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- All the ASE info one could ever want?
- Bloomberg article: Hiding Gold in All the Unusual Places
- Venezuela Sets Timetable For Gold Repatriation
- Gold/Silver Ratio Suggests Silver Buying Opportunity
- Silver Flirts With Buy Stop Zone
- WATCH: Philipp Vorndran – “Gold Is The Final Money”
- Top 10 Most Profitable Energy Stocks
- Trading Apple Going Into The iPhone 4S Release Date
- Employment Report Triggers Confusion, Masks Weakness
- Jobs Numbers Look Good Amid Depressed Expectations
- Gold and silver, unlike paper money, never die
- Market Developments This Week Very Gold Bullish; Bears Focus on Price, Not Value
- Gold producers adding to their hedges
- Economic Apocalypse Goes Mainstream: Meltdown In Two To Three Weeks; It Will Spread Everywhere
- History Channel program cites GATA in examining Fort Knox gold mystery
- SRSrocco's Report: Silver Update
- Venezuela says gold repatriation will start in November
- Links 10/7/11
- Gold prices spurred higher by more QE
- Bank Failures Moving Gold, This is Contagion: John Hathaway
- Hiding Gold in All the Unusual Places
- Vietnam lets banks restart offshore gold trading-media
- Venezuelan gold repatriation to start in month-and-a-half: central bank
- Gold’s Still A Great Investment, Says Frank Holmes–The Price Will Double
- Gold & Silver Market Morning, October 7, 2011
- WATCH: Is There Really Gold At Fort Knox?
- Why #OccupyWallStreet Doesn’t Support Obama: His “Nothing to See Here” Stance on Bank Looting
- LISTEN: A Discussion with Axel Merk
- BrotherJohnF: Silver Update – “Buy The Dips”
- Casey Research Summit Special Report: Surviving the Death of Money
| All the ASE info one could ever want? Posted: 07 Oct 2011 05:20 AM PDT |
| Bloomberg article: Hiding Gold in All the Unusual Places Posted: 07 Oct 2011 05:10 AM PDT Hiding Gold in All the Unusual Places By Ben Steverman - Oct 6, 2011 If you're looking for a safe place to put your investments, Chad Venzke has a suggestion: Dig a hole in the ground four feet deep, pack gold and silver in a piece of plastic PVC pipe, seal it, and bury it. The 30-year-old central Wisconsin resident trusts no one but himself to store and protect his gold and silver—not banks, not investment funds, and certainly not the government. It's precisely because of this suspicion of institutions that he invests in those metals to begin with. In case of emergency, "you always want to have your precious metals within arms reach," he says. Venzke is hardly the only investor who wants his precious metals nearby at all times. A pound of gold worth about $24,000 can easily fit in a pocket; how to protect it is a decision that carries expensive consequences. Do-it-yourself investors who don't trust banks must find creative storage options, whether burying gold in the yard, submerging it in a koi pond, stashing it behind air-conditioning ducts, or placing it under carpets. All these options are debated in online gold and silver investor forums. They're also debated and demonstrated in youtube videos, including one by Venzke that has been viewed more than 7,000 times. MOUNTING HOARDS While there's no way of knowing how many investors take Venzke's advice, there are growing piles of precious metals in, under, or near American homes. From mid-2010 to mid-2011, U.S. investors bought up more than 100 tonnes of physical gold coins and bars, up from 15.2 tonnes in 2007, according to the World Gold Council. (A tonne, or metric ton, is 1,000 kilograms.) Worldwide bar and coin demand rose 37 percent during the mid-2010 to mid-2011 period, according to the Council, even as demand from exchange-traded funds backed by physical gold, and similar products, fell 84 percent. The notion of keeping one's gold in a safety deposit box—inside the banks many gold aficionados find so untrustworthy—is anathema to many gold bugs. Venzke, who predicts "runaway inflation" and a crisis leading to a "new form of currency within this decade," worries that the boxes won't be accessible if banks shut down in a crisis. "How are you supposed to get your stuff out of there?" he asks. For those storing gold and silver in or around their home, the most immediate danger isn't a crisis or a dip in metal prices. It's theft. The FBI, which tallies the theft of precious metals and jewelry in one category, says $1.6 billion was stolen in 2010, up 51 percent from 2005. Just 4.2 percent of the lost loot was recovered last year. Metal detectors are a big worry. Basic detectors can find metal on the surface or in the first 12 inches to 14 inches below ground, depending on soil conditions, says Louis Mahnken Jr., a sales representative for Kellyco Metal Detectors in Winter Springs, Fla. That's why Venzke advises burying it at least four feet deep. There are online debates about the best way to frustrate such thieves, including using scrap metal as decoys or hiding metal by covering it underground with asbestos or mirrors. DOORSTOPS, BOAT ANCHORS Metal owners also use the "hiding in plain sight" maneuver. According to dealers, some customers buy 100-oz. silver bars, paint them black, and use them as doorstops. That's foolish, says Steven Ellsworth, a coin dealer in Clifton, Va., who teaches security classes for the American Numismatic Assn. Ellsworth is a believer in keeping precious metals in bank safety deposit boxes, as well as having high security at home. "My wife sometimes thinks we're over-secured and calls our residence 'the compound,'" says Ellsworth, a retired Army colonel. His security measures include fences, alarms, cameras, and dogs. Safes can certainly deter thieves. Yet an inexpensive fire safe may be exactly the wrong place to put your valuables. Richard Krasilovsky, president of Empire Safe, calls such safes "handy carrying cases for burglars." A fire safe is designed to protect papers from fire, not from intruders, says Ryan Smith, a senior product manager at SentrySafe. "It wouldn't be wise to put any more than $20,000 of valuables in our products," he says. Krasilovsky, whose company makes high-end safes, says safes must be very strong and very heavy—a recent sale was of a $10,000 safe that weighed 4,000 pounds. A proper safe starts at $2,000 and could cost as much as $40,000, he says. If the safe isn't certified to resist burglars with tools for 30 minutes, a so-called "TL-30" rating, "you're buying an expensive boat anchor," says Ellsworth. Of course, whether gold is buried, put in a safe, or hidden under your bed, there's nothing to stop a determined person with a gun from making you show them where you put it. That's why it's important no one ever know you have gold in the first place. Krasilovsky's company will deliver safes in the middle of the night, installing them where no one, including a contractor, is likely to stumble across them. "People have to be extraordinarily secretive," Krasilovsky says. This secrecy keeps away not only thieves but also prying relatives and the tax man. "One of the benefits of owning precious metals is nobody knows you own it," Venzke says. "It's the most private investment you can make." Unless, of course, you feel compelled to post youtube videos sharing insights about where to stash your gold. http://www.bloomberg.com/news/print/...al-places.html |
| Venezuela Sets Timetable For Gold Repatriation Posted: 07 Oct 2011 05:06 AM PDT By Avery Goodman: Many people have been wondering what ever happened to Hugo Chavez's demand for physical delivery of all Venezuelan gold held in overseas banks. Reuters is reporting that the scheduled deliveries will start on November 5th. According to the Venezuelan government, the gold will be transported by ship. Hmmm ... It is very unlikely that small easily transported, high value items like gold, would be transported by ship in the modern age of air transport. The Venezuelan gold will surely travel by air. Most likely, it will travel somewhere in the neighborhood of November, but it won't be on the timetable released by the Venezuelan government. No one can blame Venezuela, its banks, or its insurers if they are being intentionally deceptive about this. There are surely a lot of people who would like nothing more than an opportunity to make careful plans to hijack gold in transport. According to Reuters, Complete Story » |
| Gold/Silver Ratio Suggests Silver Buying Opportunity Posted: 07 Oct 2011 04:59 AM PDT By Hard Assets Investor: Anyone who follows financial markets is well aware that the past few months have been brutal for investors. Commodities in particular were hit extremely hard during the latter half of September, falling to multimonth lows in many cases. Concern that the ongoing sovereign debt crisis in Europe and economic weakness in the United States would spread to the rest of the world was the catalyst for the downward move. Even the safe-haven vehicles gold and silver tumbled in September. Investors often flock to the pair during times of uncertainty, but as we've consistently seen, when financial conditions get particularly rough, gold and silver lose their safe-haven appeal. Yet as we wrote in our last two editions of Precious Metals Monitor, prices may have already struck bottom. And though we don't expect them to run away to the upside, now may be the time for long-term investors to accumulate positions. That Complete Story » |
| Silver Flirts With Buy Stop Zone Posted: 07 Oct 2011 04:16 AM PDT No Got Gold Report this weekend, but for a good cause. HOUSTON – How interesting that silver is apparently only a whisker away from triggering what must be a bevy of short-seller trading and trailing stops along with what is likely a similar number of buy stops from trend jumping funds. Consider the chart just below for this quick note today.
Note, please, that SLV, our proxy for silver in today's note, is consolidating roughly in line with where it met with resistance on the way up in December last year (near the $30 mark). Note also that SLV is not very far below the runaway gap lower which occurred September 23 (an important technical event). Continued… Zooming in to a shorter-term view, we have to note there should be significant opposition to SLV advancement above the $32 level. However, should SLV manage to rally up to and through, say about $32.50 and look like it means it, it ought to set off a chain reaction of the combined effect of short trailing stops and buying stops being tripped. With the open interest in the paper silver futures quite low, it could be rather explosive in fact. Our interest is piqued, to say the least.
On another note, we are taking this coming weekend "off" to prepare slides and materials for our upcoming presentations at the New Orleans Investment Conference October 26-29. We consider the "Nawlins" conference one of the true "can't miss" confabs of the year and our good friend Brien Lundin, the conference organizer, has outdone himself with this year's lineup. Glen Beck, Charles Krauthammer, Marc Faber, Peter Schiff, and Dennis Gartman are scheduled and that's just the tip of a very large expert-talent iceberg. We are looking forward to meeting and speaking with as many of you as possible at this year's 4-day event too. If interested in attending, please click on the NOIC link at right. We understand there are still a few "slots" open as of this minute, but we wouldn't count on those slots still being there long. The venue is large and plush, but we know attendance is limited to the number than can be comfortably situated in the conference hall. We do plan to update all our technical charts this weekend by the usual time, however, early Monday at the latest. We are watching silver in the context of other metals, and especially its red cousin, copper. We doubt we will have all that much of a rally in one without a corresponding rally in the other.
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| WATCH: Philipp Vorndran – “Gold Is The Final Money” Posted: 07 Oct 2011 04:04 AM PDT Philipp Vorndran, of Flossbach & von Storch, and James Turk, Director of the GoldMoney Foundation, talk about the unsustainable level of US government debt. They discuss the possible combinations of growth, taxes, austerity and inflation necessary to reduce the debt burden. Philipp explains that as long as it can print its own money, the US government will never default on its debt. The real question is how much the dollars it repays it with will be worth. They also talk about the US sovereign debt bubble, but Philipp does not expect rising interest rates, because of central bank policy, including Operation Twist. They talk about stocks. Philipp explains that dividends and cash flow has to be analysed together with risk, sustainability of earnings and risk. They also talk about the Eurozone's new bailout fund and whether it will be enough to save the euro. Philipp explains the difference between the EFSF and the ESM and the process for their approval. He explains that the size of the EFSF is enough to rescue small countries like Greece or Ireland, but too small to deal with problems in Italy or Spain. They talk about whether Greece can leave the euro. Philipp explains that there is no doubt that Greece is bankrupt. He talks of a 75% haircut on Greek debt and also expects strong opposition to austerity from Greek public opinion. He talks of the danger of bank runs in Portugal and other countries. Portugal, Greece and Ireland could still be contained and even leave the euro without destroying it. This interview was recorded on October 1st 2011 in Vienna. ~TVR |
| Top 10 Most Profitable Energy Stocks Posted: 07 Oct 2011 04:01 AM PDT By Dividendinvestr: We like energy stocks for a few reasons. They provide protection against inflation and a decline in the value of the dollar. Everybody is a consumer of energy and investors hedge their exposure by initiating positions in energy companies. If the price of oil climbs, they pay more at the pump, but they also have capital gains, which offsets the effects of high oil prices. Finally, we like energy stocks because the thirst for energy keeps growing globally, especially in the fast-growing emerging markets. We screened for the top 10 most profitable energy companies based in USA. All the companies in this list have a minimum current operating margin of 20% and EPS growth rate of 10% in the last 5 years. Alliance Holdings GP, L.P. (AHGP) is a limited partnership formed to own and control Alliance Resource Management GP, LLC, the managing general partner of Alliance Resource Partners, L.P. Complete Story » |
| Trading Apple Going Into The iPhone 4S Release Date Posted: 07 Oct 2011 03:49 AM PDT By Jared Gardner: Apple (AAPL) has been through a number of iPhone announcement and release cycles which have produced significant positive alpha compared to the S&P 500 ETF (SPY). I chose not to use the Nasdaq ETF (QQQ) due to the massive AAPL weighting that it holds. If you just want the data, I have compiled it on a spreadsheet that you can download from my site by clicking here. As shown in my previous article, Apple's stock price has followed a general pattern around the announcement of its iPhone products. Please reference my previous article for the full methodology on the analysis. As well, you can view my most recent article explaining the key strategy behind the AAPL announcement by clicking here. Put briefly, I analyzed AAPL's alpha in order to see if there were any general alpha trends related to AAPL's announcement date, both 10 trading days before as well as Complete Story » |
| Employment Report Triggers Confusion, Masks Weakness Posted: 07 Oct 2011 03:39 AM PDT By Carlos X. Alexandre:c The much awaited jobs report produced a nice number of 103,000, way above the 59,000 forecast. The summary published by MarketWatch read as follows.
The initial reaction was euphoric. In view of an implied better economic picture, the dollar dropped and the S&P futures rose. But if economically speaking rates should be higher due to economic strength, as shown by a drop in the bond market, why did the dollar drop? And the fact that 103,000 new jobs is hardly a beauty, is it being viewed as a positive or negative, from an Complete Story » |
| Jobs Numbers Look Good Amid Depressed Expectations Posted: 07 Oct 2011 03:35 AM PDT By Marc Chandler: I had thought I had gone a bit out of the limb warning of the risks of a stronger than expected report and that the stronger the report the worse the dollar would perform. Instant gratification, but with holidays in the US, Canada, and Japan on Monday, the market may not significantly extend the dollar's decline ahead of the weekend. However, short-term momentum and trend followers are probably still net short the euro, though some nimble players have reversed ship. The employment data is only good becasue expectations have been so depressed. The 103k headline increase and 137k private sector increase are not spectacular by any stretch of the imagination. The August series was revised up by 57k and the July report by 42k. The work week increased by 6 minutes and this is worth say around 350k full-time equivalent and hourly earnings rose 0.2%. The jobs and income should Complete Story » |
| Gold and silver, unlike paper money, never die Posted: 07 Oct 2011 03:00 AM PDT Moments like these can be tough. Gold is down, and silver is too. Call it a "correction," "liquidation," a "flight" - call it whatever you prefer. In short, ... |
| Market Developments This Week Very Gold Bullish; Bears Focus on Price, Not Value Posted: 07 Oct 2011 02:51 AM PDT |
| Gold producers adding to their hedges Posted: 07 Oct 2011 01:00 AM PDT Hedging transactions among gold producers have been severely reduced in the wake of gold's strong price rally over the last few years. Most companies decided to fully expose their future output to the ... |
| Economic Apocalypse Goes Mainstream: Meltdown In Two To Three Weeks; It Will Spread Everywhere Posted: 07 Oct 2011 12:54 AM PDT |
| History Channel program cites GATA in examining Fort Knox gold mystery Posted: 07 Oct 2011 12:40 AM PDT |
| SRSrocco's Report: Silver Update Posted: 06 Oct 2011 11:31 PM PDT  After the big selloff in silver over the past two weeks, the commercial net short position has dropped to levels almost as low as they were in Nov 2008 when silver was at $9.00 an ounce. The COT Report shows these figures on every Friday from positions held on the close of trading on Tuesday. There are several categories of traders, but the most important are either the Large Speculators or the Commercials. The large speculators are big hedge funds and etc. The Commercials are the bullion banks themselves. JP Morgan is famous for holding the largest percentage of Commercial shorts of all the banks. In these two main categories, there are LONG and SHORT positions. If someone is long, they want to price to head higher, if they are short they are hedging their positions or they want the price to go lower. When there is a great deal of short positions, it normally means the price will be heading lower at some point. When the total short positions are low, the opposite is true. In the graph above the term LCNS stands for subtracting the Commercial Longs from the Commercial Shorts, which gives us a Commercial Net Short Position. Here we can see that after the big selloff, the LCNS is now almost as low as it was in 2008. Now that a good percentage of the LCNS have been liquidated, a firm bottom may be taking place. Also if you notice over the past four years the LCNS line (blue color) has been above the price of silver line (Pink color)…especially when silver hit $21 in March of 2008. That trend is now firmly below the silver price line and I believe it will remain there until we finally get our COMEX SILVER DEFAULT. Silver Eagle Sales Continue to Fly off the Shelves  October turned out to be the second best sales month behind Jan. Already in the first three business days of Oct, the US Mint sold over 1 million silver eagles. This averages out to about to 330,000 silver eagles sold by the US Mint a day. If the price of silver falls from here, we could see that daily sales figure move upwards of a half a million. Even at an average of 200,000 in October, that would be over 7 million for the month. I don't believe the US Mint has this sort of capacity. So, if the price of silver continues to fall to the $26-$27 level, I would bet the US Mint will have to suspend the sale of the Silver Eagles until 2012. The United States produced 38.5 million ounces of silver in 2010, and it looks like the US Mint just might sell over 40 million silver eagles in 2011….more than the total U.S. domestic supply. Some have said that by law the US Mint must use silver mined in the United States. This is no longer true. I spoke with the Public Relations person at the US Mint a few weeks ago and he told me that in 2002, the Senate came up with a new law that allows the US Mint to purchase silver for their rounds from other sources. The authorizing legislation for the American Silver Eagle bullion program stipulated that the silver used to mint the coins be acquired from the Defense National Stockpile with the intent to deplete the stockpile's silver holdings slowly over several years. By 2002, it became apparent that the stockpile would be depleted and that further legislation would be required for the program to continue. On June 6, 2002, Senator Harry Reid (D-Nevada) introduced bill S. 2594, "Support of American Eagle Silver Bullion Program Act," "to authorize the Secretary of the Treasury to purchase silver on the open market when the silver stockpile is depleted." The bill was passed by the Senate on June 21 and by the House on June 27 and signed into law (Pub. L. No. 107-201, 116 Stat. 736) by President Bush on July 23, 2002 (source-Wikipedia) Peak Silver Article Finished & will be Released when the New SGS Website is Up The article turned out to be 26 pages long. There are over 20 graphs and charts with plenty of detail on where we are heading with global silver production. Many analysts say global silver production will increase for the next decade. If we get that Depression in the next year or two…which I believe we are, all bets are off for increasing silver production. This might seem bearish for the price of silver as the so called "DEFLATIONISTS" keep regurgitating this over and over. Very few analysts realize we are heading into a Hyperinflationary Depression…and not a deflationary one. It's fricken hilarious to hear on CNBC and etc that this week is deflationary because Ben isn't printing money…or next month will be inflationary because he is. That is all BS folks. Don't forget what the biggest aspect of hyperinflation is….and that is the "LOSS OF FAITH IN THE CURRENCY". You don't need continued printing to make inflation…you just need loss of confidence and the whole house of fiat cards comes tumbling down. It's time to get your physical silver before the rest of the world wakes up from the nightmare that nicely printed Monopoly money and US Treasuries and not safe havens, but rather a Ponzi scheme several hundreds of thousands of times worse than Bernie Madoff.  |
| Venezuela says gold repatriation will start in November Posted: 06 Oct 2011 10:17 PM PDT |
| Posted: 06 Oct 2011 09:51 PM PDT Dwarfs Better Off Tossed Than Jobless, Florida Republican Says Bloomberg World's Largest Shark Sanctuary Declared in Central Pacific Pew Charitable Trusts (hat tip reader furzy mouse) U.S. Panel Says No to Prostate Screening for Healthy Men New York Times Faster-than-light neutrinos face time trial Nature News (hat tip reader furzy mouse) More Drugs Mean More Disease as China Fails to Control Use of Antibiotics Bloomberg (hat tip reader wunsacon) Merrill Lynch: China bust upon us MacroBusiness China labour costs push jobs back to US Financial Times Guest post: China's disappearing bank deposits Victor Shih, Financial Times High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. Europe's crisis is all about the north-south split Alan Greenspan, Financial Times. Prejudice masquerading as analysis. Real studies, which are something Greenspan appears to eschew, have argued that a lot of the periphery countries, particularly Greece, have what amounts to a national strategy issue: they aren't specializing in goods in which they can hope to be competitive (even with cheaper labor costs). A serious currency devaluation might still do the trick (as in a Euro exit), but an internal devaluation is not likely to be able to be steep enough. Portfolio: Dexia Bank's Collapse and the European Financial Crisis Stratfor (hat tip reader Cap'n Magic). Stratfor's commentary on economics and finance is usually a mixed bag, but this is a good overview. Whitehall fears new bail-out for RBS Financial Times "Ideas For Sale": How Dime Store Minigarch Art Pope Became The Koch Kingpin Of North Carolina Mark Ames, eXiled Why Did Liberals Embrace 'Occupy Wall Street'? (Hint: They're Obsessed With the Tea Party.) Mark Schmitt, New Republic (hat tip reader Harold J). Nothing like a twofer drive by shooting of progressives and OccupyWallStreet. For instance, this isn't just a caricature, it's false:
Unsavvy People Paul Krugman. I was encouraged by his endorsement, but then his op-ed goes for the "leave this to the elites":
Aargh. What about "The elites in America are corrupt" don't you understand? Marines Heading to Wall Street to Protect Protesters Salem-News (hat tip Lisa Epstein) America's Lost Decade Andy Kroll, TomDispatch The Public-Private Partnership Behind Zuccotti Park LittleSis Antidote du jour:
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| Gold prices spurred higher by more QE Posted: 06 Oct 2011 09:45 PM PDT Precious metal prices rose yesterday on news of more quantitative easing (QE) by central banks in Europe. The most actively traded Comex gold contract, for December delivery, rose $11.60 (0.7%), ... |
| Bank Failures Moving Gold, This is Contagion: John Hathaway Posted: 06 Oct 2011 09:10 PM PDT  Here's a John Hathaway blog that Eric King sent me yesterday afternoon. I've actually found the time to read it...and it's a must read...as is everything that John has to say. The link to the King World News blog is here. |
| Hiding Gold in All the Unusual Places Posted: 06 Oct 2011 09:10 PM PDT  If you're looking for a safe place to put your investments, Chad Venzke has a suggestion: Dig a hole in the ground four feet deep, pack gold and silver in a piece of plastic PVC pipe, seal it, and bury it. |
| Vietnam lets banks restart offshore gold trading-media Posted: 06 Oct 2011 09:10 PM PDT  Vietnam's central bank has allowed five banks and Saigon Jewelry Co (SJC), the country's top gold trader, to reopen offshore gold trading accounts to help narrow the gap between domestic and international prices, state-run media said on Thursday. |
| Venezuelan gold repatriation to start in month-and-a-half: central bank Posted: 06 Oct 2011 09:10 PM PDT  Venezuela's central bank says almost all of its $11 billion in gold reserves held abroad will start making its way to the country in mid-November; analysts say it will be a slow and expensive process. |
| Gold’s Still A Great Investment, Says Frank Holmes–The Price Will Double Posted: 06 Oct 2011 09:10 PM PDT  It's a buying opportunity, says Frank Holmes of San Antonio-based U.S. Global Investors. Holmes thinks two ongoing factors will drive gold prices to double again over the next few years: The "fear trade," in which traders seek to hedge their exposure to fiat-currencies while governments continue to spend way more than they take in, and the "love trade," in which millions of newly wealthy consumers in India and China load up on jewelry. |
| Gold & Silver Market Morning, October 7, 2011 Posted: 06 Oct 2011 09:00 PM PDT |
| WATCH: Is There Really Gold At Fort Knox? Posted: 06 Oct 2011 08:45 PM PDT From the History Channel, Brad Meltzer's Decoded: Fort Knox: ~TVR |
| Why #OccupyWallStreet Doesn’t Support Obama: His “Nothing to See Here” Stance on Bank Looting Posted: 06 Oct 2011 08:40 PM PDT Despite the efforts of some liberal pundits and organizers (and by extension, the Democratic party hackocracy) to lay claim to OccupyWallStreet, the nascent movement is having none of it. Participants are critical of the President's bank-coddling ways and Obama gave a remarkably bald-face confirmation of their dim views. As Dave Dayen recounts, Obama was cornered into explaining why his Administration has been soft of bank malfeasance. His defense amounted to "They're savvy businessmen": "Banks are in the business of making money, and they find loopholes." Is breaking IRS rules a "loophole"? How about making repeated false certifications in SEC filings? Or as Dayen points out, fabricating documents? Or making wrongful foreclosures, aka stealing houses? The Administration's strategy for maintaining this posture is by being anti-investigation and anti-transparency. As we've discussed, the stress tests were a sham. The foreclosure task force didn't even try to look serious, it was a mere 8 week investigation and of 2800 cases chosen for review (in no scientific manner), only 100 were foreclosures. The US Trustee's office found a level of servicing errors more than 10 times that asserted by banks and happily parroted by Federal banking regulators. We expect readers could add to this list just as readily as we can. There are plenty of grounds for legal action. Contrary to the Obama/Geithner position, this is a target rich environment. And some of the violations were persistent and deliberate enough that they might well raise to the level of being criminal. This is a mere illustrative tally: 1. Violation of REMIC (real estate mortgage conduit) rules, which are IRS provisions which allow mortgage backed securities to be treated as pass-through entities. As we've indicated, the violations were clear cut and are easily documented. Moreover, when the senior enforcement officer in the IRS was alerted last year, she was keenly interested. But the word that came back was the the question had gone to the White House, and the answer was to nix going after these violations: "We are not going to use tax as a tool of policy." So this is not a case of creative use of "loopholes," this is prima facie evidence of an Administration policy of protecting the banks. 2. Consumer fraud under HAMP. Catherine Masto of Nevada has already delineated this case in her second amended complaint against numerous Bank of America entities (in fact, the evidently clueless President could find a raft of other litigation ideas in her filing). All the servicers engaged in similar egregious conduct. 3. Securities fraud by mortgage trustees and serivcers. While the statute of limitations for securities fraud for the sale of toxic mortgage securities in the runup to the crisis has now passed, securitization trustees and servicers are making false certifications in periodic SEC filings. In layperson terms, the trustee certifies that everything is kosher with the trust assets. As readers well know, in many cases the custodians do not have the notes or they were not conveyed to the trust as stipulated in the pooling and servicing agreement (as in they were not properly endorsed through the chain of title). Now of course, pursuing this sort of litigation would blow up the mortgage industrial complex. But it represents a powerful weapon to bring unrepentant bankers to heel. 4. Widespread risk management failures as Sarbanes-Oxley violations. As we've discussed, Sarbox provides a fairly low risk path to criminal prosecutions. And we believe the SEC has been incorrectly deterred by an adverse ruling in the early stages of its case against Angelo Mozilo. In that case, the judge (with no explanation of his ruling) barred the SEC from claiming SEC violations (which this case did) and double dipping by adding a Sarbox charge (securities fraud statutes parallel Sarbox language; indeed, that was one of the complaints re Sarbox, that many of its provisions were already represented in existing law). That's far more significant than it appears. As we argued in an earlier post, the language in Section 302 (civil violations) tracks the language in Section 906 (criminal violations). A win on a Section 302 case would thus set up what would appear to be a slam dunk criminal case. But Sarbox also contains language not present in existing securities statutes that would allow for criminal prosecution for exactly the sort of behavior that caused the crisis, namely, inadequate risk management (we discuss at length in ECONNED how risk management is kept politically weak by design and serves too often as a fig leaf for management). As we noted earlier:
As readers know, it isn't that there is no case against the major banks, it's that the Administration is determined not to make it. The fact that New York attorney general Eric Schneiderman, who has been in office less than a year and has only a dozen attorneys on his staff, has filed as many cases as he has on the banking front (and remember, this is one of many beats he is expected to cover) is a stinging repudiation to the Administration. As we've indicated, there is evidence of an active press campaign to promote Iowa state AG Tom Miller, the head of whatever is left of the "50 state" attorney general negotiations (and increasingly take down Schneiderman). This truly embarrassing article from The Daily Beast is the latest example. There isn't the slightest effort to understand why the failure of the formerly 50 state AGs to investigate means that the idea that there is a possibility of a worthwhile settlement for states and consumers is pure unadulterated horseshit. And so the author imputes bad motives to Schneiderman, when in fact there is a credible case that Miller was trying to curry favor with the Administration (he was fawning over the Treasury's Michael Barr in Congressional hearings, and it was widely believed he was angling to become the head of the Consumer Financial Protection Bureau). As much as I disagree with the overall story line of Ron Suskind's Confidence Men (that the naive Obama was done a dirty by his economics team, in particular Geithner), many of the vignettes are relevant. For instance, the House Subcommittee on Telecommunications and Finance, frustrated with its inability to understand how Wall Street had changed, called imprisoned insider trader Dennis Levine to see if he might be able to shed some light. Representative Ed Markey recounted that Levine had said it had become a game, with the banks engaging in behavior that was "subtly fraudulent." They used lawyers to help steer a path that would make it hard to prosecute them, and also focused on activities where the returns more than offset the risks. What did Levine recommend?
Pretty much everyone who is not part of the problem instinctively knows that needed to happen. Yet Obama and other members of the elite keep trying to placate the protestors by acknowledging that they have legitimate concerns while refusing to take needed corrective steps. The disproportionate media reaction to what even as of this week are still fairly small scale demonstrations reveals an acute and well warranted sense of vulnerability among the elites. The word "entitlement" has become inadequate to capture the preening self-regard, the obliviousness to the damage that high-flying finance has inflicted on the real economy. There is ample evidence of widespread opposition to the looting of the banking industry, going back to the 99 to 1 opposition in calls to Congress on the TARP (it fell to a mere 4:1 when the industry realized what was happening and mobilized employees to weigh in). The officialdom has chosen to mistake sullen resignation of citizens in the face of the bailouts and brazen continued looting as complacency. But the ruling classes recognize, too late, that OccupyWallStreet is a spark on perilously dry tinder. Efforts by police to contain the demonstrators keep backfiring, giving them legitimacy, free PR, and eliciting considerable sympathy. Ironically, the banks and their state backers seem almost hopelessly locked into strategies that will continue to fail. And if they escalate, that action has the potential to be the sort of galvanizing event that they fear most. The nightmare of the elites that may well be visited upon them is one day doors all over the US will open and hordes of the heretofore discenfranchised 99% to walk to their town squares and show by the mere force of turning up united against known enemies that they can and will prevail.
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| LISTEN: A Discussion with Axel Merk Posted: 06 Oct 2011 08:17 PM PDT
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| BrotherJohnF: Silver Update – “Buy The Dips” Posted: 06 Oct 2011 08:16 PM PDT Brother John looks at the moving averages, manipulated markets, and a new coin shop recommended by viewers. ~TVR |
| Casey Research Summit Special Report: Surviving the Death of Money Posted: 06 Oct 2011 07:00 PM PDT When the currency system as we know it dies, some people will become very wealthy. In this special report from the Casey Research/Sprott Inc. Summit "When the Money Dies," The Gold Report cornered... Visit the aureport.com for more information and for a free newsletter |
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