AIG Is Suing Bank of America for $10 Billion
August 8th, 2011Via: New York Times:
The American International Group is planning to sue Bank of America over hundreds of mortgage-backed securities, adding to the surge of investors seeking compensation for the troubled mortgages that led to the financial crisis.
The suit seeks to recover more than $10 billion in losses on $28 billion of investments, in possibly the largest mortgage-security-related action filed by a single investor.
It claims that Bank of America and its Merrill Lynch and Countrywide Financial units misrepresented the quality of the mortgages placed in securities and sold to investors, according to three people with knowledge of the complaint.
S&P Downgrades Fannie Mae, Freddie Mac
August 8th, 2011They’re just getting started: Muni Market Prepares for Lost AAA Ratings; “Hundreds and Hundreds” of Downgrades.
Via: CNBC:
Standard & Poor’s downgraded the ratings of government-sponsored enterprises Fannie Mae and Freddie Mac Monday, citing their reliance on U.S. government.
Both Fannie and Freddie were lowered to AA+ from triple-A. The Federal Home Loan Banks were also cut to AA-plus.
Fannie and Freddie own or guarantee about half of all U.S. mortgages, or nearly 31 million home loans worth more than $5 trillion. As part of a nationalized system, they account for nearly all new mortgage loans. Their downgrade might force anyone looking to buy a home to pay higher mortgage rates.
An Investment Manager’s View on the Top 1%
August 8th, 2011Via: Who Rules America:
I sit in an interesting chair in the financial services industry. Our clients largely fall into the top 1%, have a net worth of $5,000,000 or above, and if working make over $300,000 per year. My observations on the sources of their wealth and concerns come from my professional and social activities within this group.
Work by various economists and tax experts make it indisputable that the top 1% controls a widely disproportionate share of the income and wealth in the United States. When does one enter that top 1%? (I’ll use “k” for 1,000 and “M” for 1,000,000 as we usually do when communicating with clients or discussing money; thousands and millions take too much time to say.) Available data isn’t exact, but a family enters the top 1% or so today with somewhere around $300k to $400k in pre-tax annual income and over $1.2M in net worth. Compared to the average American family with a pre-tax income in the mid-$50k range and net worth around $120k, this probably seems like a lot of money. But, there are big differences within that top 1%, with the wealth distribution highly skewed towards the top 0.1%.
JAPAN: TRADING IN RICE FUTURES HALTED ON DISORDERLY PRICE INCREASE
August 8th, 2011But this rice thing…
There is definitely potential for a wildcard result here.
—Toshiso Kosako: Come the Harvest Season in the Fall, There Will Be Chaos
Via: Bloomberg:
Rice futures in Tokyo surged in their first trading on the bourse since 1939, triggering a suspension of trade, on concern radiation from the stricken Fukushima nuclear plant may spread to crops and curb supply.
No deals were concluded on the Tokyo Grain Exchange after prices hit 18,500 yen per 60 kilograms from the opening, compared with the bourse’s reference price of 13,500 yen. The surge triggered trade to be suspended.
The exchange listed rice contracts today for the first time since the start of World War II to boost flagging volumes and profit. The resumption comes as fallout from the Fukushima Dai- Ichi power plant may spread after it was found cattle had been fed cesium-tainted rice straw.
“People are very concerned that rice supplies may be smaller on fear of radiation contamination,” Nobuyuki Chino, chairman of the exchange’s rice futures trading committee, told reporters in Tokyo. “This was reflected in the prices,” said Chino, who is also president of Tokyo-based grain company Continental Rice Corp.
Commercial stockpiles of rice, a Japanese staple, may drop to the lowest level in four years in 2012, after the March earthquake and nuclear disaster curbed production, possibly spurring the government to release its reserves, according to the agriculture ministry.
Spot Gold: $1715
August 8th, 2011Melt up. $1715.35, new high.
Key Figure [SIC] in Abu Ghraib Atrocities Freed from Prison
August 8th, 2011The “key figures” are Bush, Cheney and Rumsfeld…
Via: AP:
The convicted ringleader of detainee abuses at Abu Ghraib was released Saturday from a military prison, an Army spokeswoman said.
Charles Graner Jr., 42, was released from the U.S. Disciplinary Barracks at Fort Leavenworth, Kansas, after serving more than 6½ years of a 10-year sentence, spokeswoman Rebecca Steed said. Graner will be under the supervision of a probation officer until Dec. 25, 2014, she said.
Steed said she could not release any information about Graner’s whereabouts or his destination after release. Neither Graner nor his wife — who was a fellow Abu Ghraib defendant — have responded to interview requests from The Associated Press. Calls and emails to Graner’s father and lawyer were not immediately returned.
Graner was an Army Reserve corporal when he and six other members of the Maryland-based 372nd Military Police Company were charged in 2004 with abusing detainees at the prison in Iraq.
The strongest evidence was photographs of grinning U.S. soldiers posing beside naked detainees stacked in a pyramid or held on a leash.
The pictures complicated international relations for the U.S. and provoked debate about whether harsh interrogation techniques approved by the Pentagon amounted to torture.
Graner was convicted of offenses that included stacking the prisoners into a pyramid, knocking one of them out with a head punch and ordering prisoners to masturbate while soldiers took pictures.
He maintained that the actions were part of a plan directed by military intelligence officers to soften up prisoners for interrogation.
Graner is the last Abu Ghraib defendant to be released from prison and received the longest sentence.
Hana Adwar, an Iraqi human rights activist, told The Associated Press that the “easy” release of a criminal who “committed a war crime” would be met with outrage in Iraq.
“He was charged with a crime that shocked the international community, and then he was released,” she said. “I believe that such an act is an attempt to deceive and blind the Iraqi nation.”
Steed said Graner’s obligation to the military ends at the end of 2014. Until then, his supervised release could be suspended.
More Violence in British Capital After Riots
August 8th, 2011Via: Reuters:
Groups of youths attacked shops and damaged a police car in north London on Sunday as police sent in reinforcements to prevent more rioting on the scale that laid waste to another area of the British capital 24 hours earlier.
Scattered incidents broke out on Sunday evening in Enfield, a few miles north of the deprived London neighborhood of Tottenham, which was hit by some of the worst riots seen in London for years on Saturday night after a protest over the fatal shooting of a man by armed police a few days earlier turned violent.
Police Commander Christine Jones said the police had “extra resources” on duty across the capital on Sunday.
Related: Tottenham Riot Photos
Power Companies Prepare as Solar Storms Set to Hit Earth
August 8th, 2011Via: Reuters:
Three large explosions from the Sun over the past few days have prompted U.S. government scientists to caution users of satellite, telecommunications and electric equipment to prepare for possible disruptions over the next few days.
“The magnetic storm that is soon to develop probably will be in the moderate to strong level,” said Joseph Kunches, a space weather scientist at the Space Weather Prediction Center, a division of the U.S. National Oceanic and Atmospheric Administration (NOAA).
He said solar storms this week could affect communications and global positioning system (GPS) satellites and might even produce an aurora visible as far south as Minnesota and Wisconsin.
SPOT GOLD $1700
August 8th, 2011$1701.38.
Greenspan: No Chance of Default, U.S. Can Print Money
August 8th, 2011HAHA:
I’m sticking with my initial guess on this: No default. The U.S. is dealing with a $14 trillion clusterfuck. No way that thing hits the wall. Not like this. There’s way too much potential for something to go super-critical.
I have no idea what’s going down at the meeting mentioned below, but it’s probably safe to assume that it has something to do with making sure that the death machine keeps grinding out the sausage by whatever means necessary.
Via: CNBC:
Former Federal Reserve Chairman Alan Greenspan on Sunday ruled out the chance of a US default following S&P’s decision to downgrade America’s credit rating.
“The United States can pay any debt it has because we can always print money to do that. So there is zero probability of default” said Greenspan on NBC’s Meet the Press.
