Oct 112019
 
 October 11, 2019  Posted by at 9:57 am Finance Tagged with: , , , , , , , , , , ,


Balthus Girl at a window 1957

 

How the Crybabies on Wall Street Try to Force the Fed into QE-4 (WS)
After Unveiling ‘NotQE’, Fed Eases Liquidity Rules For Foreign Banks (ZH)
America’s Political Implosion (SCF)
Dems Weigh Knee-Capping A Republican Impeachment Criticism (Pol.)
US House Republicans To Seek Sanctions On Turkey Over Kurd Offensive (R.)
Syrian Kurdish Leaders Urge EU To Pull Envoys Over Turkey Offensive (RT)
Explosions Rock Iranian Tanker Near Saudi Port City Of Jeddah (RT)
GM’s Third-Quarter China Vehicle Sales Down 17.5% (R.)
What Jeff Bezos Wants (Atl.)
Facebook Paid Just £28m Tax On Record £1.6bn Earnings In UK (G.)

 

 

2 stories I couldn’t find decent pieces on: new hopes for a Brexit deal, and Giuliani’s ‘associates’ arrested. I was wondering why they were labeled his ‘associates’, but all I could find is they were ’associated’ with him. Right. Now, I always found Rudy a weird character, but these stories simply become part of the entire load of anti-Trump tales we’re doused in every day. It becomes impossible to judge what is real or not.

Meanwhile, while you weren’t looking, the Fed is busy saving Wall Street again. Got to rescue them bonuses.

How the Crybabies on Wall Street Try to Force the Fed into QE-4 (WS)

Fed Chair Jerome Powell’s explanation on Tuesday and the FOMC minutes released yesterday were a bitter disappointment for the Crybabies on Wall Street – the broker-dealers and banks: They’d expected a massive bout of QE, and perhaps some of the players had gleefully contributed to, or even instigated the turmoil in the repo market to make sure they would get that massive bout of QE as the Fed would be forced to calm the waters with QE, the theory went. This QE would include big purchases of long-term securities to push down long-term yields, and drive up the prices of those bonds these Crybabies are holding or have bet on with derivatives.


This is particularly crucial to the “primary dealers” – the 24 US and foreign broker-dealers and banks that are authorized to deal directly with the US Treasury and the New York Fed. They’ve been hoarding Treasury securities with longer maturities. As of October 2, according to the most recent data from the New York Fed, they hoarded $161 billion, double the $81 billion a year ago – though that has come down from the peak in July of $219 billion. Note the top two lines (black): Less than two-year maturities amounting to $74 billion; and 11-year and over maturities amounting to $37 billion. Not included on this chart are the primary dealers’ holdings of Treasury bills, TIPS, Agency securities, and Floating Rate Notes.

Primary dealers are funding their hoard in the repo market. These funding needs were putting pressures on the repo market, the Fed already said in its minutes for the July meeting, before repo rates totally blew out in mid-September. But primary dealers could have sold a large part of those securities, if they’d wanted to. Prices were high and yields were low, a sign that there was heavy demand. But the dealers were holding out for even higher prices and even lower yields. And any heavy selling could have pushed up those yields and steepened the yield curve, very unpalatable for folks clamoring for rate cuts. So these dealers are sitting on a pile of Treasury notes and bonds whose prices they want to rise, and therefore their yields would have to fall. Massive QE, where the Fed buys these types of Treasury securities, would accomplish that.

Read more …

Why would the banks not risk going broke? They’ll be saved no matter what.

After Unveiling ‘NotQE’, Fed Eases Liquidity Rules For Foreign Banks (ZH)

Having cracked down on Deutsche Bank in the past, The Fed appears to be playing good-regulator/bad-regulator as The FT reports that Deutsche is expected to benefit most from an imminent change in The Fed’s liquidity rules. Specifically, US banking regulators have dropped an idea to subject local branches of foreign banks to tough new liquidity rules (forcing US branches of foreign banks to hold a minimum level of liquid assets to protect them from a cash crunch). As The FT further details, people familiar with his thinking say Randal Quarles, the vice-chair for banking supervision at the Fed, accepts the banks’ argument that any liquidity rules on bank branches should only be imposed in conjunction with foreign regulators.

“Without some international agreement, we could have the situation where each country is trying to grab whatever isn’t nailed down if there is another scare.” And Deutsche Bank benefits most (or rescued from major liquidity needs) since it has by far the largest assets in US branches… Why would The Fed do this? Simple, it cannot afford another Lehman-like move (or even the fear of one)…

Read more …

The whole enchilada is under threat. Time to leave the partisan trenches.

America’s Political Implosion (SCF)

The polarization in American politics has become so extreme there seems no longer to be any center ground. The political establishment is consequently imploding into an abyss of its own making. President Trump is being driven into an impeachment process by Democrats and their media supporters who accuse him of being “unpatriotic” and a danger to national security. Trump and Republicans hit back at Democrats and the “deep state” whom they condemn for conspiring to overthrow the presidency in a coup dressed up as “impeachment”. The White House is being subpoenaed, the Democrat-controlled House of Representatives wants to access transcripts to all of Trump’s phone calls to foreign leaders; Secretary of State Mike Pompeo has blasted congressmen for “harassing the State Department” in their search of evidence to indict Trump.

Trump calls the impeachment bid a “witch-hunt”. Republican Representatives protest that the US is facing a dark day of constitutional crisis, whereby opposing Democratic party leaders are abusing their office by accusing Trump of “high crimes” without ever presenting evidence. It’s an Alice in Wonderland scenario writ large, where the gravest verdict is being cast before evidence is presented, never mind proven; the president is guilty until proven innocent. Trump, in his turn, has berated senior Democrat Adam Schiff, the chair of the House Intelligence Committee, for “treason” – a capital offense. Are federal police obliged to arrest him? Schiff is accused of colluding with a supposed CIA whistleblower in concocting the complaint that Trump tried to extort Ukrainian President Volodymyr Zelensky to dig dirt on Democratic presidential candidate Joe Biden.


There seems no end to this political civil war in the US. The American political class is literally tearing itself apart, destroying its ability to govern with any normal function. So-called liberal media outlets, in lockstep with the Democrats, inculpate Trump for wrongdoing, while they staunchly assert that credible reports of Joe Biden abusing his former vice presidential office to enrich his son over Ukraine gas business are false. Many Americans don’t see it that way. They see Biden as being up to his neck in past corruption; they also see a flagrant double-standard of the establishment protecting Biden from investigation while hounding Trump at every possible opportunity, even when evidence against Trump is scant.

Read more …

Curious way to phrase holding a simple vote.

Dems Weigh Knee-Capping A Republican Impeachment Criticism (Pol.)

House Democrats are grappling with whether to take more steps to formalize their impeachment inquiry and silence a chief Republican criticism of their efforts, with competing factions beginning to emerge. President Donald Trump and his allies on Capitol Hill have hammered Speaker Nancy Pelosi for not holding a vote authorizing the House’s impeachment proceedings — arguing that without a vote, the entire process is illegitimate. Pelosi has refused to cave, dismissing Trump’s demand last week and insisting it is not required under the Constitution or House rules. And allies close to the speaker say her position hasn’t changed, describing the idea as the latest “Republican canard” in a series of stall tactics the GOP will employ to protect Trump.

“It is one act after another of obstruction of justice by the White House, by the State Department, and by the attorney general. And I say, give them more rope to hang themselves,” Rep. Harley Rouda (D-Calif.), who flipped his conservative Orange County district in 2018, said in an interview. Yet some Democratic lawmakers and aides have begun to say privately — and, to a lesser extent, publicly — that the House should just vote to formalize the inquiry, robbing the GOP of its main talking point. The debate is threatening to cleave Democrats’ unified front as the White House makes the arcane procedural arguments the centerpiece of its impeachment defense. “If Nancy asked me, I would say sure, let’s have a vote. Everybody’s on record, so they’re not going to vote any differently. What’s the danger in having a vote to formalize it?” said Rep. John Yarmuth (D-Ky.), an early impeachment backer.


But the suggestion has provoked strong objections from some of their colleagues who say they would be abdicating their authority if lawmakers permit other branches of government to dictate their procedures. “If we allow that to happen, Congress would be completely dysfunctional,” Rep. Sean Casten (D-Ill.) said at a recent town hall event in Glen Ellyn, Ill. “If we have to take a complete show vote, we’ll get the vote. But I find it offensive that they are basically telling us how to do our job with a misreading of the Constitution. Read the freakin’ Constitution. And then let’s honor our oath to it.”

Read more …

Will the Democrats support this?

US House Republicans To Seek Sanctions On Turkey Over Kurd Offensive (R.)

Twenty-nine of President Donald Trump’s fellow Republicans in the U.S. House of Representatives announced on Thursday they would introduce legislation to impose sanctions against Turkey, underscoring lawmakers unhappiness about its assault on Kurdish forces in Syria. A day after Republicans and Democrats announced similar legislation in the Senate, the lawmakers – including Republican Leader Kevin McCarthy, Republican Whip Steve Scalise and other party leaders – said they wanted a strong response to Ankara’s aggression. “President (Recep Tayyip) Erdogan and his regime must face serious consequences for mercilessly attacking our Kurdish allies in northern Syria,” Republican Representative Liz Cheney, chairwoman of the House Republican Conference, said in a statement.


It was not immediately clear how the legislation would fare in the House of Representatives, which is controlled by Democrats. On Sunday, Trump abruptly shifted policy and said he was withdrawing U.S. forces from northeastern Syria, clearing the way for Turkey to launch an assault across the border. Turkey began the offensive quickly, pounding Kurdish militias, who recently were fighting alongside U.S. forces against Islamic State militants, on Wednesday and Thursday, killing dozens and forcing many thousands of people to flee.

Read more …

Erdogan has threatend to release 3.6 million refugees into Europe, so don’t hold your breath for this one.

Syrian Kurdish Leaders Urge EU To Pull Envoys Over Turkey Offensive (RT)

Kurdish leaders have called on European countries to withdraw their ambassadors from Turkey in protest at Ankara’s military operation against their forces in northern Syria. A delegation from the Syrian Democratic Council (SDC) – the political wing of the Syrian Democratic Forces (SDF) – traveled to Brussels on Thursday to urge the EU to take concrete measures to punish Turkey, AFP reports. “We want an urgent intervention on this crisis, and these attacks should be stopped quickly. Air space should be closed for Turkish flights so that air attacks can be stopped,” senior SDC figure Ilham Ahmed said in Brussels. “All European states should freeze their relations by withdrawing their ambassadors from Turkey immediately.” The EU has urged Turkey to halt the assault but has not taken any action. The bloc’s foreign ministers will discuss the crisis at a regular meeting on Monday.

Read more …

Oh, lovely.

Explosions Rock Iranian Tanker Near Saudi Port City Of Jeddah (RT)

A tanker belonging to Iran’s government-owned oil corporation has been hit by two missiles and caught fire in the Red Sea, 60 miles from Saudi shores. The incident is being treated as a terrorist attack, local media says.
The tanker Sinopa, operated by the National Iranian Oil Company (NIOC), was sailing through the Red Sea when the explosion occurred. The blast was powerful enough to damage two of its reservoirs, leading to an oil spill in the area. Local media cited unnamed Iranian “technical experts” who believe that the incident could have been caused by a “terrorist attack,” but didn’t provide any evidence to back the claim.


The tanker’s crew wasn’t hurt in the incident, which took place near Jeddah, the largest port in the Red Sea and maritime gateway to Saudi Arabia. NIOC, which once ranked second after Saudi Aramco in terms of crude oil extraction, told state-run IRNA news agency that the vessel was hit by what appears to be two missiles. That report did not expand on where the attack came from.

Read more …

Small is beautiful.

GM’s Third-Quarter China Vehicle Sales Down 17.5% (R.)

General Motors Co’s July to September vehicle sales in China fell 17.5%, as the U.S. automaker was hurt by a slowing economy amid the Sino-U.S. trade war and by heightened competition in its key mid-priced SUV segment. GM delivered 689,531 vehicles in China in the third quarter this year, according to a company statement. The drop for the quarter ended September 30 marks the fifth straight quarterly sales decline for GM in China, the world’s biggest auto market. It delivered 2.26 million vehicles in the first nine months this year, according to Reuters calculation.


As GM and Ford Motor Co’s China sales extend declines, U.S. car companies’ share of total China passenger vehicles sales fell to 9.5% in the first eight months of this year from 10.7% in the year-ago period, according to the China Association of Automobile Manufacturers (CAAM). Over the same period, German car makers’ share has risen to 23.8% from 21.6% and Japanese auto makers’ to 21.7% from 18.3%.

Read more …

Wasn’t he the guy who wants to live on the moon?

What Jeff Bezos Wants (Atl.)

Where in the pantheon of American commercial titans does Jeffrey Bezos belong? Andrew Carnegie’s hearths forged the steel that became the skeleton of the railroad and the city. John D. Rockefeller refined 90 percent of American oil, which supplied the pre-electric nation with light. Bill Gates created a program that was considered a prerequisite for turning on a computer. At 55, Bezos has never dominated a major market as thoroughly as any of these forebears, and while he is presently the richest man on the planet, he has less wealth than Gates did at his zenith. Yet Rockefeller largely contented himself with oil wells, pump stations, and railcars; Gates’s fortune depended on an operating system. The scope of the empire the founder and CEO of Amazon has built is wider. Indeed, it is without precedent in the long history of American capitalism.


Today, Bezos controls nearly 40 percent of all e-commerce in the United States. More product searches are conducted on Amazon than on Google, which has allowed Bezos to build an advertising business as valuable as the entirety of IBM. One estimate has Amazon Web Services controlling almost half of the cloud-computing industry—institutions as varied as General Electric, Unilever, and even the CIA rely on its servers. Forty-two percent of paper book sales and a third of the market for streaming video are controlled by the company; Twitch, its video platform popular among gamers, attracts 15 million users a day. Add The Washington Post to this portfolio and Bezos is, at a minimum, a rival to the likes of Disney’s Bob Iger or the suits at AT&T, and arguably the most powerful man in American culture.

Read more …

“Profits on social media app surged by more than 50% to £797m in latest tax year..”

Facebook Paid Just £28m Tax On Record £1.6bn Earnings In UK (G.)

Facebook’s UK operations paid £28m in tax last year despite attracting a record £1.6bn in British sales. The social media company’s latest UK accounts show that gross income from advertisers rose almost 30% last year to £1.65bn, and pretax profits surged by more than 50% from £63m to £97m. Facebook UK said the net revenues it made from advertisers rose 50% last year to £797m, meaning 12% of its sales were converted to profits. This falls far short of the company’s overall performance – last year Facebook made $25bn (£19.7bn) of profit on total sales of $55.8bn – meaning it converted 44% of its sales into profits.


Facebook’s UK operation expanded rapidly last year with staff numbers rising by more than 50%, from 1,290 to 1,965 year on year, with a total staff wages and pension bill of £431m. The company’s UK office provides marketing services and sales and engineering support to other parts of the company. Facebook said it spent £356m on research, development and engineering in the UK last year. Last month, online retail giant Amazon came under fire for paying just £14.7m in UK corporation tax last year, despite reporting sales of £2.3bn. Earlier this month, Netflix UK’s accounts showed that the streaming giant received a €57,000 (£51,000) tax rebate from the UK government last year, despite making an estimated £700m from British subscribers bingeing on fare from The Crown to Stranger Things.

Read more …

 

A baby Grauer’s gorilla, a critically endangered species, in the forest of Kahuzi-Biega National Park in the Democratic Republic of Congo. In 2018, logging began in the protected area, threatening the habitat of the gorillas.

 

 

 

 

Home Forums Debt Rattle October 11 2019

This topic contains 10 replies, has 6 voices, and was last updated by  Dr. D 2 months ago.

Viewing 11 posts - 1 through 11 (of 11 total)
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  • #50532

    Balthus Girl at a window 1957   • How the Crybabies on Wall Street Try to Force the Fed into QE-4 (WS) • After Unveiling ‘NotQE’, Fed Eases Liqui
    [See the full post at: Debt Rattle October 11 2019]

    #50533

    V. Arnold
    Participant

    Balthus Girl at a window 1957

    Wow, look at that gorgeous window. It’s huge, like a portal to the world outside…

    #50534

    V. Arnold
    Participant

    A baby Grauer’s gorilla, a critically endangered species, in the forest of Kahuzi-Biega National Park in the Democratic Republic of Congo. In 2018, logging began in the protected area, threatening the habitat of the gorillas.

    Just fucking lovely: God’s be good; we’re a really fucked up species; we humans…
    I’d love to wake up, a thousand years in the future to see just what we finally did to our beautiful blue dot………………
    On second thought; that may be a really bad idea……………….

    #50535

    zerosum
    Participant

    It becomes impossible to judge what is real or not.

    We need a primer. Is the truth real? Where should we look? WHY DOES IT MATTER?
    ——
    This is what happens when someone is going to “DRAIN THE SWAMP” A political implosion

    America’s Political Implosion


    a flagrant double-standard of the establishment protecting Biden from investigation while hounding Trump at every possible opportunity, even when evidence against Trump is scant.
    There seems no end to this political civil war in the US. The American political class is literally tearing itself apart, destroying its ability to govern with any normal function.

    #50536

    That article is the Debt Rattle, zero. Why put it here as well?

    #50537

    Turfkiller
    Participant

    “The FT reports that Deutsche is expected to benefit most from an imminent change in the Fed’s liquidity rules.”

    And today a Federal Appeals Court has been informed:

    “At some point in recent years, Deutsche Bank has apparently *got rid of* Donald Trump’s tax returns.
    It’s unclear when and why this happened, but it’s normal procedure at the bank was to retain such records.

    The Automatic Earth: “Investigate Biden!”

    #50538

    The Automatic Earth: “Investigate Biden!”

    Yes, Turfkiller, exactly that. And investigate Trump too, but then he’s been under non-stop investigation for three years running now. Biden has not.

    #50539

    Dr. D
    Participant

    Sure, investigate them all. Shiff sold the port of L.A. to China, Pelosi had a Chinese spy in her meetings for 20 years, Reid stole NV land and sold it, Kushner has Israeli business deals, Trump has this. Again, problem is, “Illegal! Investigate!” Okay, it’s Hunter Biden getting kicked out for drugs, going on a crack-fueled gay-sex bender in Skid Row, then the next day flying to Ukr and getting paid more than Exxon’s executives for not knowing law, oil, gas, or Ukrainian. “Legal! Investigate no one!” Why? If they’re all fine, they should laugh, investigate, then throw it in Trump’s face. They’re supposedly rigging 2020 election: well what do you think investigating Trump for the midterms was? A: Throwing the 2018, and now the 2020 elections. Goose: meet gander.

    “Read the freakin’ Constitution. And then let’s honor our oath to it.”

    So quaint to hear their undying loyalty to the Constitution when they are publicly against the 1st, 2nd, 4th, 5th, and 10th Amendments. And against speaking in any public place of the “creator’ that “endowed” the people with “inalienable”, i.e., un-removable, inherent rights, i.e., the 1st, 2nd, 4th 5th and 10th amendments. And against the freedom between men to trade it was philosophically based on, i.e. capitalism. And against the very existence of the nation at all, i.e. borders. So if they want to adhere to the Constitution, I welcome it.

    …But for the small issue, if it’s so simple and clear, why DON’T they have a vote that will surely win, that will establish a committee to “investigate impeachment”. …That’s not even an Impeachment! It’s just thinking about maybe someday possibly having impeachment. No commitments here! Why? Because then they would have to follow legal and parliamentary RULES. And when you’re #AntiLogos, any rule, any order, any restraint to total power of the ego is your mortal enemy. It IS embarrassing Trump has to remind them of their duty and process of U.S. law, especially when they’re all lawyers, they SHOULD be embarrassed, but that doesn’t make him wrong. If they’d just followed the process they know they would win, he wouldn’t have been able to shame them.

    “US House Republicans to Seek Sanctions on Turkey over Kurd Offensive (R.)”

    Sounds great. But I expect Trump, Putin, Assad, Erdogan, and most probably BoJo have already cut up a plan on the Turkish border and are keeping the sausage-making in the dark. The market, the others, don’t seem worried about it, so they know it’s settled. Kurdish Syrians had no trouble before, even in a 5-ethnic nation, so I don’t see why they would now. Turkey would fall if they accepted a fully armed, mobilized Kurdish army inside their borders, so pick your poison. Europe’s largest army collapses with the nation and goes rogue, or accept some smashing?

    “Erdogan has threatened to release 3.6 million refugees into Europe, so don’t hold your breath for this one.”

    I’d say great! You release the migrants, we align with Greece and take Cyprus back. No NATO, no gas fields. Suck it. But since they only surrender because surrendering to everyone is ‘nice’, that can never happen.

    “Explosions Rock Iranian Tanker Near Saudi Port City of Jeddah (RT)”

    Always hear, “when the first bomb goes off in [blank], then the horsemen ride, the dead rise, dogs and cats living together, mass hysteria.” …Because people are violent unthinking brutes, I guess. Never happens. So we had ALL, two piracies, wiped out the world’s refinery, AND blowing up a ship near Suez, and…? The world is a lot more stable than they lead you to believe. A million people without power in one of the most crime-ridden, income-divided cities in America: nothing. No “Two Days Before the Day After Tomorrow” panic in the streets. We wiped out the biggest port in the U.S. in NOLA. Nada. No impact on the U.S. as a whole. This is why the collapse is the “Slow Decent,” but for S.F. the shtf today. P.S. 30% drop in U.S. crop yields minimum. Because of snow. Thanks to Global Warming because that’s logic!

    “What Jeff Bezos Wants (Atl.)”

    Bezos is akin to Woolworths or Sears Roebuck. We haven’t had anyone do anything real in so long, no one can remember what it was like or who they were.

    What does he want? He’s a front man for the CIA who funded him, just like Zuck, Dorsey, Gates, and Epstein. Look into his contracts and who made it legal for him to monopoly while not collecting sales tax for 20 years. Wasn’t him! Sure wasn’t the states who got screwed for every one of his billions! Why? Monopoly control, but more the 1984-type surveillance of everything sold, and back when, especially books.

    “Logging began in the protected area, threatening the habitat of the gorillas.”

    Depends how the logging is done. The greatest, oldest forest in Europe is logged regularly, but in limited acres each year, and no one can really tell. Japan logged for 2,000 years and they are protected woodlots, where trees are tallied for individual purposes, like temples. In the northeast, they have been logging continuously since Thoreau talked about it, yet there are 1,000x more trees now instead of the logged-over wastes in 1840. Just depends if you act like a fool or not. But hey, if you want everything you buy to be made of petroleum instead, stop logging. Exxon won’t mind. Or you could knock down D.C. and Berlin and grow a tree farm. Be productive! Be green! Be green as San Fransisco is today as a few hundred die of events related to power outages, like fires and traffic lights. The gorillas won’t mind your death at all.

    #50540

    Polder Dweller
    Participant

    Meanwhile, while you weren’t looking, the Fed is busy saving Wall Street again. Got to rescue them bonuses

    I’ve got no problem with bonuses when things go well provided the beneficiaries get hit with “maluses” when things go awry.

    #50541

    I’ve got no problem with bonuses when things go well provided the beneficiaries get hit with “maluses” when things go awry.

    But that never happens.

    I do have a huge problem with $20 million bonuses being paid out to dead beat bankers while health care staff can’t make ends meet. I do.

    #50548

    Dr. D
    Participant

    That’s hilarious. We’ll use the exact same formula we use to calculate bonuses.

    “Okay, I need $200,000 back from each of you this year, so go SELL the Rolex, SELL the beach house, and we’ll have Deutsche’s trading dept back at par in no time…”

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