of the CIO in 2009. But the New York Fed never actually performed the examinations, nor did officials there coordinate with their colleagues at the Office of the Comptroller of the Currency to investigate. Worse, they blamed this partially on a reorganization of supervisors at JPMorgan, which “resulted in a significant loss of institutional knowledge regarding the CIO.”
Related: Wall Street Is Betting Big on Cory Booker
Related: Wall Street Is Betting Big on Cory Booker
We don’t know what the New York Fed might have found at the CIO, and whether it might have prevented the London Whale trade. But you can’t find anything if you don’t look. And a deeper probe may have revealed the control failures at JPMorgan, where executives remained ignorant of the risks being taken at subsidiary offices.
This is eerily similar to the mindset from top officials on the Carmen Segarra tapes. The New York Fed seems to define “supervision” as writing a stern letter, or bringing up issues in a meeting with bank executives, without follow-through. Lower-level employees who uncover potential problems at the supervised institutions get countermanded somehow, and no real oversight develops. And if someone leaves the supervision unit, any knowledge they had about the inner workings of the bank goes with them.
This is eerily similar to the mindset from top officials on the Carmen Segarra tapes. The New York Fed seems to define “supervision” as writing a stern letter, or bringing up issues in a meeting with bank executives, without follow-through. Lower-level employees who uncover potential problems at the supervised institutions get countermanded somehow, and no real oversight develops. And if someone leaves the supervision unit, any knowledge they had about the inner workings of the bank goes with them.
In the This American Life tapes, the discussion between Carmen Segarra and her boss Mike Silva over Goldman Sachs’ conflict of interest policy best reflects this tension. Not only does Silva alter his stated position on whether Goldman has a conflict of interest policy, he demands that Segarra change her view as well. “Why can’t we just say they have bits and pieces of a policy,” Silva asks Segarra, “but they have to dramatically
improve it?” It’s pretty clear that someone told Silva to back off, and remove all traces of questioning Goldman on this issue.
When Segarra refused, she was fired.
improve it?” It’s pretty clear that someone told Silva to back off, and remove all traces of questioning Goldman on this issue.
When Segarra refused, she was fired.
We don’t know who forced Silva’s hand, or why. But it fits the pattern of how initial supervision questions at the line level vanish into the ether at the New York Fed. We don’t know who gave the order to prevent further investigation into JPMorgan’s investments, either. And that speaks to the persistent problem of how the opaque institution is structured.
A Troubling Lack of Transparency
A Troubling Lack of Transparency
The Federal Reserve Board of Governors is a public institution, which writes banking rules and enacts monetary policy. But the 12 regional banks, which carry out regulatory
examinations, are privately run. The local banking industry and other corporate interests choose the majority of the regional bank boards, who subsequently select a president. Unsurprisingly, those presidents often reflect the business management perspective of those who choose them. Bill Dudley, the New York Fed president, spent his career as chief economist for Goldman Sachs.
examinations, are privately run. The local banking industry and other corporate interests choose the majority of the regional bank boards, who subsequently select a president. Unsurprisingly, those presidents often reflect the business management perspective of those who choose them. Bill Dudley, the New York Fed president, spent his career as chief economist for Goldman Sachs.
This public/private hybrid leads to a lack of transparency about the regional banks and their activities. The New York Fed, which because of the presence of Wall Street has by far the most power of the regional banks, routinely exempts itself from public
disclosure requirements. During the AIG trial going on in Washington, the New York Fed has refused to reveal to opposing counsel the so-called “Doomsday Book,” a blueprint that lays out the emergency powers and legal boundaries for how to deal with financial crises. Even the Inspector General report on the London Whale was abridged.
disclosure requirements. During the AIG trial going on in Washington, the New York Fed has refused to reveal to opposing counsel the so-called “Doomsday Book,” a blueprint that lays out the emergency powers and legal boundaries for how to deal with financial crises. Even the Inspector General report on the London Whale was abridged.
Related: CFPB Hits a Bad Bank Where It Hurts
Some secrecy may be expected at a government institution, but not necessarily for one that seems controlled by Wall Street, for the benefit of Wall Street. This allows top executives and their staff to manage the affairs of the New York Fed without
challenge, even when they violate the spirit of their bank supervisory mission.
challenge, even when they violate the spirit of their bank supervisory mission.
In response to the Segarra tapes, Sens. Elizabeth Warren (D-MA) and Sherrod Brown (D-OH) called for Banking Committee hearings and an investigation into the New York Fed, and House Democrats have made formal requests as well. So far, committee chairs have given no final word, according to Senate sources. The White House has said nothing. Now, Americans for Financial Reform (AFR), the umbrella organization of progressive and labor groups on this issue, has gotten involved in demanding hearings. It’s a problem when the “key on-the-ground supervisor for Wall Street banks,” as AFR puts it, cannot be trusted to carry out its functions.
Perhaps a bigger question is: Who is protecting the New York Fed, in the same way that they’ve protected Wall Street through their unwillingness to act? Why shouldn’t they have to answer for their lapses in supervising the same banks that helped generate
the financial crisis?
the financial crisis?
Captured regulatory institutions make the entire financial system more unstable. Regardless of Bill Dudley’s big talk, there’s something wrong at the heart of the New York Fed, and we need to expose it.
Source (The Fiscal Times)
Why Goldman Sachs & Blackstone Are Becoming So Hated in Europe
Goldman Sachs and Blackstone are private equity investors buying up rental property in Madrid. About 13,000 household were told their rents would not increase. Now in a down market, when their renewals come due. they are told their rents will rise sharply or get out. Now a judge will decide who, if anyone, is to blame. Any tenants evicted can reapply for social housing but this whole thing is turning into a very bad image for New York. There are somethings you just do not do and throwing people out on the street is on the top of the list. If you want to have the masses hanging bankers as they did on the real Black Friday in 1869, this is one way to do it. Some 13,000 households are already on the waiting list for flats owned by Madrid city council according to Reuters.
The Growing Concern of Home-Grown Terrorits
They are saying that the attack in Canada was because it was supporting the USA is sending troops to fight against ISIS. Canada did pass a bill to launch combat mission against ISIS 157-134 in House of Commons. The European powers are very much afraid to do so because of domestic high Muslim populations. What took place in Canada does illustrate the risks of a religious war. Japanese pilots would crash their planes into ships because they believed the Emperor was the virtual son of God on Earth. What someone believes if paramount.